HomeMy WebLinkAbout29. Potential uses of American Rescue Plan Act (ARPA) Funds
TO: Honorable Mayor and Members of the Common Council
FROM: Mark Rohloff, City Manager
DATE: November 3, 2021
RE: Potential ARPA Uses
Following the October 12 Council resolution on the use of American Rescue Plan Act (ARPA) Funds, staff
met to discuss general strategy on the use of these funds. Staff appreciated comments from Councilors that
they did not want to approve funds in a “piecemeal” fashion. At the same time, there was a general
recognition that we do not want to over commit funds too early so that we are not prepared to address
other issues that may arise over the next few years. As a result of these discussions, staff has prepared
two separate tables for Council discussion on potential uses of ARPA funds.
Based on Council’s recommendation, staff prepared two tables, one to address the 75% allocation of ARPA
funds to infrastructure, and the remaining 25% for non-infrastructure purposes. Based on the federal
allocation of $20.5 million, staff allocated $15,385,863 to infrastructure projects, and $5,128,621 for non-
infrastructure purposes. Within each allocation, staff has identified some general areas for Council’s
consideration. These categories are summarized below. The more immediate expenditures are specific,
while other categories remain general until such time that an actual use of funds is decided and approved
by Council.
INFRASTRUCTURE USES
Projects already approved by Council
On October 26, the Council approved using $50,900 in ARPA funds for a variety of capital items that were
identified by staff as being needed relative to the COVID response. These are the only funds that have
been approved to date by the City Council.
Unfunded Projects from 2022 CIP
When the Capital Improvement Plan (CIP) was approved by Council in September, there were
approximately $2.6 million in projects that were not funded due to Council’s self-imposed borrowing limit
of $20 million for 2022. The projects in this category are those that staff believes are needed in the
immediate future. A major highlight of this expenditure is the purchase of police and fire radios. These
radios require replacement because the technology of the previous radios is now obsolete; we need to
replace these radios in 2022. In order to meet advance ordering requirements and get the best pricing, this
purchase needs to be confirmed prior to December 14.
2022 Capital Equipment
For the 2022 CIP, staff had intended to use $1.5 million in levy support for capital equipment. In order to
limit our property tax levy increase, staff was only able to fund capital equipment at $1.1 million. As the
attachment shows, there is approximately $447,450 in equipment in the CIP that is not funded. Staff is
recommending that these purchases be made with ARPA funds.
IT and Security Projects
Throughout the course of the COVID emergency, staff has identified other equipment that is needed that
we could not acquire with Coronavirus Aid, Relief, and Economic Security Act (CARES) funding. As the
attached sheet shows, approximately $44,000 in IT and security equipment is needed that is not funded in
the 2022 budget.
Repay Community Foundation for Convention Center Improvements
In 2007, the Oshkosh Area Community Foundation (OACF) loaned the city $1 million to assist with
Convention Center improvements. With interest capitalized upfront, the total amount to pay back is $1.25
million. The idea was for the loan to be repaid after other debt obligations were met, and through a
portion of food and beverage sale proceeds at the Convention Center. Over the course of the past 14 years,
the amount remaining on the loan remains slightly over $900,000.
The latest repayment plan was to increase payments to OACF after the initial debt on the convention center
had been paid off. Unfortunately, with the severe reduction in room tax dollars due to COVID, the payoff
of this debt is not possible at this time. Staff is proposing that the remaining $900,000 be paid off with
ARPA funds. This will enable the room tax/convention center fund to support current operational costs
and future debt costs by itself. This payoff is long overdue and will enable the Community Foundation to
focus on basic needs in our community. The proceeds from the Community Foundation loan were used
to fund a building infrastructure project, so I believe it is appropriate to use ARPA funds for this purpose.
Infrastructure Projects for Future Consideration
Potential IT and Security Projects
The CIP has identified several Information Technology (IT) related projects that remain unfunded in the
coming years. Rather than commit funds at this time, staff is proposing that an allocation of $850,000 be
set aside for these potential projects. These projects would come before Council for approval at a later time,
but we feel that a reservation of funds is necessary at this time for long-term planning purposes.
Future CIP Levy Projects
As the attached sheet indicates, there is approximately $1,260,000 in capital equipment that will likely not
be able to be funded with levy dollars in 2023 and 2024. Staff is proposing that these funds be reserved
until future years in the event that levy support is not available for these purchases. Among these capital
purchases are replacement emergency generators at several of our fire stations along with other
improvements have been identified in the Five Year CIP.
Reduce 2023 Debt Financing
As directed by Council, staff is planning to limit General Obligation (G.O.) borrowing to $15 million for
the 2023 CIP. As it currently stands, the 2023 CIP has identified nearly $21 million in debt financing needs.
Staff is proposing that slightly over $5.9 million in ARPA funds be reserved until such time that the City
Council considers the 2023 CIP.
After these expenditures and reservations, approximately $3.25 million in infrastructure ARPA funds will
remain. Mr. Van Gompel has pointed out that we would need to reduce our 2024 borrowing by $8.25
million in order to maintain our annual borrowing limit of $15 million. With only $3.25 million in ARPA
funds remaining, it is appropriate to reserve those funds to identify what future capital improvements
may be necessary.
