Discuss Possible Uses of Coronavirus State & Local Fiscal Recovery Funds (American Rescue Plan Act Funds)

The City is projected to receive approximately $2.9M in Federal Funds from the American Rescue Plan Act (ARPA) Funds that will be distributed through the State in two equal payments in July 2021 and Summer of 2022.

The Department of the Treasury has issued guidance on how these funds may be used: 

1. To respond to the public health emergency or its negative economic impacts,
2. To respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers.
3. For the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency.
4. To make necessary investments in water, sewer, or broadband infrastructure.  

This guidance has created many questions and a Frequently Asked Questions was also prepared by the Treasury to address these questions.  A summary of the FAQ's is attached. 

Several agencies have inquired about infrastructure related to road improvements, and per FAQ # 4.2 the answer is typically no with the exception if an agency can determine that they had any lost revenue (provision #3) above and apply this towards the governmental services of roads.  The City of Ramsey has not experienced loss of revenue due to the pandemic as of December 31, 2020 in comparison to year 2019 when the pandemic was not present.

A couple of options that staff would like to discuss with the City Council is the possible use of the ARPA funds for the proposed body cameras for police (in the amount of $117,000 and included in the 2022 requested General Fund Budget) and the remainder for the Water Treatment Plant.  Both are eligible expenses per the Guidance.  A number of other potential uses are mentioned in the attached FAQs that could also be considered if the city wishes to develop programs that address other community needs.

The use of the funds needs to be determined by December 31, 2024 and all funds spent by December 31, 2026.  Unused funds are to be returned to the State.




 

20 minutes
 

Finance Director

Discussion only on uses of ARPA funds.