Agenda Item No. 19
CITY OF YUCAIPA
AGENDA REPORT
TO: Honorable Mayor and City Council
FRO`I: �kb-'Raymond A. Casey, City Manager/Treasurer
FOR: City Council Meeting of June 27, 2022
SUBJECT: Strategic ARPA Funding Plan / Essential Worker Stipend RECOMMENDATION:
That the City Council confirm/approve the following ARPA allocations:
1. Confirm $706,856 toward Government Services, including Police, Fire and other ARPA eligible services, in FY 22; and
2. Approve an Essential Worker Stipend in the amount of $440,200, as authorized and funded by the American Rescue Plan Act (ARPA) of 2021, within Fiscal Year 2021-2022 (FY 22); and
3. Confirm $2,062,421 to fully fund the FY 23 Budget related to Government Services, including Police, Fire and other ARPA eligible services.
BACKGROUND:
On March 4, 2020, Governor Gavin Newsom declared a state-wide state of emergency due to the spread of COVID-19. On March 10, 2020, the San Bernardino County Department of Public Health proclaimed a Public Health Emergency and the Board of Supervisors issued and the Department of Public Health issued a Proclamation of Local Emergency. On March 11, 2020, the World Health Organization declared the COVID-19 outbreak to be a pandemic. On March 13, 2020, the President of the United States declared a national state of emergency. On March 18, 2020, City Council held an emergency meeting and adopted Resolution No. 2020-16, declaring the existence of a local emergency due to the spread of the COVID-19 virus.
On March 11, 2021, the American Rescue Plan Act of 2021 (ARPA) was signed into law. The $1.9 trillion economic stimulus bill provides $350 billion for states, counties, municipalities, tribal governments, and territories to respond to the COVID-19 public health emergency. Of the $350 billion, ARPA provides $65.1 billion to municipal governments. Of the $65.1 billion, the City of Yucaipa was awarded approximately $8 million in ARPA funding, half of which was received in June 2021 and the other half was just received recently. -376-
City Council Agenda
Meeting of June 27, 2022
Strategic ARPA Funding Plan / Essential Worker Stipend
Final Guidelines clarified and Treasury Staff recommended that cities with less than $10,000,000 in ARPA funding simply opt for the "Standard Allowance" where cities may report lost revenues without justification. However, staff believes the City must still follow ARPA requirements related to qualified expenditures and make corresponding annual reports when necessary.
The following allocations of ARPA funds have been approved by the City Council to date:
Total ARPA Funding $8,017,860
Previous Allocations
FY 22 Lost Revenue (Government
Services, including Police, Fire and $2,178,220
other ARPA eligible services)
Previous Frozen/Cut Positions 703,163
Wilson III Basin Project 927,000
Subtotal, Previous Allocations 3,808,383
Remaining ARPA Funding to Allocate: $4,209,477
DISCUSSION:
The City has made various responses to the COVID-19 pandemic and allocations of ARPA Funds, if applicable, as follows:
Pandemic Response
Because the COVID-19 pandemic has negatively impacted housing cost affordability and because of state mandated obligations to provide affordable housing in accordance with the Surplus Land Act, the City is considering utilizing a City owned property located at Oak Glan and Avenue E for an affordable housing project. This item may come before the City Council in the next several Council meetings in the form of an Exclusive Negotiating Agreement but is not currently being recommended for funding as directed by the City Council during the Goals and Objectives process.
The Property is not currently being used by the City and City staff has evaluated the Property for its potential to be used for City work or operations. Staff has determined that the Property is not suitable for the City's use.
-377-
City Council Agenda
Meeting of June 27, 2022
Strategic ARPA Funding Plan / Essential Worker Stipend
Economic Recovery Response
CDBG-CV]
On April 2, 2020, it was announced that the County of San Bernardino received a total of $6,560,515 in federal grant funding to begin responding to the financial crisis created by the spread of coronavirus. The new funding comes in the form of Community Development Block Grants (CDBG-CVI) and Emergency Solutions Grant (ESG) Program funds and allows city and county governments to invest in programs to support economic growth, spur job creation, address homelessness, and provide affordable housing. These funds were made available by the CARES Act, the third federal coronavirus response bill.
