BACKGROUND/DISCUSSION:
The American Rescue Plan Act of 2021 established the Coronavirus State and Local Fiscal Recovery Funds. This act authorized the United States Treasury to distribute $350 billion to state, local, territorial, and tribal governments to bolster the response to the COVID-19 emergency and its economic impacts. The City of Saginaw's share of this program is $6,023,676 which will be paid in two distributions of $3,011,838. The first was received in the summer of 2021 and the second is expected in the summer of 2022.
Since the total distribution to the City is less than $10M, the City can use the "revenue loss replacement" category when justifying the use of the funds. This spending category is the most flexible and can be used for government services or anything traditionally provided by local government.
These funds may NOT be used to offset a reduction in net tax revenue, for deposits into pension funds, for debt service, to replenish financial reserves, or for the satisfaction of settlements or judgements.
The total amount of the award must be obligated by December 31, 2024 and spent by December 31, 2026.
FINANCIAL IMPACT:
The City received a total funding award of $6,023,676.42 which will be paid in two equal distributions. The first was received by the City in August 2021. The second is expected to be received in the summer of 2022.
RECOMMENDATION:
There is no action recommended. This item is for discussion and planning purposes.