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Rendering of front entrance and canopy of Hanlon-Deerfield school, from School Building Committee Presentation (Aug. 5, 2021).
7-14-2022 1:57am
Select Board Deliberates, Declines to Apply ARPA Funds to Hanlon-Deerfield Project's $4 Million in Increased Costs
Darlene Cancell
Editor
This Monday, directly after Select Board heard a presentation on acceptable uses of Westwood’s funding from the American Rescue Plan Act (ARPA), the board was immediately faced with a joint request by the School Building and Permanent Building Committees to use much of that funding to cover $1.1 million of $4 million in increased costs related to the Hanlon-Deerfield school building project. Select Board declined to immediately apply funds as requested, but directed staff to investigate funding sources.
Select Board learns how to use ARPA funds, applies first $465,000 of $4.8 million
Assistant Town Administrator and Financial Director Pam Dukeman explained allowable uses of ARPA in four broad, spending categories: replacing lost public sector revenue due to the pandemic, supporting the COVID-19 public heath response, giving premium payments to eligible workers, and investing in water, sewer and broadband infrastructure.
Westwood is receiving ARPA funding through two allocations: $1.7 million directly to Westwood and $3.185 million through Norfolk County. Westwood has received the full amount of its direct allocation. Because Norfolk County has lacked infrastructure to handle ARPA funds that it has been charged with distributing to its municipalities, the county has reserved a 3 percent fee for it troubles. Apparently, 2.5 percent is going to pay for ARPA administration and 0.5 percent is going to county projects. Minus this 3 percent county administrative fee, Westwood’s allocation of ARPA funds through Norfolk County is $3.1 million. Combined with Westwood’s direct funding of $1.7 million, Westwood’s total grant in ARPA funding is $4.8 million. Funds must be fully obligated by December 31, 2024 and spent out by December 31, 2026.
Regarding how that money may be spent, Ms. Dukeman explained at length the current limitation of spending under the category of replacing lost public sector revenue due to the pandemic. This broad category of need appears largely flexible and inclusive of most applications of normal town funding. Ms. Dukeman notes that the few exceptions are that ARPA funding must not be applied to pensions, direct tax reductions, existing debt service, or reserve accounts.
However, while Westwood has interpreted ARPA implementation to allow Westwood and other communities to assume a standard revenue loss of $10 million in its calculations for ARPA funding, Norfolk County has taken a different interpretation. The county understands ARPA to allocate a standard, $10 million in revenue loss to the county as a whole, from which the county believes it must allocate a portion to its municipalities. By the county’s calculation, Westwood’s revenue loss is $331,000, rather than $10 million as interpreted by Westwood. The county’s interpretation limits the amount of ARPA funds to which Westwood may spend in the broad spending category of replacing lost public sector revenue due to the pandemic.
Therefore, Ms. Dukeman explained that of the $4.8 million available to Westwood in ARPA funding, a little over $2.0 million may be spent in the category of lost public sector revenue - the spending category which, but for a few exceptions, allows towns to flexibly direct ARPA money to most town uses.
Ms. Dukeman presented the following projects, totaling $465,000, for Select Board's consideration for ARPA funding. Select Board unanimously approved them all:
- Performing an audit of disability compliance in town - $25,000
- Increasing social services capacity (e.g. services through Westwood Youth & Family Services) - $150,000
- Library’s HVAC system - $100,000
- Updating School Street Playground - $190,000
Select Board Clerk Michael Walsh (who acted as Chair for this meeting), noted that School Street Playground is in almost constant use. Select Board member Marianne LeBlanc Cummings noted making the playground and other places around town "universally accessible" with a disability audit is a “huge investment” and worthwhile.
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The School Building and Permanent Building Committee's joint request for $1.1 million in ARPA funds
Ms. Cummings opened this discussion by disclosing that her husband, John Cummings, was presenting on the issue of the school building, and that she had sought advice of the state ethics committee. Upon being informed that she could participate on the issue if she believed that she could be impartial and she filed a disclosure form, Ms. Cummings noted she had filed such form and stated, “I do feel I can act fairly and objectively in this matter.”
“There’s no doubt that you can act fairly and impartially,” said Mr. Walsh. “The question is, do you want to?” He asked jokingly.
“I do,” responded Ms. Cummings.
Together with Mr. Cummings, School Committee member Maya Plotkin made a pitch for ARPA funds to address what she called a “worst case scenario” resulting from contractor bidding on the Hanlon-Deerfield school building project. Ms. Plotkin noted that while the original budget for the building was estimated at $70.3 million, all three contractor bids that were received in June exceeded that amount. The lowest bid came from Brait Builders at $73.9 million.
However, Ms. Plotkin and Mr. Cummings noted that on top of that amount, an additional $452,800 must be included in the project from a list of “alternates.” "Alternate 1" is installing a UV filtration with HVAC system ($27,300) and "Alternate 2" is a front door canopy for accessibility and aesthetics ($425,500). Without these apparently essential items which raise the project's cost estimate to $74.4 million, the project “won’t get done,” said Mr. Cummings.
To address the unexpected burden of an extra $4 million in school building costs, the joint committee re-examined soft costs and reduced technology costs, lowering costs by $600,000. It noted that unspent money from the project’s feasibility phase budget could be applied to further reduce the funding gap by another $203,000. It applied incentives of $140,000 from Eversource for creating a net zero energy building. The School Committee also unanimously decided to allocate the entire University Station mitigation fund of $2 million to the building project. After all of those steps, however, there remains an overage of $1.1 million.
To address the remaining $1.1 million difference in original and new expected project cost, Mr. Cummings and Ms. Plotkin requested that Select Board apply ARPA funds in that amount to fully fund the project. Mr. Cummings offered the information that the project costs have increased due to supply chain issues due to the pandemic. He noted that ARPA is intended to provide a “rescue” in just such a COVID-19 related scenario.
While all Select Board members indicated support for the school building project, they refused to make a commitment at that very moment to provide ARPA funding to cover the $1.1 million gap, as requested by Mr. Cummings and Ms. Plotkin.
“It’s too important to the town to have a gap like this, but we need due diligence on where the funds come from,” said Select Board Chair Mr. Gotti (who joined the meeting remotely while traveling in a vehicle). Mr. Walsh and Ms. Cummings agreed.
The Select Board unanimously directed Ms. Dukeman and Town Administrator Christopher Coleman to review town resources for potential funding sources for the Hanlon-Deerfield school project.
Remote meeting provision set to expire Friday
Town Counsel Pat Ahearn noted that the state provision to allow remote meetings of town government expires at midnight on Friday, July 15, 2022. While the state Senate and House each have passed their own versions of a bill to extend the expiration date to either December 15, 2023 or March 31, 2023, respectively, Mr. Ahearn noted that there are significant differences those bodies must work out. Mr. Ahearn voiced his hopes for proposed legislation to head to the governor’s desk to sign by Friday.
