04-26-2022 CCM Workshop (ARPA Funds)HUTCHINSON CITY COUNCIL
SPECIAL WORKSHOP
MEETING MINUTES
TUESDAY, APRIL 26, 2022, AT 4:00 P.M.
CITY CENTER — COUNCIL CHAMBERS
Call to Order — 4:00 p.m.
Mayor Gary Forcier called the meeting to order. Members present were Pat May, Chad Czmowski,
Mary Christensen and Dave Sebesta. Others present were Matt Jaunich, City Administrator and
other city directors and staff.
DISCUSSION/REVIEW ITEMS
1. Review of American Rescue Plan Act (ARPA) Funds
Matt Jaunich, City Administrator, presented before the Council. Mr. Jaunich explained that in
March of 2021 President Biden signed into law the American Rescue Plan Act (ARPA). The bill
was a $1.9 trillion economic stimulus package to assist the United States in its recovery from the
economic and health effects of the COVID-19 pandemic. The Coronavirus State and Local Fiscal
Recovery Funds program, part of ARPA, delivers $350 billion to state, local and Tribal
governments across the United States to support their response to and recovery from COVID. As
part of that package, Minnesota is set to receive about $8.5 billion to address COVID-19 response
and recovery efforts. Minnesota counties, towns and cities will receive about $2.1 billion of the
ARPA funds with $377 million going to local governments with populations below 50,000.
Hutchinson is set to receive about $1.51 million, half of which has been received in 2021 with the
remaining amount expected to be delivered some time in 2022. The U.S. Department of Treasury
lists three main goals of the funding: 1.) To fight the pandemic and support families and
businesses struggling with its public health and economic impacts; 2.) To maintain vital public
services; 3.) To build a strong, resilient and equitable recovery by making investments that
support long-term growth and opportunity. Ideally, funds should be used in a way that have a
"significant and lasting" impact on the community. Any allocation of funds should be mindful of
creating new programs, or add-ons to existing programs, that would require a lasting financial
commitment. The federal government has noted five eligible uses of funds which are as follows:
1.) responding to the public health emergency; 2.) responding to the negative economic impacts
of the pandemic; 3.) premium pay for essential workers; 4.) revenue replacement for the provision
of government services to the extent the reduction in revenue is due to COVID-19; 5.)
investments in water, sewer and broadband infrastructure. The federal government has noted that
funds cannot be used for the following: 1.) to offset a tax cut or delay a tax/tax increase; 2.)
deposit in pension funds; 3.) replenishing of financial reserves; 4.) debt service payments; 5.) to
the satisfaction of settlements or judgements; 6.) use of funds to undermine COVID-19 mitigation
practices in line with CDC guidance and recommendations. The timeline to spend the funding for
costs incurred is through December 31, 2024. This means that ARPA funds may be utilized for
eligible expenditures incurred between March 3, 2021 and December 31, 2024. Mr. Jaunich went
into more detail of each eligible use defined by the federal government. Mr. Jaunich explained
that staffs plan is to use the funds for revenue replacement for the provision of government
services to the extent the reduction in revenue is due to COVID-19. Mr. Jaunich explained that
this gives us the greatest flexibility when it comes to spending the money and it is the easiest
reporting requirement. The items in this report are not exclusive and other expenses may be
eligible. However, staff still needs to develop a plan for how the money will be spent.
Mr. Jaunich noted some additional things to consider: 1.) The City's non -recurring revenue
policy; 2.) This is one-time money; 3.) Funds should be used in a way that have a "significant and
lasting" impact on the community; 4.) Funds should go to investments that support long-term
growth and opportunity within the community; 5.) What will have the greatest impact on the
community?; 6.) Funds should not be used for "operational or reoccurring expenses"; 7.) Core
values, strategic plans and long-term community needs should be considered; 8.) Staff is looking
for direction from the Council so that a formal plan can be brought back for action.
Mr. Jaunich then reviewed potential projects within all departments: Administration, Creekside,
Economic Development, Information Technology, Fire, Housing, Parks and Recreation, Public
Works, and Community Requests.
Council Member Czmowski asked what staff would see as a priority within the facility projects.
Mr. Jaunich noted that HVAC systems are a priority with other east rink improvements, as well as
the Franklin Neighborhood redevelopment. He expressed that he feels these two projects would
impact the most people/users.
Mayor Forcier expressed that he would like to see the funds used on infrastructure and HVAC
systems.
It was noted that the third priority of staff might be security upgrades.
Dan Jochum, Planning Director, expressed that he feels infrastructure should be expanded to Hwy
7/22 and/or east on 5th Avenue toward Hwy 22 and is a significant, lasting impact on the
community.
The Council asked for final cost estimates on the Franklin Neighborhood Redevelopment, HVAC
upgrades and infrastructure expansions. Mr. Jaunich reminded the Council that the projects
selected should have the most significant and lasting impact on the community.
Council Member Christensen liked the idea of touchless drinking fountains within the parks and
throughout the community as well as security systems within the parks. Council Member
Christensen asked for costs associated with these two items. Discussion was held regarding
security systems within the parks system.
Judy Flemming, HRA Director, requested that the Council not forget about affordable housing.
General discussion was held regarding the housing needs in the community.
The intention is to approve a plan by the end of May/June.
Motion by Czmowski, second by Christensen, to adjourn at 4:55 p.m. Motion carried
unanimously.
ATTEST:
Gary T. Forcier
Mayor
Matthew Jaunich
City Administrator