HomeMy WebLinkAboutAGENDA REPORT 2022 0216 CCSA REG ITEM 09DCITY OF MOORPARK, CALIFORNIA
City Council Meeting
of February 16, 2022
ACTION APPROVED STAFF
RECOMMENDATION, INCLUDING
ADOPTION OF RESOLUTION NO.
2022-4074. (ROLL CALL VOTE:
UNANIMOUS).
BY B.Garza.
D.Consider Resolution Amending the Fiscal Year 2021/22 Budget to Receive
$8,701,674 in American Rescue Plan Act of 2021 (ARPA) Funds, Set Aside
$5,688,798 of ARPA Funds for the Princeton Avenue Improvement Project, and
Provide Direction to Staff Regarding Allocation of the Remainder of the City’s
ARPA Funds. Staff Recommendation: 1) Adopt Resolution No. 2022-4074
amending the Fiscal Year 2021/22 Budget to receive the City’s allocation of ARPA
funds in the amount of $8,701,674 utilizing the Standard Allowance methodology
outlined by the U.S. Department of the Treasury; and 2) Set aside $5,688,798 of
the City’s ARPA funds for the Princeton Avenue Improvement Project; and 3)
Provide direction to staff regarding allocation of the City’s remaining ARPA funds
toward the Princeton Avenue Improvement Project, Temporary City Hall Project,
and other eligible government services. (ROLL CALL VOTE REQUIRED) (Staff:
Brian Chong, Assistant to the City Manager)
Item: 9.D.
MOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable City Council
FROM: Brian Chong, Assistant to the City Manager
DATE: 02/16/2022 Regular Meeting
SUBJECT: Consider Resolution Amending the Fiscal Year 2021/22 Budget to
Receive $8,701,674 in American Rescue Plan Act of 2021 (ARPA)
Funds, Set Aside $5,688,798 of ARPA Funds for the Princeton Avenue
Improvement Project, and Provide Direction to Staff Regarding
Allocation of the Remainder of the City’s ARPA Funds
SUMMARY
In March 2021, the federal government passed the American Rescue Plan Act of 2021
(ARPA), a $1.9 trillion federal aid package designed to help the American people and
American economy recover from the prolonged impacts of the COVID-19 pandemic. The
funding package included $350 billion in direct financial relief for all state, local, tribal, and
territorial governments, of which approximately $8.7 million is allocated to the City of
Moorpark.
In May 2021, the U.S. Department of the Treasury (“Treasury Department”) published an
“Interim Final Rule” that provided draft guidance on the spending of ARPA funds by local
governments. The Treasury Department then took public comment on the Interim Final
Rule and received over 1,500 public comments. In January 2022, the Treasury
Department published its “Final Rule” document to guide ARPA spending.
While some local governments immediately began expending their ARPA funds based
on the Interim Final Rule, many other local governments (including Moorpark) held off on
expending their ARPA funds until the Final Rule was published amid concerns that
spending allowed (or interpreted to potentially be allowed) under the Interim Final Rule
would not be allowed under the Final Rule and could trigger penalties or repayment of the
funds to the federal government. Although the City Council did not appropriate its ARPA
funds based on the Interim Final Rule, the City Council did provide staff with preliminary
direction on how to expend the City’s ARPA Funds on July 28, 2021. The exercise
Item: 9.D.
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included a survey of the public to determine their preferences, City Council discussion
about 86 potential projects, and a narrowing down of those to 40 potential projects.
With the Final Rule now published, further City Council direction on how to spend its
ARPA funds is now sought. The Final Rule contained a “Standard Allowance” provision
that had major implications for how the City could expend its ARPA funds. The most
flexible revenue category for ARPA funds is Revenue Replacement; funds in this category
can be used for any “government service” instead of being limited to those categories
identified in ARPA. Because the Interim Final Rule did not contain final formulas for
calculating lost revenues, it was unclear how much of the City’s ARPA funds could
ultimately be used for Revenue Replacement. The Final Rule’s Standard Allowance
stipulates that up to $10,000,000 can be presumed as lost revenue without calculation or
justification; for the City, this means its entire $8,701,674 ARPA award can be taken in
the most flexible Revenue Replacement category, which notably enables roads projects
and facilities projects to be funded.
On January 14, 2022, the City opened construction bids for the Princeton Avenue
Improvement Project, which includes numerous street improvements on Princeton
Avenue between Spring Road and Condor Drive. Due to steep increases in construction
materials and labor in recent years and months, the construction bids were higher than
the Engineer’s Estimate for the project. As a result, staff recommends reserving
$5,688,798 of its ARPA funds to provide the budget necessary to proceed with the
contracts associated with the project’s construction phase. Additional details about the
project, bids, and formal appropriation of the funds are provided in a separate agenda
item at this City Council meeting.
At this time, staff is recommending that the City Council adopt a resolution amending the
FY 2021/22 Budget to officially receive the City’s ARPA funds, set aside $5,688,798 of its
ARPA funds for the Princeton Avenue Improvement Project, and provide direction to staff
regarding allocation of the remainder of the City’s ARPA funds.
BACKGROUND
In March 2021, the federal government passed the American Rescue Plan Act of 2021
(ARPA), a $1.9 trillion federal aid package designed to help the American people and
American economy recover from the prolonged impacts of the COVID-19 pandemic.
Among the major pools of funding was $350 billion in direct financial relief for all state,
local, tribal, and territorial governments. Of that, the City of Moorpark will receive
$8,701,674 in ARPA funding.
Budget Amendment to Receive ARPA Funds
The City’s FY 2021/22 Budget does not currently include revenues or expenditures from
ARPA, since the budget was adopted prior to the Treasury Department’s Final Rule
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document. The City Treasurer has created a separate fund (Fund 2800) to receive and
appropriate ARPA Funds. The attached resolution (Attachment 1) will formally accept the
ARPA funds and deposit them into Fund 2800.
Appropriation of the City’s ARPA funds will be accomplished by separate budget
resolutions adopted by the City Council, with the ARPA funds remaining as fund balance
until appropriated. Use of ARPA funds for the Princeton Avenue Improvement Project,
as recommended, would be accomplished via a budget resolution contained in a separate
agenda item, which is on the agenda this evening.
Interim Final Rule (May 2021)
On May 17, 2021, the U.S. Department of the Treasury (“Treasury Department”)
published an “Interim Final Rule” (available on the Treasury Department website) that
provided draft guidance on the spending of ARPA funds by local governments. The
Treasury Department solicited public review and comment on the Interim Final Rule,
which would lead to publication of a Final Rule governing the use of ARPA funds.
However, local government agencies were authorized to begin expending their ARPA
funds consistent with the Interim Final Rule immediately when it was published. Some
governments, such as many who directly provide public health and COVID-19 testing
services, took advantage of this authorization, since there was little doubt that such
services were clearly going to be allowed in the Final Rule. Other governments, such as
the City, opted to wait until the Final Rule was published to ensure that its spending would
be consistent with final guidance, for fear that it would potentially expend ARPA funds on
programs/services that were in the gray area of potentially-allowed under the Interim Final
Rule but ultimately not allowed under the Final Rule.
The Interim Final Rule established seven broad categories of spending ARPA funds:
1)Public Health
2)Negative Economic Impacts
3)Services to Disproportionately Impacted Communities
4)Premium Pay
5) Infrastructure
6)Revenue Replacement
7) Administrative Expenses
Within those seven categories, a total of 66 subcategories were also identified, though
the City does not provide all of them (i.e., the City does not operate a wastewater
treatment plant and therefore would not utilize funds for wastewater treatment plant
projects). However, the City does have the ability to pass through funds to other agencies
(i.e., the City could pass through funding to Ventura County to fund projects at its
wastewater treatment plant serving Moorpark). The City could also create new programs
in sectors that it does not currently operate in, such as in mental health services.
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On July 28, 2021, the City Council held a special meeting to provide early direction to
staff regarding the use of ARPA funds, to ensure that staff only vets projects that the City
Council indicated it has interest in funding. For example, if the City Council indicated that
it had no interest in transferring funds to Ventura County Waterworks District No. 1 for
water storage projects, then staff would not invest time reaching out to them on potential
projects to fund. To help inform the City Council’s discussion, the City also conducted an
online survey to gauge public opinion on how ARPA funds should be spent. While not a
scientifically or statistically valid survey, the 165 responses received were likely a
reasonable approximation of public opinion at the time. The results of the online
community survey are provided as Attachment 2.
Additionally, staff created a list of dozens of potential projects for ARPA funds based on
the City’s Budget and Capital Improvement Program, the City Council’s Goals and
Objectives, and brainstorming for types of projects that would enhance municipal services
and improve the quality of life for Moorpark residents and businesses. The City Council
also identified additional potential projects during its discussion, and the City Council
ultimately provided direction on 86 potential projects. Of them, 40 projects were identified
to proceed through further vetting, and 46 projects were removed from consideration.
Of note, the biggest of the all of the projects was the potential to use ARPA funds to
replace governmental revenues lost as a result of the COVID-19 pandemic. Because the
formulas for calculating lost revenues were not finalized in the Interim Final Rule, the final
calculation for lost revenues was unknown. For that reason, at the July 28, 2021 City
Council meeting, staff did not present a calculation for the Revenue Replacement
category and how much would then be available for the other ARPA-restricted categories.
In general, use of ARPA funds to replace lost revenues is preferable because such funds
can then be used to provide any “government service,” rather than being restricted to the
more limited categories contained within ARPA (for example, spending on streets/roads
and public safety is only allowed to the extent that those expenditures fall under the
Revenue Replacement category).
Final Rule (January 2022)
On January 6, 2022, the Treasury Department issued its Final Rule (also available on the
Treasury Department’s website) and accompanying “Overview of the Final Rule”
(Attachment 3) governing the use of ARPA funds, with an effective date of April 1, 2022.
The Final Rule contained significant clarifications, definitions, and streamlined processes
to receive and report on ARPA funds. It also provided final calculations and options to
take advantage of the more-flexible Revenue Replacement category. Additionally, by
finalizing the allowable uses of ARPA funds, the City no longer has to be concerned about
potentially expending ARPA funds on a project or program that was subsequently
deemed ineligible by the Treasury Department. The City is now able to identify what
portion of its ARPA funds can be taken as Revenue Replacement and with full knowledge
of what is eligible and ineligible spending under ARPA.
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DISCUSSION
General Rules and Prohibitions
ARPA funds must be spent or appropriated for use for the period between March 3, 2021,
and December 31, 2024. However, the funds do not have to be actually expended until
December 31, 2026. The additional two years to expend ARPA funds would typically be
used for large-scale construction projects that take multiple years to design, bid, and
complete. Use of ARPA funding toward the Princeton Avenue Improvement Project, for
example, would fall into this category. Although project completion is expected by 2024,
weather or other construction delays in the project could potentially extend the project
beyond December 31, 2024.
ARPA funds cannot be used toward contributions to a pension fund for the purpose of
reducing an accrued, unfunded liability. For CalPERS-member local governments like
the City, this means that the City cannot allocate ARPA funds toward mitigating the
impacts of the CalPERS decision to reduce its Discount Rate from 7.5% to 6.8% (the
assumed rate of return from its investments to help fund CalPERS pensions). After
assuming a lower rate of return, CalPERS in turn charges its member agencies higher
contributions to make up the difference. As a result, the City has accrued a less-than-
fully funded CalPERS liability; however this liability is currently funded at 95%. Even if
the City opts to receive ARPA funds in the Revenue Replacement category, the City
cannot use the funds toward offsetting these additional CalPERS payments stemming
from its Discount Rate decrease.
ARPA funds also cannot be used to pay debt service or to replenish rainy day funds.
Accordingly, the City cannot simply opt to receive ARPA funds and then deposit them into
the General Fund’s (1000) fund balance, the Endowment Fund (2018), or the Special
Projects Fund (3004). Instead, the City must identify specific government services and
actual projects where the ARPA funds will be used.
Revenue Replacement Calculation Methodology
The Interim Final Rule contained a proposed formula to estimate pandemic-related
revenue loss that generally took the most recent pre-pandemic full fiscal year, corrected
for any counterfactual one-time revenues/losses (such as a one-time sale of land, for
example), and expected revenue growth had the pandemic not occurred based on actual
data of the preceding three years.
While the Final Rule made numerous clarifications and adjustments to the definitions and
calculations of revenues and revenue loss, the most critical change was the addition of a
“Standard Allowance” of up to $10,000,000 whereby ARPA fund recipients can assume
a revenue loss of up to $10,000,000 without having to calculate revenue loss using the
Final Rule formulas and without having to meet reporting requirements to determine
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actual revenue loss in future fiscal years. The Standard Allowance is analogous to
standard deductions on income tax returns. Because the City is receiving less than the
$10,000,000 Standard Allowance Limit, the Final Rule enables the City to receive all of
its $8,701,674 ARPA funds in the most-flexible Revenue Replacement category.
As such, staff recommends that the City Council elect to receive its full ARPA allocation
as Revenue Replacement to maximize flexibility of its ARPA spending and to minimize
the administrative burden needed to report on actual revenue losses to the Treasury
Department over the next several years. The attached resolution incorporates this
recommendation.
It should be noted that the City’s election to receive ARPA funds utilizing the Standard
Allowance methodology or through the revenue loss formulas is an irrevocable decision
once made and reported to the Treasury Department by the City.
Appropriation of ARPA Funds
As part of the direction to staff at its July 28, 2021 meeting, the City Council considered
86 potential projects/programs for ARPA spending and narrowed the list to 40 items to be
further vetted for future funding consideration. The list is not exhaustive, and the City
Council retains the ability to add new projects (or reconsider previously-eliminated
projects) at this time. With the release of the Final Rule and the ability of the City to use
the entirety of its ARPA funds in the more flexible Revenue Replacement category,
additional projects and programs are also now newly eligible to receive ARPA funds.
Staff has identified several considerations that the City Council may wish to utilize as it
discusses how to select projects and programs to receive ARPA funding.
Projects/Programs with Dedicated Funding Sources: Some projects/programs
have dedicated funding sources associated with them. For example, the City’s
audio/video recording equipment for City Council meetings is outdated and in need
of replacement, but the City receives and sets aside funding from cable television
franchise fees that can only be used for this purpose into a dedicated fund (3006).
While projects and programs with dedicated funding sources can always be
enhanced with additional funding, staff recommends that the City Council use the
one-time ARPA funds for projects without dedicated funding sources.
Projects/Programs at Risk of Not Meeting ARPA-Specified Timeframes:
Regardless of whether ARPA funds are taken as Revenue Replacement or as
ARPA-eligible spending, ARPA funds must be appropriated by December 31, 2024
and expended by December 31, 2026. Projects that are expected to begin
construction beyond the immediate future carry additional risk of delays past those
deadlines, particularly for capital projects that are subject to environmental review
and challenge. Construction of the new Moorpark City Library (as distinct from its
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design costs), for example, is subject to environmental review and challenge.
While the City plans to be well underway with construction by the end of 2024 and
completed with construction well before the end of 2026, a legal challenge to the
project’s environmental document could potentially delay the project by years as
the challenge proceeded through the courts. If such a project is to be funded with
ARPA funds, a worst-case scenario may result in the City scrambling to reassign
ARPA funds in late 2024 or facing an uphill battle with the Treasury Department to
be allowed to reallocate its ARPA funds in 2025 or 2026, the deadline to
appropriate ARPA funds. There are also numerous potential projects/programs
with schedules beyond the allowable ARPA time horizons, such as North Hills
Parkway and the Millard Storm drain project, which should not be recipients of
ARPA funds.
Projects/Programs with a Large Administrative Burden: Because ARPA projects
are subject to federal reporting requirements that can create a significant
administrative burden on City staff, it is generally most efficient to avoid funding
smaller-dollar projects/programs that inherently require heavy documentation and
reporting efforts. For example, consistent with federal law, the City provided paid
time off to employees due to COVID-19 illness, COVID-19 vaccines and side
effects, and COVID-19 testing. Under the Final Rule, the City could reimburse
itself for these costs with ARPA funds, but there would be a significant amount of
staff effort to document and report these costs to the Treasury Department. To the
extent that there are other, larger projects with fewer individual transactions, the
City Council may wish to fund those with ARPA funds.