The City has been allocated $ 202,897 in funding through the CDBG-CV1 for activities that prevent or respond to the impacts of the COVID-19 pandemic. As a "Cooperative City," the City partners with the County to implement the federal CDBG program, including preparation and submittal of grant related documents, complying with federal regulations for implementing grant funded projects, and coordination with federal monitors and inspectors on program and project performance and compliance.
On April 27, 2020, City Council directed staff to include up to approximately $ 187,000 +/- in assistance to businesses to avoid job loss caused by business closure related to social distancing by providing short-term working capital assistance to small businesses Small Business Resiliency Grant Program), as outlined in the CDBG-CV grant funding guidelines.
The City Council subsequently increased this amount to $202,897 in CDBG-CV funding be allocated to the Small Business Resiliency Grant Program to assist approximately Yucaipa based small businesses with up to a $10,000 loan to grant from the CDBG-CV program. Approximately $21,000 of the CDBG-CV grant program will be used to cover staffing costs for the administration of the Small Business Resiliency Grant Program.
CDBG-CV3
The third round of Community Development Block Grant- Coronavirus funds (CDBG-CV3) which was the next round where the City is eligible was released by the County on December 14, 2020. Under this round of funding, the City's CDBG-CV3 estimated allocation is $210,786.
Similar to CDBG-CVl fund restrictions, and as approved by the City Council, CDBG-CV3 funds must be used towards activities that contribute to the prevention of, preparation for, and response to COVID-19. CDBG-CV3 funding will be used to develop, implement, and administer a Mortgage and Rental Assistance Program for residents. The program aimed to assist at least twenty-five (25) low to moderate income households in Yucaipa. In addition, unused CDBG-CVI can be applied to the CDBG-CV3 program.
-378-
City Council Agenda
Meeting of June 27, 2022
Strategic ARPA Funding Plan / Essential Worker Stipend
For both CDBG-CVI & CDBG-CV3 programs, there is no net impact to the General Fund as all costs associated with each program will ultimately be reimbursed to the City through CDBG funding by the County.
Government Operations Response
Government Services
As discussed above, the City allocated a total of approximately $2.9 million in Lost Revenues toward FY 22 Government Services and Previously Frozen/Cut Positions. This allowed for a continuity of essential City operations during the COVID-19 pandemic.
As detailed in the table below, staff is recommending another allocation of $2.8 million toward government services to make the City "whole" from lost revenue from the COVID-19 pandemic, $2.1 million in FY 23 and $707K in FY 22.
Essential Worker Stipend
One of the eligible uses of ARPA funds includes payments to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers that are performing such essential work. Title 31 Subtitle A Part 35 Subpart A § 35.6 "Eligible uses" (c) "Providing premium pay to eligible workers" states "A recipient may use funds to provide premium pay to eligible workers of the recipient who perform essential work." Premium pay amounts are limited to a rate of $13/hour and may not exceed $25,000 per employee.
A local emergency related to the COVID-19 pandemic was adopted by the Yucaipa City Council between March 18, 2020, and March 14, 2022, and narrowed somewhat since that time. As a number of other cities in the area approved premium compensation for essential workers as shown in Exhibit A, the City Council may wish to consider a prorated $100/week (approximately $2.50/hour) for each currently active essential employee that worked during the declared local emergency in FY 22.
City of Yucaipa's COVID-19 practices
At the onset of the COVID-19 pandemic in March 2020, City Hall was closed to the public as dictated by the State of California. However, contrary to how surrounding cities responded, City Hall was still nearly fully operational as detailed below:
• The City Hall Lobby was closed to the public; however, the public was always able to submit documents physically at City Hall and electronically throughout the entirety of the COVID-19 pandemic restriction; and
• Various staff continued physically working throughout the entirety of the COVID- 19 pandemic restriction at their respective locations as follows:
o City Hall employees physically worked at City Hall; and -379-
City Council Agenda
Meeting of June 27, 2022
Strategic ARPA Funding Plan / Essential Worker Stipend
o Public Works employees physically worked at their respective physical location; and
• City staff operated in person on a split shift, 12 hours/day for 6 days (Monday — Saturday) for the first 4 weeks of COVID-19, resuming the regular 9/80 schedule in person immediately thereafter when the lobby was once again allowed to be opened by the State of California; and
• City staff continued to conduct business on -site by responding to emails and phone calls, processing physical documents submitted to City Hall and electronically, conducting physical meetings and/or video teleconferences with applicants, and making special appointments when necessary.
