Discussion:
On July 27, 2021 the City of Shakopee received its first installment of Coronavirus Local Fiscal Recovery Funds in the amount of $2,199,407. Prior to receiving the funding, staff had compiled a list of possible options for using the funds noting that most had little staff work at the time, and that all would ultimately have to return to council for action. These were presented at the August 4th Council Meeting.
At that time, it was noted that the list wasn't exhaustive and that other projects would continue to be brought forward in the future. The only purpose of the discussion on the 4th was to determine if Council thought recovery funds would be a good fit for funding the particular projects, not on the merits of the projects themselves. Any project would still have to go through our normal processes with oversight and Council actions.
Unlike some city/county organizations, all of our funding was able to be categorized as "replaced lost public sector revenue," thus allowing for expanded usage. Shakopee essentially does not need to conform to the other various category spending requirements in the act due to this designation. Other organizations that have not been able to categorize the funding as lost income can have a more extensive planning process to determine how to use the funds under the law.
Under a "lost revenue" designation, the city has broad latitude in uses for the funding. However, any use would need to comply with other lawful uses, and cannot be used for debt payments, replenishing reserve funds or use in programs that require non-federal matching funds. In other words, if the city could not expend funds on a project or issue before, it is still prohibited by those restrictions. The act did not give the city latitude to expend funds contrary to state and Federal guidelines.
Following the general maxim that one-time funding should be used for one-time projects and not for operational expenses, city staff brought forward thirteen initial projects for discussion. Of those, a 2% cost of living adjustment for city staff ($377k), Dining Parklets for Downtown Shakopee ($300k), Marketing and Economic Development contracts with Momentum Strategies and Integrated ($135k), the purchase of a Sewer Jetter replacement vehicle ($285k), three Civil Defense Sirens ($80k), City Hall Protective Window Film ($50k) and two City Entrance Gateway Monuments ($100k) were slated as acceptable uses of the funds.
Most of those projects have been through the full council approval process and are in various stages of development (window film and sirens have yet to move forward).
This leaves approximately $850k for use from the 2021 funding, and another $2.2M that will be delivered to the city in 2022.
On November 3, 2021 staff proposed replacing the two existing electronic message boards in the downtown monument with a new integrated Daktronics system and proposed to use ARPA funds for the purchase. This prompted a request to renew the discussion on fund usage.
The first reporting deadline has been pushed from October 31, 2021 to April of 2022. All funds must be expended by December 31, 2024.