 |
AGENDA ITEM REVIEW FORM |
6.D.
Regular City Council Meeting
- Meeting Date:
- 02/09/2022
- Department Head:
- Kay Macuil
- Submitted By:
- Kay Macuil, City Attorney, Attorney's Office
Action Requested:
Motion
Order
Order
ITEM:
Discussion and possible action on any and all matters regarding Order No. 2022-02. An order of the Mayor and City Council of the City of San Luis, Arizona authorizing American Rescue Plan Act (“ARPA”) funds to respond to eligible employees who performed essential work during the COVID-19 public health emergency with premium pay, as authorized by ARPA and the U.S. Treasury’s final rule issued January 27, 2022; repealing any conflicting provisions; providing for severability; and declaring an emergency. (Lizandro Galaviz, Acting City Manager)
SUMMARY:
Background
Under the federal ARPA program and the Treasury’s final rule, the U.S. government allows the city to implement the ARPA program by paying additional compensation, or “premium pay.”
On January 12, 2022, City Council passed Order No. 2022-01 authorizing the federal American Rescue Plan Act (ARPA) fund allocation to the City of San Luis to be used for a list of projects, including
$645,000 for premium pay (“Premium Pay”) under the ARPA program.
On January 27, 2022, the U.S. Department of Treasury issued the final rule published on the Federal Register.
(Citation: 87 Fed. Reg. 4338 through 4454 for the Coronavirus Local Fiscal Recovery Funds portion of ARPA, which included the final regulations to implement the Premium Pay program. The final rule took into account public comments since the interim government was published on May 17, 2021, and changes were made to the regulations for Premium Pay. The final rule is part of the U.S. Code of Federal Register at 31 C.F.R. Part 35 Pandemic Relief Programs, Subpart
A-Coronavirus State and Local Fiscal Recovery Funds Sections 35.1 through 35.12).
The final rule sets up three (3) categories of eligibility for Premium Pay (31 CFR 35.6(c)). An employee is eligible if they fall into any one of the three:
Under the federal ARPA program and the Treasury’s final rule, the U.S. government allows the city to implement the ARPA program by paying additional compensation, or “premium pay.”
On January 12, 2022, City Council passed Order No. 2022-01 authorizing the federal American Rescue Plan Act (ARPA) fund allocation to the City of San Luis to be used for a list of projects, including
$645,000 for premium pay (“Premium Pay”) under the ARPA program.
On January 27, 2022, the U.S. Department of Treasury issued the final rule published on the Federal Register.
(Citation: 87 Fed. Reg. 4338 through 4454 for the Coronavirus Local Fiscal Recovery Funds portion of ARPA, which included the final regulations to implement the Premium Pay program. The final rule took into account public comments since the interim government was published on May 17, 2021, and changes were made to the regulations for Premium Pay. The final rule is part of the U.S. Code of Federal Register at 31 C.F.R. Part 35 Pandemic Relief Programs, Subpart
A-Coronavirus State and Local Fiscal Recovery Funds Sections 35.1 through 35.12).
The final rule sets up three (3) categories of eligibility for Premium Pay (31 CFR 35.6(c)). An employee is eligible if they fall into any one of the three:
- the eligible worker’s total wages and remuneration, including the Premium Pay, is less than or equal to $80,100.00,
- the eligible worker is an hourly wage-earner (non-exempt from the Fair Labor Standards Act overtime provisions (29 U.S.C. 207),
- the eligible worker does not fit into the above categories written justification must be provided to the
- performed “Essential Work” (defined below and at 31 CFR 35.5 as described below),
- during the pandemic. (Staff used the period March 13, 2020 - the date of the Mayor’s Emergency Declaration and City Council’s Emergency Order through February 11, 2022, which is allowed under 31 CFR 35.6(C)(3), and
- why the city determined that the premium pay was responsive despite the worker’s higher income and exempt status.
Under 31-35.3, “Essential Work” means work that:
- Is not performed while teleworking from a residence; and
- Involves:
- Regular in-person interactions with patients, the public, or coworkers of the individual that is performing the work; or
- Regular physical handling of items that were handled by, or are to be handled by patients, the public, or coworkers of the individual that is performing the work.
