Atwater leaders contemplating how to spend $3.3 million in federal stimulus funds

The Atwater City Council discussed how to spend more than $3.3 million in federal American Rescue Plan Act (ARPA) money on Monday night — with much of the talks focused on whether to use the money for government expenses or find ways to funnel it to residents.

The discussion, which did not come to a conclusion and will return for a vote on another date, was part of an effort to designate the city’s more than $3.3 million as “lost funds.” It’s not clear when the City Council will decide what its ARPA spending priorities are.

The lost funds designation would allow city officials to use the federal funds for general government expenses. A recent decision by the U.S. Department of the Treasury, known as the “Final Rule,” would allow local governments to use up to $10 million in ARPA funds for priorities determined by city officials.

However, in the case of smaller cities like Atwater that will see less than $10 million in ARPA money, the amount city officials can spend on general government expenditures would be less.

So far, the city has received about half of its anticipated ARPA allotment, which will total $7,071,141 when the remainder is paid to the city this summer.

The first allotment the city received last summer, totaled $3,035,571, according to Lori Waterman, Atwater city manager.

The remaining money, including the money expected this July, has to be spent by Dec. 31, 2026, the deadline for local governments to spend all of their allotted ARPA money.

A list of priorities city staff put together ahead of the City Council meeting Monday night ranged from civic center expenses to new doors in city-owned buildings. There were also ideas like retrofitting HVAC systems in some city facilities and making new street and sidewalk improvements.

However, not all of the City Council felt that was how the ARPA money should be spent. Personal protective equipment for day care centers, establishing a matching grant program for local businesses and other ways to give the federal money to the residents of Atwater became a sticking point for some.

“Most of this money needs to go back to the public, and we need to figure out a way to make that happen,” said City Council member Brian Raymond.

Despite some of the projects the ARPA money would be used for, including utility bill payment kiosks that helps to make utility bill payments easier for Atwater residents, the City Council pushed back on funneling much of the ARPA money towards city-owned facilities and programs.

Some of that money was going to go towards reimbursing the city for expenditures city officials already made from the general fund, like paying for a Zoom account that would allow City Council members to conduct remote council meetings and paying for recreation department programs and staff salaries.

“It should go to our community, not to the city,” said Councilmember John Cale.

Money from the American Rescue Plan Act became available to cities and counties across the U.S. early last year after President Joe Biden signed the bill into law in March 2021, allocating $1.9 trillion to local governments to combat the worst effects of COVID-19, including negative economic and health impacts.