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ADOPT A RESOLUTION APPROVING RECOMMENDED FINAL ADJUSTMENTS TO THE AMERICAN RESCUE PLAN ACT PROGRAMS AND PROJECTS
recommended action
RECOMMENDATION
It is recommended that the City Council adopt a resolution approving the recommended final adjustments to the American Rescue Plan Act Programs and Projects:
1. Allocate $2,000,000 to support Banner Island Ballpark upgrades;
2. Allocate $2,558,000 to purchase and install four emergency generators for New City Hall;
3. Increase the allocation for the Animal Shelter Facilities Upgrade project by $462,072; and
4. Allocate $500,000 to the Northeast Stockton Library and Community Center project.
Authorize the City Manager to take necessary and appropriate actions to carry out the purpose and intent of this resolution.
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Summary
In 2021, the American Rescue Plan Act was passed by Congress, allocating $78,052,072 to the City of Stockton for COVID mitigation and recovery efforts. All funds must be fully obligated by December 31, 2024, and fully expended by December 31, 2026.
Additional information regarding ARPA projects and plans, financial reports to the Department of the Treasury, workshops, and any supplementary actions taken by Council can be found on the City’s website at:
www.stocktonca.gov/government/city_manager/american_rescue_plan_act.php <http://www.stocktonca.gov/government/city_manager/american_rescue_plan_act.php>
DISCUSSION
Background
The American Rescue Plan Act (the Act) established the Coronavirus State Fiscal Recovery Fund and Coronavirus Local Fiscal Recovery Fund (CLFRF), which provides a combined $350 billion in assistance to eligible state, local, territorial, and Tribal governments to support COVID-19 economic recovery efforts. Of the $350 billion, $19.53 billion was allocated to non-entitlement units of local government, ultimately allocating $78,052,072 to the City of Stockton based on the City’s 2019 Census data. The Treasury’s intended goal is to provide substantial flexibility for each government to meet local needs - including support for households, small businesses, impacted industries, essential workers, and the communities hit hardest by the COVID-19 public health crisis. These funds can also be used to make necessary investments in water, sewer, and infrastructure. Funding objectives include relief to:
• Support urgent COVID-19 response efforts to continue to decrease the spread of the virus and bring the pandemic under control;
• Replace lost revenue for eligible governments to strengthen support for vital public services and help retain jobs;
• Support immediate economic stabilization for households and businesses; and
• Address systemic public health and economic challenges that have contributed to the inequal impact of the pandemic.
Local governments received funds in two tranches. Half of the funding, or $39,026,036, was received by the City on June 1, 2021, with the balance arriving in July 2022. Funds must be obligated by December 31, 2024. The period for performance ends December 31, 2026.
The City of Stockton, like most communities throughout the country, was negatively impacted by the COVID-19 public health emergency. In particular, the city experienced severe revenue losses due to reduced business patronage, recreational activities & events, and outside travel, in addition to experiencing numerous business closures. However, the City continued its operations throughout the pandemic and maintained essential services for its residents - while adhering to the local and state-wide health mandates/directives to ensure proper safety for its employees and allowing adequate time-off for COVID-19 related issues. Furthermore, City staff continued to remain at work and provide essential services to the community throughout the pandemic.
The City received the first half of ARAP funds on June 1, 2021 and submitted the first iteration of proposed projects to the City Council on June 22, 2021, as New Business Item 15.1, which was approved by motion 2021-06-22-1501.
The proposed list of projects was identified and categorized to support:
• COVID Mitigation and Prevention
• Community Well Being
• Essential Support to Household
• Small Business Support & Economic Recovery
• Homeless & Housing
• Recovery of City Government
• Digital Divide & Internet Connectivity
• Other Miscellaneous Projects
The Council provided guidance and recommendations for revisions, which were brought back to Council in September 2021 and approved with motion 2021-09-14-1501. This September action also set aside ten percent (10%) of the funds as a Council Contingency allocation.
In December of 2021, Council approved a recommendation to reprogram $6,050,000 from existing projects to provide a match for the Housing Authority of San Joaquin County’s (HASJC) application for Project Homekey funding to support their Calaveras Quarters Project. This reallocation of funding canceled $5,850,000 from the proposed Down Payment Assistance Program and $200,000 from the Coordinated Entry Project. No Contingency Funds were used to complete this action, which was approved by resolution 2021-12-14-1504.
City staff provided the Council with an update on all ARPA-funded projects during the 2022 Study Session on Projects Funded by the American Rescue Plan Act, held at the Civic Auditorium on February 16, 2022.
On April 19, 2022, with motion 2022-04-19-1201, City Council approved a contract under the Recovery of City Government - General Administration, to support procurement activities related to ARAP purchases and reporting. This again, reprogrammed funding from an existing project and did not expend any contingency funds.
In May of 2022, with motion 2022-05-24-1502, City council approved the use of $2.5 million in Council Contingency Funds: $1.5 million would support new video board equipment for the Stockton Arena, $500,000 to support ongoing traffic and safety improvement projects within the Miracle Mile District, and $500,000 to support the unfunded, State mandated COVID-related sick leave. This action reduced the Council Contingency line from $7,805,208 to $5,305,208.
