The Legislative Council at its October 20 meeting gave final approval to using $2.5 million from American Rescue Plan (ARP) funds released to Newtown for the Hawley School HVAC project, approving it unanimously following similar actions by the Board of Selectmen and the Board of Finance.

“This project seems like a natural fit given why we got the money,” said Councilman Ryan Knapp. “Some uses by other communities in the area have been eyebrow-raising. But I can’t think of a better use of COVID money that to improve the ventilation in an old building. I’m all for it.”

Councilman Kathy Reiss asked how the town arrived at the number it was using, rather than using more or less of the $7.5 million that Newtown received in ARP funds.

“There was no science to it,” said First Selectman Dan Rosenthal, who noted the amount was roughly one-third of the town’s allocation and would reduce the money the town spent per year on bonding by roughly $200,000.

Rosenthal said there are many things that could be funded through the ARP money, and that requests have been coming from various departments. However, the only item that needs to be decided immediately is whether to use part of the funds for the Hawley HVAC project.

“The decision tonight is on Hawley — it fits exactly in the parameters of the [ARP] funding,” said Rosenthal.

The town has until December 21, 2024, to allocate money from the disbursement and another year after that to spend it.

The appropriation for Hawley School was authorized in the capital improvement plan (2021-22 to 2025-26). The project will cost roughly $8 million and the town will issue bonds to borrow the amount, minus the $2.5 million in ARP money if the voters also approve it. Voters will be asked to approve or reject the appropriation on Election Day, Tuesday, November 2.

“I appreciate the application of money to this project,” said Councilman Judit DeStefano. “I wish we would use more towards it. It’s helpful when people know where funds are coming from [to pay for a project].”

Rosenthal stated that if the Hawley School HVAC project does not pass at referendum in November, the ARP funds can be used elsewhere.

“If it doesn’t [pass at referendum], we still have the $7.5 million [in ARP funds] to spend and the decision changes,” said Rosenthal.

ARP Guidelines

According to the US Department of the Treasury, ARP funds can be used by the town for the following:

*Support public health expenditures, by, for example, funding COVID-19 mitigation efforts, medical expenses, behavioral health care, and certain public health and safety staff.

*Address negative economic impacts caused by the public health emergency, including economic harms to workers, households, small businesses, impacted industries, and the public sector.

*Replace lost public sector revenue, using this funding to provide government services to the extent of the reduction in revenue experienced due to the pandemic.

*Provide premium pay for essential workers, offering additional support to those who have and will bear the greatest health risks because of their service in critical infrastructure sectors.

*Invest in water, sewer, and broadband infrastructure, making necessary investments to improve access to clean drinking water, support vital wastewater and storm water infrastructure, and to expand access to broadband internet.

“Within these overall categories, recipients have broad flexibility to decide how best to use this funding to meet the needs of their communities,” states the treasury website.

Rosenthal noted that the ARP requires anything that funds are used for not be a “recurring item” — so for instance a new position with a salary would not be an approved use of the money. Any recurring items would have to be funded by the town’s normal operating budget in future years. Additionally, ARP funding cannot be applied directly to the budget as revenue to directly reduce the mill rate.

Finance Director Robert Tait said that the ARP disbursed $1.56 billion to counties and towns, and $3.93 billion to residents across the country. Of the town’s $7.6 million share of the money, it received half, or $3.8 million, this year and the other half be available for spending next year.

Creating A Paper Trail

Rosenthal said at an August BOS meeting that even though the town does not have to do formal appropriations to spend ARP money, he felt it was better to follow the prescribed process in the Newtown Charter as funds are allocated. Rosenthal’s thinking was it creates a paper trail should the federal government question how Newtown applied the funds, as well as showing taxpayers how those funds were used.

Some other things the town could use the money for besides the Hawley project are new WiFi routers at the community center and municipal center, which selectmen indicated were working poorly; a new roof for the municipal center; and vehicle cameras for the police department.

Rosenthal said he felt it was best to keep items under consideration for ARP funds to items that have been considered for past budgets.

Rosenthal said that up to one third of the disbursement, or $2.4 million, can be used as part of the Revenue Loss Calculation, which can be used in any way the town sees fit. The $2.5 million for the Hawley School HVAC does not need to be used as part of the Revenue Loss Calculation, as it falls “squarely within the things allowed by the grant.”

“I think most towns are using the revenue loss part of it,” said Rosenthal.

Reporter Jim Taylor can be reached at jim@thebee.com.