By AWC staff

Last year, Congress passed the American Rescue Plan Act (ARPA), sending billions of federal dollars directly to cities across the country. While many communities are considering investments in infrastructure, replacing lost city revenues, or setting up community support programs, some cities are investing in city staff.

Here are three ways city leaders can use ARPA funds to support city staff.

1. Fund public safety, public health, and human services staff
   Using ARPA dollars, cities may fund payroll and benefits for the portion of an employee’s time spent responding to the COVID-19 pandemic. For example, cities can consider first responders entirely devoted to responding to Covid-19 if the employee or their unit or division is primarily dedicated to responding to COVID-19. Per Treasury, “primarily dedicated” means that more than half of the employee, unit, or division’s time is dedicated to responding to COVID-19.
   
   Remember, responding to the Covid-19 pandemic covers more than just responding to the direct health impacts of the virus. For example, a staff member tasked with running a grant program for local businesses impacted by Covid-19 could be considered eligible to have their payroll and benefits covered for the portion of time they are spending running the program.

2. Rehire and employ additional public sector staff
   During the initial months of the pandemic, over 50 percent of surveyed cities indicated they had implemented hiring freezes in response to the pandemic. An additional 25 percent of cities implemented furloughs, with almost 20 percent of cities laying off employees.
   
   Under ARPA, cities have two options to rehire and employ additional public sector staff:
   • Hire back employees for pre- pandemic positions
     Hire employees for positions that existed on January 27, 2020, but were unfilled or eliminated as of March 3, 2021.
   • Hire above the pre-pandemic staff levels or hire different positions
     Hire up to an additional 7.5 percent of a city’s pre-pandemic staffing levels. Using a Treasury-provided formula, cities can calculate the number of positions they can fund using ARPA dollars. Cities using this formula are not required to hire staff for the same roles or positions that existed prior to the pandemic.

3. Retain existing city staff
   Retain current employees and avoid layoffs. Here are three ways cities can use ARPA funds to retain existing staff:
   • Provide additional funding to employees who experienced pay reductions or who were furloughed since the beginning of the pandemic. Cities will need to take into account unemployment benefits that employees received.
   • Maintain current salary levels to prevent layoffs. ARPA funds can be used to maintain current salary levels, including taking inflation into account.
   • Offer worker retention incentives, including reasonable pay increases added to an employee’s current compensation without exceeding incentives traditionally offered by the city to compete for employees.