HomeMy WebLinkAbout07 COVID-19 RELIEF FUNDS DocuSign Envelope ID:65CF223A-E760-4E47-BD81-C742D7BBD192 �
� Agenda Item
Reviewed:
AGENDA REPORT City Manager
Finance Director Y61
MEETING DATE: AUGUST 18, 2020
TO: MATTHEW S. WEST, CITY MANAGER
FROM: JASON AL-IMAM, FINANCE DIRECTOR/CITY TREASURER
SUBJECT: COVID-19 RELIEF FUNDS
SUMMARY
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was
signed into law, which included funding for state and local government. The City of Tustin did not
receive a direct federal allocation; however, the City has received allocations of CARES Act funds
from the State of California and County of Orange, which must be spent on eligible expenditures
directly related to COVID-19. This report recommends that the City Council accept and
appropriate these funds for various expenditures to respond to COVID-19. This report also
provides the City Council with an update on the status of other costs associated with COVID-19
that are eligible for reimbursement from the federal government.
RECOMMENDATION
Staff recommends the City Council:
1. Authorize the City Manager to Accept and Appropriate Coronavirus Aid, Relief, and
Economic Security Act ("CARES Act") funds from the State of California in the amount of
$992,487;
2. Approve the State CARES Spending Plan (as outlined within this report);
3. Authorize the City Manager to Accept and Appropriate CARES Act funds from the County
of Orange in the amount of$2,721,865.29; and,
4. Receive and File the Fiscal Update on COVID-19 Relief Funds.
CORRELATION TO THE STRATEGIC PLAN
The recommendation correlates to the City's strategic plan by implementing Goal C, strategy #4,
explore opportunities for new or increased revenues.
DISCUSSION
The Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") established the
Coronavirus Relief Fund, which provided funding to local governments with populations greater
than 500,000 to cover costs related to necessary expenses incurred from March 1, 2020 through
December 30, 2020 due to the public health emergency created by COVID-19. A portion of
CARES Act funds received by the State of California and the County of Orange has been allocated
to the City of Tustin.
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COVID-19 Relief Funds
State CARES Act Funds
On June 26, 2020, the California Legislature approved the Fiscal Year 2020/21 budget, which
included an allocation of the State's CARES Act funds to cities. The City of Tustin received an
allocation of$992,487, which is required to be spent on CARES Act eligible expenses. The State
has placed an additional restriction that requires the City to submit an expenditure report by
September 1, 2020 and substantially spend the money by October 30, 2020. It is recommended
that the City Council consider the proposed spending plan for State CARES Act funds:
Proposed State CARES Spending Plan
• $742,487 — Reimburse the City for payroll expenses for public safety employees whose
services are substantially dedicated to mitigating or responding to COVID-19
• $250,000 — Economic assistance to small businesses and non-profit organizations for
business interruption as a result of COVID-19
County of Orange CARES Act Funds — City Expenses
On June 29, 2020, the City of Tustin received $681,730.37 of CARES Act funds from the County
of Orange, which is restricted for specified uses and is generally intended to cover city expenses
such as payroll expenses for public safety and expenses for care for homeless
populations. These funds were used to reimburse the City for expenditures incurred through June
30, 2020 for public safety payroll expenses for employees whose services were substantially
dedicated to mitigating or responding to COVID-19 and to care for the homeless.
County of Orange CARES Act Funds — Small Business Assistance
On May 29, 2020, the City received $1,912,628.63 of CARES Act funds from the County of
Orange for economic support to small businesses. Small businesses may be eligible to receive a
working capital grant of up to $10,000. The grant may be used for business operating expenses
such as rent/lease payments, mortgage payments, utility expenses, inventory, personal protective
equipment (PPE), or other similar expenses that occur in the ordinary course of operations. The
City also created the Temporary Outdoor Expansion Grant Program to provide up to $2,000 for
eligible businesses such as restaurants and retailers to expand their outdoor areas and activities
to mitigate restrictions placed on indoor activities due to COVID-19 related State and County
health orders. The City began disbursing funds to small businesses in July 2020. These funds are
expected to be fully expended by December 30, 2020.
County of Orange CARES Act Funds — Food Delivery Expenses
On July 16, 2020, the City received $127,506.29 of CARES Act funds from the County of Orange
for food delivery to residents, including, for example, senior citizens and other vulnerable
populations, to enable compliance with COVID-19 public health precautions. These funds are
expected to be fully expended by December 30, 2020.
Federal Emergency Management Agency (FEMA)
The City is eligible to receive FEMA reimbursement for certain COVID-19 related expenses. On
March 31, 2020 the City Council authorized City staff to begin the recovery process with FEMA
for reimbursement for eligible costs associated with protective measures related to COVID-19.
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COVID-19 Relief Funds
Protective measures include, but are not limited to the purchase of equipment and supplies and
to assist with the COVID-19 response. As of June 30, 2020, the City had incurred $131,085.10
on FEMA eligible expenditures. The City must also meet a local share requirement for FEMA
funding, ranging from 6.25% to 25% of total expenditures submitted, depending on the
participation level of the State of California.
U.S. Department of Housing & Urban Development— Community Development Block Grant
On April 2, 2020, the City received notice of a special allocation in the amount of$498,862 to its
Community Development Block Grant funds to be used to prevent, prepare for, and respond to
COVID-19 (CDBG-CV). This allocation was authorized by the CARES Act. On April 21, 2020, the
City Council amended the City's Action Plan by allocating CDBG-CV funding to applicable
activities in response to COVID-19. These funds are available to the City on a reimbursement
basis and must be spent within six years.
Jason AI-Imam
Finance Director/City Treasurer