In response to the COVID-19 pandemic, the federal government authorized $360 billion in direct aid to State and Local Governments under the American Rescue Plan Act (ARPA). The City's allocation is $18,009,865, to be drawn down in two equal tranches. On June 17, 2021, the City received the first tranche of $9,004,932.50, with the second tranche to be drawn in June 2022. Per the U.S. Department of the Treasury's Final Rule published in January 2022 (overview attached), all ARPA funds are required to be earmarked by December 31, 2024, with all funds fully expended by December 31, 2026.

As a reminder, ARPA funding eligible uses include:

1. Response to the public health emergency or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality;
2. Response to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers;
3. The provision of government services to the extent of the reduction in revenue due to the COVID–19 public health emergency relative to revenues collected in the most recent full fiscal year prior to the emergency; and
4. Investments in water, sewer, or broadband infrastructure

In addition to the above eligible uses, the Final Rule states that recipients (the City) may use funds to replace revenue loss, which shall be determined by a standard allowance of $10 million in aggregate, not to exceed award amount; or calculating the jurisdiction's specific revenue loss each year using the Treasury's formula. The City calculated that revenue loss for the 2020 and 2021 fiscal years were $4,845,164 and $1,353,283, respectively. It is staff's recommendation that the City use the standard allowance of $10 million in revenue loss for eligible expenditures, which include a broad range of government services traditionally provided by recipient governments, including the construction or maintenance of roads and other infrastructure, provision of public safety and other services, to name a few. Revenue loss funds can also be used to meet non-federal cost-share or matching requirements of other federal programs. Revenue loss funds cannot be used for debt service, replenishing financial reserves, or satisfying settlements or judgements. ARPA funds used for government services are subject to streamlined reporting and compliance requirements.

To-date, City Council has approved the use of ARPA as follows:

• July 15, 2021 - $649,810.86 (revenue loss) for the purchase of 151 body camera units and all associated hardware and licensing for the first two years of a five year contract.
• September 22, 2021 under the adoption of the Fiscal Year 2022 budget - $4 million (revenue loss) for the construction of Building "E" ($2 million) and the replacement of the Citywide financial system ($2 million).
• August 19, 2021 - $345,264 (generally eligible) use of ARPA funds to provide 80 hours of paid leave for employees impacted by COVID-19, and an additional 40 hours of paid leave for certain public safety personnel. This benefit was later extended by City Council on January 6, 2022 and expired on March 31, 2022.
• December 9, 2021 - $80,798.12 (revenue loss) for the purchase of 120 smart phones and cases to support previously approved body cams; $275,000 (generally eligible) for Disaster Recovery Site Cloud software; $300,000 (generally eligible) for cybersecurity enhancements for the remaining three years of the City's five year Cisco Enterprise Agreement.

To-date, Council has authorized approximately $5,650,872.98 in ARPA funding, of which $920,264 is covered under generally eligible expenditures and $4,730,608.98 under revenue loss. The balance of available ARPA funding from the first tranche is approximately $3,354,059.52 and the second tranche to be drawn down in June is another $9,004,932.50, for a total of $12,358,992. Of the total ARPA funding available, $5,269,391.02 is available to be applied to projects eligible under the Revenue Loss category.

At the December 9, 2021 Special Council Meeting, Council authorized staff to publish a Request for Information (RFI) to gather input from the public on uses of ARPA funds to address affordable housing needs and homelessness. The RFI was published on March 1, 2022 and closed on April 4, 2022. The City received a total of 12 responses from the following non-profit and for-profit entities: Brevard Alzheimer's Foundation; Carras Community Investments; Community of Hope; Daily Bread; Easterseals; Habitat for Humanity of Brevard; Helps Community Initiatives (HCI); I Am Ministries (The Source); Reid Friedson, PhD.; Rise with Hope Enterprise; and The Sirmons Group Ministries. All agencies proposed collaboration with other organizations, except one (Reid Friedson, PhD: Governance and Education Expert). 10 out of the 12 agencies proposed use of additional funding to supplement ARPA funding. Number of residents/households assisted range from two (2) to 111,000 residents. The timeframe for expenditure of funds range from four (4) months up to two years. Funding requests range from $75,000 to $5 million, more than half of which are construction-related suggestions. Construction projects recommended include Section 8 affordable housing, attainable housing for homeless currently in shelter, affordable housing with supportive services, single-family homes, two (2) emergency/transitional houses for homeless, facility to house and support programs and services related to emergency shelter, meals, showers, etc.

Staff proposes the following for Council's consideration:

• $50,000 (generally eligible) for enhanced cleaning under COVID-19 protocols  
• $5,269,391.02 (revenue loss) in additional funding to cover General Fund contribution to the construction of Building "E", which would encumber the remaining balance available under Revenue Loss
• $2 million (generally eligible) to address homelessness and affordable housing using the City's Request for Proposal procurement process

This would leave a balance of $3,039,600.98 in uncommitted ARPA funding for generally eligible uses.