The Kenai Peninsula Borough Assembly passed a resolution that would accept Coronavirus State and Local Fiscal Recovery Funds. The state is requiring local municipalities approve a resolution for the receipt of said funds.
Finance Director Terry Eubank told the Kenai City Council:
“This resolution is being required by the state DCCED in order for them to meet the federal guidelines regarding ARPA funds. Once the state receives these funds for the NEUs, the non-entitlement units, which the city is one, they have 30 days to distribute those funds. The only way that that happens is by a resolution like this giving us the authority to accept the funds, this does not appropriate the funds, that will be a separate discussion. This gives the administration the ability to negotiate the grant agreements and things with the DCCED and then once the final amount is known, it’s estimated almost $1.9 million to the city, we will bring back an ordinance for appropriation of those funds and the spending plan. This really is a timing issue for the state in order to satisfy the agreements, the requirements of the ARPA funds, and just gives us the ability to negotiate those documents.”
Eubank discusses the difference between ARPA funds and CARES funds:
“The eligible expenditures under the ARPA funds are different than what was under CARES act. I think in some cases they are more stringent. I think there is more direct ties to direct financial impact for spending some of the money, but there are other areas that it does provide for revenue replacement for some governmental entities. I will say, I haven’t finished the calculations, but I don’t think the city of Kenai is going to be eligible for revenue replacement, because I don’t think we had a revenue loss, but it also provides things for water and sewer infrastructure projects as an eligible expenditure. Expenditure broadband infrastructure is another direct eligible expenditure. It is different than cares, but I don’t think that it is an easy explanation.”
Each NEU’s share is not to exceed 75% of its most recent adopted budget as of January 27, 2020. The nearly $1.9 million will come in two payments, and it’s reportedly less than 75% of the city’s most recent adopted budget as of January 2020.
U.S. Treasury guidance requires the state to distribute the funds within 30 days to NEU’s. Eubank also states that the funds will not be spent until the ordinance for appropriation is adopted.