Review of Previously-Identified Projects/Programs
Applying the above criteria to the 40 items previously identified for continued
consideration by the City Council at its July 28, 2021 meeting yields the following results.
These projects are sorted in chronological order of discussion and do not reflect that the
City Council ranked any as a higher or lower priority. The five-character numbers
appearing in parentheses after some projects are project numbers as identified in the
City’s Capital Improvement Program.
Table 1: Previously Considered Projects/Programs
Project/Program Staff
Recommendation
1)Reimburse the City for all qualifying leaves related to getting vaccinated or
side effects of the vaccine.
Do Not Pursue
(Admin. Burden)
2)Reimburse the City for all qualifying leaves related to staff getting COVID-19
tests.
Do Not Pursue
(Admin. Burden)
3)Reimburse the City for added janitorial costs.Do Not Pursue
(Admin. Burden)
4)Enhance HVAC filtration systems.Do Not Pursue
(Admin. Burden)
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Project/Program Staff
Recommendation
5)Upgrade to touchless fixtures (such as automatic doors, sinks, etc.).Do Not Pursue
(Admin. Burden)
6)Install bottle filling stations at public parks and City facilities.Do Not Pursue
(Admin. Burden)
7)Improve parks to support healthy living, outdoor recreation, and socialization.Do Not Pursue
(Ded. Funding Src.)
8)Construct trails and trail improvements.Do Not Pursue
(Ded. Funding Src.)
9)Develop and implement a grant (or assistance to other) program(s) for third
party mental health services providers (consider getting feedback from
community on how to support this area).
Consider
10)Provide Ventura County Behavioral Health personnel in Moorpark to provide
mental health services.Consider
11)Install and maintain full capture devices for capture of trash in designated
catch basins.Consider
12)Incorporate pavement infiltration/stormwater improvements into Public
Service Facility Asphalt Repair and Slurry project (C0069).
Do Not Pursue
(Timeframe Risk)
13)Fund stormwater improvements associated with a trail to be built on the City’s
80-acre open space parcel at the southwest corner of Tierra Rejada Road and
Moorpark Road (C0062).
Do Not Pursue
(Timeframe Risk)
14)Fund stormwater improvements at other locations, such as Tierra Rejada
Park, Mountain Meadows Park, Peach Hill Park, and the SCE easement
northwest of its substation.
Do Not Pursue
(Timeframe Risk)
15)Fund Princeton Avenue/Campus Park Drive Landscape & Irrigation Project
(M0045).
Do Not Pursue
(Ded. Funding Src.)
16)Fund Los Angeles Avenue Landscape & Irrigation Renovation Project
(M0046).
Do Not Pursue
(Ded. Funding Src.)
17)Fund landscape and irrigation renovation projects on Los Angeles Avenue
(north side between Shasta Avenue and Gabbert Road), Spring Road (south
of Los Angeles Avenue), Miller Parkway, and Tierra Rejada Road (south side).
Do Not Pursue
(Timeframe Risk)
18)Fund a brine line to facilitate better use of groundwater resources.Do Not Pursue
(Timeframe Risk)
19)Construct a Meet-Me Room to facilitate broadband deployment in Moorpark.Consider
20)Fund co-location of City fiber-optic conduit when other entities install conduit
in Moorpark, along routes identified in the City’s Broadband Strategic Plan.
Do Not Pursue
(Timeframe Risk)
21)Fund broadband conduit within the Princeton Avenue Improvement Project
area.Consider
22)Fund broadband conduit to connect City facilities (Civic Center, Arroyo Vista
Recreation Center, Police Services Center).
Do Not Pursue
(Timeframe Risk)
23)Provide and enhance free Wi-Fi at City parks and facilities.Do Not Pursue
(Admin. Burden)
24)Develop and implement a grant program to include housing support.Do Not Pursue
(Admin. Burden)
25)Fund a residential eviction prevention program.Do Not Pursue
(Admin. Burden)
26)Create a commercial tenant rental assistance program.Do Not Pursue
(Admin. Burden)
27)Assist businesses that did not receive other assistance.Do Not Pursue
(Admin. Burden)
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Project/Program Staff
Recommendation
28)Subsidize permit fees for COVID-affected businesses, such as businesses
expanding outdoors.
Do Not Pursue
(Admin. Burden)
29)Fund a Moorpark Business Resource Center to provide counseling,
workshops, and trainings to local businesses in partnership with economic
development agencies; implement an entrepreneurship program, and create
a standalone website to attract visitors, new businesses, and shopping locally.
Do Not Pursue
(Admin. Burden)
30)Provide grants to the High Street Arts Center to replace lost revenue, or
reimburse the City for back rent.Consider
31)Provide assistance to local nonprofit childcare and early education providers
to increase programming within Moorpark.
Do Not Pursue
(Admin. Burden)
32)Fund improvements on High Street to enhance outdoor spaces and
activations, or form a High Street Business District (startup costs).
Do Not Pursue
(Admin. Burden)
33)Create scholarship program for City’s Little Learners Academy Preschool.Consider
34)Provide funding to the Moorpark Unified School District for academic services.Do Not Pursue
(Admin. Burden)
35)Create a scholarship program for activities/programs at the Moorpark City
Library and Moorpark Active Adult Center.Consider
36)Revenue replacement for the City for government services (to offset
pandemic-related revenue losses).Consider
37)Provide pandemic-related premium pay for private sector workers.Do Not Pursue
(Admin. Burden)
38)Fund administrative expenses related to receiving, spending, and reporting on
ARPA-related programs and projects.
Do Not Pursue
(Admin. Burden)
39)Fund administrative costs for ARPA-related data analysis.Do Not Pursue
(Admin. Burden)
40)Transfer money to other units of government.Do Not Pursue
(Admin. Burden)
Other Potential Projects/Programs
With the addition of the Standard Allowance option in the Revenue Replacement category
and the confirmation that the City can utilize its full ARPA award for any government
service, numerous other high-priority City projects are newly eligible for ARPA funding.
Staff has reviewed the City’s Annual Budget and Capital Improvement Program, City
Council Goals and Objectives, and current projects/programs to identify other potential
projects/programs that may now benefit from ARPA funding and could be completed
within the ARPA-specified timeframes.
Table 2: Other Potential Major Projects/Programs Not Previously Considered
Project/Program Staff
Recommendation
41)Fund the Princeton Avenue Improvement Project.Consider
42)Fund Temporary City Hall Project acquisition and renovation.Consider
If the City Council opts to take all of its ARPA allocation as Revenue Replacement through
the Standard Allowance option, the City could utilize the funds for any “government
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service,” as provided in the Treasury Department’s Final Rule. This gives the City Council
broad discretion on how to spend funds, and the City Council is not limited to the items
presented in this staff report.
Premium Pay for Private Sector Workers
At its July 28, 2021 meeting, the City Council had a lengthy discussion about potentially
appropriating some of its ARPA funds toward providing premium pay to private sector
grocery store workers. The Final Rule contained numerous clarifications for premium pay
programs, notably clarifying that premium pay could be awarded retrospectively, allowing
the City to award premium pay to workers who were working at the beginning of the
pandemic (prior to the March 3, 2021 starting date for ARPA-funded projects/programs
generally). However, implementing a premium pay program would create a major
administrative burden for the City. The Final Rule establishes the following steps to
pursue this option:
1)Identify “Eligible” Workers: Although the previous City Council discussion was
specific to grocery store workers, the Overview of the Final Rule document
identifies dozens of additional eligible essential worker occupations including those
within the health care industry, emergency responders, pharmacy workers,
restaurant workers, food delivery workers, child care providers, cleaning service
providers, social service providers, behavioral health workers, public sector
workers, educators and school service providers, laundromat workers, elections
workers, dental care workers, transportation industry workers, warehouse workers,
hotel workers, and many more. Although previous City Council discussion was
focused specifically on grocery store workers, the City Council could include or not
include other eligible workers in a potential Premium Pay program.
2)Verify the Eligible Worker Performs “Essential Work”: The City would have to verify
that each eligible worker performed work that involved regular, in-person
interactions with patients, the public, or co-workers, or performed work involving
the regular physical handling of items that were handled by patients, the public, or
co-workers. The City would also have to verify that the work was not performed
via teleworking.
3)Verify That the Premium Pay “Responds to” Workers Performing Essential Work:
The City would have to verify that each recipient falls within at least one of the
following three categories: (1) Eligible worker is earning at or below 150 percent of
their residing state or county’s average annual wage for all occupations, as defined
by the Bureau of Labor Statistics; (2) Eligible worker is not exempt from the Fair
Labor Standards Act overtime provisions; or (3) Eligible worker is justified by the
City, which must submit its justification to the Treasury Department detailing how
the premium pay is otherwise appropriate.
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In addition, recipients of ARPA funds must develop and maintain a conflict of interest
policy that prohibits elected officials from steering funds to projects in which they have a
financial interest or using funds to pay themselves premium pay.
Procedurally, the scope of implementing a premium pay program for private sector
workers would consist of:
1) Identify the business sectors to receive premium pay and specify types of eligible
employees (part-time/full-time, management/hourly, dates worked, etc.).
2) Reach out to businesses with eligible employees to obtain employee records to
determine eligibility.
3) Audit information to confirm employees’ eligibility, including any appeals, etc.
4) Make payments to eligible recipients.
5) Report on spending to the Treasury Department.
There would be a significant chance that employers would not wish to share employee
records – particularly for employees that no longer work at the business – and there would
be a potential for fraud that would necessitate a robust auditing process in determining
eligibility. Depending on the breadth of business sectors included in the program and the
ultimate number of eligible employees, the staff time anticipated to successfully
implement such a program would likely be in the high hundreds or low thousands of hours
of staff time. Contracting out administration of a premium pay program would be an
option, but would also likely cost in the high tens or low hundreds of thousands of dollars.
The City may also have trouble finding a qualified vendor to administer the program; the
City of Oxnard issued a Request for Proposals for such a program administrator for its
program and received only one response. The proposal was not fully responsive,
however, and was excluded. As a result, the City’s staff was left to administer the
program.
For these reasons, staff recommends that the City Council not pursue a premium pay
program for private grocery store workers with its ARPA funds.
Recommendations and Direction for ARPA-Funded Projects/Programs
Of the projects and programs discussed in the staff report, only the Princeton Avenue
Improvement Project is extremely time-sensitive. The project is shovel-ready, and the
funds will be expended within the ARPA expenditure timeframes. As such, staff
recommends that the City Council immediately set aside $5,688,798 for the Princeton
Avenue Improvement Project so that contracts for construction and for construction
administration may be awarded via a separate agenda item at tonight’s City Council
meeting, and so that a contract for construction management and inspection services can
be awarded at the March 2, 2022, City Council meeting.
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Doing so would leave a remaining balance of ARPA funds of $3,012,876, and staff
recommends that the City Council set aside the remainder for two purposes.
First, staff recommends setting aside $1,000,000 in ARPA funds for projects previously
identified and discussed at the July 28, 2021, City Council meeting, or for other
government services as determined by the City Council. Additional discussion on
spending for these purposes is provided in Table 3, below.
Second, after funding is set aside for the Princeton Avenue Improvement Project and
government services as determined, staff recommends allocating the remainder
($2,012,876) toward the purchase of the Temporary City Hall building at 323 Science
Drive. Because purchase of the property was a single large transaction, ARPA reporting
requirements would also be greatly simplified by allocating funds for this purpose.
Table 3: ARPA-Funded Projects/Programs Recommended for Consideration
Project/Program Staff Recommendation
1)Fund the Princeton Avenue Improvement Project.$5,688,798
[Immediately]
2)Fund Temporary City Hall Project acquisition and renovation.$2,012,876
3)Develop and implement a grant (or assistance to other) program(s) for
third party mental health services providers (consider getting feedback
from community on how to support this area).
$1,000,000
4)Provide Ventura County Behavioral Health personnel in Moorpark to
provide mental health services.
5)Install and maintain full capture devices for capture of trash in
designated catch basins.
6)Construct a Meet-Me Room to facilitate broadband deployment in
Moorpark.
7)Provide grants to the High Street Arts Center to replace lost revenue,
or reimburse the City for back rent.
8)Create scholarship program for City’s Little Learners Academy
Preschool.
9)Create a scholarship program for activities/programs at the Moorpark
City Library and Moorpark Active Adult Center.
10)Fund any other government service, as identified by the City Council.
TOTAL $8,701,674
In order for the City’s ARPA funds to be allocated to the Princeton Avenue Improvement
Project, the Temporary City Hall, or government services not specified in the Final Rule’s
ARPA categories, the City Council must elect to claim the City’s ARPA funds as Revenue
Replacement, as recommended.
FISCAL IMPACT
The attached Budget Amendment Resolution documents the City’s receipt of $8,701,674
in ARPA funds. Although staff recommends that the City Council reserve some ARPA
67
Honorable City Council
02/16/2022 Regular Meeting
Page 13
funds for various projects, appropriation of any ARPA funds must be approved via
resolutions to be adopted by the City Council separate from this agenda item.
COUNCIL GOAL COMPLIANCE
As recommended, this action would be consistent with the following City Council Goals:
•Goal 3, Objective 9 (3.9): Identify revenue enhancement strategies.
•Goal 3, Objective 12 (3.12): Identify and transition to temporary City Hall location.
STAFF RECOMMENDATION (ROLL CALL VOTE REQUIRED)
1.Adopt Resolution No. 2022-___ amending the Fiscal Year 2021/22 Budget to
receive the City’s allocation of ARPA funds in the amount of $8,701,674 utilizing
the Standard Allowance methodology outlined by the U.S. Department of the
Treasury; and
2.Set aside $5,688,798 of the City’s ARPA funds for the Princeton Avenue
Improvement Project; and
3.Provide direction to staff regarding allocation of the City’s remaining ARPA funds
toward the Princeton Avenue Improvement Project, Temporary City Hall Project,
and other eligible government services.
Attachment 1: Draft Resolution No. 2022-___
Attachment 2: Community Survey Results
Attachment 3: Overview of the Final Rule (U.S. Treasury Department)
68
RESOLUTION NO. 2022-____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MOORPARK, CALIFORNIA, AMENDING THE FISCAL
YEAR 2021/22 BUDGET TO RECEIVE $8,701,674 IN
AMERICAN RESCUE PLAN ACT (ARPA) FUNDS
WHEREAS, in March 2021, the United States federal government passed the
American Rescue Plan Act of 2021 (ARPA), which established the Coronavirus State
and Local Fiscal Recovery Funds to provide state, local, and Tribal governments with
the resources needed to respond to the pandemic and its economic effects to build a
stronger, more equitable economy during the recovery; and
WHEREAS, on January 6, 2022, the U.S. Department of the Treasury published
a “Final Rule” implementing the Coronavirus Local Fiscal Recovery Fund established
under ARPA; and
WHEREAS, the Final Rule allows ARPA fund recipients to accept up to
$10,000,000 in ARPA funds as Revenue Replacement, utilizing the Standard Allowance
procedure in lieu of calculating revenue loss, as specified in the Final Rule; and
WHEREAS, the City of Moorpark is allocated $8,701,674 in funding from the
Coronavirus Local Fiscal Recovery Fund and is therefore eligible to receive its entire
ARPA allocation statutorily as Revenue Replacement; and
WHEREAS, the City Treasurer has created the American Rescue Plan Act
(ARPA-CLFR) Fund (2800) to account for the City’s use of ARPA funds; and
WHEREAS, on June 16, 2021, the City Council adopted the Operating and
Capital Improvement Budget for Fiscal Year (FY) 2021/22 without accounting for receipt
of ARPA funds; and
WHEREAS, Exhibit “A” hereof describes a budget amendment and its resultant
impact to the budget line items needed to deposit $8,701,674 of ARPA funds into the
American Rescue Plan Act (ARPA-CLFR) Fund (2800).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK
DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. The City Council elects to receive its ARPA allocation as Revenue
Replacement, utilizing the Standard Allowance procedures described in the Final Rule.
