OML UPDATE AT A GLANCE
Here are the top three things you need to know from the past several days:
- Today the Ohio Senate passed SB 310, legislation creating a statewide distribution model for allocating federal financial aid to Ohio local governments with fewer than 500,000 residents. More information is provided below.
- Due to the economic impact of COVID-19, Gov. DeWine has announced $775 million in reductions to Ohio's General Revenue Fund for the remainder of Fiscal Year 2020 which ends on June 30. You can read more in the state COVID-19 response article below. At the end of February and prior to the onset of the COVID-19 pandemic, state revenues for the fiscal year were ahead of estimates by over $200 million. As of the end of April, Ohio's revenues were below the budgeted estimates by $776.9 million.
- As the state increases COVID-19 testing capacity, the Ohio Department of Health has issued new testing guidance to set priorities for those who need testing. Those areas include nursing homes and other congregate living settings such as developmental centers, treatment facilities, homeless and domestic violence shelters, youth detention centers, and other areas where community outbreaks could occur. You can read the full guidance HERE.
SENATE PASSES BILL TO DISTRIBUTE CARES ACT FUNDS TO LOCAL GOVERNMENTS
Yesterday the Ohio Senate introduced SB 310, sponsored by Sen. Dolan (R- Chagrin Falls), legislation that creates a mechanism for the state to distribute nearly $1.2 billion of federal financial aid to Ohio's local governments below 500,000 in population as provided by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Today, the Ohio Senate Finance Committee received sponsor testimony and then voted to pass the bill on to the full Senate where shortly after, the upper chamber voted unanimously in support of the bill. The bill has been sent to the Ohio House, where we hope it will receive the same degree of urgency.
The League greatly appreciates the leadership of Senate Finance Chairman Matt Dolan, the bill's sponsor, and all of the members of the Ohio Senate for their support for this important piece of legislation.
SB 310 would disperse $350 million through the Local Government Fund (
) formula in a separate distribution fund to be used only for non-budgeted COVID-19-related expenses per the guidelines provided by the U.S. Department of Treasury. Under the bill, park districts would not receive any of this allocation, nor would the five counties and one municipality with populations over 500,000 that received direct distributions from the CARES Act. The remaining funds, which could be up to $850 million, would be held in reserve by the state for a second round of funding. You can read the bill language HERE
and the analysis HERE
Additionally, SB 310 was amended to include language that will require a local government to pass a resolution stating they will follow the guidelines established by the U.S. Dept. of Treasury on how the federal aid can be spent. The resolutions must be submitted to the political subdivision's county auditor and Ohio Office of Budget and Management (OBM). The League has requested that OBM provide a template on what should be included in the resolution and will send the example to our members in the event it is made available. The legislation says local governments
"...must adopt a resolution or ordinance affirming that the funds so received may be expended only to cover costs of the subdivision consistent with the requirements of the "Coronavirus Aid, Relief, and Economic Security Act
." You can read the amendment language
The League joined the Ohio Mayors Alliance, the County Commissioners Association of Ohio, the Ohio Township Association, the Northeast Ohio Mayors and City Managers Association and the Cuyahoga County Mayors and City Managers Association in support of SB 310 and provided the Senate Finance committee with joint written proponent testimony that can be found
In addition to urging legislators support for the bill, the testimony urges the Ohio General Assembly to ensure all of the remaining $850 million is dedicated to and used exclusively by local governments. Additionally, should the federal government provide greater flexibility for the use of these funds, the League and our local government partners requests that the second phase of funding be released to local governments for revenue replacement based on specific community needs.
GOVERNOR DEWINE CONTINUES COVID-19 RESPONSE
- As of Wednesday afternoon, Ohio is reporting 20,625 cases of coronavirus, 1,225 deaths, 4,052 hospitalizations and 1,151 ICU admissions.
- Because Ohio is mandated to balance its budget each year, and in addition to identifying areas of savings, the following budget reductions will be made for the next two months:
- Medicaid: $210 million
- K12 Foundation Payment Reduction: $300 million
- Other Education Budget Line Items: $55 million
- Higher Education: $110 million
- All Other Agencies: $100 million
- The budget reductions are in addition to Gov. DeWine's March 23 directive to freeze hiring, new contracts, pay increases, and promotions at all state agencies, boards, and commissions. The new budget reductions will not apply to critical services available to Ohioans or COVID-19 pandemic services. Money to balance the Fiscal Year 2020 budget will not be drawn from Ohio's Budget Stabilization Fund, otherwise known as the "rainy-day fund."
- Projections by Ohio Office of Budget and Management (OBM) Director Kim Murnieks indicate that the state's revenues will continue to be below estimates in the coming months as Ohio moves through the COVID-19 crisis. Gov. DeWine, Lt. Gov. Husted, and Dir. Murnieks will continue to work with the Ohio General Assembly to identify ways to continue supporting Ohio's economy through the COVID-19 crisis.
- Ohio will be reopening the Bureau of Motor Vehicles (BMV) locations in late May to give time for the expansion of the BMV's "Get In Line Online" program to all deputy registrar locations that do not already have the service in order to avoid large crowds.
U.S. TREASURY DEPT. RELEASES FAQ ON LOCAL GOVERNMENT USE OF CARES ACT FUNDS
Below is a list provided by NLC of the most-asked questions from the U.S. Treasury's updated FAQ.
You can read the Treasury's updated Coronavirus Relief Fund FAQ HERE
Are recipients required to use other federal funds or seek reimbursement under other federal programs before using Fund payments to satisfy eligible expenses?
