To: Honorable Mayor and Members of City Council
From: Steve Potter, City Manager
Prepared By: Rajneil Prasad, Finance Director
TITLE:
Title
American Rescue Plan Act (ARPA) Funds Reallocation
LABEL
RECOMMENDED ACTION:
Recommendation
Adopt a resolution amending the Capital Improvement Project plan; and reallocating a portion of the City’s American Rescue Plan Act funds, as documented in Council Budget Amendment 05P04, and determining that the actions authorized by this resolution are exempt from CEQA under State CEQA Guideline 15378.
Body
DISCUSSION:
The City of Napa received an allocation $15.12 million in American Rescue Plan Act (ARPA) funds. These funds are intended to address needs including public health response, negative economic impacts, and improvements to water, sewer, and broadband infrastructure. The City’s allocation of ARPA funds was based on guidance from the US Treasury, City Council priorities, community needs, and a City department COVID impacts needs assessment, as well as focus on one-time needs.
ARPA funds must be obligated by Dec. 31, 2024, and spent by Dec. 31, 2026. Given these deadlines, the City has three months to come up with a distribution plan that ensures unobligated/available funds are used efficiently and for their intended purposes within the allowed timeframe.
Staff is recommending:
For ARPA Funded Capital Improvement Projects (CIP):
A funding exchange to efficiently utilize the ARPA funding and accomplish the currently programmed priority projects. This exchange will modify the funding allocations and allow the programmed projects to advance as planned. The proposed exchange will add the Browns Valley Project and the Senior Center Paving and ADA Project to the list of projects funded by ARPA. The construction contracts for these projects have been awarded by City Council and meet all requirements for ARPA funding. Several projects previously programmed with ARPA funds (Stormdrain Repairs, Generator for the Police Building and Generator for the Corp Yard), will be completed through other funding sources that had previously been programed on the Browns Valley and Senior Center Projects. This exchange removes the risk for the use of ARPA funding that could be associated with potential project delays outside of the City’s control.
|
Project |
Project No. |
ARPA |
GF Facilities CIP |
Measure T |
|
Generator for Police Facility 911-Dispatch and EOC |
33FC23PW04 |
$(209,000) |
$209,000 |
- |
|
Generator for Corporation Yard |
33FC23PW05 |
$(221,000) |
$221,000 |
- |
|
Police Department HVAC |
33FC20PW03 |
$83,500 |
$(73,500) |
- |
|
Senior Center paving & ADA |
33FC22PW02 |
$356,500 |
$(356,500) |
- |
|
HR Contact Tracing |
15ARPA01 |
$(80,000) |
- |
- |
|
Rose Lane Sewer Separation |
33SD16PW01 |
$(100,000) |
- |
- |
|
Stormdrain Infrastructure Funding |
33SD23PW01 |
$(3,600,000) |
- |
$3,770,000 |
|
Browns Valley Rd/ First St |
33ST22PW03 |
$3,770,000 |
- |
$(3,770,000) |
|
Total |
|
- |
- |
- |
• Senior Center Paving & ADA (33FC22PW02) - This project will complete the parking Lot paving and ADA Improvements at the Napa Senior Center. (*New ARPA Project)
o Status: City Council authorized the construction contract award on September 17, 2024 with a construction budget of $421,032.33.
o Funding Revision: This project is currently funded by the GF Facilities CIP Fund and the proposed exchange would program ARPA funding instead. $365,000 of the project’s GF CIP Facilities Funds will be transferred out of the project to fund the Generator for Police Facility 911-Dispatch and EOC (33FC23PW04) and Generator for Corporation Yard (33FC23PW05) projects as described above. $365,000 of ARPA Funds will be transferred to the project budget. The total project budget will remain unchanged. This funding exchange will ensure the efficient use of ARPA funding and that the priority
• Generator for Police Facility 911-Dispatch and EOC (33FC23PW04) - Purchase new generator and install equipment.
o Status: Generator ordered and engineering plans nearing completion to bid the construction work.
o Funding Revision: This project is currently funded by ARPA funds and a funding exchange is being proposed to efficiently deliver currently programmed projects. The generator was ordered five months ago and is anticipated to arrive in calendar year 2025. Staff is finalizing the construction plans to bid out the associated site work and installation. Based on the remaining work and schedules, staff is recommending the funding source be swapped for general fund. The result of this swap would remove $209,000 of ARPA funds from the Generator for Police Facility 911-Dispatch and EOC (33FC23PW04) project in exchange for $209,000 of GF Facilities CIP Funds from the Senior Center Paving & ADA Project (FC22PW02). This funding exchange will provide the same level of overall funding to the projects and will ensure that these priority projects are completed as planned.
• Generator for Corporation Yard (33FC23PW05) - Purchase new generator and install equipment.
o Status: Generator ordered and engineering plans nearing completion to bid construction work.
o Funding Revision: This project is currently funded by ARPA funds and a funding exchange is being proposed to efficiently deliver currently programmed projects. The generator was ordered five months ago and is anticipated to arrive in calendar year 2025 Staff is finalizing the construction plans to bid out the associated site work and installation. Based on the remaining work and schedules, staff is recommending the funding source be swapped for general fund. The result of this swap would remove $221,000 of ARPA funds from the Generator for Corporation Yard (33FC23PW05) project in exchange for $221,000 of GF Facilities CIP Funds from the Senior Center Paving & ADA Project (FC22PW02). This funding exchange will provide the same level of overall funding to the projects and will ensure that these priority projects are completed as planned.