SECTION 2. The budget amendment to receive $8,701,674 in American Rescue
Plan Act (ARPA) funds, as more particularly described in Exhibit A, attached hereto, is
hereby approved.
ATTACHMENT 1
69
Resolution No. 2022-____
Page 2
SECTION 3. The City Clerk shall certify to the adoption of this resolution and
shall cause a certified resolution to be filed in the book of original resolutions.
PASSED AND ADOPTED this 16th day of February 2022.
________________________________
Janice S. Parvin, Mayor
ATTEST:
___________________________________
Ky Spangler, City Clerk
Attachment: Exhibit A – Budget Amendment
70
REVENUE BUDGET ALLOCATION:
Fund-Account Number Amount
2800-000-G0027-46530 8,701,674.00$
Total 8,701,674.00$
EXPENDITURES BUDGET ALLOCATION:
Account Number Current Budget Revision Amended Budget
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
-$
Total -$ -$ -$
Fund Title
AMERICAN RESCUE PLAN ACT (ARPA-CLFR)
EXHIBIT A
BUDGET AMENDMENT FOR
AMERICAN RESCUE PLAN ACT (ARPA-CLFR) FUND
RECEIPT OF AMERICAN RESCUE PLAN ACT FUNDS
FY 2021/22
71
Moorpark Community Survey: ARPA Priorities
1 / 1
Q3 The American Rescue Plan Act (ARPA) identifies seven categories
eligible for use of funding. Please rank the following in order from 1 (most
important) to 7 (least important).
Answered: 162 Skipped: 3
26.71%
43
31.06%
50
18.01%
29
11.18%
18
8.70%
14
3.11%
5
1.24%
2 161 5.42
14.37%
23
25.62%
41
29.38%
47
20.00%
32
6.88%
11
3.13%
5
0.63%
1 160 5.09
16.77%
27
19.88%
32
17.39%
28
19.25%
31
13.66%
22
6.83%
11
6.21%
10 161 4.61
3.13%
5
3.75%
6
8.75%
14
18.75%
30
21.25%
34
29.38%
47
15.00%
24 160 3.01
36.65%
59
15.53%
25
13.04%
21
16.77%
27
11.18%
18
4.97%
8
1.86%
3 161 5.27
1.88%
3
3.75%
6
12.50%
20
10.63%
17
34.38%
55
26.25%
42
10.63%
17 160 3.07
1.26%
2
0.63%
1
1.26%
2
2.52%
4
3.77%
6
25.79%
41
64.78%
103 159 1.57
Public Health
Addressing
Negative...
Services to
Disproportio...
Premium Pay
for Public a...
Infrastructure
Revenue
Replacement ...
Administrative
Costs
0 1 2 3 4 5 6 7 8 9 10
1 2 3 4 5 6 7 TOTAL SCORE
Public Health
Addressing Negative Economic
Impacts
Services to Disproportionately
Impacted Communities
Premium Pay for Public and Private
Workers
Infrastructure
Revenue Replacement for
Government Services
Administrative Costs
ATTACHMENT 2
11
72
Moorpark Community Survey: ARPA Priorities
1 / 1
Q4 The U.S. Treasury Department allows ARPA funds to be used for the
following Public Health purposes. In your opinion, how important is it to use
ARPA funds to be used for the following?
Answered: 164 Skipped: 1
10.98%
18
11.59%
19
18.90%
31
25.61%
42
32.93%
54 164 3.58
9.88%
16
19.14%
31
27.16%
44
23.46%
38
20.37%
33 162 3.25
27.44%
45
17.68%
29
20.12%
33
15.85%
26
18.90%
31 164 2.81
5.49%
9
12.20%
20
19.51%
32
31.10%
51
31.71%
52 164 3.71
6.75%
11
18.40%
30
30.06%
49
22.09%
36
22.70%
37 163 3.36
4.91%
8
15.34%
25
31.90%
52
30.06%
49
17.79%
29 163 3.40
9.82%
16
23.31%
38
33.13%
54
22.09%
36
11.66%
19 163 3.02
14.72%
24
28.22%
46
31.90%
52
17.18%
28
7.98%
13 163 2.75
7.36%
12
21.47%
35
33.74%
55
22.09%
36
15.34%
25 163 3.17
2.47%
4
6.79%
11
12.96%
21
32.72%
53
45.06%
73 162 4.11
6.75%
11
9.20%
15
22.70%
37
31.29%
51
30.06%
49 163 3.69
9.88%
16
17.90%
29
36.42%
59
20.99%
34
14.81%
24 162 3.13
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
COVID-19 Vaccination
COVID-19 Testing
COVID-19 Contact
Tracing
Prevention in
Congregate Settings
(Nursing Homes,
Prisons/Jails, Dense
Work Sites, Schools,
etc.)
Personal Protective
Equipment
Medical Expenses
(including Alternative
Care Facilities)
Capital Investments or
Physical Plant Changes
to Public Facilities that
respond to the COVID-
19 public health
emergency
Other COVID-19 Public
Health Expenses
(including
Communications,
Enforcement,
Isolation/Quarantine)
Payroll Costs for Public
Health, Safety, and
Other Public Sector
Staff Responding to
COVID-19
Mental Health Services
Substance Use
Services
Other Public Health
Services
12
73
Moorpark Community Survey: ARPA Priorities
1 / 1
Q5 The U.S. Treasury Department allows ARPA funds to be used
for Addressing Negative Economic Impacts. In your opinion, how important
is it to use ARPA funds to be used for the following?
Answered: 164 Skipped: 1
6.13%
10
12.88%
21
19.02%
31
33.74%
55
28.22%
46 163 3.65
9.20%
15
18.40%
30
26.38%
43
23.93%
39
22.09%
36 163 3.31
24.54%
40
25.15%
41
28.83%
47
9.20%
15
12.27%
20 163 2.60
12.27%
20
14.11%
23
25.77%
42
26.99%
44
20.86%
34 163 3.30
15.95%
26
19.02%
31
23.31%
38
23.31%
38
18.40%
30 163 3.09
20.99%
34
22.84%
37
24.69%
40
14.81%
24
16.67%
27 162 2.83
5.52%
9
20.25%
33
25.77%
42
26.38%
43
22.09%
36 163 3.39
25.31%
41
25.93%
42
28.40%
46
10.49%
17
9.88%
16 162 2.54
3.68%
6
9.20%
15
25.77%
42
37.42%
61
23.93%
39 163 3.69
10.56%
17
14.91%
24
34.78%
56
22.98%
37
16.77%
27 161 3.20
22.84%
37
33.95%
55
27.16%
44
8.02%
13
8.02%
13 162 2.44
9.26%
15
30.25%
49
42.59%
69
11.73%
19
6.17%
10 162 2.75
18.87%
30
28.93%
46
37.74%
60
8.81%
14
5.66%
9 159 2.53
12.96%
21
21.60%
35
32.10%
52
23.46%
38
9.88%
16 162 2.96
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
Household Assistance:
Food Programs
Household Assistance:
Rent, Mortgage, and
Utility Aid
Household Assistance:
Cash Transfers
Household Assistance:
Internet Access
Programs
Household Assistance:
Eviction Prevention
Unemployment Benefits
or Cash Assistance to
Unemployed Workers
Job Training Assistance
(e.g., Sectoral Job-
Training, Subsidized
Employment,
Employment Supports
or Incentives)
Contributions to
Unemployment
Insurance Trust Funds
Small Business
Economic Assistance
(General)
Aid to Nonprofit
Organizations
Aid to Tourism, Travel,
or Hospitality
Aid to Other Impacted
Industries
Other Economic
Support
Rehiring Public Sector
Staff
13
74
Moorpark Community Survey: ARPA Priorities
1 / 2
Q6 The U.S. Treasury Department allows ARPA funds to be used for the
following Services to Disproportionately Impacted Communities. In your
opinion, how important is it to use ARPA funds to be used for the
following?
Answered: 163 Skipped: 2
14
75
Moorpark Community Survey: ARPA Priorities
2 / 2
9.32%
15
13.04%
21
16.77%
27
31.06%
50
29.81%
48 161 3.59
8.07%
13
8.70%
14
22.98%
37
31.68%
51
28.57%
46 161 3.64
5.59%
9
11.18%
18
22.36%
36
31.06%
50
29.81%
48 161 3.68
5.63%
9
8.75%
14
13.75%
22
22.50%
36
49.38%
79 160 4.01
14.47%
23
13.21%
21
33.33%
53
18.87%
30
20.13%
32 159 3.17
8.70%
14
9.94%
16
20.50%
33
31.06%
50
29.81%
48 161 3.63
10.63%
17
16.88%
27
29.38%
47
21.88%
35
21.25%
34 160 3.26
4.94%
8
9.26%
15
19.14%
31
30.86%
50
35.80%
58 162 3.83
13.84%
22
15.72%
25
32.08%
51
18.87%
30
19.50%
31 159 3.14
11.73%
19
18.52%
30
22.84%
37
24.69%
40
22.22%
36 162 3.27
11.11%
18
17.28%
28
21.60%
35
24.69%
40
25.31%
41 162 3.36
13.84%
22
24.53%
39
28.30%
45
19.50%
31
13.84%
22 159 2.95
15.92%
25
24.84%
39
29.30%
46
19.75%
31
10.19%
16 157 2.83
8.23%
13
28.48%
45
32.91%
52
21.52%
34
8.86%
14 158 2.94
17.83%
28
27.39%
43
31.85%
50
12.10%
19
10.83%
17 157 2.71
6.29%
10
15.09%
24
29.56%
47
32.70%
52
16.35%
26 159 3.38
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
Education Assistance:
Early Learning
Education Assistance:
Aid to High-Poverty
Districts
Education Assistance:
Academic Services
Education Assistance:
Social, Emotional, and
Mental Health Services
Education Assistance:
Other
Healthy Childhood
Environments: Child
Care
Healthy Childhood
Environments: Home
Visiting
Healthy Childhood
Environments: Services
to Foster Youth or
Families Involved in
Child Welfare System
Healthy Childhood
Environments: Other
Housing Support:
Affordable Housing
Housing Support:
Services for Unhoused
Persons
Housing Support: Other
Housing Assistance
Social Determinants of
Health: Other
Social Determinants of
Health: Community
Health Workers or
Benefits Navigators
Social Determinants of
Health: Lead
Remediation
Social Determinants of
Health: Community
Violence Interventions
15
76
Moorpark Community Survey: ARPA Priorities
1 / 1
Q7 The U.S. Treasury Department allows ARPA funds to be used for
Premium Pay. In your opinion, how important is it to use ARPA funds to be
used for the following?
Answered: 159 Skipped: 6
28.21%
44
23.08%
36
23.72%
37
16.67%
26
8.33%
13 156 2.54
28.93%
46
22.01%
35
32.08%
51
10.69%
17
6.29%
10 159 2.43
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
Public Sector
Employees
Private Sector:
Grants to Other
Employers
16
77
Moorpark Community Survey: ARPA Priorities
1 / 2
Q8 The U.S. Treasury Department allows ARPA funds to be used for
Infrastructure. In your opinion, how important is it to use ARPA funds to be
used for the following?
Answered: 162 Skipped: 3
17
78
Moorpark Community Survey: ARPA Priorities
2 / 2
3.77%
6
10.06%
16
24.53%
39
24.53%
39
37.11%
59 159 3.81
3.80%
6
9.49%
15
25.32%
40
25.95%
41
35.44%
56 158 3.80
6.54%
10
13.07%
20
28.10%
43
22.22%
34
30.07%
46 153 3.56
6.45%
10
14.84%
23
29.68%
46
21.94%
34
27.10%
42 155 3.48
5.13%
8
15.38%
24
26.28%
41
24.36%
38
28.85%
45 156 3.56
5.16%
8
10.97%
17
27.74%
43
28.39%
44
27.74%
43 155 3.63
3.80%
6
8.86%
14
24.68%
39
26.58%
42
36.08%
57 158 3.82
2.53%
4
6.96%
11
18.99%
30
24.68%
39
46.84%
74 158 4.06
11.84%
18
15.13%
23
34.87%
53
21.05%
32
17.11%
26 152 3.16
1.88%
3
6.25%
10
18.75%
30
25.62%
41
47.50%
76 160 4.11
2.53%
4
6.96%
11
20.89%
33
29.11%
46
40.51%
64 158 3.98
3.85%
6
9.62%
15
22.44%
35
27.56%
43
36.54%
57 156 3.83
3.16%
5
8.23%
13
20.89%
33
29.75%
47
37.97%
60 158 3.91
1.27%
2
7.01%
11
22.93%
36
29.94%
47
38.85%
61 157 3.98
6.41%
10
8.97%
14
30.13%
47
22.44%
35
32.05%
50 156 3.65
7.69%
12
14.74%
23
32.69%
51
21.15%
33
23.72%
37 156 3.38
12.34%
19
18.83%
29
33.12%
51
16.23%
25
19.48%
30 154 3.12
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
Clean Water:
Centralized Wastewater
Treatment
Clean Water:
Centralized Wastewater
Collection and
Conveyance
Clean Water:
Decentralized
Wastewater
Clean Water: Combined
Sewer Overflows
Clean Water: Other
Sewer Infrastructure
Clean Water:
Stormwater
Clean Water: Energy
Conservation
Clean Water: Water
Conservation
Clean Water: Nonpoint
Source
Drinking Water:
Treatment
Drinking Water:
Transmission &
Distribution
Drinking Water:
Transmission &
Distribution: Lead
Remediation
Drinking Water: Source
Drinking Water: Storage
Drinking Water: Other
Water Infrastructure
Broadband: "Last Mile"
Projects
Broadband: Other
Projects
18
79
Moorpark Community Survey: ARPA Priorities
1 / 1
Q9 The U.S. Treasury Department allows ARPA funds to be used for
Revenue Replacement. In your opinion, how important is it to use ARPA
funds to be used for the following?
Answered: 154 Skipped: 11
17.53%
27
27.92%
43
31.82%
49
13.64%
21
9.09%
14 154 2.69
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
Provision of
Government
Services
19
80
Moorpark Community Survey: ARPA Priorities
1 / 1
Q10 The U.S. Treasury Department allows ARPA funds to be used for
Administrative purposes. In your opinion, how important is it to use ARPA
funds to be used for the following?
Answered: 159 Skipped: 6
31.45%
50
37.74%
60
25.16%
40
3.77%
6
1.89%
3 159 2.07
22.58%
35
38.06%
59
20.65%
32
16.13%
25
2.58%
4 155 2.38
40.00%
62
34.19%
53
21.29%
33
3.23%
5
1.29%
2 155 1.92
NOT
IMPORTANT
AT ALL
SLIGHTLY
IMPORTANT
MODERATELY
IMPORTANT
VERY
IMPORTANT
EXTREMELY
IMPORTANT
TOTAL WEIGHTED
AVERAGE
Administrative
Expenses
Evaluation of Data
Analysis
Transfers to Other
Units of
Government
20
81
Moorpark Community Survey: ARPA Priorities
1 / 3
Q11 What else would you like the City of Moorpark to spend ARPA funds
on?
Answered: 51 Skipped: 114
#RESPONSES DATE
1 Don't spend the money, return it. We don't need the federal government fascists in our city or
giving money to our city. If I had the $8M I would give it directly to prevent these fascists from
getting a foothold in our city. RETURN IT or pay the consequences.
