HomeMy WebLinkAbout4003 Resolution - Local CARES Utility AssistanceExcerpt from Agenda Report for the Resolution - Local CARES Utility
Assistance Program presented at the October 19, 2020 Council Meeting
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Discussion/Recommendation Section:
To date, approximately $1.6M has been spent by the City on Local CARES eligible activities,
including Local CARES business assistance grants. Staff also estimates that prior to the eligibility
period ending (November 15, 2020) an additional $500-900K of Local CARES eligible expenses
will be incurred by the City. However, due to recent clarification from the granting agency
allowing for Public Safety expenses to be regarded as substantially dedicated to COVID-19 effort,
City is eligible to be reimbursed for all of Local CARES allocation ($3.3M) and not risk having to
return funds to the State.
Impacts of the pandemic to our residents has been varied and complex. While the local economy
as a whole continues to do better than most communities across the nation, inabilit y to work due
to health issues or lack of employment due to business closure or localized downturn, and overall
economic uncertainty has impacted a portion of the City's utility customers and their ability to pay
for utilities services. City provides water, sewer, storm water, irrigation, and ambulance services
to customers within and outside of City limits. Over $565K or 2,961 accounts are delinquent as
of 10/7/20; average delinquency over a similar period of time under normal circumstances is
approximately $30K. City is seeing an increase in delinquency of $50K each week since July and
we expect for this trend to continue until circumstances begin to change. The recent move of
Franklin and Benton counties to Phase 2 of the Safe Start Plan may reestablish some employment,
but until conditions return closer to normal, many residents will remain resource strapped.
As previously discussed, a concern of staff, and frankly industry wide, is that for those customers
unable to pay, their outstanding balance continues to increase. A Governor's proclamation, or a
City Emergency Order suspending shut offs, is not the same as forgiving the cost for service
provided. Further, the City cannot simply expunge outstanding account balances for some but not
others, thereby creating a system where some pay for service and other do not.
In light of the above, staff is recommending that the City Council consider utilizing a portion of
the Local CARES grant to establish a utility assistance program to assist utility customers who
meet the following local criteria:
1. City of Pasco utility account holder
2. Delinquent by more than 30 days
3. Physical location of property is within the City limits
4. Account holder to demonstrate that the financial need is a result of COVID-19
Federal and State grants require a higher degree of documentation that are challenging to manage
when the eligible applicants could be greater than 1,000 in number, and receiving less than $500
in funding. However, Local CARES grant has been a learning process for all involved. While
program administration initially followed traditional federal and state grant guidelines, granting
agencies have come to the recognition that application of normal grant guidelines is not possible
in the current emergency, and creates inefficiencies that severely limit timely action for which the
fund was allocated. Via individual inquiries and updated agency guidance, staff has the
understanding that local governments tasked with distributing funds to combat COVID-19 may do
Excerpt from Agenda Report for the Resolution - Local CARES Utility
Assistance Program presented at the October 19, 2020 Council Meeting
P a g e | 2
so in a prudent manner, which meets the intent of the law while not bogging down the process.
This is a desired outcome for the City, however, after the emergency subsides and we are beyond
the fog of the emergency at hand, the auditors will eventually appear, and there is always the risk
that they will consider all or a portion of our program guidelines to be unsatisfactory. Due to these
factors staff is presenting three options to Council to meet the aforementioned State and Federal
requirements, each with varying level of documentation requirements:
Option A - Minimal Documentation
Competed Application
Self-certify inability to pay due to COVID-19 on application - no documents
needed
State Issued ID
Option B - Medium Documentation
Documents from Option A
Self-certify citizenship, permanent residency, or legal immigrant status on
application - no documents needed
Proof of loss of income like paystubs, notice of layoff, closures, claim of
unemployment etc.
Option C - Highest Documentation
Documents from Option A and B
Proof of legal residency status like social security card, passport, birth certificate,
residency card, active visa etc.
In distributing federal funds to beneficiaries, the more complex the requirements are in terms of
documentation; the fewer the number of applicants, the more cost in terms of time it takes to
administer the program, however the less risk of an audit finding requiring repayment. Too simple
a process will provide for greater applicants, ease of administration, the likelihood of an audit
finding and requirement to repay the grant monies used, and such a finding may impact the City
with regard to future federal funding opportunities. Finding the balance between assistance
provided in a time of need, ease of administration, and establishment of defensible criteria is the
key to successfully executing this proposed program.
Based on the above information and analysis, staff is recommending that Council select Option B
as it will reduce the risk of a subsequent financial burden to be borne by all City taxpayers and
ratepayers while also reducing the burden to the customers in need of assistance. Option B also
allows for internal staff to be able to administer the program, greatly reducing the need for external
costly assistance, which will allow for close to 100% of the funds to be dedicated to customer
assistance. Furthermore, if Option B is authorized, staff will be able to provide application options
that can be catered to the technology available to our customers. Request of sensitive information
will limit the number of ways customers can apply and increase records retention cost for the City.
In this case and considering the economic circumstances affecting the community - staff requests
Council allocate $400K for utility assistance relief and authorize Option B as the City's program
requirements.