• Police Department HVAC (33FC20PW03) - The project will replace the PD cooling tower and other system components. The current ARPA funding levels provide partial funding for the project and the CIP facilities funds are also being utilized.
o Status: The contract for the new equipment and construction work is being negotiated with the vendor and will be presented in Fall 2024 for award.
o Funding Revision: This project is currently funded by ARPA funds and GF Facility CIP Funds. Additional ARPA eligible expenses were identified since July 1, 2024 and have been encumbered, therefore an additional ARPA allocation of $83,500 is recommended for this project. In exchange for $73,500 of ARPA funds, $73,500 of the HVAC’s project’s GF CIP Facilities Funds will be transferred out of the project to fund the Generator for Police Facility 911-Dispatch and EOC (33FC23PW04) and Generator for Corporation Yard (33FC23PW05) projects as described above. An additional $10,000 of ARPA funds will be added to this project from the HR Contact Tracing Project (5ARPA01), increasing the project’s overall revenues and expenditures budget by $10,000. This funding exchange will ensure that the priority generator projects are completed as planned.
• Browns Valley Road/First Street (33ST22PW03) - Design and construct sidewalk, street, bike lanes, and traffic safety improvements. (New ARPA Project)
o The contract was awarded in August 2024. This project is currently funded by Measure T Funds and the proposed exchange would result in ARPA funding being programmed. $3.77M of Measure T Funds from the Browns Valley Road/First Street Project will be used to fund the Stormdrain Infrastructure Funding Project. In exchange, $3.77M of ARPA will be transferred to this project ($3.6M ARPA funds from Stormdrain Infrastructure Funding, $70,000 from the HR Contract Tracing Project (15ARPA01) and $100,000 from the Rose Lane Sewer Separation Project(33SD16PW01). This funding exchange will ensure that these priority projects are completed as planned.
• Rose Lane Sewer Separation (33SD16PW01) - Through a project partnership with Napa Sanitation District, the work will eliminate a storm drain connection to the sanitary sewer system.
o Status: Project designed and awarded by Napa San. Construction planned for this fall.
o Funding Revision: The partnership with Napa San has resulted in cost savings to the City. The project’s ARPA funding will be reduced by $100,000 to reflect the projected reduced project costs. $100,000 will be transferred to the Browns Valley Road/First Street Project (33ST22PW03).
• Stormdrain Infrastructure Funding (33SD23PW01) - Stormdrain condition assessment, project design and system repairs.
o Status: Completed Stormdrain assessments and designed project to reline pipes. Construction contract bidding process was conducted twice, but value engineering and additional outreach is required to ensure the project meets the established goals. Re-bidding is anticipated in fall 2024.
o Funding Revision: This project is currently funded by ARPA funds. Due to the need for re-bidding, this project’s timeline may no longer meet the ARPA encumbrance deadlines. Therefore, $3.6M of ARPA funds from the Stormdrain Infrastructure Funding will be exchanged for $3.77M of Measure T Funds from the Browns Valley Road/First Street Project. This funding exchange will ensure that the ARPA funds are utilized efficiently and that these priority projects are completed as planned.
The funding sources for the proposed exchange have been closely analyzed and are eligible for use on these projects. Measure T funding is used for paving, maintenance, reconstruction, and/or rehabilitation of streets and transportation infrastructure within the public right-of-way including storm drain repairs. With Measure T funds proposed to deliver the Stormdrain project, an updated Measure T 5-Year Plan is required to be adopted by City Council, in accordance with the terms of the Measure T tax ordinance. The updated Measure T 5-Year Plan will be presented for City Council adoption at a future meeting.
For other ARPA Funded Projects:
|
Project |
Current ARPA Project Total |
Recommended Changes |
Recommended Revised Budget |
|
Street Outreach/Housing Readiness |
$600,000 |
$(296,944) |
$303,056 |
|
Homeless Service Gaps* |
$1,500,000 |
- |
$1,500,000 |
|
Code Enforcement: Blight Nuisances and Vehicle Abatement |
$600,000 |
$50,000 |
$650,000 |
|
North Napa Center Operational Gaps |
$200,000 |
$(200,000) |
- |
|
Homeless Service Gaps** |
$100,000 |
$446,944 |
$546,944 |
|
Total |
$3,000,000 |
- |
$3,000,000 |
*Project renamed from Tenancy Care and Ongoing Housing Support for Project Homekey sites.