7/18/2021 10:07 PM
2 -Education -Low income families -High school sports -Community Pools downtown Moorpark
(near police department ) -High-school transportation bus -Grants for individuals that want to
start their own business ! -better customer service, representatives from Moorpark city hall . -
Free children activities
7/17/2021 2:40 AM
3 public pool. land conservation and recreation 7/16/2021 8:25 PM
4 Build a pool for the mental and physical health of our residents!7/16/2021 5:51 PM
5 Higher pay and health benefits for paraeducators that work closely with children with special
needs.
7/16/2021 2:08 PM
6 The Princeton project and code enforcement 7/16/2021 11:44 AM
7 Helping businesses come to and thrive in moorpark. Keep drugged out homeless population
out of our city by diligence.
7/16/2021 11:25 AM
8 Building a community pool for both the community and the high school.7/16/2021 10:39 AM
9 Invest it in our children. Accessible internet access to all including equipment. COVID safe
activities -outdoor places or a community pool. Our kids only have one skate park maybe other
outdoor areas to enjoy.
7/16/2021 10:15 AM
10 Please ensure that Moorpark becomes more self-sufficient energy wise with these funds, as
much as possible. And more efficient at saving, treating and distributing water. Thank you
7/16/2021 9:57 AM
11 The Moorpark pool! For school sports and rec. desalination of water and grey water treatment
for parks and landscaping and farms! Use the water runoff and collect the runoff. Also solar
panels on every appropriate roof of commercial buildings to run power for the city and residents
to have back up. Before the city moves out of the bungalows they need to have every open
commercial space filled. If it’s not filled then move in. Review the business practices, stop the
la investors from buying and raising rent on our commercial business spaces and leaving them
empty. Invert a fee paid to the city that open spaces will be assessed a monthly fee. Money
will go to improving incoming business opportunities. Small business incentives. Social media
exposure and advertisement.
7/16/2021 9:46 AM
12 A climate action and resiliency plan 7/16/2021 9:41 AM
13 Businesses so that we have companies stay here and don't have to travel our of city to do
things.
7/15/2021 9:49 PM
14 Education related that benefits all students not just low income.7/15/2021 3:28 PM
15 This and any city with half a brain should NOT BE TAKING this Money. It allow FEDERAL
Govt. to interfere in what should be local decisions. it' EVIL
7/15/2021 11:58 AM
16 School 7/15/2021 10:48 AM
17 Local businesses and updating high street and more community functions. Roads need to be
fixed
7/15/2021 8:15 AM
18 Fixing water and helping those in need.7/15/2021 8:13 AM
19 Reduce the number of permits and fees for small businesses. The amount of time, energy and 7/15/2021 7:34 AM
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Moorpark Community Survey: ARPA Priorities
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money spent to have a new business in moorpark is limiting and offputting.
20 Creating an alternate route for around the city. For trucks.7/15/2021 6:39 AM
21 More permanent pickleball courts to help improve mental and physical health of the
community.
7/14/2021 10:44 PM
22 Mental health and youth programs.7/14/2021 10:22 PM
23 A city splash pad.7/14/2021 9:05 PM
24 A sidewalk on LA Ave and Spring, by the abandoned house. My children walk to school there! 7/14/2021 8:45 PM
25 Parks, schools, public safety, mental health services 7/14/2021 8:38 PM
26 Spend the money on keeping the homeless housed.7/14/2021 8:34 PM
27 the lump sum payment should be used for infrastructure and the jobs that go with it. Money
should not be spent to further incentivize unemployment
7/14/2021 7:56 PM
28 A community pool 7/14/2021 7:48 PM
29 Public parks, trails, LA Avenue traffic 7/14/2021 7:23 PM
30 Education 7/14/2021 7:04 PM
31 Directly on residents who were impacted by the shutdown. Eviction protection and rental
assistance. Thank you.
7/14/2021 5:20 PM
32 Economic development grants for new businesses wanting to start in Moorpark. Senior
services, improve the senior nutrition program. Community Pool for aquatic sports, lessons,
health of the community.
7/14/2021 3:10 PM
33 1) Solar energy infrastructure for all government buildings and parks facilities. 2) Fund and
support native plant rehabilitation projects. 3) Arroyo Simi trail improvements, to include
connection to Simi Valley.
7/12/2021 9:19 PM
34 Economic, health, water and electric grid, so we don’t have to go through flex alerts, brown
outs or losing power for days! Unacceptable!!!
7/12/2021 6:53 PM
35 More police.7/12/2021 12:38 PM
36 Tutoring programs open to all students to make up for work missed during COVID, and income
replacement to restaurants and other businesses closed during pandemic
7/11/2021 2:56 PM
37 Opening and reopening businesses. Would like to eat here, shop here and have fun here
instead of going someplace else. Moorpark has turned into somewhat of a ghost town. Stop
assisting people with handouts when there are plenty of jobs available.
7/11/2021 1:15 PM
38 Reducing truck traffic on LA Avenue.7/10/2021 11:01 PM
39 If allowed, AFFORDABLE HOUSING for current Moorpark residents.7/7/2021 10:33 AM
40 Fix dangerous lifted sidewalk concrete from tree roots in mountain Meadows neighborhood. 7/3/2021 10:27 PM
41 A safe teen center. Entry level employment for young people to get into the work force. Not
everyone is destined to be college grads.
7/3/2021 7:23 AM
42 More for infrastructure 7/1/2021 6:28 PM
43 Mental Health, help families heal and grow in love. Help end the cycle of abuse.6/30/2021 8:07 PM
44 Affordable housing!6/30/2021 1:17 PM
45 Funds should only be used to bring businesses and individuals directly affected back to pre-
covid status. This should not be used for social engineering or supplementing funds that were
mismanaged by irresponsible state governments.
6/30/2021 11:46 AM
46 Education. The students are going to be suffering and deserve an at home option if they can’t
be vaccinated
6/29/2021 10:47 PM
47 Schools and teachers. Make sure our children and teachers are safe in the expected return to
school.
6/29/2021 7:52 PM
22
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48 Mental health services, job training programs and scholarships to moorpark College for those
struggling to find work (retrain to jobs available). Additional resources for schools such as
library support, art resources, field trips and enrichment. The schools need help and to stop
relying on fundraisers for basic expenses like PE and art.
6/29/2021 7:32 PM
49 Emergency supply storage and emergency supply for residents in multiple locations. Such as
water, food, necessary medical equipment. Think what is next emergency would be. Fire?
Flood? Pandemic? What we need to sustain without panic. Make fast WiFi available entire
Moorpark.
6/29/2021 9:53 AM
50 Timed stop lights 6/29/2021 9:47 AM
51 Road, sidewalk highway improvement. Land development and housing.6/29/2021 8:37 AM
23
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Coronavirus State & Local
Fiscal Recovery Funds:
Overview of the Final Rule
U.S. DEPARTMENT OF THE TREASURY
January 2022
ATTACHMENT 3
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U.S. DEPARTMENT OF THE TREASURY
Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
The Overview of the Final Rule provides a summary of major provisions of the final
rule for informational purposes and is intended as a brief, simplified user guide to the
final rule provisions.
The descriptions provided in this document summarize key provisions of the final rule
but are non-exhaustive, do not describe all terms and conditions associated with the use
of SLFRF, and do not describe all requirements that may apply to this funding. Any SLFRF
funds received are also subject to the terms and conditions of the agreement entered
into by Treasury and the respective jurisdiction, which incorporate the provisions of the
final rule and the guidance that implements this program.
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Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
Contents
Introduction .................................................................................................................................................. 4
Overview of the Program .............................................................................................................................. 6
Replacing Lost Public Sector Revenue .......................................................................................................... 9
Responding to Public Health and Economic Impacts of COVID-19 ............................................................. 12
Responding to the Public Health Emergency .......................................................................................... 14
Responding to Negative Economic Impacts ............................................................................................ 16
Assistance to Households ................................................................................................................... 17
Assistance to Small Businesses ........................................................................................................... 21
Assistance to Nonprofits ..................................................................................................................... 23
Aid to Impacted Industries .................................................................................................................. 24
Public Sector Capacity ............................................................................................................................. 26
Public Safety, Public Health, and Human Services Staff ..................................................................... 26
Government Employment and Rehiring Public Sector Staff ............................................................... 27
Effective Service Delivery .................................................................................................................... 28
Capital Expenditures ............................................................................................................................... 30
Framework for Eligible Uses Beyond those Enumerated ....................................................................... 32
Premium Pay ............................................................................................................................................... 35
Water & Sewer Infrastructure .................................................................................................................... 37
Broadband Infrastructure ........................................................................................................................... 39
Restrictions on Use ..................................................................................................................................... 41
Program Administration ............................................................................................................................. 43
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U.S. DEPARTMENT OF THE TREASURY
Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
Introduction
The Coronavirus State and Local Fiscal Recovery Funds (SLFRF), a part of the American Rescue Plan,
delivers $350 billion to state, local, and Tribal governments across the country to support their response
to and recovery from the COVID-19 public health emergency. The program ensures that governments
have the resources needed to:
• Fight the pandemic and support families and businesses struggling with its public health and
economic impacts,
• Maintain vital public services, even amid declines in revenue, and
• Build a strong, resilient, and equitable recovery by making investments that support long-term
growth and opportunity.
EARLY PROGRAM IMPLEMENTATION
In May 2021, Treasury published the Interim final rule (IFR) describing eligible and ineligible uses of
funds (as well as other program provisions), sought feedback from the public on these program rules,
and began to distribute funds. The IFR went immediately into effect in May, and since then,
governments have used SLFRF funds to meet their immediate pandemic response needs and begin
building a strong and equitable recovery, such as through providing vaccine incentives, development of
affordable housing, and construction of infrastructure to deliver safe and reliable water.
As governments began to deploy this funding in their communities, Treasury carefully considered the
feedback provided through its public comment process and other forums. Treasury received over 1,500
comments, participated in hundreds of meetings, and received correspondence from a wide range of
governments and other stakeholders.
KEY CHANGES AND CLARIFICATIONS IN THE FINAL RULE
The final rule delivers broader flexibility and greater simplicity in the program, responsive to feedback in
the comment process. Among other clarifications and changes, the final rule provides the features
below.
Replacing Lost Public Sector Revenue
The final rule offers a standard allowance for revenue loss of up to $10 million, allowing recipients to
select between a standard amount of revenue loss or complete a full revenue loss calculation.
Recipients that select the standard allowance may use that amount – in many cases their full award – for
government services, with streamlined reporting requirements.
Public Health and Economic Impacts
In addition to programs and services, the final rule clarifies that recipients can use funds for capital
expenditures that support an eligible COVID-19 public health or economic response. For example,
recipients may build certain affordable housing, childcare facilities, schools, hospitals, and other projects
consistent with final rule requirements.
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U.S. Department of the Treasury
In addition, the final rule provides an expanded set of households and communities that are presumed
to be “impacted” and “disproportionately impacted” by the pandemic, thereby allowing recipients to
provide responses to a broad set of households and entities without requiring additional analysis.
Further, the final rule provides a broader set of uses available for these communities as part of COVID-
19 public health and economic response, including making affordable housing, childcare, early learning,
and services to address learning loss during the pandemic eligible in all impacted communities and
making certain community development and neighborhood revitalization activities eligible for
disproportionately impacted communities.
Further, the final rule allows for a broader set of uses to restore and support government employment,
including hiring above a recipient’s pre-pandemic baseline, providing funds to employees that
experienced pay cuts or furloughs, avoiding layoffs, and providing retention incentives.
Premium Pay
The final rule delivers more streamlined options to provide premium pay, by broadening the share of
eligible workers who can receive premium pay without a written justification while maintaining a focus
on lower-income and frontline workers performing essential work.
Water, Sewer & Broadband Infrastructure
The final rule significantly broadens eligible broadband infrastructure investments to address challenges
with broadband access, affordability, and reliability, and adds additional eligible water and sewer
infrastructure investments, including a broader range of lead remediation and stormwater management
projects.
FINAL RULE EFFECTIVE DATE
The final rule takes effect on April 1, 2022. Until that time, the interim final rule remains in effect; funds
used consistently with the IFR while it is in effect are in compliance with the SLFRF program.
However, recipients can choose to take advantage of the final rule’s flexibilities and simplifications now,
even ahead of the effective date. Treasury will not take action to enforce the interim final rule to the
extent that a use of funds is consistent with the terms of the final rule, regardless of when the SLFRF
funds were used. Recipients may consult the Statement Regarding Compliance with the Coronavirus
State and Local Fiscal Recovery Funds Interim Final Rule and Final Rule, which can be found on Treasury’s
website, for more information on compliance with the interim final rule and the final rule.
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Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
Overview of the Program
The Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program provides substantial flexibility
for each jurisdiction to meet local needs within the four separate eligible use categories. This Overview
of the Final Rule addresses the four eligible use categories ordered from the broadest and most flexible
to the most specific.
Recipients may use SLFRF funds to:
• Replace lost public sector revenue, using this funding to provide government services up to the
amount of revenue loss due to the pandemic.
• Recipients may determine their revenue loss by choosing between two options:
• A standard allowance of up to $10 million in aggregate, not to exceed their
award amount, during the program;
• Calculating their jurisdiction’s specific revenue loss each year using Treasury’s
formula, which compares actual revenue to a counterfactual trend.
• Recipients may use funds up to the amount of revenue loss for government services;
generally, services traditionally provided by recipient governments are government
services, unless Treasury has stated otherwise.
• Support the COVID-19 public health and economic response by addressing COVID-19 and its
impact on public health as well as addressing economic harms to households, small businesses,
nonprofits, impacted industries, and the public sector.
• Recipients can use funds for programs, services, or capital expenditures that respond to
the public health and negative economic impacts of the pandemic.
• To provide simple and clear eligible uses of funds, Treasury provides a list of
enumerated uses that recipients can provide to households, populations, or classes (i.e.,
groups) that experienced pandemic impacts.
• Public health eligible uses include COVID-19 mitigation and prevention, medical
expenses, behavioral healthcare, and preventing and responding to violence.
• Eligible uses to respond to negative economic impacts are organized by the type of
beneficiary: assistance to households, small businesses, and nonprofits.
• Each category includes assistance for “impacted” and “disproportionately
impacted” classes: impacted classes experienced the general, broad-based
impacts of the pandemic, while disproportionately impacted classes faced
meaningfully more severe impacts, often due to preexisting disparities.
• To simplify administration, the final rule presumes that some populations and
groups were impacted or disproportionately impacted and are eligible for
responsive services.
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U.S. Department of the Treasury
•Eligible uses for assistance to impacted households include aid for re-
employment, job training, food, rent, mortgages, utilities, affordable housing
development, childcare, early education, addressing learning loss, and many
more uses.
•Eligible uses for assistance to impacted small businesses or nonprofits include
loans or grants to mitigate financial hardship, technical assistance for small
businesses, and many more uses.
•Recipients can also provide assistance to impacted industries like travel, tourism, and
hospitality that faced substantial pandemic impacts, or address impacts to the public
sector, for example by re-hiring public sector workers cut during the crisis.
•Recipients providing funds for enumerated uses to populations and groups that
Treasury has presumed eligible are clearly operating consistently with the final rule.
Recipients can also identify (1) other populations or groups, beyond those presumed
eligible, that experienced pandemic impacts or disproportionate impacts and (2) other
programs, services, or capital expenditures, beyond those enumerated, to respond to
those impacts.
•Provide premium pay for eligible workers performing essential work, offering additional
support to those who have and will bear the greatest health risks because of their service in
critical sectors.
•Recipients may provide premium pay to eligible workers – generally those working in-
person in key economic sectors – who are below a wage threshold or non-exempt from
the Fair Labor Standards Act overtime provisions, or if the recipient submits justification
that the premium pay is responsive to workers performing essential work.
•Invest in water, sewer, and broadband infrastructure, making necessary investments to
improve access to clean drinking water, to support vital wastewater and stormwater
infrastructure, and to expand affordable access to broadband internet.
•Recipients may fund a broad range of water and sewer projects, including those eligible
under the EPA’s Clean Water State Revolving Fund, EPA’s Drinking Water State
Revolving Fund, and certain additional projects, including a wide set of lead
remediation, stormwater infrastructure, and aid for private wells and septic units.
