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Receive a status update on the County’s direct funding from the Federal American Rescue Plan Act (ARPA) Coronavirus State & Local Fiscal Recovery Funds
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Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
The County Administrator (CAO) recommends that the Board of Supervisors receive a status update on the County’s direct funding from the Federal American Rescue Plan Act (ARPA) Coronavirus State & Local Fiscal Recovery Funds (SLFRF).
SUMMARY
In the Fall 2021 the Board of Supervisors received an overview on ARPA guidelines and approved the eligible spending categories in-line with the U.S. Treasury guidelines. The Board also held two special meetings to provide an opportunity for public comment on input into the County’s ARPA process. Following public input, the Board established an initial category allocation of the County’s direct funding by eligible spending category. The Initial Board Approved Allocation for ARPA Direct Funding is included in Attachment A.
The Board of Supervisors also provided direction in the Fall 2021 in the following areas for which a verbal status update will be provided:
• Host an informal (nonscientific) ARPA Community Web Based Survey to solicit community input on the use of ARPA funds.
• Subject Matter Workgroup Presentations addressing key ARPA categories for potential investment and further Board direction.
• Additional information on the County’s detailed calculation for Revenue Loss under ARPA guidelines and the allowable use of funds claimed as revenue recovery.
• Review of the County’s RFP process for streamlining future Requests for Proposal guidelines.
The County Administrator’s Office will also provide an update on the County’s ARPA website, including the development of a Frequently Asked Questions page, and other available resources to maintain transparency and accountability for the direct ARPA funding. The update will include information on the issuance of the Final Rule for SLFRF by the U.S. Treasury on January 6, 2022.
FINANCIAL IMPACT:
The direct allocation to Solano County of Coronavirus State and Local Fiscal Recovery Funds under the ARPA is $86,949,405. An expenditure plan is required and there are federal guidelines for Board consideration in the development of the plan. Funding can be used to cover eligible costs incurred during the period that begins on March 3, 2021 and ends on December 31, 2024. All obligations incurred must be fully expended by December 31, 2026. The County received $43.5 million in May 2021, representing the first half of the funds. The remaining funds are anticipated to be received in May 2022. The Board directed that staff focus on the first half of the funds as part of the initial allocation into categories.
The County ARPA allocation is not part of the FY2021/22 Recommended Budget, appropriations for spending any portion of the ARPA funds will need to be approved by the Board by a 4/5 vote and noticed. The Board also needs to approve all ARPA expenditures.
The costs associated with preparing the agenda item are nominal and absorbed by various department’s FY2021/22 Working Budget.
DISCUSSION:
Solano County received a direct federal funding allocation under the American Rescue Plan Act (ARPA) - Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program of $86,949,405 not included in FY2021/22 Budget or any other budget and requiring 4/5 vote to appropriate and expend.
ARPA Community Web Based Survey - The Board directed staff to conduct an ARPA Community Web Based Survey to solicit community input on the use of ARPA funds. The Survey was developed and available to the public through November 30, 2021. The survey responses have been collected and were previously provided to your Board. The survey, which was available in English, Spanish and Tagalog, resulted in 941 responses from across the County. The survey results are available on the County’s ARPA website.
Subject Matter Workgroups - On October 19, 2021, the Board directed staff move forward with proposed ARPA category discussions, establishing Department/Subject Matter Workgroups. These Subject Matter Workgroups are intended to help facilitate discussion sessions to allow for Department staff in coordination with local government agencies, partners and other subject matter partners to review existing studies, Board received copies of needs assessments and strategic plans, and other available information on needs, gaps in services, or potential investments and potential funding options where ARPA funds may be used to address COVID-19 recovery efforts in-line with U.S. Treasury guidelines.
Based on Board direction, the CAO established ARPA Subject Matter Workgroups, conducted by various departments working to gather information on programs and services for the Board to consider further direction. The CAO is in consultation with the Board Chair and has been working to schedule Subject Matter Workgroups to present concepts and facilitate Board discussion on eligible ARAP spending categories. The first workgroup presentations will follow this Status Update to your Board on February 8, 2022. Additional Workgroup presentations will be scheduled at Board meetings in March and April 2022.
Revenue Recovery under ARPA Guidelines - According to the recently issued U.S. Treasury Final Rule the County has two options in determining the amount of revenue loss which may be claimed under ARPA. Recipients may elect a “standard allowance” of $10 million, or recipients may calculate actual revenue loss according to the formula in the Final Rule. Under the calculated method the County will calculate revenue loss at four distinct points in time, December 31, 2020, 2021, 2022 and 2023. The County revenue loss at December 31, 2020 is centered in our Health & Social Services Department (HSS) and was calculated at approximately $22 million. The calculation at the second point in time, December 31, 2021 is in process and will be provided to the Board at a later date. HSS staff will provide a verbal update on calculated revenue losses as part of the status update.
Review of RFP Process - The County Administrator team also established a workgroup to address questions/concerns regarding the County’s Request for Proposal Process in light of the potential for upcoming RFP’s related to potential ARPA funding under Federal Procurement Guidelines as required by the Final U.S. Treasury Rule for SLFRF. The workgroup, consisting of representatives from General Services Purchasing Unit, County Counsel, County Department Staff responsible for recent RFP’s and contracts and the County Administrator’s Office, reviewed the existing RFP guidelines. The Review confirmed the County remains in compliance with Federal Procurement Guidelines and is in-line with other California Counties in regard to RFP guidelines. The Workgroup continues efforts to identify strategies which may assist smaller agencies in responding to County RFP’s in the future. Any County RFP for ARPA funds will be written with the goal of streamlining the process for responding agencies.
U.S. Treasury Final Rule - On January 6, 2022, the U.S. Treasury issued the long-awaited Final Rule for Coronavirus State & Local Fiscal Recovery Funds. Previously, the ARPA Interim Final Rule was issued by the U.S. Treasury on the use of funding was published in the Federal Register on May 17, 2021. It was open for public comment until July 16, 2021. The U.S. Treasury received over 1,000 comments and had been working to issue the Final Rule, which was originally expected in the Fall 2021. The U.S. Treasury issued the first Frequently Asked Questions as of July 19, 2021, providing additional information and guidance. The Final Rule takes effect on April 1, 2022. Until that time, the Interim Final Rule remains in effect. For more information on the Final Rule see the County’s ARPA website.
The County Administrator’s Office has established website to address public access to ARPA information and easily share Board Reports, other data from the U.S. Treasury, and ARPA requests received by the Board.
The County’s ARPA website can be found at: www.SolanoCounty.com/ARPA <http://www.SolanoCounty.com/ARPA>
ALTERNATIVES:
The Board may alternatively choose not to receive a status update on the County’s direct funding from the Federal American Rescue Plan Act (ARPA) Coronavirus State & Local Fiscal Recovery Funds (SLFRF). This is not recommended as the development of an ARPA plan for expanding the funds and seeking County input is a prerequisite for allocation of funds and can aide the Board the deliberations in the determination of the plan for allocations and investment in the COVID-19 economic recovery countywide.
OTHER AGENCY INVOLVEMENT:
The County Administrator prepared the report at the direction of the Board of Supervisors.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION