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Home My WebLink About7.1 - 3355 CARES Act Funding Spending Plan Page 1 of 4 STAFF REPORT CITY COUNCIL DATE: September 1, 2020 TO: Honorable Mayor and City Councilmembers FROM: Linda Smith, City Manager SUBJECT: CARES Act Funding Proposed Spending Plan Prepared by: John Stefanski, Assistant to the City Manager EXECUTIVE SUMMARY: The City Council will consider approval of a spending plan for the City's allocation of $811,404 in funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act, as provided for in the State’s Fiscal Year 2020-21 Adopted Budget, for expenditures incurred due to the COVID-19 Public Health Emergency. STAFF RECOMMENDATION: Adopt the Resolution Approving the CARES Act Funding Spending Plan. FINANCIAL IMPACT: Under the State’s Fiscal Year 2020-21 Adopted Budget, the City will receive $811,404 in funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Upon receipt of the funds, Staff will adjust the budget for both revenues and expenditures accordingly. There will be no net impact on the General Fund. DESCRIPTION: Background In March 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act, an economic stimulus package in response to the negative financial impacts associated with the COVID-19 pandemic. The package provides over $2 trillion in economic relief programs to assist workers, families, and businesses, as well as state, local, and tribal governments. The State of California received over $15 billion in CARES Act funding. The State’s Fiscal Year 2020-21 Adopted Budget included $500 million from this funding for cities, with $275 million to be allocated, on a per-population basis, to cities with populations below 300,000. Under this framework, the City of Dublin will receive $811,404. Page 2 of 4 Funding Guidelines The State has made this funding contingent on the adherence to federal guidance, the state’s stay-at-home requirements, and other health requirements, orders, directives, and guidance as directed by the Governor and the California Department of Public Health. Furthermore, the City may only spend the funds in accordance with guidelines established by the CARES Act. CARES Act funding can only be used for necessary expenses incurred due to the public health emergency, including the expense of responding directly to the emergency as well as second-order effects of the pandemic, along with other related expenses which were not accounted for in the current budget. Under the CARES Act Guidelines there are six general categories of eligible expenses including, but not limited to: 1. Medical expenses, such as costs of providing COVID-19 testing. 2. Public health expenses, including costs of communicating and enforcing public health orders and acquiring/distributing personal protective equipment (PPE). 3. Payroll expenses for public safety or similar employees whose services are substantially dedicated to mitigating or responding to the public health emergency. 4. Expenses related to facilitating compliance with COVID-19-related public health measures including bolstering telework capabilities for public agencies, delivering food to vulnerable populations, and providing paid sick/family/medical leave to public employees. 5. Expenses associated with the provision of economic support in connection with the COVID-19 public health emergency like grants to small businesses, rental/mortgage assistance, eviction prevention, homelessness prevention grant programs, and unemployment insurance costs related to the COVID-19 public health emergency if such costs will not be reimbursed by the federal government pursuant to the CARES Act or otherwise. 6. Any other COVID-19 related expenses reasonably necessary to the function of government that satisfy the program’s eligibility criteria, including matching requirements for FEMA Public Assistance Grants. Eligible expenses must have been incurred between March 1, 2020 through December 30, 2020. The $811,404 in CARES Act funding must be spent, not just encumbered, by December 30, 2020. Funds not spent by the December 30, 2020 timeline shall be returned to the U.S. Treasury in accordance with Federal guidelines. Furthermore, any loans created from these funds must be utilized before December 30, 2020. Unused funds from these loans as well as any future repayments must be returned to the U.S. Treasury as well. State Process and Timeline The State will initially disburse funds in one-sixth increments for the months of July, August, and September. The balance of the funds will be provided at the end of September or early October. This remaining balance will be paid after the City satisfies Page 3 of 4 certain Department of Finance reporting requirements, which are in development. The City received its first payment of $135,234 on July 30. Proposed Spending Plan The proposed spending plan accounts for eligible expenses the City has incurred since March 1, 2020 as well as planned expenses for the remainder of the calendar year. The proposed spending plan categorizes expenses in accordance with the CARES Act categories of eligible expenses. The proposed spending plan is attached as Exhibit A to the Resolution. The following is a description of Staff’s plan to utilize the funding. • Category 1: Medical Expenses- $25,000 The City is planning to utilize the FEMA Public Assistance (PA) program to cover the costs associated with the Stanford Health Valley Care testing site. FEMA PA currently requires a 25% local match, which CARES Act funding may cover. The initial cost of the testing site was $100,000 and therefore any local matching requirement would equal $25,000. • Category 2: Public Health Expenses-$157,489 This funding will be used to cover expenses related to health order communications such as park signage and facility signage detailing COVID-19 physical distancing and masking protocols, park monitors to enforce public health orders and educate park users on the guidelines, facility sanitization activities, and the purchase of sanitization supplies. • Category 3: Payroll Expenses-$11,572 Several City staff positions have been repurposed to support the ongoing COVID-19 response. These positions are reallocated to support the Senior Center Lunch Program and Meals on Wheels program, which have witnessed significant increases in utilization. • Category 4: Health Order Compliance-$217,342 This funding proposes to cover expenses related to unemployment insurance claims and expenses to facilitate teleworking arrangements including monthly technology reimbursement stipends to employees, as well as the purchase of Zoom licenses and webcams. Lastly, the City would propose to use this funding to reimburse the City’s General Fund for facility modifications, including a new check-in station in the Civic Center Lobby and the purchase of plexiglass dividers for public facing countertops. • Category 5: COVID-19 Economic Support-$400,000 Staff proposes reserving approximately half of its CARES Act allocation for economic support for those experiencing second order effects from the COVID- 19 pandemic. Staff is recommending that a minimum of $200,000 of this funding be utilized to supplement the Small Business Microloan program, which was unable, due to funding constraints, to consider 60 applications under the first round of the program. At the $200,000 level, the City would be able to assist between 20-25 of those businesses. At $400,000, the City could fund between 45-55 businesses. Page 4 of 4 If the City Council decided on the minimum recommendation, the remaining half could be used for other economic support programs, including augmenting existing rental assistance for lower income households impacted by COVID-19. Currently, the City has provided $50,500 to CityServe for an Emergency Rental Assistance Program, funded by an East Bay Community Energy Grant, and the County has developed a rental assistance program, earmarking approximately $75,000 in available funds for Dublin residents. The deadline to apply for those funds was August 11. The availability of the funds was promoted by the City. Next Steps Following City Council approval, Staff will execute the spending plan to ensure all funds are spent by December 30, 2020 and in accordance with the funding guidelines. Staff will also report back to the City Council on the use of the Economic Support funding as that is finalized. STRATEGIC PLAN INITIATIVE: None. NOTICING REQUIREMENTS/PUBLIC OUTREACH: None. ATTACHMENTS: 1. Resolution Approving the CARES Act Funding Spending Plan 2. Exhibit A to the Resolution - CARES Act Funding Spending Plan RESOLUTION NO. XX-20 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN * * * * * * * * * APPROVING THE CARES ACT FUNDING SPENDING PLAN WHEREAS, in March 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act, an economic stimulus package in response to the economic impacts associated with the COVID-19 Pandemic; and WHEREAS, the Fiscal Year 2020-21 California State Adopted Budget included $500 million from this funding for cities, with $275 million to be allocated, on a per population basis, to cities with populations below 300,000; and WHEREAS, the City will receive $811,404 in funding pursuant to the State budget allocation; and WHEREAS, pursuant to the Federal guidelines established for the CARES Act and described in the accompanying Staff Report to this Resolution, the City plans to expend the entirety of this allocation by December 30, 2020 and any unused funds shall be returned to the US Treasury. NOW, THEREFORE BE IT RESOLVED, the City Council of the City of Dublin hereby approves the CARES Act Spending Plan, attached as Exhibit A to this Resolution; and BE IT FURTHER RESOLVED that due to the time constraints associated with the CARES Act funding, the City Manager is authorized to adjust this spending plan to ensure the proper and timely expenditure of such funds. PASSED, APPROVED AND ADOPTED this 1st day of September 2020, by the following vote: AYES: NOES: ABSENT: ABSTAIN: ______________________________ Mayor ATTEST: _________________________________ City Clerk Exhibit A to the Resolution Cares Act Funding Spending Plan As of August 11, 2020 Prepared by John Stefanski, Assistant to the City Manager Budget #Revenue 1 CARES Act Allocation 811,404$ 2 3 Total Revenue 811,404$ 4 5 Expenses 6 Medical Expenses 25,000$ 7 SVC Testing Site; FEMA PA Match 25,000$ 8 Public Health Expenses 157,489$ 9 Health Order Communications 18,320$ 10 Health Order Enforcement 34,320$ 11 PPE/Sanitization Activities 104,849$ 12 Payroll Expenses 11,572$ 13 COVID-19 Staffing 11,572$ 14 Health Order Compliance 217,342$ 15 Unemployment Insurance Claims 93,000$ 16 Teleworking Improvements 84,703$ 17 Facility Modifications 39,639$ 18 COVID-19 Economic Support 400,000$ 19 Small Business Microloan Program 200,000$ 20 Other Economic Support/Rental Assist. Prg. 200,000$ 21 22 Total Expenses 811,404$ 23 Surplus/(Deficit) 0$