Title
American Rescue Plan Proposed Strategic Plan
Description
This report provides the City Council with a framework to consider in developing a strategic plan for the use of federal American Rescue Plan Act (ARPA) funds and requests Council feedback and direction on a draft strategic plan with priorities for implementation. Because detailed guidance on approved uses of funds has not been provided by Treasury, the attached summary is conceptual only. A more detailed and robust list of programs will be developed for City Council discussion after the guidance is released. Based on information received from the Treasury earlier this week, detailed guidance is expected to be released on or around May 11, 2021.
THIS ITEM IS FOR INFORMATION AND DISCUSSION.
Report
Summary
The federal government allocated $416 million to the City of Phoenix in the American Rescue Plan. Funding is anticipated to be received in two equal distributions 12 months apart. Based on the timing of the first distribution, we expect to receive the first allocation of approximately $208 million no later than mid-May. The second allocation of $208 million will be awarded one year after the first allocation and is not expected to be available to spend until FY 22-23.
According to federal guidance issued to date, the Fund may only be used to cover costs that are necessary expenditures caused by COVID-19 incurred between March 3, 2021 and Dec. 31, 2024. Per the initial guidance and language currently available, funds can only be used:
- to respond to the public health emergency with respect to the Coronavirus Disease 2019 (COVID-19) or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality;
- to respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers of the state, territory, or tribal government that are performing such essential work, or by providing grants to eligible employers that have eligible workers who perform essential work;
- for the provision of government services to the extent of the reduction in revenue of such state, territory, or tribal government due to the COVID-19 public health emergency relative to revenues collected in the most recent full fiscal year of the state, territory, or tribal government prior to the emergency; or
- to make necessary investments in water, sewer, or broadband infrastructure.
The proposed strategic options are based on input from councilmembers. Some of the proposals are new initiatives and some are programs that were successfully implemented under the $293 million Coronavirus Relief Fund (CRF) Strategic Plan.
Like the CRF strategic plan, the proposed ARPA strategic plan includes three areas of emphasis: Community Investment, City Operations and a Contingency for Future Operational Needs. Attachment A provides the Council with a detailed list of programs that staff have developed to address important community or operational initiatives. Guidance from the federal government continues to evolve and we will need to be nimble to adjust our programs to ensure compliance with federal rules. The latest notice from the Treasury states that neither guidance or funding will be released until May 11, 2021.
A Reserve is proposed to preserve resources in case the federal government changes guidance to allow the funds to be used in new areas of concern for the council or to supplement funding for an approved program that exhausts its allocation of funds before more funding becomes available. The Reserve would also be available to cover other unexpected COVID-19 expenses that could occur later in the year.
Staff is seeking Council feedback and direction on a draft strategic plan with priorities for implementation. Based on the Council’s strategic direction, staff will return to a future meeting with recommended allocation of funds for Council discussion, amendment and approval.
Department
Responsible Department
This item is submitted by City Manager Ed Zuercher and Assistant City Manager Jeff Barton.