HomeMy WebLinkAboutItem 02 ARPA GuidanceAGENDA ITEM SUMMARY
Meeting Date: 12/6/2021
Meeting Type:
Work Session
Staff Contact/Dept.:
Nathan Bell
Staff Phone No:
541-726-2364
Estimated Time:
30 Minutes
SPRINGFIELD Council Goals:
Provide Financially
CITY COUNCIL
Responsible and
Innovative Government
Services
ITEM TITLE: AMERICAN RESCUE PLAN ACT OF 2021 (ARPA) GUIDANCE
ACTION Provide direction to City staff on the use of the City's ARPA allocation.
REQUESTED:
ISSUE City staff is looking for guidance on prioritization and timing on the use of ARPA
STATEMENT: funds ahead of the Fiscal Year 2023 (FY23) Budget Process.
ATTACHMENTS: Attachment 1: Council Briefing Memorandum
DISCUSSION/ The American Rescue Plan Act of 2021 (ARPA) was signed into law by President
FINANCIAL Joe Biden on March 11, 2021. It provides for 65 billion in direct allocation to
IMPACT: cities. The City of Springfield will receive $13,956,221, to be paid in two equal
payments with the first payment of $6,978,110 already deposited into the City's
bank account on May 19', 2021 and the second payment expected one year later.
In a Council work session on September 131, 2021, Staff provided Council with a
list of potential uses of ARPA funds with estimated costs. Council asked staff to
bring that list back at a later date in a work session with the uses prioritized and cost
estimates tightened.
In the coming month, Staff will begin the process of putting together the City's
FY23 Proposed Budget. Staff will use the guidance provided this evening to
incorporate any priority ARPA funded projects into the FY23 Proposed Budget or
potentially sooner in the form of a FY22 supplemental budget.
MEMORANDUM City of Springfield
Date: 12/6/2021
To: Nancy Newton, City Manager COUNCIL
From: Nathan Bell, Finance Director BRIEFING
Subject: ARPA GUIDANCE MEMORANDUM
ISSUE:
City staff is looking for guidance on prioritization and timing on the use of ARPA funds ahead of
the Fiscal Year 2023 (FY23) Budget Process.
COUNCIL GOALS/
MANDATE:
Financially Responsible and Stable Government Services
BACKGROUND:
In a Council work session on September 13, 2021, Staff provided Council with a list of potential uses
of ARPA funds with estimated costs. Council asked staff to bring that list back at a later date in a
work session with the uses prioritized and cost estimates tightened.
The following items are listed in the order of prioritization. Please note that several of the items from
the original list were programmed into the City's FY22 budget through Supplemental Budget 1 (SB 1)
as approved by Council in regular session on October 18, 2021 and are not included in this list. This
included Fire & Life Safety radio replacement, Museum elevator replacement, Council Chambers
security upgrades, and additional staffing in the Development and Public Works Community
Development Division for project delivery, with the costs spanning multiple years. The full lifetime
cost of these adds is approximately $2.4M, leaving a remaining balance of approximately $11.5M of
ARPA funds left to allocate.
Prioritization and Timing on the Use of APPA Funds:
Justice Center Roof Replacement — $450K — The roof of the Justice Center is failing prematurely and
has an estimated remaining life of five years. Staff recommend that we not risk taking the current
roof close to the point of failure and schedule the replacement in the summer of 2022. This would
require that this project be considered for inclusion in a FY22 supplemental budget.
City-wide Legacy Street Light Replacement — $2.75M — This project was approved in concept in a
work session on October 11, 2021 with yet -to -be -identified funding. This project would require a
negligible amount of staff time to deliver and could be started relatively soon, making it a good
candidate for ARPA funding. With three years remaining to expend all funds and many of the other
projects listed requiring more substantial staff time to deliver, projects like this make it easier for us
to assure that the City does not lose any of its allocation due to time running out. Additionally,
delivering this project quickly will start generating significant cost savings as well as the benefit of
improved City lighting for the community. Staff recommend that this project be considered for
inclusion in a FY22 supplemental budget.
Attachment 1, Page 1 of 3
Cover Projected General Fund Deficit Spend — $5M — Over the past couple of years, the Council and
staff have made strides in improving the structural imbalance in the General Fund. However, there
remains additional work to get this Fund balanced and on a sustainable trajectory. Based on the most
recent five-year forecast, the projected deficit spend in FY22-25 is $5M. ARPA funds could be used
to cover this deficit spend, allowing the City to maintain current staffing and service levels while
preserving the General Fund reserve and providing us with additional time to address our long-term
structural imbalance in both the Ambulance and General Fund.