•Recipients may fund high-speed broadband infrastructure in areas of need that the
recipient identifies, such as areas without access to adequate speeds, affordable
options, or where connections are inconsistent or unreliable; completed projects must
participate in a low-income subsidy program.
While recipients have considerable flexibility to use funds to address the diverse needs of their
communities, some restrictions on use apply across all eligible use categories. These include:
•For states and territories: No offsets of a reduction in net tax revenue resulting from a change
in state or territory law.
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U.S. Department of the Treasury
• For all recipients except for Tribal governments: No extraordinary contributions to a pension
fund for the purpose of reducing an accrued, unfunded liability.
• For all recipients: No payments for debt service and replenishments of rainy day funds; no
satisfaction of settlements and judgments; no uses that contravene or violate the American
Rescue Plan Act, Uniform Guidance conflicts of interest requirements, and other federal, state,
and local laws and regulations.
Under the SLFRF program, funds must be used for costs incurred on or after March 3, 2021. Further,
funds must be obligated by December 31, 2024, and expended by December 31, 2026. This time period,
during which recipients can expend SLFRF funds, is the “period of performance.”
In addition to SLFRF, the American Rescue Plan includes other sources of funding for state and local
governments, including the Coronavirus Capital Projects Fund to fund critical capital investments
including broadband infrastructure; the Homeowner Assistance Fund to provide relief for our country’s
most vulnerable homeowners; the Emergency Rental Assistance Program to assist households that are
unable to pay rent or utilities; and the State Small Business Credit Initiative to fund small business credit
expansion initiatives. Eligible recipients are encouraged to visit the Treasury website for more
information.
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Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
Replacing Lost Public Sector Revenue
The Coronavirus State and Local Fiscal Recovery Funds provide needed fiscal relief for recipients that
have experienced revenue loss due to the onset of the COVID-19 public health emergency. Specifically,
SLFRF funding may be used to pay for “government services” in an amount equal to the revenue loss
experienced by the recipient due to the COVID-19 public health emergency.
Government services generally include any service traditionally provided by a government, including
construction of roads and other infrastructure, provision of public safety and other services, and health
and educational services. Funds spent under government services are subject to streamlined reporting
and compliance requirements.
In order to use funds under government services, recipients should first determine revenue loss. They
may, then, spend up to that amount on general government services.
DETERMINING REVENUE LOSS
Recipients have two options for how to determine their amount of revenue loss. Recipients must choose
one of the two options and cannot switch between these approaches after an election is made.
1.Recipients may elect a “standard allowance” of $10 million to spend on government services
through the period of performance.
Under this option, which is newly offered in the final rule Treasury presumes that up to $10
million in revenue has been lost due to the public health emergency and recipients are
permitted to use that amount (not to exceed the award amount) to fund “government services.”
The standard allowance provides an estimate of revenue loss that is based on an extensive
analysis of average revenue loss across states and localities, and offers a simple, convenient way
to determine revenue loss, particularly for SLFRF’s smallest recipients.
All recipients may elect to use this standard allowance instead of calculating lost revenue using
the formula below, including those with total allocations of $10 million or less. Electing the
standard allowance does not increase or decrease a recipient’s total allocation.
2.Recipients may calculate their actual revenue loss according to the formula articulated in the
final rule.
Under this option, recipients calculate revenue loss at four distinct points in time, either at the
end of each calendar year (e.g., December 31 for years 2020, 2021, 2022, and 2023) or the end
of each fiscal year of the recipient. Under the flexibility provided in the final rule, recipients can
choose whether to use calendar or fiscal year dates but must be consistent throughout the
period of performance. Treasury has also provided several adjustments to the definition of
general revenue in the final rule.
To calculate revenue loss at each of these dates, recipients must follow a four-step process:
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U.S. Department of the Treasury
a.Calculate revenues collected in the most recent full fiscal year prior to the public health
emergency (i.e., last full fiscal year before January 27, 2020), called the base year
revenue.
b.Estimate counterfactual revenue, which is equal to the following formula, where n is the
number of months elapsed since the end of the base year to the calculation date:
𝑎𝑎𝑟𝑑 𝑦𝑑𝑎𝑟 𝑟𝑑𝑟𝑑𝑚𝑟𝑑 × (1 +𝑔𝑟𝑚𝑟𝑟ℎ 𝑎𝑑𝑗𝑟𝑟𝑟𝑚𝑑𝑚𝑟)
𝑛
12
The growth adjustment is the greater of either a standard growth rate—5.2 percent—or
the recipient’s average annual revenue growth in the last full three fiscal years prior to
the COVID-19 public health emergency.
c.Identify actual revenue, which equals revenues collected over the twelve months
immediately preceding the calculation date.
Under the final rule, recipients must adjust actual revenue totals for the effect of tax
cuts and tax increases that are adopted after the date of adoption of the final rule
(January 6, 2022). Specifically, the estimated fiscal impact of tax cuts and tax increases
adopted after January 6, 2022, must be added or subtracted to the calculation of actual
revenue for purposes of calculation dates that occur on or after April 1, 2022.
Recipients may subtract from their calculation of actual revenue the effect of tax
increases enacted prior to the adoption of the final rule. Note that recipients that elect
to remove the effect of tax increases enacted before the adoption of the final rule must
also remove the effect of tax decreases enacted before the adoption of the final rule,
such that they are accurately removing the effect of tax policy changes on revenue.
d.Revenue loss for the calculation date is equal to counterfactual revenue minus actual
revenue (adjusted for tax changes) for the twelve-month period. If actual revenue
exceeds counterfactual revenue, the loss is set to zero for that twelve-month period.
Revenue loss for the period of performance is the sum of the revenue loss on for each
calculation date.
The supplementary information in the final rule provides an example of this calculation, which
recipients may find helpful, in the Revenue Loss section.
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U.S. Department of the Treasury
SPENDING ON GOVERNMENT SERVICES
Recipients can use SLFRF funds on government services up to the revenue loss amount, whether that be
the standard allowance amount or the amount calculated using the above approach. Government
services generally include any service traditionally provided by a government, unless Treasury has
stated otherwise. Here are some common examples, although this list is not exhaustive:
✓ Construction of schools and hospitals
✓ Road building and maintenance, and
other infrastructure
✓ Health services
✓ General government administration,
staff, and administrative facilities
✓ Environmental remediation
✓ Provision of police, fire, and other public
safety services (including purchase of
fire trucks and police vehicles)
Government services is the most flexible eligible use category under the SLFRF program, and funds are
subject to streamlined reporting and compliance requirements. Recipients should be mindful that
certain restrictions, which are detailed further in the Restrictions on Use section and apply to all uses of
funds, apply to government services as well.
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Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
Responding to Public Health and Economic Impacts of COVID-19
The Coronavirus State and Local Fiscal Recovery Funds provide resources for governments to meet the
public health and economic needs of those impacted by the pandemic in their communities, as well as
address longstanding health and economic disparities, which amplified the impact of the pandemic in
disproportionately impacted communities, resulting in more severe pandemic impacts.
The eligible use category to respond to public health and negative economic impacts is organized
around the types of assistance a recipient may provide and includes several sub-categories:
• public health,
• assistance to households,
• assistance to small businesses,
• assistance to nonprofits,
• aid to impacted industries, and
• public sector capacity.
In general, to identify eligible uses of funds in this category, recipients should (1) identify a COVID-19
public health or economic impact on an individual or class (i.e., a group) and (2) design a program that
responds to that impact. Responses should be related and reasonably proportional to the harm
identified and reasonably designed to benefit those impacted.
To provide simple, clear eligible uses of funds that meet this standard, Treasury provides a non-
exhaustive list of enumerated uses that respond to pandemic impacts. Treasury also presumes that
some populations experienced pandemic impacts and are eligible for responsive services. In other
words, recipients providing enumerated uses of funds to populations presumed eligible are clearly
operating consistently with the final rule.1
Recipients also have broad flexibility to (1) identify and respond to other pandemic impacts and (2)
serve other populations that experienced pandemic impacts, beyond the enumerated uses and
presumed eligible populations. Recipients can also identify groups or “classes” of beneficiaries that
experienced pandemic impacts and provide services to those classes.
1 However, please note that use of funds for enumerated uses may not be grossly disproportionate to the harm. Further,
recipients should consult the Capital Expenditures section for more information about pursuing a capital expenditure; please
note that enumerated capital expenditures are not presumed to be reasonably proportional responses to an identified harm
except as provided in the Capital Expenditures section.
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U.S. Department of the Treasury
Step 1. Identify COVID-19 public health or
economic impact
2. Design a response that addresses or
responds to the impact
Analysis •Can identify impact to a specific
household, business or nonprofit or
to a class of households, businesses,
or nonprofits (i.e., group)
•Can also identify disproportionate
impacts, or more severe impacts, to
a specific beneficiary or to a class
•Types of responses can include a
program, service, or capital
expenditure
•Response should be related and
reasonably proportional to the harm
•Response should also be reasonably
designed to benefit impacted
individual or class
Simplifying
Presumptions •Final Rule presumes certain
populations and classes are impacted
and disproportionately impacted
•Final Rule provides non-exhaustive
list of enumerated eligible uses that
respond to pandemic impacts and
disproportionate impacts
To assess eligibility of uses of funds, recipients should first determine the sub-category where their use
of funds may fit (e.g., public health, assistance to households, assistance to small businesses), based on
the entity that experienced the health or economic impact.2 Then, recipients should refer to the relevant
section for more details on each sub-category.
While the same overall eligibility standard applies to all uses of funds to respond to the public health
and negative economic impacts of the pandemic, each sub-category has specific nuances on its
application. In addition:
•Recipients interested in using funds for capital expenditures (i.e., investments in property,
facilities, or equipment) should review the Capital Expenditures section in addition to the
eligible use sub-category.
•Recipients interested in other uses of funds, beyond the enumerated uses, should refer to the
section on “Framework for Eligible Uses Beyond Those Enumerated.”
2 For example, a recipient interested in providing aid to unemployed individuals is addressing a negative economic impact
experienced by a household and should refer to the section on assistance to households. Recipients should also be aware of the
difference between “beneficiaries” and “sub-recipients.” Beneficiaries are households, small businesses, or nonprofits that can
receive assistance based on impacts of the pandemic that they experienced. On the other hand, sub-recipients are
organizations that carry out eligible uses on behalf of a government, often through grants or contracts. Sub-recipients do not
need to have experienced a negative economic impact of the pandemic; rather, they are providing services to beneficiaries that
experienced an impact.
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Coronavirus State & Local Fiscal Recovery Funds: Overview of the Final Rule
U.S. Department of the Treasury
RESPONDING TO THE PUBLIC HEALTH EMERGENCY
While the country has made tremendous progress in the fight against COVID-19, including a historic
vaccination campaign, the disease still poses a grave threat to Americans’ health and the economy.
Providing state, local, and Tribal governments the resources needed to fight the COVID-19 pandemic is a
core goal of the Coronavirus State and Local Fiscal Recovery Funds, as well as addressing the other ways
that the pandemic has impacted public health. Treasury has identified several public health impacts of
the pandemic and enumerated uses of funds to respond to impacted populations.
•COVID-19 mitigation and prevention. The pandemic has broadly impacted Americans and recipients
can provide services to prevent and mitigate COVID-19 to the general public or to small businesses,
nonprofits, and impacted industries in general. Enumerated eligible uses include:
✓Vaccination programs, including vaccine
incentives and vaccine sites
✓Testing programs, equipment and sites
✓Monitoring, contact tracing & public
health surveillance (e.g., monitoring for
variants)
✓Public communication efforts
✓Public health data systems
✓COVID-19 prevention and treatment
equipment, such as ventilators and
ambulances
✓Medical and PPE/protective supplies
✓Support for isolation or quarantine
✓Ventilation system installation and
improvement
✓Technical assistance on mitigation of
COVID-19 threats to public health and
safety
✓Transportation to reach vaccination or
testing sites, or other prevention and
mitigation services for vulnerable
populations
✓Support for prevention, mitigation, or
other services in congregate living
facilities, public facilities, and schools
✓Support for prevention and mitigation
strategies in small businesses, nonprofits,
and impacted industries
✓Medical facilities generally dedicated to
COVID-19 treatment and mitigation (e.g.,
ICUs, emergency rooms)
✓Temporary medical facilities and other
measures to increase COVID-19 treatment
capacity
✓Emergency operations centers &
emergency response equipment (e.g.,
emergency response radio systems)
✓Public telemedicine capabilities for COVID-
19 related treatment
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•Medical expenses. Funds may be used for expenses to households, medical providers, or others that
incurred medical costs due to the pandemic, including:
✓Unreimbursed expenses for medical care
for COVID-19 testing or treatment, such
as uncompensated care costs for
medical providers or out-of-pocket costs
for individuals
✓Paid family and medical leave for public
employees to enable compliance with
COVID-19 public health precautions
✓Emergency medical response expenses
✓Treatment of long-term symptoms or effects
of COVID-19
•Behavioral health care, such as mental health treatment, substance use treatment, and other
behavioral health services. Treasury recognizes that the pandemic has broadly impacted Americans’
behavioral health and recipients can provide these services to the general public to respond.
Enumerated eligible uses include:
✓Prevention, outpatient treatment,
inpatient treatment, crisis care,
diversion programs, outreach to
individuals not yet engaged in
treatment, harm reduction & long-term
recovery support
✓Enhanced behavioral health services in
schools
✓Services for pregnant women or infants
born with neonatal abstinence
syndrome
✓Support for equitable access to reduce
disparities in access to high-quality
treatment
✓Peer support groups, costs for residence in
supportive housing or recovery housing, and
the 988 National Suicide Prevention Lifeline
or other hotline services
✓Expansion of access to evidence-based
services for opioid use disorder prevention,
treatment, harm reduction, and recovery
✓Behavioral health facilities & equipment
•Preventing and responding to violence. Recognizing that violence – and especially gun violence –
has increased in some communities due to the pandemic, recipients may use funds to respond in
these communities through:
✓Referrals to trauma recovery services for
victims of crime
✓Community violence intervention
programs, including:
•Evidence-based practices like
focused deterrence, with
wraparound services such as
behavioral therapy, trauma
recovery, job training, education,
housing and relocation services, and
financial assistance
✓In communities experiencing increased
gun violence due to the pandemic:
•Law enforcement officers focused
on advancing community policing
•Enforcement efforts to reduce gun
violence, including prosecution
•Technology & equipment to support
law enforcement response
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RESPONDING TO NEGATIVE ECONOMIC IMPACTS
The pandemic caused severe economic damage and, while the economy is on track to a strong recovery,
much work remains to continue building a robust, resilient, and equitable economy in the wake of the
crisis and to ensure that the benefits of this recovery reach all Americans. While the pandemic impacted
millions of American households and businesses, some of its most severe impacts fell on low-income
and underserved communities, where pre-existing disparities amplified the impact of the pandemic and
where the most work remains to reach a full recovery.
The final rule recognizes that the pandemic caused broad-based impacts that affected many
communities, households, and small businesses across the country; for example, many workers faced
unemployment and many small businesses saw declines in revenue. The final rule describes these as
“impacted" households, communities, small businesses, and nonprofits.
At the same time, the pandemic caused disproportionate impacts, or more severe impacts, in certain
communities. For example, low-income and underserved communities have faced more severe health
and economic outcomes like higher rates of COVID-19 mortality and unemployment, often because pre-
existing disparities exacerbated the impact of the pandemic. The final rule describes these as
“disproportionately impacted” households, communities, small businesses, and nonprofits.
To simplify administration of the program, the final rule presumes that certain populations were
“impacted” and “disproportionately impacted” by the pandemic; these populations are presumed to be
eligible for services that respond to the impact they experienced. The final rule also enumerates a non-
exhaustive list of eligible uses that are recognized as responsive to the impacts or disproportionate
impacts of COVID-19. Recipients providing enumerated uses to populations presumed eligible are clearly
operating consistently with the final rule.
