HomeMy WebLinkAboutAGENDA REPORT 2023 0301 CCSA REG ITEM 09DCITY OF MOORPARK, CALIFORNIA
City Council Meeting
of March 1, 2023
ACTION ADOPTED RESOLUTION NO.
2023-4163. (ROLL CALL VOTE: 4-0,
COUNCILMEMBER GROFF ABSENT)
BY A. Hurtado.
D. Consider Resolution Amending the Fiscal Year (FY) 2022/23 Budget to Allocate
the American Rescue Plan Act of 2021 (ARPA) Funds to Various Programs and
as General Fund Revenue Replacement. Staff Recommendation: Adopt
Resolution No. 2023-4163, to amend the Fiscal Year 2022/23 Budget to allocate
ARPA Funds to scholarships for the City’s preschool and recreational
programming ($70,000) and trash control devices on stormdrain catch basins
($80,000). (Staff: Brian Chong, Assistant to the City Manager) (ROLL CALL
VOTE REQUIRED)
Item: 9.D.
MOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable City Council
FROM: Brian Chong, Assistant to the City Manager
DATE: 03/01/2023 Regular Meeting
SUBJECT: Consider Resolution Amending the Fiscal Year (FY) 2022/23 Budget
to Allocate the American Rescue Plan Act of 2021 (ARPA) Funds to
Various Programs and as General Fund Revenue Replacement
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 $8,701,674 was 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an “Interim Final Rule” that provided draft guidance on the spending of ARPA funds by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. Then, in January 2022, the
Treasury department published its “Final Rule” document to guide ARPA spending.
Subsequently in 2022, the City Council allocated $7,701,674, comprised of $2,012,876
toward the new City Hall facility at 323 Science Drive and $5,688,798 toward the new
Moorpark City Library building. These appropriations leave a remainder of $1,000,000
of available ARPA funding. It is recommended at this time that the City Council allocate
ARPA Funds to various programs and as General Fund revenue replacement.
Item: 9.D.
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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 received an
allocation of $8,701,674 in ARPA funds.
Interim Final Rule (May 2021)
On May 17, 2021, the Treasury Department published an “Interim Final Rule” that
provided guidance on the spending of ARPA funds by local governments. The Interim
Final Rule established seven broad categories of spending ARPA funds (Public Health;
Negative Economic Impacts; Services to Disproportionately Impacted Communities;
Premium Pay; Infrastructure; Revenue Replacement; and Administrative Expenses) and
66 subcategories within those categories.
Following publication, the Treasury Department solicited public review and comment on
the Interim Final Rule, which would lead to subsequent publication of a “Final Rule”
governing the use of ARPA funds. However, local governments were authorized to
begin expending their ARPA funds consistent with the Interim Final Rule immediately
when it was published. Some governments, particularly those who were directly
providing public health and COVID-19 testing services, took advantage of the
authorization, since there was little doubt that such spending would be allowed in the
Final Rule. Other governments, such as the City, opted to wait until the final guidance
for fear that agencies would potentially expend ARPA funds on programs/services that
were in the gray area of potentially-allowed uses under the Interim Final Rule but
ultimately not allowed under the Final Rule.
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 vetted projects that the
City Council indicated it has interest in funding. 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.
Additionally, staff created a list of dozens of potential projects 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 potential projects during its discussion, and the City Council
ultimately provided direction on 86 potential projects. Of them, 40 projects were
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identified to proceed through further vetting, and 46 projects were removed from
consideration.
Final Rule (January 2022)
On January 6, 2022, the Treasury Department issued its Final Rule and accompanying
Overview of the “Final Rule” 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. With publication of the
Final Rule, the City no longer needs to be concerned about potentially expending ARPA
funds on a project or program that was subsequently deemed ineligible by the Treasury
Department.
Critically, the Final Rule also included numerous clarifications and calculations of
revenue and revenue loss for the “Revenue Replacement” spending category. Among
the changes was the addition of a “Standard Allowance” of up to $10,000,000 whereby
APRA fund recipients can assume a revenue loss of up to $10,000,000 without having
to calculate revenue loss and without having to meet various reporting requirements to
determine actual revenue loss in subsequent fiscal years. 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 in APRA funds in the most-flexible Revenue Replacement
category. The funds can then be used for any “governmental purpose.”
City Council Appropriations (February and September 2022)
On February 16, 2022, the City Council adopted Resolution No. 2022-4074, by which
the City elected to receive its entire ARPA allocation as Revenue Replacement, utilizing
the Standard Allowance procedures in the Final Rule. This resulted in the placement of
$8,701,674 into City Fund 2800.
