The American Rescue Plan Act (ARPA) is the Biden administration’s initiative to provide $350 billion to state and local governments to deal with the impact of the COVID-19 pandemic. Verona received $700,755.97 in ARPA funding in June and, at Monday night’s Town Council meeting, Verona CFO Matt Laracy talked about some of the ways that the funding might be used here.
The June funding is half of the roughly $1.4 million that Verona will eventually receive under ARPA; the balance will be paid out in 2022. The ARPA funds can be used in four broad areas: to close a general loss of municipal revenue, emergency health and safety measures, invest in infrastructure, or to provide additional pay to essential workers. (The Coronavirus Aid, Relief, and Economic Security Act passed during the Trump administration, which is also known as the CARES Act, primarily aided businesses and individuals, but there were some funds that municipalities could use to offset the cost of managing and mitigating the pandemic.)
Verona is likely to use much of its ARPA funding in the first category, Laracy said, because of the substantial restrictions on uses in the other three categories. The town had a shortfall of about $690,000 in revenue last year in its main budget and an additional $365,000 at the Verona Pool, which operates under a separate budget. The Verona Pool opened a month late last year because of the pandemic and the Town Council had to lower membership rates to square with the shortened season. The pool also lost revenue because there was no food vendor last year.
New Jersey has authorized towns to spread the repayment of their losses over five years, but Laracy said that, now that there is ARPA funding available, it makes the most sense to close the deficit faster. “The easiest way for us and for us to get the most bang for our buck is to associate as much of the funds as we can to the revenue loss that we’ve assumed through the pandemic,” Laracy said. Putting the federal money towards closing the revenue gap should also help Verona to avoid raising taxes.
You can listen to Laracy’s remarks in the video of the Town Council meeting below. He follows Verona Public Library Director Claudine Pascale, who spoke about the implementation of the library’s strategic plan.