NON-INFRASTRUCTURE PROJECTS
As the 2nd attachment indicates, approximately $5,125,000 is being allocated for non-infrastructure
purposes based on Council‘s direction. The attachment indicates the following potential uses and/or
reservations of these ARPA funds:
Day By Day Warming Shelter
For 2021, Council tasked me with a goal of identifying ways to address homelessness in our community.
The Day By Day Warming Shelter (DBD) has seen a noticeable increase in its guests since the start of the
pandemic. DBD continues to operate out of a temporary facility and recognizes the need to have a year
around facility in which they can provide shelter service and assist in transitioning people out of the
cyclical nature of short term shelters. I had suggested to Council that the city support the construction of
a $3.5 million facility with approximately $1 million in ARPA funds. I am aware that other governmental
agencies, nonprofits, and foundations are also considering support. I remain committed to providing
support to Day By Day, and I am recommending that $1 million beside aside as the city’s contribution to
this project.
Other Homeless Initiatives
In order to address the continuum of care that is necessary to provide housing security for our residents,
I am proposing that we reserve $750,000 in ARPA funds for other direct future homeless initiatives.
Specifically, I am aware that COTS is interested in operating a transitional facility here in Oshkosh.
Additionally, the Oshkosh Kids Foundation is making plans to construct a “Tiny Homes” project on
Packer Avenue. These projects will likely be forthcoming in future months. I believe it is appropriate to
reserve funds so that we may consider projects such as these to address the continuum of care. These
potential projects are already on the list of ARPA requests that we have received.
Housing and Nonprofit Assistance
Staff has received multiple requests from various agencies regarding other housing initiatives that can
potentially address homelessness or other issues of housing insecurity. Staff is also aware that the State of
Wisconsin has a $200 million program to fund local governments and nonprofits for various initiatives
related to the COVID pandemic. Additionally, other governmental entities, notably Winnebago County,
also have ARPA funds or are seeking state funds for the same purposes. Rather than commit our ARPA
funds at this time, I believe it is appropriate to reserve funds to potentially partner with other
governmental and nonprofit entities for potential projects. A total of $1,875,000 is proposed to be reserved
for these potential projects. Any funding out of this reserved amount would require Council approval. I
am not making any specific recommendations at this time.
Business Assistance
Similar to assistance for housing support, I believe that the business community has yet to feel the entire
impact of the COVID pandemic. Additionally, there are other programs with other governmental and
nonprofit entities available that we may be able to work with to assist local businesses, as well as unused
TIF loan funds that we could repurpose for other business assistance programs. I propose that we reserve
approximately $500,000 for these potential projects in the future. Any funding out of this amount would
require Council approval.
Reserve for Other Initiatives
After funds have been reserved or allocated to the above projects, approximately $1 million would remain
as undesignated ARPA funds for non-infrastructure purposes. I recommend that we keep these funds in
reserve so that we can identify other needs that may arise. These funds may be used to support some of
the requests that we have already received, or we can hold off until we have identified other needs.
Award to City of Oshkosh $20,514,484
Council Resolution for Infrastructure (75%)$15,385,863
Amount
Remaining
Projects Approved on October 26, 2021
Server upgrade $20,000
WiFi Hardware $2,000
Video Conferencing $5,800
Surveillance Cameras $4,000
Automatic Vehicle Location $19,100 $50,900 $15,334,963
Projects to be Considered Now
Projects from 2022 CIP
Police Radios $1,200,000
Fire Radios $689,400
Menominee Beach House $150,000
GOH Lighting $80,000
Station 19 Parking Lot $36,500
Library Generator $160,000
City Hall Entrance Doors $65,700
Concrete Repairs $250,000 $2,631,600 $12,703,363
2022 Levy Shortfall
Museum Masonry $25,000
Museum General Purpose Room $50,000
Fire Dept Generator $60,000
Fire Hose $51,450
Fire Dept Mattresses $20,000
Fire Nozzles $20,000
Fire Dept Station Renovations $50,000
Fire Dept Turnout Gear $71,000
Senior Center North Front Area $20,000
City Hall Security $80,000 $447,450 $12,255,913
IT and Security Projects
Additional Laptops for telecommuting (5)$6,000
Computer training lab desktops (17)$12,000
Update squad MDC $26,000 $44,000 $12,211,913
Repay Oshkosh Foundation $900,000 $11,311,913
Projects For Future Consideration
Potential IT and Security Projects $850,000 $10,461,913
Future CIP Levy Projects
Fire Department Generators (3)$600,000
Fire Hose (2023, 2024)$83,150
Museum Masonry (2023)$175,000
Museum General Purpose Room (2023)$150,000
Fire Dept Station Renovations (2023, 2024)$100,000
Fire Dept Turnout Gear (2023, 2024)$152,000 $1,260,150 $9,201,763
Reduce 2023 Debt Financing $5,948,180 $3,253,583
Reduce 2024 Debt Financing $8,250,000 -$4,996,417
Potential ARPA Projects
Award to City of Oshkosh $20,514,484
25% ARPA Allocation $5,128,621
Amount
Remaining
Day by Day Warming Shelter $1,000,000
Other Homeless Initiatives $750,000
Housing & Non Profit Assistance with Potential County/State Match $1,875,000
Business Assistance with Potential County/State Match $500,000 $4,125,000
Reserve to 1/1/24 $1,003,621
Projected Use of ARPA Funds for