• City Council meetings were always physically held at City Hall as City staff supported these meetings in person, with the option of remote teleconference for City Councilmembers and public participation throughout the entirety of the COVID-19 pandemic restriction.
During this time, a number of nearby cities closed their respective City Halls, mostly in their entirety, for an average of approximately 21 weeks (145 days), ranging from 10 weeks to 55 weeks.
As City staff served the City's residents and businesses to provide continuity of essential services during the COVID-19 pandemic as essential workers, it is recommended that the City Council consider approving the proposed essential worker pay in appreciate of staff s dedication.
Proposed Essential Worker Pay Guidelines:
The following provides potential guidelines for approving an Essential Worker Stipend:
• Provide premium pay of $100 per week to essential permanent employees who were on the City's payroll for any part of the period from March 14, 2020, and March 25, 2022, and are employed at the approval date of essential worker payment, if approved.
ARPA Funding Recommendations Summary
Therefore, in conjunction with above discussion if the essential worker stipend is approved, staff is now recommending that all remaining ARPA funding and the following budget revisions/allocations be approved as follows:
:1
City Council Agenda
Meeting of June 27, 2022
Strategic ARPA Funding Plan / Essential Worker Stipend
Remaining ARPA Funding to Allocate: $4,209,477
New Allocations
FY 23 Lost Revenue (Government
Services, including Police, Fire and $2,062,421
other ARPA eligible services)
Essential Worker Stipend- FY22 440,200
FY 22 Lost Revenue (Government
Services, including Police, Fire and 706,856
other ARPA eligible services)
Subtotal, New Allocations $3,209,477
FISCAL IMPACT:
Discussed above.
Attachments:
Exhibit A - Neighboring City Premium Pay for Essential Employees -381-
Exhibit A
Neighboring City Premium Pay for Essential Employees
Non Public Safety Employees (Police/Fire)
American Rescue Plan Act
# of Weeks Closed to
ARPA
Number of
Total Essential
% of ARPA
Agency
Public
Population
Essential Worker Pay
employees
ARPA Funding
Worker Pay
funding
0 53,682
55 $ 8,017,860
$ 440,200
5.49%
City of Yucaipa
16 50,000 - 100,000
$ 6,500 (Max.)
377
$ 11,508,106
$ 2,450,500
21.29%
City A
11 100,000
$1,000 to $2,500
139
$ 16,463,101
$ 347,500
2.11%
City E
10 50,000 - 100,000
Still Pending
$ 22,171,505
City F
Cities outside of comp
11 50,000 - 100,000
$ 4,000
291
$ 9,956,344
$ 1,164,000
11.69%
City G
6 50,000 - 100,000
$ 12,500
750
$ 17,776,763
$ 9,375,000
52.74%
City H
63 50,000 - 100,000
$ 9,000
260
$ 20,425,061
$ 2,340,000
11.46%
City 1
12 100,000
$ 5,000
410
$ 45,366,413
$ 2,050,000
4.52%
City N
3/16/2020 to ?
> 100,000
$3,000 / 4% raise and
221
$ 19,566,027
$ 1,854,307
9.48%
City O
5% toward Pers
3/16/2020 to ?
50,000 - 100,000
5% of salary
$ 26,178,395
$ 3,000,000
11.46%
City P
4 50,000 - 100,000
7% of salary
91 $ 21,848,669
$ 388,311
1.78%
City Q
Notes:
A portion of the listed cities have included part-time employees for Premium Pay Number of employees and salary information are from the State Controllers Site -382-