Coronavirus Relief Funds for Minnetrista

Ever know a family that hummed along just fine until someone dies and there’s a contested will? Normally rational, calm, level headed people can transform into unrecognizable personalities clamoring for a piece of the windfall. It’s a situation no one prepares you for and if the will isn’t clear it makes the situation all the more volatile.

Well, that’s exactly what our friends in Congress and our state government have done with the CARES Act and distributing hundreds of thousands of dollars of Coronavirus Relief Funds (CRF) to cities with vague, undefined rules that are shifting and changing as we speak. So far the only ones benefiting, at least from Minnetrista’s CRF $579K, are the attorneys wading thru it all.

Minnetrista hasn’t made a decision on how to allocate these funds but council and staff have already spent many thousands of dollars in our collective time on the matter. I started writing about it back in early August and have attended multiple workshops on CRF reporting requirements, spending rules, and countless hours in council discussions. I have no doubt it will be on our agenda again next week.

I’ll make a prediction that a decision won’t be made until after the election. Wagers anyone?

Stay tuned.

http://www.ShannonBruceForMayor.com

Minnetrista poised to step off ethical cliff

Minnetrista is poised to step off a steep ethical cliff. Minnetrista staff and legal counsel advocated Monday night for using Minnetrista’s $579,000 Coronavirus Relief Fund (CRF) on city payroll even though none of Minnetrista’s personnel have been substantially dedicated to COVID-19 related activities. None.

The city’s Administrator had to sign the form (below) requesting the funds, certifying their use according to guidelines which clearly state that any expenditure included in the city’s budget prior to the pandemic is not allowed.

CRF form

The funds have now been received by the city. But guess what? Despite the intention to spend the funds on payroll that was budgeted before the pandemic (specifically public safety payroll) the $579K of revenue is not reflected in the city’s projected 2020 fund balance that was provided to the council at its work session Monday night and therefore will not reduce the city’s preliminary tax levy**See update below re prohibition on federal COVID funds being used to reduce the tax levy.**

Follow along:

  1. City Administrator requests CRF funds of $579K.
  2. City Administrator promises to only use funds for valid COVID-19 related expenses.
  3. Minnetrista receives the funds based on it’s certification to follow the rules.
  4. City staff advocates using the funds for non-COVID-19 related payroll.
  5. City staff omits the $579K revenue from the 2020 fund balance keeping it from reducing the preliminary tax levy.
  6. Minnetrista taxpayers don’t benefit at all.

I attended a League of Minnesota Cities webinar on CRF reporting last week where at approximately 24:40 they talk about how Minnesota Management & Budget (MMB) doesn’t plan to audit reports and that local governments are on the “honor” system.

LMC CRF Reporting webinar

What is even more concerning is that our city attorney from Kennedy & Graven indicated the MMB makes a presumption that all payroll costs reported are substantially due to COVID-19 related activities. He also seemed confident that because other Minnesota cities were using the funds for payroll that Minnetrista could too.

From attending the webinar on CRF fund reporting requirements, it was clear the state does not want to be in a position of advising cities on whether or not their spending qualifies under the guidelines. Making the “presumption” that reported payroll spending is due to COVID-19 is their way of looking the other way.

I had proposed using Minnetrista’s CRF money to address the city’s information technology architecture and it’s ability to support remote operations which has been difficult under our current infrastructure during this pandemic. That could have been a legitimate use of the funds.

It was decided to check with the state auditor to see if Minnetrista could legitimately claim payroll expenses and then to report back to council. My guess is the auditor will just say they presume the city is following the rules.

Unfortunately we have individuals on the council and staff that have no problem promising to follow the rules and then deciding not to. As long as they can get away with it.

Readers can listen to the work session and council meeting where these issues were discussed Monday night.

**UPDATE 8/8/2020 – Learned from a state legislator today who read the post that using federal COVID funds to reduce the city’s tax levy is explicitly prohibited. Likely the reason federal CRF rules say a city cannot spend the money on previously levied categories budgeted prior to the pandemic, as Minnetrista is contemplating.

www.ShannonBruceForMayor.com

Minnetrista is not a dictatorship. City’s emergency order bypasses spending laws

Minnetrista’s Mayor refuses to rescind her emergency order which allows her, singlehandedly, without council approval, to “execute any agreements, contracts and related documents regarding the local emergency…” Minnetrista has just received over $579,000 in federal funds to be used for coronavirus relief. Your city council should determine how these funds are spent, not just the Mayor. We have elected representatives on the council to represent you. Minnetrista is not a dictatorship unless you allow it to be.

