Agenda - Council Work Session - 03/08/2022

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4400 Federal Register/Vol. 87, No. 18/Thursday, January 27, 2022/Rules and Regulations final rule incorporated this definition types of employees and permissible C.Revenue Loss and emphasized that premium pay structures for awarding premium pay. A Background should be in addition to compensation few commenters asked if premium pay typically received. could be awarded to volunteers or those Sections 602(c)(1)(C) and 603(c)(1)(C) Public Comment:Several submitted in irregular and non-hourly or salaried of the Social Security Act provide that comments related to the definition of employment positions. Similarly, SLFRF funds may be used"for the "premium pay." Several commenters various commenters asked if part-time provision of government services to the asked Treasury to clarify certain aspects workers were eligible for premium pay. extent of the reduction in revenue of of the interim final rule and statutory Some commenters asked Treasury to such. . .government due to the definition of premium pay. For instance, provide more detail on when premium COVID-19 public health emergency a few commenters asked whether the pay may be paid retroactively or if a relative to revenues collected in the $25,000 limit applies to the annual government could reimburse its general most recent full fiscal year of the . . . amount of premium pay received or the fund for hazard pay already paid before government prior to the emergency." aggregate amount of premium pay the start of the period of performance. This provision allows recipients received over the period of performance. Treasury Response:Treasury has also experiencing budget shortfalls to use A few commenters requested flexibility made clear in the final rule that a payments from the SLFRF funds to as to how premium pay may be recipient may award premium pay to avoid cuts to government services and, awarded,including flexibility to make non-hourly or salaried workers as well thus, enables state,local,and Tribal monthly or quarterly payments or lump as part-time workers.Premium pay may governments to continue to provide sum payments. Finally, commenters not,however,be awarded to volunteers. valuable services and ensures that fiscal requested additional clarification as to If a recipient is interested in austerity measures do not hamper the how premium pay should be calculated. compensating volunteers with SLFRF broader economic recovery. For instance,a commenter asked how to funds,then it must do so consistent State and local government budgets calculate the amount of and account for with the requirements set forth in other experienced stress in fiscal year 2020 as overtime pay and other incentive eligible use categories;for example, see delayed tax filings and pandemic- pay.269 section Public Sector Capacity and related business closures caused Treasury Response:Treasury has Workforce in Public Health and revenues to decline sharply.271 Twenty- clarified some of these issues in the Negative Economic Impacts. two state governments took actions to final rule. For example,Treasury has Under the final rule,recipients may close budget gaps in fiscal year 2020 272 clarified in the final rule that the award premium pay retroactively; and nearly 80 percent of cities reported $25,000 per employee limit is for the however, SLFRF funds may not be used being less able to meet the fiscal needs entire period ofperformance,not an to reimburse a recipient or eligible of their communities relative to fiscal annual ca .Further,recipients have employer grantee for premium pay or year 2019.273 Surveys of Tribal p p hazard pay already received by the governments and Tribal enterprises discretion with respect to the way in employee. To make retroactive premium conducted in 2020 found majorities of which premium pay is awarded to payments funded with SLFRF funds, a respondents reporting substantial cost eligible workers (e.g.,monthly, recipient or eligible employer grantee increases and revenue decreases,with quarterly,lump sum),provided that the must make a new cash outlay for the Tribal governments reporting reductions total premium pay awarded to any premium payments and the payments in health care,housing, social services, eligible worker does not exceed$13 per must be in addition to any wages or and economic development activities as hour or$25,000 over the period of performance.Finally, a recipient may remuneration the eligible worker a result of reduced revenues.274 already received, subject to the other The economic recovery,aided by the award premium pay to an eligible requirements and limitations set forth in broad distribution of COVID-19 worker in addition to the overtime pay the ARPA and this final rule. vaccines and the deployment of federal already earned by the eligible worker Finally,as part of accepting the stimulus,has led to a strong rebound in but in no instance may the portion of Award Terms and Conditions for total state and local government revenue the compensation funded with SLFRF SLFRF,each recipient agreed to and is contributing to a brighter fiscal funds exceed$13 per hour, even if strict time-and-a-half calculation requires maintain aconflict-of-interest policy consistent with 2 CFR 200.318(c)that is 271In the second quarter of 2020,quarterly state more.270 To the extent that an employer applicable to all activities funded with and local tax revenues as reported by the U.S. is required under the FLSA to make the SLFRF award. This award term Census Bureau fell 19 percent compared to the payments to an elig requires worker in excess uires recipients Tents and subreci cents to second quarter of 2019;U.S.Census Bureau, q p p Quarterly Summary of State and Local Tax of$13 per hour or$25,000 in the report to Treasury or the pass-through Revenue,https://www.census.govlprograms- aggregate over the period of agency,as appropriate,any potential surveys/gtax.html. performance,the employer must use a conflict of interest related to the award 272 National Association of State Budget Officers, source of funding other than the SLFRF funds per 2 CFR 200.112. Pursuant to Fiscal Survey of the States(Fall 2020),available at p https://higherlogicdownload.s3.amazonaws.com/ funds to satisfy those obligations. this policy, decisions concerning SLFRF NASBO19d2d2db1-c943-4f1b-b750-Ofca152d64c2/ Program Structure funds must be free of undisclosed Uploadedlmages/Fiscal%20SurveyINASBO_Fall_ g personal or organizational conflicts of 2020_Fiscal_Survey_of States_S.pdf. Public Comment. Several commenters National League of Cities,City Fiscal also requested elaboration on eligible interest,both in fact and in appearance. Conditions(2020),available at https://www.nic.org/ Consistent with this policy, elected wp-con ten t/uploads/2020/OS/City_Fiscal_ Fiscal— officials are prohibited from using their Con ditions_2020_FINAL.pdf. 269 See 29 U.S.C.207(a)("[Alt a rate not less than 274 Surveys conducted by the Center for Indian one and one-half times the regular rate at which he official position and control over SLFRF Country Development at the Federal Reserve Bank is employed."). funds for their own private gain. This of Minneapolis in March,April,and September 270 All recipients are required to comply with policy also prohibits,among other 2020.Elijah Moreno&Heather Sobrepena,Tribal otherwise applicable laws,including any wage and things, elected officials from steering entities remain resilient as COVID-19 batters their hour requirements in the Fair Labor Standards Act. funds to projects in which they have a finances,Federal Reserve Bank of Minneapolis See generally,Department of Labor,Wages and the (Nov.10,2020),https://www.minneapolisfed.org/ Fair Labor Standards Act,https://www.dol.gov/ financial interest or using funds to pay articlel2020ltribal-entities-remain-resilient-as- agencies/whd/flsa. themselves premium pay. covid-19-batters-their finances.