At the same meeting, the City Council appropriated $5,688,798 of the City’s ARPA
funds to the Princeton Avenue Improvement Project, as part of the award of the
construction contract for the project. Additionally, the City Council directed staff to
proceed with the allocation of $2,012,876 in ARPA funds toward the acquisition of the
new City Hall at 323 Science Drive.
On September 21, 2022, the City Council formally approved the allocation of
$2,012,876 in ARPA funds toward the City Hall project. Additionally, the City Council
changed the previously-approved ARPA expenditure of $5,688,798 toward the
Princeton Avenue Improvement Project to instead go toward the new Moorpark City
Library project. Relative to the Princeton Avenue project, the library project has fewer
funding options available. To backfill the Princeton Avenue project, the City Council
appropriated $5,688,798 from the City-Wide Traffic Mitigation Fund instead. As a result,
the current state of ARPA expenditures is shown below:
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New Moorpark City Library .............................................. $5,688,798
New City Hall Acquisition ................................................. $2,012,876
Unappropriated ARPA Funding ....................................... $1,000,000
Total ................................................................................ $8,701,674
DISCUSSION
From the perspective of the Treasury Department, the City has already appropriated its
entire ARPA fund allocation toward revenue replacement. From the City’s perspective,
however, $1,000,000 of unappropriated one-time revenues remain available. These
funds may be used for any “governmental purpose.”
On July 18, 2021, the City Council discussed 86 potential ARPA-funded projects and
narrowed down the list to 40 projects for further vetting. On February 16, 2022, the City
Council applied several considerations to the list of potential projects, excluding
projects/programs with the following:
• Projects/Programs with dedicated funding sources
• Projects/Programs at risk of not meeting ARPA-specified timeframes
• Projects/Programs with a large administrative burden
Applying these considerations resulted in the following seven projects/programs to be
further considered for ARPA funds:
• Develop and implement a grant (or assistant to other) program(s) for third-party
mental health services providers.
• Provide Ventura County Behavioral Health personnel in Moorpark to provide
mental health services.
• Construct a Meet-Me Room to facilitate broadband deployment in Moorpark.
• Provide grants to the High Street Arts Center to replace lost revenue or
reimburse the City for back rent.
• Install and maintain full capture devices for capture of trash in designated catch
basins.
• Create a scholarship program for the City’s Little Learners Academy Preschool.
• Create a scholarship program for activities/programs the Moorpark City Library
and Moorpark Active Adult Center.
Subsequent to the City Council action, staff has engaged in multiple discussions with
potential service providers and recipients to study the viability of these projects. Staff
recommends appropriating $150,000 in ARPA funds to the following:
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1) Scholarships for City Programs: Appropriate $70,000 toward scholarships at the
City’s Little Learners Academy preschool, Active Adult Center, and Moorpark City
Library. While many classes, services, and activities are offered for free, others
have registration and supply fees that cover instructors and materials. Of note,
the City’s existing scholarship program for the Little Learners Academy and other
Arroyo Vista Recreation Center programming is currently on pause due to lack of
funding. As such, staff recommends that these scholarships be expanded to all
of the City’s recreational programming.
2) Stormdrain Catch Basins: Appropriate $80,000 to install trash control devices on
stormdrain catch basins, as required by the California State Water Resources
Control Board. This project does not have another identified source of funding.
Staff estimates that approximately 110 catch basins can be improved with this
funding.
Staff also recommends not funding the following projects:
1) Mental Health Services. The City engaged with the County of Ventura to consider
providing mental health services for the community. However, the County is
unable to provide comprehensive services at this time due to limited resources
and staffing shortages for various mental and behavioral health positions. The
amount required to offer such services would also far exceed the amount of
ARPA funds the City would contribute and would need substantial funding
beyond the ARPA spending window. As such, staff recommends not funding this
project at this time. However, the City is continuing discussions with the County
and third-party providers on other realistic and long-term options for providing
mental health services for the community.
2) Meet-Me Room. A Meet-Me Room was suggested by the City’s 2020 Broadband
Strategic Plan, to advance the City’s broadband deployment goals. However, a
March 2022 market study found that a Meet-Me Room was not immediately
financially viable and likely would not be until either the State of California and/or
the County of Ventura constructed their middle-mile broadband networks within
the SR-23 right-of-way. While both have made planning progress in doing so,
neither has begun construction of this portion of their networks. As such, staff
recommends not funding this project at this time.
3) High Street Arts Center. Although the High Street Arts Center (HSAC) is now
fully operational, it was subject to health regulations that prohibited them from
hosting productions during the peak of the pandemic. As a result, HSAC did not
have revenues and suffered financial hardship. However, HSAC subsequently
received a Shuttered Venue Operators Grant from the U.S. Small Business
Administration’s COVID-19 response funding to offset these revenue losses. As
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such, HSAC does not have as large a need for additional ARPA funds at this
time, and staff recommends not appropriating ARPA funds to HSAC.