As discussed further in the section Framework for Eligible Uses Beyond Those Enumerated, recipients
can also identify other pandemic impacts, impacted or disproportionately impacted populations or
classes, and responses.
However, note that the final rule maintains that general infrastructure projects, including roads, streets,
and surface transportation infrastructure, would generally not be eligible under this eligible use
category, unless the project responded to a specific pandemic public health need or a specific negative
economic impact. Similarly, general economic development or workforce development – activities that
do not respond to negative economic impacts of the pandemic but rather seek to more generally
enhance the jurisdiction’s business climate – would generally not be eligible under this eligible use
category.
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Assistance to Households
Impacted Households and Communities
Treasury presumes the following households and communities are impacted by the pandemic:
✓Low- or-moderate income households or
communities
✓Households that experienced
unemployment
✓Households that experienced increased
food or housing insecurity
✓Households that qualify for the Children’s
Health Insurance Program, Childcare
Subsidies through the Child Care
Development Fund (CCDF) Program, or
Medicaid
✓When providing affordable housing programs:
households that qualify for the National Housing
Trust Fund and Home Investment Partnerships
Program
✓When providing services to address lost
instructional time in K-12 schools: any student
that lost access to in-person instruction for a
significant period of time
Low- or moderate-income households and communities are those with (i) income at or below 300
percent of the Federal Poverty Guidelines for the size of the household based on the most recently
published poverty guidelines or (ii) income at or below 65 percent of the area median income for the
county and size of household based on the most recently published data. For the vast majority of
communities, the Federal Poverty Guidelines are higher than the area’s median income and using the
Federal Poverty Guidelines would result in more households and communities being presumed eligible.
Treasury has provided an easy-to-use spreadsheet with Federal Poverty Guidelines and area median
income levels on its website.
Recipients can measure income for a specific household or the median income for the community,
depending on whether the response they plan to provide serves specific households or the general
community. The income thresholds vary by household size; recipients should generally use income
thresholds for the appropriate household size but can use a default household size of three when easier
for administration or when measuring income for a general community.
The income limit for 300 percent of the Federal Poverty Guidelines for a household of three is $65,880
per year.3 In other words, recipients can always presume that a household earning below this level, or a
community with median income below this level, is impacted by the pandemic and eligible for services
to respond. Additionally, by following the steps detailed in the section Framework for Eligible Uses
Beyond Those Enumerated, recipients may designate additional households as impacted or
disproportionately impacted beyond these presumptions, and may also pursue projects not listed below
in response to these impacts consistent with Treasury’s standards.
3 For recipients in Alaska, the income limit for 300 percent of the Federal Poverty Guidelines for a household of three is $82,350
per year. For recipients in Hawaii, the income limit for 300 percent of the Federal Poverty Guidelines for a household of three is
$75,780 per year.
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Treasury recognizes the enumerated projects below, which have been expanded under the final rule, as
eligible to respond to impacts of the pandemic on households and communities:
✓Food assistance & food banks
✓Emergency housing assistance: rental
assistance, mortgage assistance, utility
assistance, assistance paying delinquent
property taxes, counseling and legal aid to
prevent eviction and homelessness &
emergency programs or services for homeless
individuals, including temporary residences
for people experiencing homelessness
✓Health insurance coverage expansion
✓Benefits for surviving family members of
individuals who have died from COVID-19
✓Assistance to individuals who want and are
available for work, including job training,
public jobs programs and fairs, support for
childcare and transportation to and from a
jobsite or interview, incentives for newly-
employed workers, subsidized employment,
grants to hire underserved workers,
assistance to unemployed individuals to start
small businesses & development of job and
workforce training centers
✓Financial services for the unbanked and
underbanked
✓Burials, home repair & home weatherization
✓Programs, devices & equipment for internet
access and digital literacy, including subsidies
for costs of access
✓Cash assistance
✓Paid sick, medical, and family leave programs
✓Assistance in accessing and applying for
public benefits or services
✓Childcare and early learning services, home
visiting programs, services for child welfare-
involved families and foster youth & childcare
facilities
✓Assistance to address the impact of learning
loss for K-12 students (e.g., high-quality
tutoring, differentiated instruction)
✓Programs or services to support long-term
housing security: including development of
affordable housing and permanent
supportive housing
✓Certain contributions to an Unemployment
Insurance Trust Fund4
4 Recipients may only use SLFRF funds for contributions to unemployment insurance trust funds and repayment of the principal
amount due on advances received under Title XII of the Social Security Act up to an amount equal to (i) the difference between
the balance in the recipient’s unemployment insurance trust fund as of January 27, 2020 and the balance of such account as of
May 17, 2021, plus (ii) the principal amount outstanding as of May 17, 2021 on any advances received under Title XII of the
Social Security Act between January 27, 2020 and May 17, 2021. Further, recipients may use SLFRF funds for the payment of
any interest due on such Title XII advances. Additionally, a recipient that deposits SLFRF funds into its unemployment insurance
trust fund to fully restore the pre-pandemic balance may not draw down that balance and deposit more SLFRF funds, back up
to the pre-pandemic balance. Recipients that deposit SLFRF funds into an unemployment insurance trust fund, or use SLFRF
funds to repay principal on Title XII advances, may not take action to reduce benefits available to unemployed workers by
changing the computation method governing regular unemployment compensation in a way that results in a reduction of
average weekly benefit amounts or the number of weeks of benefits payable (i.e., maximum benefit entitlement).
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Disproportionately Impacted Households and Communities
Treasury presumes the following households and communities are disproportionately impacted by the
pandemic:
✓ Low -income households and communities
✓ Households residing in Qualified Census
Tracts
✓ Households that qualify for certain federal
5benefits
✓ Households receiving services provided by
Tribal governments
✓ Households residing in the U.S. territories or
receiving services from these governments
Low-income households and communities are those with (i) income at or below 185 percent of the
Federal Poverty Guidelines for the size of its household based on the most recently published poverty
guidelines or (ii) income at or below 40 percent of area median income for its county and size of
household based on the most recently published data. For the vast majority of communities, the Federal
Poverty Guidelines level is higher than the area median income level and using this level would result in
more households and communities being presumed eligible. Treasury has provided an easy-to-use
spreadsheet with Federal Poverty Guidelines and area median income levels on its website.
Recipients can measure income for a specific household or the median income for the community,
depending on whether the service they plan to provide serves specific households or the general
community. The income thresholds vary by household size; recipients should generally use income
thresholds for the appropriate household size but can use a default household size of three when easier
for administration or when measuring income for a general community.
The income limit for 185 percent of the Federal Poverty Guidelines for a household of three is $40,626
per year.6 In other words, recipients can always presume that a household earning below this level, or a
community with median income below this level, is disproportionately impacted by the pandemic and
eligible for services to respond.
5 These programs are Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP),
Free- and Reduced-Price Lunch (NSLP) and/or School Breakfast (SBP) programs, Medicare Part D Low-Income Subsidies,
Supplemental Security Income (SSI), Head Start and/or Early Head Start, Special Supplemental Nutrition Program for Women,
Infants, and Children (WIC), Section 8 Vouchers, Low-Income Home Energy Assistance Program (LIHEAP), and Pell Grants. For
services to address educational disparities, Treasury will recognize Title I eligible schools as disproportionately impacted and
responsive services that support the school generally or support the whole school as eligible.
6 For recipients in Alaska, the income limit for 185 percent of the Federal Poverty Guidelines for a household of three is $50,783
per year. For recipients in Hawaii, the income limit for 185 percent of the Federal Poverty Guidelines for a household of three is
$46,731 per year
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Treasury recognizes the enumerated projects below, which have been expanded under the final rule, as
eligible to respond to disproportionate impacts of the pandemic on households and communities:
✓Pay for community health workers to help
households access health & social services
✓Remediation of lead paint or other lead
hazards
✓Primary care clinics, hospitals, integration of
health services into other settings, and other
investments in medical equipment & facilities
designed to address health disparities
✓Housing vouchers & assistance relocating to
neighborhoods with higher economic
opportunity
✓Investments in neighborhoods to promote
improved health outcomes
✓Improvements to vacant and abandoned
properties, including rehabilitation or
maintenance, renovation, removal and
remediation of environmental contaminants,
demolition or deconstruction, greening/vacant lot
cleanup & conversion to affordable housing7
✓Services to address educational disparities,
including assistance to high-poverty school
districts & educational and evidence-based
services to address student academic, social,
emotional, and mental health needs
✓Schools and other educational equipment &
facilities
7 Please see the final rule for further details and conditions applicable to this eligible use. This includes Treasury’s presumption
that demolition of vacant or abandoned residential properties that results in a net reduction in occupiable housing units for
low- and moderate-income individuals in an area where the availability of such housing is lower than the need for such housing
is ineligible for support with SLFRF funds.
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Assistance to Small Businesses
Small businesses have faced widespread challenges due to the pandemic, including periods of
shutdown, declines in revenue, or increased costs. The final rule provides many tools for recipients to
respond to the impacts of the pandemic on small businesses, or disproportionate impacts on businesses
where pre-existing disparities like lack of access to capital compounded the pandemic’s effects.
Small businesses eligible for assistance are those that experienced negative economic impacts or
disproportionate impacts of the pandemic and meet the definition of “small business,” specifically:
1.Have no more than 500 employees, or if applicable, the size standard in number of employees
established by the Administrator of the Small Business Administration for the industry in which
the business concern or organization operates, and
2.Are a small business concern as defined in section 3 of the Small Business Act8 (which includes,
among other requirements, that the business is independently owned and operated and is not
dominant in its field of operation).
Impacted Small Businesses
Recipients can identify small businesses impacted by the pandemic, and measures to respond, in many
ways; for example, recipients could consider:
✓Decreased revenue or gross receipts
✓Financial insecurity
✓Increased costs
✓Capacity to weather financial hardship
✓Challenges covering payroll, rent or
mortgage, and other operating costs
Assistance to small businesses that experienced negative economic impacts includes the following
enumerated uses:
✓Loans or grants to mitigate financial
hardship, such as by supporting payroll
and benefits, costs to retain employees,
and mortgage, rent, utility, and other
operating costs
✓Technical assistance, counseling, or other
services to support business planning
Disproportionately Impacted Small Businesses
Treasury presumes that the following small businesses are disproportionately impacted by the
pandemic:
8 15 U.S.C. 632.
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✓Small businesses operating in Qualified
Census Tracts
✓Small businesses operated by Tribal
governments or on Tribal lands
✓Small businesses operating in the U.S.
territories
Assistance to disproportionately impacted small businesses includes the following enumerated uses,
which have been expanded under the final rule:
✓Rehabilitation of commercial properties,
storefront improvements & façade
improvements
✓Technical assistance, business incubators &
grants for start-up or expansion costs for
small businesses
✓Support for microbusinesses, including
financial, childcare, and transportation costs
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Assistance to Nonprofits
Nonprofits have faced significant challenges due to the pandemic’s increased demand for services and
changing operational needs, as well as declines in revenue sources such as donations and fees.
Nonprofits eligible for assistance are those that experienced negative economic impacts or
disproportionate impacts of the pandemic and meet the definition of “nonprofit”—specifically those
that are 501(c)(3) or 501(c)(19) tax-exempt organizations.
Impacted Nonprofits
Recipients can identify nonprofits impacted by the pandemic, and measures to respond, in many ways;
for example, recipients could consider:
✓ Decreased revenue (e.g., from donations
and fees)
✓ Financial insecurity
✓ Increased costs (e.g., uncompensated
increases in service need)
✓ Capacity to weather financial hardship
✓ Challenges covering payroll, rent or
mortgage, and other operating costs
Assistance to nonprofits that experienced negative economic impacts includes the following
enumerated uses:
✓ Loans or grants to mitigate financial
hardship
✓ Technical or in-kind assistance or other
services that mitigate negative economic
impacts of the pandemic
Disproportionately Impacted Nonprofits
Treasury presumes that the following nonprofits are disproportionately impacted by the pandemic:
✓ Nonprofits operating in Qualified Census
Tracts
✓ Nonprofits operated by Tribal
governments or on Tribal lands
✓ Nonprofits operating in the U.S. territories
Recipients may identify appropriate responses that are related and reasonably proportional to
addressing these disproportionate impacts.
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Aid to Impacted Industries
Recipients may use SLFRF funding to provide aid to industries impacted by the COVID-19 pandemic.
Recipients should first designate an impacted industry and then provide aid to address the impacted
industry’s negative economic impact.
This sub-category of eligible uses does not separately identify disproportionate impacts and
corresponding responsive services.
1. Designating an impacted industry. There are two main ways an industry can be designated as
“impacted.”
1. If the industry is in the travel, tourism, or hospitality sectors (including Tribal development
districts), the industry is impacted.
2. If the industry is outside the travel, tourism, or hospitality sectors, the industry is impacted
if:
a. The industry experienced at least 8 percent employment loss from pre-pandemic
levels,9 or
b. The industry is experiencing comparable or worse economic impacts as the national
tourism, travel, and hospitality industries as of the date of the final rule, based on
the totality of economic indicators or qualitative data (if quantitative data is
unavailable), and if the impacts were generally due to the COVID-19 public health
emergency.
Recipients have flexibility to define industries broadly or narrowly, but Treasury encourages
recipients to define narrow and discrete industries eligible for aid. State and territory recipients
also have flexibility to define the industries with greater geographic precision; for example, a
state may identify a particular industry in a certain region of a state as impacted.
2. Providing eligible aid to the impacted industry. Aid may only be provided to support
businesses, attractions, and Tribal development districts operating prior to the pandemic and
affected by required closures and other efforts to contain the pandemic. Further, aid should be
generally broadly available to all businesses within the impacted industry to avoid potential
conflicts of interest, and Treasury encourages aid to be first used for operational expenses, such
as payroll, before being used on other types of costs.
9 Specifically, a recipient should compare the percent change in the number of employees of the recipient’s identified industry
and the national Leisure & Hospitality sector in the three months before the pandemic’s most severe impacts began (a straight
three-month average of seasonally-adjusted employment data from December 2019, January 2020, and February 2020) with
the latest data as of the final rule (a straight three-month average of seasonally-adjusted employment data from September
2021, October 2021, and November 2021). For parity and simplicity, smaller recipients without employment data that measure
industries in their specific jurisdiction may use data available for a broader unit of government for this calculation (e.g., a
county may use data from the state in which it is located; a city may use data for the county, if available, or state in which it is
located) solely for purposes of determining whether a particular industry is an impacted industry.
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Treasury recognizes the enumerated projects below as eligible responses to impacted
industries.
✓Aid to mitigate financial hardship, such
as supporting payroll costs, lost pay and
benefits for returning employees,
support of operations and maintenance
of existing equipment and facilities
✓Technical assistance, counseling, or
other services to support business
planning
✓COVID-19 mitigation and infection
prevention measures (see section Public
Health)
As with all eligible uses, recipients may pursue a project not listed above by undergoing the steps
outlined in the section Framework for Eligible Uses Beyond Those Enumerated.
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PUBLIC SECTOR CAPACITY
Recipients may use SLFRF funding to restore and bolster public sector capacity, which supports
government’s ability to deliver critical COVID-19 services. There are three main categories of eligible
uses to bolster public sector capacity and workforce: Public Safety, Public Health, and Human Services
Staff; Government Employment and Rehiring Public Sector Staff; and Effective Service Delivery.
Public Safety, Public Health, and Human Services Staff
SLFRF funding may be used for payroll and covered benefits for public safety, public health, health care,
human services and similar employees of a recipient government, for the portion of the employee’s
time spent responding to COVID-19. Recipients should follow the steps below.
