On March 11, 2021, the $1.9 trillion American Rescue Plan Act (ARPA) was signed into law. ARPA included a $350 billion allocation of Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) to state, local, territorial, and tribal governments. Metropolitan Cities were one of six CSLFRF recipient types and collectively received an allocation of $45.6 billion. The City of Rocklin was categorized as a Metropolitan City and was allocated $7,039,025. The allocation methodology is largely consistent with the Community Development Block Grant formula employed by the United States Department of Housing and Urban Development.

The City received half of the funding ($3,519,512.50) in June and will receive an equal amount in mid-2022. Once the City Council has agreed on the general parameters of spending, staff recommends establishing revenue and expenditure budgets in the Fiscal Year (FY) 2021/22 Operating Budget based on the actual funds received. The second half will be incorporated into the FY 2022/23 budget as authorized by the City Council, and identified as one-time funding.

The United States Department of Treasury (Treasury) is overseeing the CSLFRF program and distribution of funds. CSLFRF funds may be spent in seven expense categories (EC): Public Health, Negative Economic Impacts, Service to Disproportionally Impacted Communities, Premium Pay, Infrastructure (water, sewer, or broadband), Revenue Replacement, and Administrative. Based on Treasury guidance, staff is recommending fifteen (15) general programs to utilize the CSLFRF funding, covering four of the ECs (Public Health, Negative Economic Impacts, and Revenue Replacement and Premium Pay), as detailed in Exhibit 1, and summarized here:

The City has until December 2024 to obligate this funding, and December 2026 to spend. Following discussion of this item, staff seeks consensus from the City Council regarding the recommendations provided by staff, either as presented or with changes. Based on the consensus direction received, staff will return to the City Council at a later date with a recommendation to establish the revenue and expenditure budgets in the amount of $3,519,513 in the FY 2021/22 Operating Budget to deliver the program and program the second half in the budget that will be prepared for FY 2022/23.

The CSLFRF Compliance and Reporting Guidance from Treasury is included for reference as Exhibit 2.

None at this time. Based on City Council direction, staff will return to the City Council with a budget amendment to establish revenue and expenditure budgets for the first half ($3,519,512.50) of the ARPA funding in the FY 2021/22 Operating Budget in the American Rescue Plan Act Fund (Fund 266) and program the second half in the budget that will be prepared for FY 2022/23.

There is no grant matching requirement and funds may only be used for project costs initiated on or after March 3, 2021. Uses must qualify within one of the seven identified ECs.