For tracking purposes, staff recommends keeping any unappropriated funds ($850,000)
in the City’s ARPA fund (Fund 2800) rather than transferring it to the General Fund’s
fund balance. The funds will still be considered revenue replacement and will allow the
City to use these funds for any governmental purpose but will offer staff the ability to
monitor expenditures separately in case of any internal or outside audits.
A draft Budget Amendment resolution is provided as Attachment 1, and can be
amended by the City Council depending on the City Council action.
ENVIRONMENTAL DETERMINATION
The California Environmental Quality Act (CEQA) does not apply to activities that will
not result in a direct or reasonably foreseeable indirect physical change in the
environment or is otherwise not considered a project as defined by CEQA Statute
§ 21065 and CEQA State Guidelines § 15060(c)(3) and § 15378. The appropriation of
ARPA funds will not result in a change to the physical environment and therefore is not
subject to CEQA. No additional environmental review is required.
FISCAL IMPACT
The City has already received $8,701,674 in ARPA funds from the federal government,
with $1,000,000 of those funds not yet appropriated. City Council appropriation of these
funds, or transfer into the General Fund’s fund balance, will obligate these funds but
have no net fiscal impact on the City.
COUNCIL GOAL COMPLIANCE
This action does not support a current strategic directive.
STAFF RECOMMENDATION (ROLL CALL VOTE REQUIRED)
Adopt Resolution No. 2023-____, to amend the FY 2022/23 Budget to allocate ARPA
Funds to scholarships for the City’s preschool and recreational programming ($70,000)
and trash control devices on stormdrain catch basins ($80,000).
Attachment: Draft Resolution No. 2023-____
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RESOLUTION NO. 2023-____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MOORPARK, CALIFORNIA, TO AMEND THE FISCAL
YEAR (FY) 2022/23 BUDGET TO APPROPRIATE
$1,000,000 FROM THE ARPA FUND (2800) FOR VARIOUS
PROJECTS/PROGRAMS AND TO THE GENERAL FUND
WHEREAS, on February 16, 2022, the City Council adopted Resolution No.
2022-4074 to receive $8,701,674 in American Rescue Plan Act (ARPA) Funds as
Revenue Replacement; and
WHEREAS, on February 16, 2022, the City Council adopted Resolution No.
2022-4075 to appropriate $5,688,798 from the ARPA Fund (2800) to the Princeton
Avenue Improvement Project; and
WHEREAS, on September 22, 2022, the City Council adopted Resolution No.
2022-4133, to reallocate the previously-appropriated $5,688,798 from the Princeton
Avenue Improvement Project to the Moorpark City Library, and to appropriate
$2,012,876 toward the new City Hall acquisition; and
WHEREAS, on June 15, 2022, the City Council adopted the Operating and
Capital Improvement Budget for FY 2022/23; and
WHEREAS, the City Council now desires to appropriate a portion of the
remaining $1,000,000 in the ARPA Fund (2800) toward a scholarship program for the
Little Learners Academy Preschool, the Moorpark Active Adult Center, the Moorpark
City Library, and other recreational programming ($70,000); and toward catch basin
trash control devices ($80,000); and
WHEREAS, Exhibit A hereof describes the above budget amendment.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK
DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. A Budget Amendment to appropriate $150,000 from the ARPA
Fund (2800), as more particularly described in Exhibit A, attached hereto, is hereby
approved.
SECTION 2. The City Clerk shall certify to the adoption of this resolution and
shall cause a certified resolution to be filed in the book of original resolutions.
PASSED AND ADOPTED this 1st day of March, 2023.
________________________________
Chris R. Enegren, Mayor
ATTACHMENT
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Resolution No. 2023-___
Page 2
ATTEST:
___________________________________
Ky Spangler, City Clerk
Exhibit A – Budget Amendment
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FUND BALANCE ALLOCATION:
Fund-Account Number Amount
2800-000-00000-33990 150,000.00$
Total 150,000.00$
EXPENDITURE APPROPRIATION:
Account Number Current Budget Revision Amended Budget
6000-000-P0023-21190 -$ 70,000.00$ 70,000.00$
1000-231-00000-51000 -$ 80,000.00$ 80,000.00$
Total -$ 150,000.00$ 150,000.00$
Fund Title
ARPA FUND
EXHIBIT A
BUDGET AMENDMENT FOR
ARPA FUNDS ALLOCATION
FY 2022/2023
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