1.Identify eligible public safety, public health, and human services staff. Public safety staff include:
✓Police officers (including state police
officers)
✓Sheriffs and deputy sheriffs
✓Firefighters
✓Emergency medical responders
✓Correctional and detention officers
✓Dispatchers and supervisor personnel
that directly support public safety staff
Public health staff include:
✓Employees involved in providing medical
and other physical or mental health
services to patients and supervisory
personnel, including medical staff
assigned to schools, prisons, and other
such institutions
✓Laboratory technicians, medical
examiners, morgue staff, and other
support services essential for patient
care
✓Employees of public health
departments directly engaged in
public health matters and related
supervisory personnel
Human services staff include:
✓Employees providing or administering
social services and public benefits
✓Child welfare services employees
✓Child, elder, or family care employees
2.Assess portion of time spent on COVID-19 response for eligible staff.
Recipients can use a variety of methods to assess the share of an employees’ time spent responding
to COVID-19, including using reasonable estimates—such as estimating the share of time based on
discussions with staff and applying that share to all employees in that position.
For administrative convenience, recipients can consider public health and safety employees entirely
devoted to responding to COVID-19 (and their payroll and benefits fully covered by SLFRF) if the
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employee, or his or her operating unit or division, is “primarily dedicated” to responding to COVID-
19. Primarily dedicated means that more than half of the employee, unit, or division’s time is
dedicated to responding to COVID-19.
Recipients must periodically reassess their determination and maintain records to support their
assessment, although recipients do not need to track staff hours.
3. Use SLFRF funding for payroll and covered benefits for the portion of eligible staff time spent on
COVID-19 response. SLFRF funding may be used for payroll and covered benefits for the portion of
the employees’ time spent on COVID-19 response, as calculated above, through the period of
performance.
Government Employment and Rehiring Public Sector Staff
Under the increased flexibility of the final rule, SLFRF funding may be used to support a broader set of
uses to restore and support public sector employment. Eligible uses include hiring up to a pre-pandemic
baseline that is adjusted for historic underinvestment in the public sector, providing additional funds for
employees who experienced pay cuts or were furloughed, avoiding layoffs, providing worker retention
incentives, and paying for ancillary administrative costs related to hiring, support, and retention.
• Restoring pre-pandemic employment. Recipients have two options to restore pre-pandemic
employment, depending on the recipient’s needs.
• If the recipient simply wants to hire back employees for pre-pandemic positions: Recipients
may use SLFRF funds to hire employees for the same positions that existed on January 27,
2020 but that were unfilled or eliminated as of March 3, 2021. Recipients may use SLFRF
funds to cover payroll and covered benefits for such positions through the period of
performance.
• If the recipient wants to hire above the pre-pandemic baseline and/or would like to have
flexibility in positions: Recipients may use SLFRF funds to pay for payroll and covered
benefits associated with the recipient increasing its number of budgeted FTEs up to 7.5
percent above its pre-pandemic baseline. Specifically, recipients should undergo the
following steps:
a. Identify the recipient’s budgeted FTE level on January 27, 2020. This includes all
budgeted positions, filled and unfilled. This is called the pre-pandemic baseline.
b. Multiply the pre-pandemic baseline by 1.075. This is called the adjusted pre-
pandemic baseline.
c. Identify the recipient’s budgeted FTE level on March 3, 2021, which is the beginning
of the period of performance for SLFRF funds. Recipients may, but are not required
to, exclude the number of FTEs dedicated to responding to the COVID-19 public
health emergency. This is called the actual number of FTEs.
d. Subtract the actual number of FTEs from the adjusted pre-pandemic baseline to
calculate the number of FTEs that can be covered by SLFRF funds. Recipients do not
have to hire for the same roles that existed pre-pandemic.
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Recipients may use SLFRF funds to cover payroll and covered benefits through the period of
performance; these employees must have begun their employment on or after March 3,
2021. Recipients may only use SLFRF funds for additional FTEs hired over the March 3, 2021
level (i.e., the actual number of FTEs).
• Supporting and retaining public sector workers. Recipients can also use funds in other ways
that support the public sector workforce.10 These include:
o Providing additional funding for employees who experienced pay reductions or were
furloughed since the onset of the pandemic, up to the difference in the employee’s pay,
taking into account unemployment benefits received.
o Maintaining current compensation levels to prevent layoffs. SLFRF funds may be used
to maintain current compensation levels, with adjustments for inflation, in order to
prevent layoffs that would otherwise be necessary.
o Providing worker retention incentives, including reasonable increases in
compensation to persuade employees to remain with the employer as compared to
other employment options. Retention incentives must be entirely additive to an
employee’s regular compensation, narrowly tailored to need, and should not exceed
incentives traditionally offered by the recipient or compensation that alternative
employers may offer to compete for the employees. Treasury presumes that retention
incentives that are less than 25 percent of the rate of base pay for an individual
employee or 10 percent for a group or category of employees are reasonably
proportional to the need to retain employees, as long as other requirements are met.
• Covering administrative costs associated with administering the hiring, support, and retention
programs above.
Effective Service Delivery
SLFRF funding may be used to improve the efficacy of public health and economic programs through
tools like program evaluation, data, and outreach, as well as to address administrative needs caused or
exacerbated by the pandemic. Eligible uses include:
• Supporting program evaluation, data, and outreach through:
10 Recipients should be able to substantiate that these uses of funds are substantially due to the public health emergency or its
negative economic impacts (e.g., fiscal pressures on state and local budgets) and respond to its impacts. See the final rule for
details on these uses.
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✓ Program evaluation and evidence
resources
✓ Data analysis resources to gather,
assess, share, and use data
✓ Technology infrastructure to improve
access to and the user experience of
government IT systems, as well as
technology improvements to increase
public access and delivery of
government programs and services
✓ Community outreach and engagement
activities
✓ Capacity building resources to support
using data and evidence, including
hiring staff, consultants, or technical
assistance support
• Addressing administrative needs, including:
✓ Administrative costs for programs
responding to the public health
emergency and its economic impacts,
including non-SLFRF and non-federally
funded programs
✓ Address administrative needs caused
or exacerbated by the pandemic,
including addressing backlogs caused
by shutdowns, increased repair or
maintenance needs, and technology
infrastructure to adapt government
operations to the pandemic (e.g.,
video-conferencing software, data and
case management systems)
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U.S. Department of the Treasury
CAPITAL EXPENDITURES
As described above, the final rule clarifies that recipients may use funds for programs, services, and
capital expenditures that respond to the public health and negative economic impacts of the pandemic.
Any use of funds in this category for a capital expenditure must comply with the capital expenditure
requirements, in addition to other standards for uses of funds.
Capital expenditures are subject to the same eligibility standard as other eligible uses to respond to the
pandemic’s public health and economic impacts; specifically, they must be related and reasonably
proportional to the pandemic impact identified and reasonably designed to benefit the impacted
population or class.
For ease of administration, the final rule identifies enumerated types of capital expenditures that
Treasury has identified as responding to the pandemic’s impacts; these are listed in the applicable sub-
category of eligible uses (e.g., public health, assistance to households, etc.). Recipients may also identify
other responsive capital expenditures. Similar to other eligible uses in the SLFRF program, no pre-
approval is required for capital expenditures.
To guide recipients’ analysis of whether a capital expenditure meets the eligibility standard, recipients
(with the exception of Tribal governments) must complete and meet the requirements of a written
justification for capital expenditures equal to or greater than $1 million. For large-scale capital
expenditures, which have high costs and may require an extended length of time to complete, as well as
most capital expenditures for non-enumerated uses of funds, Treasury requires recipients to submit
their written justification as part of regular reporting. Specifically:
If a project has
total capital
expenditures
of
and the use is enumerated by Treasury
as eligible, then
and the use is beyond those
enumerated by Treasury as eligible,
then
Less than $1
million
No Written Justification required No Written Justification required
Greater than or
equal to $1
million, but
less than $10
million
Written Justification required but
recipients are not required to submit as
part of regular reporting to Treasury Written Justification required and
recipients must submit as part of regular
reporting to Treasury
$10 million or
more
Written Justification required and
recipients must submit as part of regular
reporting to Treasury
A Written Justification includes:
•Description of the harm or need to be addressed. Recipients should provide a description of the
specific harm or need to be addressed and why the harm was exacerbated or caused by the
public health emergency. Recipients may provide quantitative information on the extent and the
type of harm, such as the number of individuals or entities affected.
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• Explanation of why a capital expenditure is appropriate. For example, recipients should include
an explanation of why existing equipment and facilities, or policy changes or additional funding
to pertinent programs or services, would be inadequate.
• Comparison of proposed capital project against at least two alternative capital expenditures and
demonstration of why the proposed capital expenditure is superior. Recipients should consider
the effectiveness of the capital expenditure in addressing the harm identified and the expected
total cost (including pre-development costs) against at least two alternative capital
expenditures.
Where relevant, recipients should consider the alternatives of improving existing capital assets already
owned or leasing other capital assets.
Treasury presumes that the following capital projects are generally ineligible:
Construction of new correctional
facilities as a response to an increase in
rate of crime
Construction of new congregate
facilities to decrease spread of COVID-19
in the facility
Construction of convention centers,
stadiums, or other large capital projects
intended for general economic
development or to aid impacted
industries
In undertaking capital expenditures, Treasury encourages recipients to adhere to strong labor standards,
including project labor agreements and community benefits agreements that offer wages at or above
the prevailing rate and include local hire provisions. Treasury also encourages recipients to prioritize in
their procurements employers with high labor standards and to prioritize employers without recent
violations of federal and state labor and employment laws.
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FRAMEWORK FOR ELIGIBLE USES BEYOND THOSE ENUMERATED
As described above, recipients have broad flexibility to identify and respond to other pandemic impacts
and serve other populations that experienced pandemic impacts, beyond the enumerated uses and
presumed eligible populations. Recipients should undergo the following steps to decide whether their
project is eligible:
Step 1. Identify COVID-19 public health or
economic impact
2. Design a response that addresses or
responds to the impact
Analysis • Can identify impact to a specific
household, business or nonprofit or to
a class of households, businesses or
nonprofits (i.e., group)
• Can also identify disproportionate
impacts, or more severe impacts, to a
specific beneficiary or to a class
• Types of responses can include a
program, service, or capital
expenditure
• Response should be related and
reasonably proportional to the harm
• Response should also be reasonably
designed to benefit impacted
individual or class
1. Identify a COVID-19 public health or negative economic impact on an individual or a class.
Recipients should identify an individual or class that is “impacted” or “disproportionately
impacted” by the COVID-19 public health emergency or its negative economic impacts as well as
the specific impact itself.
• “Impacted” entities are those impacted by the disease itself or the harmful
consequences of the economic disruptions resulting from or exacerbated by the COVID-
19 public health emergency. For example, an individual who lost their job or a small
business that saw lower revenue during a period of closure would both have
experienced impacts of the pandemic.
• “Disproportionately impacted” entities are those that experienced disproportionate
public health or economic outcomes from the pandemic; Treasury recognizes that pre-
existing disparities, in many cases, amplified the impacts of the pandemic, causing more
severe impacts in underserved communities. For example, a household living in a
neighborhood with limited access to medical care and healthy foods may have faced
health disparities before the pandemic, like a higher rate of chronic health conditions,
that contributed to more severe health outcomes during the COVID-19 pandemic.
The recipient may choose to identify these impacts at either the individual level or at a class
level. If the recipient is identifying impacts at the individual level, they should retain
documentation supporting the impact the individual experienced (e.g., documentation of lost
revenues from a small business). Such documentation can be streamlined in many cases (e.g.,
self-attestation that a household requires food assistance).
Recipients also have broad flexibility to identify a “class” – or a group of households, small
businesses, or nonprofits – that experienced an impact. In these cases, the recipients should
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first identify the class and the impact that it faced. Then, recipients only need to document that
the individuals served fall within that class; recipients do not need to document a specific impact
to each individual served. For example, a recipient could identify that restaurants in the
downtown area faced substantial declines in revenue due to decreased foot traffic from
workers; the recipient could develop a program to respond to the impact on that class and only
needs to document that the businesses being served are restaurants in the downtown area.
Recipients should keep the following considerations in mind when designating a class:
• There should be a relationship between the definition of the class and the proposed
response. Larger and less-specific classes are less likely to have experienced similar
harms, which may make it more difficult to design a response that appropriately
responds to those harms.
• Classes may be determined on a population basis or on a geographic basis, and the
response should be appropriately matched. For example, a response might be designed
to provide childcare to single parents, regardless of which neighborhood they live in, or
a response might provide a park to improve the health of a disproportionately impacted
neighborhood.
• Recipients may designate classes that experienced disproportionate impact, by
assessing the impacts of the pandemic and finding that some populations experienced
meaningfully more severe impacts than the general public. To determine these
disproportionate impacts, recipients:
o May designate classes based on academic research or government research
publications (such as the citations provided in the supplementary information in
the final rule), through analysis of their own data, or through analysis of other
existing data sources.
o May also consider qualitative research and sources to augment their analysis, or
when quantitative data is not readily available. Such sources might include
resident interviews or feedback from relevant state and local agencies, such as
public health departments or social services departments.
o Should consider the quality of the research, data, and applicability of analysis to
their determination in all cases.
• Some of the enumerated uses may also be appropriate responses to the impacts
experienced by other classes of beneficiaries. It is permissible for recipients to provide
these services to other classes, so long as the recipient determines that the response is
also appropriate for those groups.
• Recipients may designate a class based on income level, including at levels higher than
the final rule definition of "low- and moderate-income." For example, a recipient may
identify that households in their community with incomes above the final rule threshold
for low-income nevertheless experienced disproportionate impacts from the pandemic
and provide responsive services.
2. Design a response that addresses or responds to the impact. Programs, services, and other
interventions must be reasonably designed to benefit the individual or class that experienced
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the impact. They must also be related and reasonably proportional to the extent and type of
impact experienced. For example, uses that bear no relation or are grossly disproportionate to
the type or extent of the impact would not be eligible.
“Reasonably proportional” refers to the scale of the response compared to the scale of the
harm, as well as the targeting of the response to beneficiaries compared to the amount of harm
they experienced; for example, it may not be reasonably proportional for a cash assistance
program to provide a very small amount of aid to a group that experienced severe harm and a
much larger amount to a group that experienced relatively little harm. Recipients should
consider relevant factors about the harm identified and the response to evaluate whether the
response is reasonably proportional. For example, recipients may consider the size of the
population impacted and the severity, type, and duration of the impact. Recipients may also
consider the efficacy, cost, cost-effectiveness, and time to delivery of the response.
For disproportionately impacted communities, recipients may design interventions that address
broader pre-existing disparities that contributed to more severe health and economic outcomes
during the pandemic, such as disproportionate gaps in access to health care or pre-existing
disparities in educational outcomes that have been exacerbated by the pandemic.
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Premium Pay
The Coronavirus State and Local Fiscal Recovery Funds may be used to provide premium pay to eligible
workers performing essential work during the pandemic. Premium pay may be awarded to eligible
workers up to $13 per hour. Premium pay must be in addition to wages or remuneration (i.e.,
compensation) the eligible worker otherwise receives. Premium pay may not exceed $25,000 for any
single worker during the program.
Recipients should undergo the following steps to provide premium pay to eligible workers.
1. Identify an “eligible” worker. Eligible workers include workers “needed to maintain continuity
of operations of essential critical infrastructure sectors.” These sectors and occupations are
eligible:
✓ Health care
✓ Emergency response
✓ Sanitation, disinfection & cleaning
✓ Maintenance
✓ Grocery stores, restaurants, food
production, and food delivery
✓ Pharmacy
✓ Biomedical research
✓ Behavioral health
✓ Medical testing and diagnostics
✓ Home and community-based health care
or assistance with activities of daily living
✓ Family or child care
✓ Social services
✓ Public health
✓ Mortuary
✓ Critical clinical research, development,
and testing necessary for COVID-19
response
✓ State, local, or Tribal government
workforce
✓ Workers providing vital services to
Tribes
✓ Educational, school nutrition, and other
work required to operate a school
facility
✓ Laundry
✓ Elections
✓ Solid waste or hazardous materials
management, response, and cleanup
✓ Work requiring physical interaction with
patients
✓ Dental care
✓ Transportation and warehousing
✓ Hotel and commercial lodging facilities
that are used for COVID-19 mitigation
and containment
Beyond this list, the chief executive (or equivalent) of a recipient government may designate
additional non-public sectors as critical so long as doing so is necessary to protecting the health
and wellbeing of the residents of such jurisdictions.