**Project renamed from Studies and Legal Expenses for Housing and Homeless Related Studies.
• Consolidating previously approved projects “Tenancy Care and Ongoing Housing Support for Project Homekey sites” and “Studies and Legal Expenses for Housing and Homeless Related Studies” into one new project “Homeless Service Gaps”. As Homekey and other Permanent Supportive Housing sites have opened, we have a greater understanding of our needs related to homeless Services. Renaming as Homeless Services Gaps will allow us to continue using funds for supporting Homekey and Permanent Supportive Housing Sites, but also expand the use to be related to all homeless service’s needs. This includes closing any necessary case management and service gaps either for those that are currently experiencing homelessness, or have exited homelessness to housing, rental assistance, and supporting the community by providing services like garbage removal to abate the impacts of homelessness. Also, with The Bay Area Housing Finance Authority (BAHFA) bond measure no longer a reality, this priority has changed to be about the general support for homeless services gaps, and realigning funds to be available for all service-related needs, including legal services in the Homeless Services Gaps project.
• Street Housing Readiness - The original intent of this allocation was to continue Street Outreach services on an ongoing basis. The State budget did not eliminate the funding source for this, and therefore, we no longer need ARPA funds to supplement this program. Instead, we would like to consolidate into Homeless Services Gaps project.
• North Napa Center Operational Gaps - This was an original set aside of funds to support any unknown gaps related specifically to the opening of the North Napa Center. Nothing significant has come up yet directly related to the Center. Therefore, it is recommended we consolidate to the Homeless Services Gaps project so that funds can be used for North Napa Center or other homeless related services and needs.
Finally, staff is recommending the allocation of one Compliance Program Manager and two Code Enforcement Officers to the Code Enforcement: Blight Nuisances and Vehicle Abatement project for the remaining of FY 2024-2025. Currently these positions are funded by the General Fund. The savings from the reallocation will be programmed to use for other project related costs.
The below chart summarizes and outlines all ARPA funded projects and recommended changes.
|
Project |
Current ARPA Project Total |
Recommended Changes |
Recommended Revised Budget |
|
Police Department Building HVAC (33FC20PW03) |
$124,239 |
$83,500 |
$207,739 |
|
Street Outreach/Housing Readiness |
$600,000 |
$(296,944) |
$303,056 |
|
Homeless Service Gaps* |
$1,500,000 |
- |
$1,500,000 |
|
Code Enforcement: Blight Nuisances and Vehicle Abatement |
$600,000 |
$50,000 |
$650,000 |
|
North Napa Center Operational Gaps |
$200,000 |
$(200,000) |
- |
|
Homeless Service Gaps** |
$100,000 |
$446,944 |
$546,944 |
|
Stormdrain Infrastructure/Assessment Funding (33SD23PW01, 33SD22PW01) |
$5,309,761 |
$(3,600,000) |
$1,709,761 |
|
Generators for Facilities - Police Department, City Emergency Operations Center and 911-Dispatch Center (33FC23PW04) |
$500,000 |
$(209,000) |
$291,000 |
|
Kennedy Golf Course Backflow Device (33PK23PR01) |
$75,000 |
- |
$75,000 |
|
Fire Station 1,2,&3 Alerting Systems (33FC23FD01) |
$510,000 |
- |
$510,000 |
|
Alternate EOC & Emergency Cooling Centers Backup Power (33FC23PD02) |
$176,000 |
- |
$176,000 |
|
COVID Related Employee Costs |
$300,000 |
$(80,000) |
$220,000 |
|
Emergency Operations Plan |
$85,000 |
- |
$85,000 |
|
Community Recovery Bank |
$1,150,000 |
- |
$1,150,000 |
|
Generator for Corp Yard (33FC23PW05) |
$400,000 |
$(221,000) |
$179,000 |
|
Public Works Lucity and GIS Advancement |
$500,000 |
- |
$500,000 |
|
Records Inventory |
$101,240 |
- |
$101,240 |
|
Replenish Part-Time Funding for Police Department |
$250,000 |
- |
$250,000 |
|
State Route 29 Undercrossing (33BP12PW01) |
$2,315,000 |
- |
$2,315,000 |
|
Rose Lane Sewer Separation (33SD16PW01) |
$320,000 |
$(100,000) |
$220,000 |
|
Senior Center Paving & ADA (33FC22PW02) |
- |
$356,500 |
$356,500 |
|
Browns Valley Road/ First Street (33ST22PW03) |
- |
$3,770,000 |
$3,770,000 |
|
Total |
$15,116,240 |
- |
$15,116,240 |
|
*Project renamed from Tenancy Care and Ongoing Housing Support for Project Homekey sites |
|
** Project renamed from Studies and Legal Expenses for Housing and Homeless Related Studies |
FINANCIAL IMPACTS:
There is no new financial impact associated with this item. While the usage of the ARPA funds is shifting between City projects and priorities, the overall budget remains the same. No additional funds will be transferred.
CEQA:
City staff recommends that the City Council determine that the Recommended Action is exempt from CEQA pursuant to CEQA Guidelines Section 15378(b)(4) (fiscal activities that do not commit to a direct physical change in the environment). Each potential project that is funded through this Recommended Action will be subject to environmental review in accordance with CEQA at the earliest feasible time prior to approval consistent with CEQA Guidelines Section 15004 and 15352.
DOCUMENTS ATTACHED:
ATCH 1 - Resolution
EX A - Council Budget Amendment No. 05P04
NOTIFICATION:
None.