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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 P a g e | 1 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.