2. Verify that the eligible worker performs “essential work,” meaning work that:
• Is not performed while teleworking from a residence; and
• Involves either:
a. regular, in-person interactions with patients, the public, or coworkers of the
individual that is performing the work; or
b. regular physical handling of items that were handled by, or are to be handled by,
patients, the public, or coworkers of the individual that is performing the work.
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3. Confirm that the premium pay “responds to” workers performing essential work during the
COVID-19 public health emergency. Under the final rule, which broadened the share of eligible
workers who can receive premium pay without a written justification, recipients may meet this
requirement in one of three ways:
• Eligible worker receiving premium pay is earning (with the premium included) at or below
150 percent of their residing state or county’s average annual wage for all occupations, as
defined by the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics,
whichever is higher, on an annual basis; or
• Eligible worker receiving premium pay is not exempt from the Fair Labor Standards Act
overtime provisions; or
• If a worker does not meet either of the above requirements, the recipient must submit
written justification to Treasury detailing how the premium pay is otherwise responsive to
workers performing essential work during the public health emergency. This may include a
description of the essential worker’s duties, health, or financial risks faced due to COVID-19,
and why the recipient determined that the premium pay was responsive. Treasury
anticipates that recipients will easily be able to satisfy the justification requirement for
front-line workers, like nurses and hospital staff.
Premium pay may be awarded in installments or lump sums (e.g., monthly, quarterly, etc.) and may be
awarded to hourly, part-time, or salaried or non-hourly workers. Premium pay must be paid in addition
to wages already received and may be paid retrospectively. A recipient may not use SLFRF to merely
reimburse itself for premium pay or hazard pay already received by the worker, and premium pay may
not be paid to volunteers.
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Water & Sewer Infrastructure
The Coronavirus State and Local Fiscal Recovery Funds may be used to make necessary investments in
water and sewer infrastructure. State, local, and Tribal governments have a tremendous need to
address the consequences of deferred maintenance in drinking water systems and removal,
management, and treatment of sewage and stormwater, along with additional resiliency measures
needed to adapt to climate change.
Recipients may undertake the eligible projects below:
PROJECTS ELIGIBLE UNDER EPA’S CLEAN WATER STATE REVOLVING FUND (CWSRF)
Eligible projects under the CWSRF, and the final rule, include:
✓ Construction of publicly owned
treatment works
✓ Projects pursuant to implementation
of a nonpoint source pollution
management program established
under the Clean Water Act (CWA)
✓ Decentralized wastewater treatment
systems that treat municipal
wastewater or domestic sewage
✓ Management and treatment of
stormwater or subsurface drainage
water
✓ Water conservation, efficiency, or
reuse measures
✓ Development and implementation of a
conservation and management plan
under the CWA
✓ Watershed projects meeting the
criteria set forth in the CWA
✓ Energy consumption reduction for
publicly owned treatment works
✓ Reuse or recycling of wastewater,
stormwater, or subsurface drainage
water
✓ Security of publicly owned treatment
works
Treasury encourages recipients to review the EPA handbook for the CWSRF for a full list of eligibilities.
PROJECTS ELIGIBLE UNDER EPA’S DRINKING WATER STATE REVOLVING FUND (DWSRF)
Eligible drinking water projects under the DWSRF, and the final rule, include:
✓ Facilities to improve drinking water
quality
✓ Transmission and distribution,
including improvements of water
pressure or prevention of
contamination in infrastructure and
lead service line replacements
✓ New sources to replace contaminated
drinking water or increase drought
resilience, including aquifer storage
and recovery system for water storage
✓ Green infrastructure, including green
roofs, rainwater harvesting collection,
permeable pavement
✓ Storage of drinking water, such as to
prevent contaminants or equalize
water demands
✓ Purchase of water systems and
interconnection of systems
✓ New community water systems
Treasury encourages recipients to review the EPA handbook for the DWSRF for a full list of eligibilities.
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ADDITIONAL ELIGIBLE PROJECTS
With broadened eligibility under the final rule, SLFRF funds may be used to fund additional types of
projects— such as additional stormwater infrastructure, residential wells, lead remediation, and certain
rehabilitations of dams and reservoirs — beyond the CWSRF and DWSRF, if they are found to be
“necessary” according to the definition provided in the final rule and outlined below.
✓Culvert repair, resizing, and removal,
replacement of storm sewers, and
additional types of stormwater
infrastructure
✓Infrastructure to improve access to
safe drinking water for individual
served by residential wells, including
testing initiatives, and
treatment/remediation strategies that
address contamination
✓Dam and reservoir rehabilitation if
primary purpose of dam or reservoir is
for drinking water supply and project
is necessary for provision of drinking
water
✓Broad set of lead remediation projects
eligible under EPA grant programs
authorized by the Water
Infrastructure Improvements for the
Nation (WIIN) Act, such as lead
testing, installation of corrosion
control treatment, lead service line
replacement, as well as water quality
testing, compliance monitoring, and
remediation activities, including
replacement of internal plumbing and
faucets and fixtures in schools and
childcare facilities
A “necessary” investment in infrastructure must be:
(1)responsive to an identified need to achieve or maintain an adequate minimum level of service,
which may include a reasonable projection of increased need, whether due to population
growth or otherwise,
(2)a cost-effective means for meeting that need, taking into account available alternatives, and
(3)for investments in infrastructure that supply drinking water in order to meet projected
population growth, projected to be sustainable over its estimated useful life.
Please note that DWSRF and CWSRF-eligible projects are generally presumed to be necessary
investments. Additional eligible projects generally must be responsive to an identified need to achieve
or maintain an adequate minimum level of service. Recipients are only required to assess cost-
effectiveness of projects for the creation of new drinking water systems, dam and reservoir
rehabilitation projects, or projects for the extension of drinking water service to meet population
growth needs. Recipients should review the supplementary information to the final rule for more details
on requirements applicable to each type of investment.
APPLICABLE STANDARDS & REQUIREMENTS
Treasury encourages recipients to adhere to strong labor standards, including project labor agreements
and community benefits agreements that offer wages at or above the prevailing rate and include local
hire provisions. Treasury also encourages recipients to prioritize in their procurements employers with
high labor standards and to prioritize employers without recent violations of federal and state labor and
employment laws.
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Broadband Infrastructure
The Coronavirus State and Local Fiscal Recovery Funds may be used to make necessary investments in
broadband infrastructure, which has been shown to be critical for work, education, healthcare, and civic
participation during the public health emergency. The final rule broadens the set of eligible broadband
infrastructure investments that recipients may undertake.
Recipients may pursue investments in broadband infrastructure meeting technical standards detailed
below, as well as an expanded set of cybersecurity investments.
BROADBAND INFRASTRUCTURE INVESTMENTS
Recipients should adhere to the following requirements when designing a broadband infrastructure
project:
1. Identify an eligible area for investment. Recipients are encouraged to prioritize projects that
are designed to serve locations without access to reliable wireline 100/20 Mbps broadband
service (meaning service that reliably provides 100 Mbps download speed and 20 Mbps upload
speed through a wireline connection), but are broadly able to invest in projects designed to
provide service to locations with an identified need for additional broadband investment.
Recipients have broad flexibility to define need in their community. Examples of need could
include:
✓ Lack of access to a reliable high-speed
broadband connection
✓ Lack of affordable broadband
✓ Lack of reliable service
If recipients are considering deploying broadband to locations where there are existing and
enforceable federal or state funding commitments for reliable service of at least 100/20 Mbps,
recipients must ensure that SLFRF funds are designed to address an identified need for
additional broadband investment that is not met by existing federal or state funding
commitments. Recipients must also ensure that SLFRF funds will not be used for costs that will
be reimbursed by the other federal or state funding streams.
2. Design project to meet high-speed technical standards. Recipients are required to design
projects to, upon completion, reliably meet or exceed symmetrical 100 Mbps download and
upload speeds. In cases where it is not practicable, because of the excessive cost of the project
or geography or topography of the area to be served by the project, eligible projects may be
designed to reliably meet or exceed 100/20 Mbps and be scalable to a minimum of symmetrical
100 Mbps download and upload speeds.
Treasury encourages recipients to prioritize investments in fiber-optic infrastructure wherever
feasible and to focus on projects that will achieve last-mile connections. Further, Treasury
encourages recipients to prioritize support for broadband networks owned, operated by, or
affiliated with local governments, nonprofits, and co-operatives.
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3. Require enrollment in a low-income subsidy program. Recipients must require the service
provider for a broadband project that provides service to households to either:
✓ Participate in the FCC’s Affordable
Connectivity Program (ACP)
✓ Provide access to a broad-based
affordability program to low-income
consumers that provides benefits
commensurate to ACP
Treasury encourages broadband services to also include at least one low-cost option offered
without data usage caps at speeds sufficient for a household with multiple users to
simultaneously telework and engage in remote learning. Recipients are also encouraged to
consult with the community on affordability needs.
CYBERSECURITY INVESTMENTS
SLFRF may be used for modernization of cybersecurity for existing and new broadband infrastructure,
regardless of their speed delivery standards. This includes modernization of hardware and software.
APPLICABLE STANDARDS & REQUIREMENTS
Treasury encourages recipients to adhere to strong labor standards, including project labor agreements
and community benefits agreements that offer wages at or above the prevailing rate and include local
hire provisions. Treasury also encourages recipients to prioritize in their procurements employers with
high labor standards and to prioritize employers without recent violations of federal and state labor and
employment laws.
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Restrictions on Use
While recipients have considerable flexibility to use Coronavirus State and Local Fiscal Recovery Funds to
address the diverse needs of their communities, some restrictions on use of funds apply.
OFFSET A REDUCTION IN NET TAX REVENUE
• States and territories may not use this funding to directly or indirectly offset a reduction in net
tax revenue resulting from a change in law, regulation, or administrative interpretation
beginning on March 3, 2021, through the last day of the fiscal year in which the funds
provided have been spent. If a state or territory cuts taxes during this period, it must
demonstrate how it paid for the tax cuts from sources other than SLFRF, such as by enacting
policies to raise other sources of revenue, by cutting spending, or through higher revenue due to
economic growth. If the funds provided have been used to offset tax cuts, the amount used for
this purpose must be repaid to the Treasury.
DEPOSITS INTO PENSION FUNDS
• No recipients except Tribal governments may use this funding to make a deposit to a pension
fund. Treasury defines a “deposit” as an extraordinary contribution to a pension fund for the
purpose of reducing an accrued, unfunded liability. While pension deposits are prohibited,
recipients may use funds for routine payroll contributions connected to an eligible use of funds
(e.g., for public health and safety staff). Examples of extraordinary payments include ones that:
Reduce a liability incurred prior to the
start of the COVID-19 public health
emergency and occur outside the
recipient's regular timing for making the
payment
Occur at the regular time for pension
contributions but is larger than a regular
payment would have been
ADDITIONAL RESTRICTIONS AND REQUIREMENTS
Additional restrictions and requirements that apply across all eligible use categories include:
• No debt service or replenishing financial reserves. Since SLFRF funds are intended to be used
prospectively, recipients may not use SLFRF funds for debt service or replenishing financial
reserves (e.g., rainy day funds).
• No satisfaction of settlements and judgments. Satisfaction of any obligation arising under or
pursuant to a settlement agreement, judgment, consent decree, or judicially confirmed debt
restructuring in a judicial, administrative, or regulatory proceeding is itself not an eligible use.
However, if a settlement requires the recipient to provide services or incur other costs that are
an eligible use of SLFRF funds, SLFRF may be used for those costs.
• Additional general restrictions. SLFRF funds may not be used for a project that conflicts with or
contravenes the purpose of the American Rescue Plan Act statute (e.g., uses of funds that
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undermine COVID-19 mitigation practices in line with CDC guidance and recommendations) and
may not be used in violation of the Award Terms and Conditions or conflict of interest
requirements under the Uniform Guidance. Other applicable laws and regulations, outside of
SLFRF program requirements, may also apply (e.g., laws around procurement, contracting,
conflicts-of-interest, environmental standards, or civil rights).
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Program Administration
The Coronavirus State and Local Fiscal Recovery Funds final rule details a number of administrative
processes and requirements, including on distribution of funds, timeline for use of funds, transfer of
funds, treatment of loans, use of funds to meet non-federal match or cost-share requirements,
administrative expenses, reporting on use of funds, and remediation and recoupment of funds used for
ineligible purposes. This section provides a summary for the most frequently asked questions.
TIMELINE FOR USE OF FUNDS
Under the SLFRF, funds must be used for costs incurred on or after March 3, 2021. Further, costs must
be obligated by December 31, 2024, and expended by December 31, 2026.
TRANSFERS
Recipients may undertake projects on their own or through subrecipients, which carry out eligible uses
on behalf of a recipient, including pooling funds with other recipients or blending and braiding SLFRF
funds with other sources of funds. Localities may also transfer their funds to the state through section
603(c)(4), which will decrease the locality’s award and increase the state award amounts.
LOANS
Recipients may generally use SLFRF funds to provide loans for uses that are otherwise eligible, although
there are special rules about how recipients should track program income depending on the length of
the loan. Recipients should consult the final rule if they seek to utilize these provisions.
NON-FEDERAL MATCH OR COST-SHARE REQUIREMENTS
Funds available under the “revenue loss” eligible use category (sections 602(c)(1)(C) and 603(c)(1)(C) of
the Social Security Act) generally may be used to meet the non-federal cost-share or matching
requirements of other federal programs. However, note that SLFRF funds may not be used as the non-
federal share for purposes of a state’s Medicaid and CHIP programs because the Office of Management
and Budget has approved a waiver as requested by the Centers for Medicare & Medicaid Services
pursuant to 2 CFR 200.102 of the Uniform Guidance and related regulations.
SLFRF funds beyond those that are available under the revenue loss eligible use category may not be
used to meet the non-federal match or cost-share requirements of other federal programs, other than
as specifically provided for by statute. As an example, the Infrastructure Investment and Jobs Act
provides that SLFRF funds may be used to meet the non-federal match requirements of authorized
Bureau of Reclamation projects and certain broadband deployment projects. Recipients should consult
the final rule for further details if they seek to utilize SLFRF funds as a match for these projects.
ADMINISTRATIVE EXPENSES
SLFRF funds may be used for direct and indirect administrative expenses involved in administering the
program. For details on permissible direct and indirect administrative costs, recipients should refer to
Treasury’s Compliance and Reporting Guidance. Costs incurred for the same purpose in like
circumstances must be treated consistently as either direct or indirect costs.
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REPORTING, COMPLIANCE & RECOUPMENT
Recipients are required to comply with Treasury’s Compliance and Reporting Guidance, which includes
submitting mandatory periodic reports to Treasury.
Funds used in violation of the final rule are subject to remediation and recoupment. As outlined in the
final rule, Treasury may identify funds used in violation through reporting or other sources. Recipients
will be provided with an initial written notice of recoupment with an opportunity to submit a request for
reconsideration before Treasury provides a final notice of recoupment. If the recipient receives an initial
notice of recoupment and does not submit a request for reconsideration, the initial notice will be
deemed the final notice. Treasury may pursue other forms of remediation and monitoring in conjunction
with, or as an alternative to, recoupment.
REVISIONS TO THE OVERVIEW OF THE FINAL RULE:
•January 18, 2022 (p. 4, p. 16): Clarification that the revenue loss standard allowance is “up to”
$10 million under the Replacing Lost Public Sector Revenue eligible use category; addition of
further information on the eligibility of general infrastructure, general economic development,
and worker development projects under the Public Health and Negative Economic Impacts
eligible use category.
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