At the Council’s June 15 meeting, I shared with the Council my proposed spending plan for the City’s allocation of American Rescue Plan Act (ARPA) funds, which are just over $4.9 million.  The City has received the first half of the total funding.  We have been told to expect the second half in mid-2022.  The City has until 2024 to spend the funds on seven broad federal government priorities:

1. Supporting public health response
2. Addressing the negative economic impacts caused by the public health emergency
3. Serving the hardest-hit communities and families
4. Replacing lost public sector revenue
5. Providing premium pay for essential workers
6. Investing in water and sewer infrastructure
7. Investing in broadband infrastructure

There are also two broad categories of spending that are ineligible for ARPA funds:

1. Direct or indirect tax reductions, rebates, credits, etc.
2. Deposits into pension funds
   
   

I have attached my staff report from the June 15 meeting that describes my proposed plan and how it fits within the federal categories.  Generally, the plan can be summarized as follows:

1. Investments in Broadband Infrastructure  $2,000,000
2. Direct Assistance to People                       $1,600,000
3. Direct Assistance to Business.                      $700,000
4. Revenue Loss at City Facilities.                   $400,000
5. Climate Change Mitigation.                          $100,000
   
   

As you consider this spending plan, Council Members are advised to keep the following thoughts in mind:
 

1. This ARPA spending plan was designed to put approximately 70% of the funds into the community and spend 30% for internal expenses.  The spending plan for last year’s CARES Act funds was approximately 30% external and 70% internal.  
2. Staff conducted a community engagement plan on spending priorities.  While we could not recommend all of the public’s ideas, two in particular (climate change mitigation and increase mental health spending) have been included in the proposed plan.
3. The ARPA funds must be spent in compliance with the seven federal priorities in Edina.
4. If we delegate spending of ARPA funds to a third party, the City is still responsible to make sure the funds are spent in compliance with the federal priorities.
5. There are media, social media and community members who will be watching our decisions about how the ARPA money is spent.  We should endeavor to be good stewards with this money.  
6. The sooner the Council approves an ARPA spending plan, the sooner the money can start making a difference in our local economy.
   
   

There is one amendment I am proposing to my June 15 recommendation.  There is a software improvement that we can add to our Community Health Division that will create a significant process improvement for residents and businesses when they seek various permits from the City.  The budget for this proposed addition is $300,000.  There is a modest cost for ongoing annual support and license that would be carried in our future annual operating budgets.  With that amendment, I offer the following revised recommendation:

1. Investments in Broadband Infrastructure  $2,000,000
2. Direct Assistance to People                       $1,600,000
3. Direct Assistance to Business.                      $600,000
4. Revenue Loss at City Facilities.                    $200,000
5. Climate Change Mitigation.                          $100,000
6. Community Health Software Upgrade          $300,000             

In my June 15 memorandum to the Council, I asked you to take my proposal under advisement and to approve it - or something akin to it - at your July 21 meeting.  If you approve my proposed spending plan at the July 21 meeting, staff will put together specific plans for each spending category and advance that specific plan to the Council for final approval at your Sept. 9 meeting.  If approved at the Sept. 9 meeting, staff will begin implementation of the approved plan on Sept. 10.