With resolution 2022-06-14-1506, in June 2022, City Council approved the reprogramming of $3.6 million from the existing Low-Barrier Shelter Bed project and $1.8 million from the Safe Camping & Parking project, effectively canceling both existing projects and consolidating them into what is now the Shelter Bed and Enhanced Safety Zone, with a City budget of $5.4 million. This action also instructed the City to apply for additional grant funding from the San Joaquin County to support access to low-barrier shelter beds in the City of Stockton. Staff continues to work with the County and provide updates to Council, most recently with resolution 2022-11-01-1202, and will continue to provide updates to the Council during future meetings.
On July 26, 2022, with motion 2022-07-26-1503, the City approved a contract with Community Medical Centers to launch a pilot community well-being and crisis intervention program - Care Link Mobile Crisis Intervention Response. This partnership shares the objectives of decreasing repeat callers in crisis, increasing follow-up and access to wrap around services, decrease hesitancy to call police, increase community trust, decrease non-emergency calls to 911, and divert individuals away from the criminal justice system.
City staff provided the Council with an update on all ARPA-funded projects during the 2023 Study Session on Projects Funded by the American Rescue Plan Act, held at the Civic Auditorium on February 22, 2023.
With motion 2023-03-21-1503, in March of 2023, the Council authorized reprogramming $3.6 million from the Council-approved low Barrier Shelter Bed category to support the St. Mary’s Pathways project. Pathways is a residential temporary housing community operating under shelter guidelines, comprised of 200+/- modular temporary housing units.
In May of 2023, with resolution 2023-05-02-1208, the Council approved an additional allocation from ARPA contingency to support Uplift Downtown efforts and created a new project to replace the Arena Scoreboard and ancillary Audio/Visual systems.
In addition, the Council approved several actions from May through October 2023 to fund or support different initiatives in the City related to housing and services for the unsheltered population.
• May 2023 - Resolution 2023-05-02-1207 approved reprogramming of $1.8 million from the Low-Barrier Shelter Beds category to support a Homekey - Round 3 application and project that would provide approximately 76 one- and two-bedroom units for individuals are homeless or are at imminent risk of homelessness.
• August 2023 - Resolution 2023-08-03-0401 ratified a local emergency proclamation due to public health and safety related to unhoused individuals. This resolution authorized staff to include ARPA contingency funds as an available resource as the community worked through the closing of the Stockton Shelter, providing services to those clients at risk of losing support, and transitioning services and clients to another provider.
• September 2023 - Motion 2023-09-12-1501 formally appropriated $800,640 from ARPA contingency to operational expenses related to transitioning the Stockton Shelter facility to the care and control of the St Mary’s organization, in response to the shelter crisis outlined in the previous resolution.
• October 2023 - Motion 2023-10-17-1204 appropriated $826,961.40 in ARPA contingency funds to support construction and construction management services to resume/complete the Navigation Center project, previously under the control of the Stockton Shelter. This item was also in response to the emergency declaration established by the August resolution.
City staff provided the Council with its annual update on all ARPA-funded projects during the 2024 Study Session on Projects Funded by the American Rescue Plan Act, held at the San Joaquin Council of Governments (SJCOG) Building on February 28, 2024.
Following the 2024 Study Session, the Council approved another series of actions related to the redistribution or appropriation of ARPA funds.
• March 2024 - Resolution 2024-03-12-1503 approved the list of recommendations from the February 2024 workshop.
• May 2024 - Motion 2024-05-21-1203 approved the reallocation of $1,798,000 to support the Navigation Center Project.
• October 2024 - Motion 2024-10-01-1207 approved the reallocation of $800,640 to support the St. Mary’s Dining Room operation services related to the Navigation Center Project.
Present Situation
With the December 31, 2024 deadline to fully obligate all ARPA funds, staff has completed a final reconciliation of all project budgets and have identified $5,520,072 that is available for reallocation through this final adjustment process.
To remain compliant with the December 31, 2024 deadline, staff recommends the following adjustments to the ARPA spend plan to ensure the $5,520,072 can be fully obligated in time.
• Banner Island Ballpark Upgrades - $2,000,000
Ballpark upgrades are necessary to maintain standards set by Major League Baseball for minor league team facilities. Total estimated construction costs are in the range of $6 million. Construction contract award approval request is planned for the December 3, 2024 Council meeting.
• Emergency Generators at New City Hall - $2,558,000
This allocation will allow the City to purchase four emergency generators for New City Hall. This will be in addition to various generator replacement purchases already approved for ARPA funding. The contract award approval request is planned for the November 12, 2024 Council meeting.
• Animal Shelter Facility Upgrades - $462,072
Council previously approved $9.5 million ARPA for Animal Shelter facility upgrades and contract awards totaling $10.5 million. The requested ARPA increase provides additional contingency funding.
• Northeast Library & Community Center - $500,000
Total approved project costs amount to $14.9 million. The ARPA funding of $500,000 requested for this project will be included as part of a forthcoming contract change order request, to be presented at the November 12, 2024 Council meeting.
FINANCIAL SUMMARY
The full $78 million in ARPA funding is budgeted in the 280 Special Grants fund. The recommended action would allocate the final $5,520,072 to the projects identified above. This reallocation of ARPA funds will ensure the City’s ability to fully obligate all ARPA funds by the December 31, 2024 deadline.
Attachment A - February 2024 ARPA Workshop Materials