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�,CITY OF HUGO 14669 Fitzgerald Avenue North, Hugo, MN55038 • (651) 762-6300 • www.ci.hugo.mn.us <br />TO: <br />FROM: <br />SUBJECT: <br />DATE: <br />EST.1906 <br />Honorable Mayor Tom Weidt and Members of the City Council <br />Ron Otkin, Finance Director <br />Approve Coronavirus Relief Fund Supplemental Budget <br />For the City Council Meeting of August 3, 2020 <br />DESIRED COUNCIL ACTION <br />Approve Resolution Adopting CARES Funding Budget. <br />BACKGROUND <br />The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was created because of the sudden decline in <br />economic output following the Coronavirus Disease 2019 (COVID-19) outbreak that significantly altered the fiscal <br />outlook for state and local governments. The CARES Act was signed into law on March 27, 2020 and created the <br />Coronavirus Relief Fund (Fund), which provided $150 billion in direct assistance for domestic governments and <br />stipulated that $139 billion be allocated to state governments based on their populations. <br />The CARES Act details eligible purposes for which Coronavirus Relief Fund payments may be used. It allows local <br />governments to make payments for programs that (1) are necessary expenditures incurred due to the public health <br />emergency with respect to COVID-19; (2) were not accounted for in the budget most recently approved as of the date <br />of enactment; and (3) were incurred during the period that begins on March 1, 2020 and ends November 15, 2020. The <br />Department of the Treasury has released guidance and extensive fact sheets which sets forth their interpretation of <br />these limitations on the permissible use of the Funds. <br />The Minnesota Legislature failed to pass bill SF 47 that would distribute the Coronavirus Relief Funds to local units of <br />governments before adjourning their special session. However, on June 25, 2020 Governor Walz announced that he <br />would distribute $841 million in federal funds to cities, counties, and townships for coronavirus related expenses <br />through the Legislative Advisory Commission (LAC) process defined in state law. Under the plan, cities with populations <br />of 200 or more would be eligible to receive a distribution from the Minnesota Department of Revenue of $75.34 per <br />capita. On June 29, 2020 the City of Hugo submitted the Coronavirus Relief Fund Certification Form to the Minnesota <br />Department of Revenue certifying our intent to comply with the eligible use parameters outlined in the CARES Act and <br />requesting distribution of the City's portion of the Coronavirus Relief Funds. On July 7, 2020 the City of Hugo received <br />$1,148,713.00 in Coronavirus Relief Funds from the Department of Revenue. The City of Hugo has until November 15, <br />2020 to spend the funds. Any unspent funds must be returned to Washington County for reuse on eligible pandemic <br />costs. <br />The Finance Department has spent time researching the issued guidance and fact sheets and using that information has <br />assembled a proposed supplemental budget that meets the criteria set forth and establishes disbursements of the <br />Coronavirus Relief Funds. Staff has budgeted for the reimbursement of expenditures made to manage the pandemic <br />and modifications made at City buildings to allow business to continue safely for Council Members, Commissioners, <br />employees, and the public.