Agenda - Council Work Session - 03/08/2022

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CC Work Session 2. 3. Meeting Date: 03/08/2022 Information Title: Update on Possible Uses Of American Rescue Plan Act(ARPA)Funds Purpose/Background: The City is to receive approximately$3M in Federal Funds from the American Rescue Plan Act(ARPA)Funds that will be distributed through the state in two equal payments -the first half the city received in July 2021 and the second half is proposed to be received in the summer of 2022. Staff presented possible uses of how these funds could be used at the worksession of July 13, 2021 which was towards the construction of the water treatment plant and police body warn cameras. These were eligible uses as outlined by the U.S. Department of Treasury's interim final rule in May 2021. On January 6,2022 the US Treasury issued a final rule which provides broader flexibility and greater simplicity in how the funds may be spent. The final rule will replace the existing interim final rule on April 1,2022. According to the final rule,recipients may elect a "standard allowance" of$10 million to spend on government services through the period of performance (March 3, 2020 to December 31, 2024, or December 31, 2026 for projects in process). Under this option,the Treasury presumes that up to $10 million in revenue has been lost due to the public health emergency and recipients are permitted to use that amount(not to exceed the award amount,which would be $3M for Ramsey)to fund government services. Government services generally include any service traditionally provided by a government. Some common examples, as outlined, of eligible government services: •Road building and maintenance, and other infrastructure •General government administration, staff and administrative facilities •Provision of police, fire and other public safety services (including purchases of fire trucks and police vehicles Government services is the most flexible eligible use category under the ARPA program, and funds are subject to streamlined reporting and compliance requirements. With the implementation of the final rule, and the flexibility of now allowing these funds to be used towards roads and other general government operations, staff would like to explore these possibilities with the City Council. Timeframe: Funding Source: Responsible Party(ies): Finance Director