- January 22, 2025
Loading
Though Volusia County is still expecting to receive $107 million from the American Rescue Plan Act, less of the funds will be available to be used for provision of government services, a previously broad definition for ARPA's revenue loss category.
This is a result of recent revenue trends — to include higher-than-expected tourism taxes, state revenue sharing, water and sewer state grant funding and impact fees — and the Department of Treasury's requirement to convert fiscal-year revenue loss calculations to calendar year amounts. Unlike coronavirus relief dollars granted to the county under the Coronavirus Aid, Relief, and Economic Security Act, which had a short timeframe to be used, ARPA dollars are available for four years.
Volusia County initially projected a combined revenue loss of $80 million for the four fiscal years between 2019-2020 and 2022-2023, but because of the update in calculations, revenue loss for calendar-year 2020 is now estimated at $12 million, with no revenue loss projected for the next three calendar years.
“If you look at just $80 million versus the $12 million, it seems like a big number," County Chief Financial Officer Ryan Ossowski said. "But we’re talking about four entire years of an organization that has $620 million in our calculation as far as what our base revenue is.”
What does this mean for the county? The projects planned to be funded through the revenue loss category could need to be revisited.
On June 22, the County Council was given an overview on how ARPA funding could be used, and aside from revenue loss, three other categories were highlighted: COVID-19 response and its negative economic impacts; "premium pay" for essential workers; and water, sewer and broadband infrastructure.
But with likely regulatory and legislative changes coming regarding the ARPA dollars, Ossowski suggested waiting until the Department of Treasury updates its guidance. According to the agenda item document, the Department received nearly 1,000 online comments regarding the relief dollars, particularly pertaining to the revenue loss calculations being made on calendar year versus a fiscal year basis. As a result, county staff believes guidance could change to allow revenue loss to be calculated on a fiscal year basis, which would increase the county's revenue loss calculation for fiscal year 2020-2021 to $34 million.
Additionally, the U.S. Senate unanimously passed the State, Local, Tribal, and Territorial Fiscal Recovery, Infrastructure, and Disaster Relief Flexibility Act on Oct. 19, which if signed onto law, would allow 30% of coronavirus relief dollars to be spent on roads, mass transit and other infrastructure projects.
"Given those potential for changes, given the long period of time we have for this, it's advisable to wait to see if we have some of the flexibility to be able to do those projects before we go back and rewicker everything to fit the categories, because many of the projects that were on our previous list would not necessarily fit as a COVID-19 response or a water/sewer/broadband project," Ossowski said.
County Manager George Recktenwald agreed that waiting would be prudent, and suggested the council resist committing ARPA funds until the Department of Treasury makes a decision regarding regulatory changes.
He suggested the county hold a workshop in January to discuss the funds.