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City to Get New COVID Relief Funds under American Rescue Plan

The Council will get an update on budget revisions, related to funding from the American Rescue Plan Act (ARPA), prior to the upcoming budget introduction. The City is expected to receive ARPA funding and that it should exceed $15 million.

One of the allowable uses for the ARPA’s funding (referred to as “Local Fiscal Recovery Funds” or LFRF) is to cover revenue loss due to the COVID- 19 emergency. The lost revenue the City can recover is estimated at $4 million for FY2020/FY2021 and $2 million for FY2022. It is proposed that the bulk of the funding related to recovered lost revenue be transferred to the CIP/Capital Projects Fund for important projects already underway; specific requests by Mayor & Council for the FY2022 Budget; and future capital and infrastructure projects to be determined.

Also, specifically from FY2022 lost revenue, an additional $180,000 is recommended to be included in the FY2022 Proposed Budget for operating expenses that had been cut or excluded from the original proposed FY2022 budget. These cuts were based on expectations of significantly reduced revenues in FY2022 (this was prior to the enactment of ARPA). Finally, the Local Fiscal Recovery Funds (LFRF) – American Rescue Plan Act shows the funding for small business grants, family/individual financial assistance; non-profit food services; and several other categories related to the pandemic.

The budget as proposed leaves over $7 million of LFRF money at the end of FY2022 for use in FY2023, FY2024, and FY2025. Staff reiterates that these amounts are estimates/projections based on preliminary information in the ARPA. The City Council will make a final determination on the specific uses and related programs for the funds. This includes the development of a comprehensive plan to determine how ARPA can best benefit the City, residents, businesses, and other stakeholders.

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