ORIGINATING DEPARTMENT
To Committee(s)
| # | Committee Name | Meeting Date |
|---|---|---|
| 1 | Budget Committee | Nov 12, 2024 |
Action Item(s)
| # | File Type | Subcategory | Item Description |
|---|---|---|---|
| 1 | Resolution | Appropriation | Passage of Resolution amending the 2024 General Appropriation Resolution to reallocate American Rescue Plan Act (ARPA) by reducing project budgets. |
| 2 | Resolution | Appropriation | Passage of Resolution amending the 2024 General Appropriation Resolution by increasing the appropriation for the Finance and Property Services department Revenue Replacement and increasing the revenue estimate in the General Fund. |
| 3 | Resolution | Appropriation | Passage of Resolution amending the 2024 General Appropriation by increasing General Fund appropriations for various departments. |
Previous Actions
Background Analysis
In 2021, The City of Minneapolis received $271 million through the Coronavirus State and Local Fiscal Recovery Fund (SLFRF), a section of the American Rescue Plan Act (ARPA). These funds were intended to help the City recover from the impacts of the COVID-19 pandemic. The City of Minneapolis decided to use most of the funding focusing on five goal areas:
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Housing and homelessness
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Economic rebuilding
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Public safety
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Climate and public health
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City capacity and performance
The City also used ARPA funds for revenue replacement which was used as gap financing to reverse significant budget shortfalls during the COVID-19 pandemic. Through supplementing the budget with ARPA funding, the city was able to sustain basic services as economic activity returned to normal.
A critical deadline for compliance with U.S. Department of Treasury’s guidance related to ARPA funding is December 31, 2024. All ARPA funds must be obligated by this date. As stated in the United States Department of Treasury’s Final Rule, obligation means “an order placed for property and services and entering into contracts, subawards, and similar transactions that require payment.” See 31 CFR 35. Any funds that do not meet Treasury’s definition of obligation must be returned to the U.S. Department of the Treasury by the City.
To ensure the City will not have any funding that will need to be sent back to the federal government, the Finance Department asked for an accounting of any ARPA funds which have not yet been spent. These funds will get swept back into the city’s General Fund via Revenue Replacement. If a department still has obligations for projects begun under ARPA in the final months of 2024, such as an executed contract, those funds are to be re-appropriated to the department’s General Fund. By doing so, the City accomplishes two goals: funding for Council-approved work continues and the City does not relinquish federal funds.
Attached is a table listing each departmental ARPA project which still has a remaining balance. Of those projects, it also lists how much funding will be re-appropriated to the department’s General Fund as well as how much funding will return to the City’s General Fund. This table does not include projects which have already been completed. As of November 1, 2024, the city has spent a total of $245,862,181.47 of ARPA funds.