The table below shows the tiers for lump sum premium pay, which roughly correlate with the level of in-person workplace attendance. To qualify for premium pay, the employee must continue with the city through February 11, 2022, with the following adjustments:
- For employees doing work that puts them at most risk from the hazards of the virus that causes COVID-19 (public safety, facilities, wastewater, and solid waste), an additional $500 premium pay for the hazards born is added. Please see the description and explanation at the bottom of the table for more information on eligibility for this additional premium pay.
- For employees who were hired after March 13, 2020, premium pay is prorated.
- For employees who were hired after April 30, 2021, in addition to proration, 100% premium pay was set at $2,000 for front line workers, and for $1,500 for employees in the other categories. This maximum premium pay at $2,000 and $1,500 reflects the reduced risk since by April 30, 2021, employees had an opportunity to be fully vaccinated against the odds of suffering severe illness and hospitalization from COVID-19, as well as a better understanding on how to protect against the contagion.
- For the reasons stated in Section 4 above, those falling into category (3), maximum premium pay is set at $1,500.
- For part-time employees, the maximum premium pay is $500.
- For all other employees, the maximum premium pay for 100% in-person attendance from March 13, 2020 through February 11, 2022 is $2,000.
| % In-Person Work | $ Amount | Additional Pay for those Bearing the Most Risk Due to the Nature of Their Work | Description for Additional $500 Payment | |
| 95 thru 100% | $2,000 | $500.00 | *See below explanatory description. | |
| 75 thru 94% | $1,500 | $500.00 | ||
| 50 thru 74% | $1,250 | Not applicable | ||
| 25 thru 49% | $1,000 | Not applicable | ||
| 24% and below | $ 500 | Not applicable | ||
| Part-Time | $ 500 | Not applicable |
*The additional $500 premium pay is reserved for those employees who bear and endure the most risk of hazard from COVID-19 due to the nature of their work. This means that employees who do administrative support work are not eligible for this additional $500 if the hazard of exposure to the virus that causes COVID-19 is mainly ordinary, in-person office work.
In addition, to be eligible for $500 additional premium pay employees must meet all of the following criteria:
(1) the employee works in Departments of Public Safety, or the Divisions of Facilities, Wastewater, or Solid Waste; and
(2) the employee worked during the months from March 13, 2020 through April 30 2021, when the ability to be fully vaccinated to protect against the odds of severe illness and hospitalization was not available. Even though the vaccine was out in December of 2020, in Arizona, it took until the end of April 2021, for vaccine to be available for all working-age people and to obtain the second doses required for Pfizer and Moderna. The City of San Luis facilitated on-site vaccination events so employees all had the opportunity to be fully vaccinated by the end of April 2021.
In order for this Order to take effect for payment in February, it must be passed as an emergency requiring 6 favorable votes. If it passes as a simple majority of those present it will be effective March 11, 2022.
RECOMMENDATION / SUGGESTED MOTION:
I MOVE TO APPROVE THE PREMIUM PAY TO BE PAID OUT NO LATER THAN FEBRUARY 28, 2022 AS PRESENTED AND ADOPT ORDER NO. 2022-02, AND DECLARE AN EMERGENCY.
Fiscal Impact
- IS THERE FISCAL IMPACT ASSOCIATED WITH THIS ITEM:
- Yes
- CITY/STATE/FEDERAL FUNDS:
- Federal
- TOTAL:
- $645,000.00 per City Council Order No. 2022-01
- BUDGETED AMOUNT:
- Yes
- AVAILABLE AMOUNT TO TRANSFER:
- N/A
- ACCT NAME & GL#/REMAINING BALANCE BEFORE PURCHASE:
- ARPA Salaries 255-021-50000 $645,000.00
FISCAL IMPACT STATEMENT (IF THIS IS A BUDGET TRANSFER, YOU MUST ATTACH THE BUDGET ADJUSTMENT FORM):
ARPA Funds