FY23 FULL BUDGET REPORT ADOPTED

American Rescue Plan Act (ARPA)

The American Rescue Plan Act (ARPA) became law on March 11, 2021. An appropriation of $2,045,300 of the first tranche of an estimated $8.4 million dollars in anticipated distribution to Morrisville was incorporated into the FY 2022 budget, primarily to offset revenue loss and to advance some strategic projects during the current year. Since then, the Town of Morrisville’s allocation was determined to be approximately $9.2 million dollars, of which one-half of those funds were received in July 2021; the second tranche is expected to be received in summer 2022. Final guidance was released in January 2022, which authorized up to $10 million dollars of ARPA funds not to exceed authorized distributions to be eligible for revenue replacement, the most flexible category of spending. All ARPA spending requirements and restrictions must be followed but uses of the funds have become much broader. A separate fund to account for ARPA expenditures was established to ensure compliance with Uniform Guidance for Coronavirus Local Fiscal Recovery Funds. The town submitted its first annual report in April, documenting actual expenditures on projects to date. A reconciliation of projects for FY 2022 will be provided to Town Council separately. For the proposed FY 2023 operating and capital budgets, an additional allocation of $2,551,500 is utilized to recoup $450,000 in projected lost revenues primarily for parks and recreation programs due to the continued inability to offer full programming as the pandemic curtailed operations and activities through March 2022. The use of the remainder of the first tranche is dedicated in large part to advance two key parks and recreation priorities – a future dog park and the Shiloh Park renovations (including the basketball court). A number of other smaller projects are supported by the rest of the requested allocation. The second tranche of approximately $4.2 million dollars remains untouched and available to support ARPA funding priorities and projects captured through Town Council’ s recent ARPA survey compilation, which may include capital projects or other smaller project, “quick wins”. Robust discussion of the best uses of these one-time resources for maximum community impact are planned during FY 2023. There are no proposed appropriations from Parkland Payment-in-Lieu (PPIL) to retain these funds for prioritized Parks and Recreation projects during FY 2023 as Town Council does a comprehensive refresh of Capital Investment Plan priorities. The PPIL reserve includes $3.3 million dollars returned to this fund from anticipated future parkland acquisitions not in near- term fruition to maximize Town Council’s flexibility to prioritize projects with future anticipated bond proceeds. Following the UDO text amendment update relating to Access and Circulation in summer of 2021, staff has worked to evaluate processes and appropriate alignment of reserves to capital projects in comparisons to peer communities to strengthen policy and processes. Staff plans to implement a structured framework leveraging ERP system resources creating reconciliation and management efficiencies. Policy recommendations on strategy for appropriate utilization of these growing, yet restricted assets, will be folded into the planned update of the CIP Policy with Town Council early in FY 2023. The FY 2023 proposed budget includes identified allocations of these funds, and/or other capital reserve funds for intersection improvement projects (Phase 1 – pedestrian improvements) and for sidewalk design services to prepare projects for construction with anticipated bond proceeds in FY 2024. Other Reserves

28