City Hall Internal/External Security Camera System — $200K — Over the previous year, we have seen
an increase in security issues around City Hall including multiple fires resulting in significant cost to
the City. A security camera system would be a cost-effective way to monitor the facility. Staff
recommend that this project be considered for inclusion in a FY22 supplemental budget.
Council Chambers and Court Security — $300K — Council Chambers and the Municipal Court are two
areas of the City where the community and staff meet in person and the Council has prioritized
improving the security of those spaces. Staff is currently working with consultants to generate ideas
and associated costs. Staff included a $100K appropriation in SB 1 so that work could begin in FY22.
Based on preliminary work with a consultant, staff recommend an additional $150,000 appropriation
for the Council Chambers and to be considered for inclusion in a FY22 supplemental budget.
Additionally, staff recommend $150,000 budgeted for Court security as part of the FY23 Proposed
budget.
Ci1y Hall Space Remodel — $950K — Our library has out -grown its space and the technology
infrastructure is not meeting community needs. There is a need for modernized and more accessible
meeting and programming space and the teen and children's area has reached capacity for collections.
Staff recommends relocating the City Manager's Office (CMO) to the currently vacant and former
Fire & Life Safety admin space and allow the Library to expand into the then vacated CMO space.
City Hall Roof and HVAC Replacement — $7M — Over 40 of the HVAC units on City Hall are at end -
of -life and risk of failure. Additionally, it's an outdated system that was designed for this building
under a completely different use and without regard to the health of the occupants. With the
assumption that this building will be the long-term City Hall, now would be a good time to
modernize the HVAC system. This would mostly like involve 1-2 units on the ground and a
complete reworking of our ductwork system. This would also necessitate a roof replacement.
Another option at a lower cost is to leave the current system in place and replace all the units at end -
of -life in a single project, which would be cheaper than replacing single units as they fail. The cost of
this option would be approximately $5M and would still require roof and ducting replacement.
Website Enhancement — TBD — This project is in the early stages of planning with a survey coming
out in the coming month for City staff and the Council. Information gathered for this survey will
help define the scope of the project and associated costs. Staff recommend leaving a portion of
ARPA funds unallocated until we can determine the cost of this project or identify an alternative
source of funding.
Carter Building Remodel — In the time since the September 13, 2021 work session, there has been a
structural failure in the roof of the Carter Building and all tenants had to be relocated. The building is
currently being assessed by structural engineers and there is high probability that the building will
need to be demolished. Staff recommend that this item be dropped from consideration of ARPA
funding.
Attachment 1, Page 2 of 3
North Gateway Planning_— Staff recommend that this item be dropped from consideration of ABPA
funding. Staff will be pursuing funding through the Central Lane Metropolitan Planning
Organization.
In addition to this list of City needs, there remains an outstanding request from Willamalane for a
portions of the City's ARPA allocation. While Special Districts have been impacted by the
pandemic, no ARPA funds were directly allocated to them. Willamalane has exhausted different
avenues for securing funding and has been told by their State representatives that funding for parks
would come from the cities they reside in. Willamalane has made a formal request to the City to
receive $1.75M of the City's ARPA funds based on the proportionality of each agency's respective
budget. While the basis of this request is reasonable, Staff is recommending a lower amount based
on the significant needs of the City's buildings and infrastructure as well as projected future General
Fund deficits.
Our goal for this evening is to continue the conversation on how to best utilize the City's ARPA
funds. As mentioned in the September 13 work session, we have until December 31, 2024 to expend
these funds and do not need to identify how to use the entire remaining $11.5M balance this evening.
The use of these funds and the delivery of projects associated with it will happen in phases. We are
looking for guidance on the second phase to be incorporated into the FY23 Proposed Budget.
Additionally, with significant funds flowing into the region coupled with supply chain issues and
labor shortages, Council may want to consider some of the above items coming forward in a FY22
Supplemental Budget so that we can begin the procurement process and get into queue.
RECOMMENDED ACTION:
Provide direction to City staff on the prioritization and timing on the use of ARPA funds.
Attachment 1, Page 3 of 3