We heard plans at our last council meeting for these funds to be used for purposes that conflict with the fund rules. With the Mayor’s emergency order in place those plans don’t need council approval. This is unacceptable.

I made a motion to revoke the emergency order at our last council meeting because it has not been necessary for a single action taken by the city since it was invoked over four months ago (motion died for lack of a 2nd). An emergency order can be invoked at any time, if an emergency is imminent, by the Mayor, so there is absolutely no reason to let this continue. Let your council know you want the order revoked: lwhalen@ci.minnetrista.mn.us; mmolitor@ci.minnetrista.mn.us; pmortenson@ci.minnetrista.mn.us; jtschumperlin@ci.minnetrista.mn.us

Emergency order (page 31) provides: “City staff is authorized to enter into agreements and contracts necessary for the procurement of materials, equipment, and services required to respond to the local emergency.” and “The Mayor and City Administrator are authorized to execute any agreements, contracts, and related documents regarding the local emergency necessary to implement corrective action relative to the local emergency to protect the health, safety and welfare of the City and the community.”

Send a message to revoke Minnetrista’s emergency order and return council oversight of all city spending to Mayor Whalen, Council members Molitor, Mortenson and Tschumperlin below: lwhalen@ci.minnetrista.mn.us; mmolitor@ci.minnetrista.mn.us; pmortenson@ci.minnetrista.mn.us; jtschumperlin@ci.minnetrista.mn.us

www.ShannonBruceForMayor.com

Minnetrista to get $580K for COVID expenses?

Well, I think Minnetrista can rescind it’s emergency order now. Gov. Tim Walz announced last week that he will distribute $841 million in federal funds to cities, counties, and townships for coronavirus-related expenses. The city of Minnetrista is on the Minnesota Department of Revenue’s list to receive $579,517 of those funds and there is no requirement for a city to have an emergency order to receive them.

When I saw the amount I thought: How in the world would Minnetrista spend that much on COVID related anything? Then I remembered the advocacy of mail-in balloting by the National League of Cities and their state chapter the League of Minnesota Cities I wrote about here.

Do you think any of this money will be used to advocate for mail-in balloting and additional staff for ballot processing under the guise it’s COVID related?

Those vulnerable to COVID-19 should know that any resident can already request an absentee ballot or go to city hall to vote without crowds before the election. Mass/universal mail-in balloting opens the door to election fraud because it doesn’t provide the security in place at polling locations with supervision by election judges from different parties. No one can dispute there are plenty of incentives to manipulate election outcomes and we should make fraud more difficult, not easier.

dollarsCities’ coronavirus relief funds must be spent by November 15 (isn’t that an interesting date?) or returned. There is no requirement to submit expenses for reimbursement as had previously been discussed. There is also no requirement for a city to have an emergency order in place to receive these funds. All a city needs to do is certify that they will follow state and federal guidelines for use of the relief funds and fill out a Coronavirus Relief Fund Certification Form to get the check.

Here are the official guidelines:

1. The distributed funds will be used by the local government only to cover those costs that:

a. Are necessary expenditures incurred due to the public health emergency with respect to the Coronavirus Disease 2019 (COVID-19) (“necessary expenditures”), as described and defined by official federal guidance on section 601(d) of the Social Security Act, as added by section 5001 of Public Law 116-136 (“federal guidance”);

b. Were not accounted for in the budget most recently approved as of March 27, 2020, for the local government; and

c. Were or will be incurred during the period that begins on March 1, 2020, and ends on December 1, 2020. A cost is incurred when the local government has expended funds to cover the cost.

2. The funds distributed pursuant to this certification will not be used by the local government in any manner contrary to federal guidance. This includes, but is not limited to:

a. As a revenue replacement for lower than expected tax or other revenue collections; and

b. For expenditures for which the local government has received other emergency COVID-19 supplemental funding for that same expense, regardless of the funding source.

Minnetrista has been keeping track of it’s COVID-19 related expenses and at our last council meeting had only identified a few hundred dollars, mostly from cleaning supplies, gloves and hand sanitizer. There is also plexiglass being installed in the lobby to protect administrative staff. We’ll have to wait to see if Minnetrista files for its $580K coronavirus relief check but I think it’s a pretty safe bet. It’s also a safe bet it will be spent on the election.

www.ShannonBruceForMayor.com