2021-43 Ordinance Amending Budget for Fiscal Year 2021

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ARP monies cannot be used for demolition, clearing and property acquisition. CURE reimbursements can be used for demolition, clearing and property acquisition, as can re- purposed ARP monies used for revenue replacement. So the total amount of ARP and CURE monies to be applied to neighborhood revitalization in the proposed ordinance is: $1,000,000 from CURE reimbursements for demo/land/clearing $1,074,608 from ARP revenue replacements for demo/land/clearing $2,000,000 for housing assistance programs (ARP year#1 only) $4,074,608 TOTAL It is proposed that the remaining$1 million in ARP revenue replacement be allocated in equal measure to deferred equipment replacement ($500,000) in all operations departments, and for one-time expenses in the Police and Fire Department ($500,000). The $9 million allocation for water and sewer has been divided between two projects:the South Water Treatment Plant ClariCones and westside sewer separation projects. The proposed budget amendment also includes authorization for expenditure of$1,190,000 for relief funds that were awarded to external small business recipients by the CARES Act. These grant funds have already been distributed to recipients in accordance with the conditions of the council-approved grant agreement. The proposed ordinance, and the strategy outlined by this memo, provide funds where the City Council has informally directed them; but it also sets aside a significant amount of Federal Relief monies for future uses where the entire council has not yet determined whether and to what extent they want to provide additional assistance using ARP funds. The city of Decatur now operates under the Budget Ordinance provisions of State Statute. This gives the City Council more flexibility in the management of its budget, and it is no longer necessary to approve an appropriations ordinance. Instead, the adopted budget provides authorization for both expenditures and revenues in one balanced document. One feature of this flexibility is that over-expenditures in departmental line items can be offset by under-expenditures in the same departmental budget, so long as these variances are reconciled before the end of each fiscal year. So every December, the City Council's agenda now includes a budget reconciliation ordinance. This will occur in December 2021 as well, despite council action now on an ordinance to formally amend the budget, because year-end budget reconciliation adjusts comparatively small changes to the budget prior to the end of the fiscal year. But the City Council should still act to formally amend the 2021 budget when large structural changes in the city's financial plan are required, so that the proper council authorizations are in place.