Workshop Item Joe Huss, Finance Director/Asst. City Manager
Title
COVID Updates/ARP Funds
Background
On March 11, the American Rescue Plan (ARP) Act of 2021, also called the COVID-19 Stimulus Package or American Rescue Plan, was signed into law. The act is a $1.9 trillion economic stimulus bill that builds upon previously enacted aid measures in 2020. The package includes $130.2 billion for local governments, including $45.6 billion for metropolitan cities, of which Blaine’s share of $7.3 million is included.
Indications are that the first payment, equaling one-half of the total of Blaine’s allocation, is due within 60 days of the enactment of the bill. However, the city has received no funding as of yet and has received no official notification of when to expect funds. Additionally, some information regarding eligible uses of ARP funds and deadlines to make expenditures has surfaced. Some information on the use of ARP funds that has come out recently include:
• Eligible Expenses
o Assistance to households; small businesses; and non-profits to aid in the public health emergency response
o To aid hard-hit industries such as tourism; travel; and hospitality
o Revenue replacement (to the extent it is a reduction in revenue due to COVID-19 for the fiscal year 2019)
o Investments in water, sewer, or broadband infrastructure
• Ineligible Expenses
o Funds cannot be used to directly or indirectly offset tax reductions or delay a tax or tax increase
o Funds cannot be deposited in a pension fund
• Unofficial deadline for spending funds is December 31, 2024
However, no official guidelines have been made public at this time. Until official guidelines are issued from the Treasury Department, staff recommends proceeding cautiously in developing a spending/use plan.
Staff Recommendation
Informational; recommend continued monitoring