No. Recipients may use Fund payments for any expenses eligible under section 601(d) of the Social Security Act outlined in the Guidance. Fund payments are not required to be used as the source of funding of last resort. However, as noted below, recipients may not use payments from the Fund to cover expenditures for which they will receive reimbursement.
The Guidance states that the Fund may support a "broad range of uses" including payroll expenses for several classes of employees whose services are "substantially dedicated to mitigating or responding to the COVID-19 public health emergency." What are some examples of types of covered employees?
The Guidance provides examples of broad classes of employees whose payroll expenses would be eligible expenses under the Fund. These classes of employees include public safety, public health, health care, human services, and similar employees whose services are substantially dedicated to mitigating or responding to the COVID-19 public health emergency. Payroll and benefit costs associated with public employees who could have been furloughed or otherwise laid off but who were instead repurposed to perform previously unbudgeted functions substantially dedicated to mitigating or responding to the COVID-19 public health emergency are also covered. Other eligible expenditures include payroll and benefit costs of educational support staff or faculty responsible for developing online learning capabilities necessary to continue educational instruction in response to COVID-19-related school closures. Please see the Guidance for a discussion of what is meant by an expense that was not accounted for in the budget most recently approved as of March 27, 2020.
Would providing a consumer grant program to prevent eviction and assist in preventing homelessness be considered an eligible expense?
Yes, assuming that the recipient considers the grants to be a necessary expense incurred due to the COVID-19 public health emergency and the grants meet the other requirements for the use of Fund payments under section 601(d) of the Social Security Act outlined in the Guidance. As a general matter, providing assistance to recipients to enable them to meet property tax requirements would not be an eligible use of funds, but exceptions may be made in the case of assistance designed to prevent foreclosures.
May recipients create a "payroll support program" for public employees?
Use of payments from the Fund to cover payroll or benefits expenses of public employees are limited to those employees whose work duties are substantially dedicated to mitigating or responding to the COVID-19 public health emergency.
May recipients use Fund payments to provide emergency financial assistance to individuals and families directly impacted by a loss of income due to the COVID-19 public health emergency?
Yes, if a government determines such assistance to be a necessary expenditure. Such assistance could include, for example, a program to assist individuals with payment of overdue rent or mortgage payments to avoid eviction or foreclosure or unforeseen financial costs for funerals and other emergency individual needs. Such assistance should be structured in a manner to ensure as much as possible, within the realm of what is administratively feasible, that such assistance is necessary.
May Fund payments be used to replace foregone utility fees? If not, can Fund payments be used as a direct subsidy payment to all utility account holders?
Fund payments may not be used for government revenue replacement, including the replacement of unpaid utility fees. Fund payments may be used for subsidy payments to electricity account holders to the extent that the subsidy payments are deemed by the recipient to be necessary expenditures incurred due to the COVID-19 public health emergency and meet the other criteria of section 601(d) of the Social Security Act outlined in the Guidance. For example, if determined to be a necessary expenditure, a government could provide grants to individuals facing economic hardship to allow them to pay their utility fees and thereby continue to receive essential services.
NLC LAUNCHES CAMPAIGN TO SECURE LOCAL FUNDING IN NEXT FEDERAL RELIEF PACKAGE
The National League of Cities (NLC) has launched the "Cities Are Essential" campaign to help secure money in the next relief package for cities, towns, and villages nationwide.
The NLC is asking Congress for $500 billion in federal aid over the next two years to help cities and counties, regardless of size, respond to and recover from COVID-19. The money would be split 50/50 with the counties, with cities receiving $125 billion in the first year.
Congress passed the CARES Act that contained the Coronavirus Relief Fund, which allocated $150 billion to states and local governments. Because only the most populous 36 cities and 135 counties received direct funding from the Coronavirus Relief Fund, the majority of cities, towns, and villages across the nation received no direct funding.
The money that NLC is asking for is not a handout, nor is it a federal bailout, as some in Washington suggest. The money is an extension of the local government-federal government partnership. Relief for cities means quality of life for residents.
We want to thank all our members who have been contacting Ohio's Congressional delegation to voice the need for federal relief for our cities and villages. This local advocacy will continue to play a vital role in helping secure much-needed future financial aid for the local communities that serve Ohio residents on the front lines of the COVID-19 pandemic. To read more about this campaign, click HERE
PUCO ISSUES GUIDANCE ON WATER SUPPLY FLUSHING
The Public Utilities Commission of Ohio (PUCO) has issued the following memo regarding water supply flushing:
As businesses and buildings reopen under the "Responsible RestartOhio" plan due to the COVID-19 pandemic, that have had little to no water usage, it is important to flush water that has been stagnant. Low water usage can contribute to bacterial growth, including Legionella which can cause a serious type of pneumonia called Legionnaires' disease. It can also cause other water quality issues with potential health risks due to the build-up of lead and copper in stagnant water that's been collecting in older pipes and fixtures.
As buildings reopen, it is critical to drain, flush, and if necessary based on a review of building conditions, disinfect the hot and cold-water systems to remove harmful contaminants. Devices that store water, such as drinking water fountains, water heaters, storage tanks, and any droplet or mist-forming devices such as cooling towers, humidifiers, showerheads, and certain medical and manufacturing devices and process equipment should also be flushed and disinfected in accordance with manufacturer's recommendations or industry best practices.
The Ohio Department of Health and the Ohio Environmental Protection Agency has issued a letter with more information, which you can access HERE
, as well as "Guidance for Premise Plumbing Water Service Restoration", which you can access HERE
All questions should be directed to the Ohio Department of Health COVID-19 Hotline at 1-833-4-ASK-ODH.