DATE: October 6, 2026
TO: Board of Supervisors
SUBMITTED BY: Paul Nerland, County Administrative Officer
SUBJECT: State and Local Fiscal Recovery Funds Second Amendment to Subrecipient Agreement with Self-Help Enterprises on behalf of Lanare Community Services District
RECOMMENDED ACTION(S):
TITLE
Approve and authorize the Chairman to execute a retroactive Second Amendment to Subrecipient Agreement No. 23-493 with Self-Help Enterprises (SHE), on behalf of Lanare Community Services District, for provision of American Rescue Plan Act-State and Local Fiscal Recovery Funds (ARPA-SLFRF), which will revise the expenditure plan, timeline section, and grant funding section, and reduce the maximum compensation by $120,316, from $1,600,000 to $1,479,684.
REPORT
Approval of the recommended action will authorize the Second Amendment to Subrecipient Agreement No. 23-493 (Agreement) with SHE, which will revise the expenditure plan, timeline section, and grant funding section, and reduce the maximum compensation by $120,316, from $1,600,000 to $1,479,684. This item pertains to a location in District 4.
ALTERNATIVE ACTION(S):
If the recommended action is not approved, the subrecipient agreement will remain in its current form, and the identified cost savings in the Agreement will go unspent by both SHE and the County. Any ARPA-SLFRF unspent by December 31, 2026, will be returned to the United States Department of the Treasury (Treasury).
FISCAL IMPACT:
There is no increase to Net County Cost associated with the recommended action. The program is fully funded with ARPA-SLFRF. Sufficient appropriations are included in the FY 2026-27 Adopted Budget for the Auditor/Controller-Treasurer/Tax Collector Org. 1033 - Disaster Claiming, Fund 0026, Subclass 91021, Account 7845.
DISCUSSION:
On November 20, 2023, the U.S. Department of Treasury (Treasury) published the Obligation Interim Final Rule (Obligation IFR) which amended the definition of “Obligations” and included additional flexibility with respect to the ARPA-SLFRF program.
After the SLFRF obligation deadline of December 31, 2024, Treasury’s guidance permits recipients to amend existing contracts after the obligation deadline, so long as the amended contract is within substantially the same scope and for substantially the same purpose as the original contract. Per Treasury’s Frequently Asked Questions (FAQ 17.16), if those requirements are met, SLFRF funds may be used to cover cost increases contained in the amended agreement.
Treasury’s Obligation IFR includes the ability for recipients to reclassify funds when excess funds that were obligated by the deadline but ultimately would not be expended on an eligible activity. For example, recipients may reclassify cost savings from an under-budget project to another eligible project under the SLFRF program rules, including the requirement that the recipient incurred the obligation by December 31, 2024, to expend funds on the activity.
On March 3, 2025, the CAO’s Office provided written notice to the ARPA-SLFRF awarded departments and subrecipients with active programs to remind them of the Treasury’s liquidation deadline of December 31, 2026. To ensure the County can meet the Treasury’s liquidation deadline, the CAO’s Office required all subrecipients to complete their awarded programs and submit their last claims by June 30, 2026.
On June 30, 2026, your Board received the CAO’s Office progress report on the County’s ARPA-SLFRF Program. Your Board then directed the CAO’s Office to initiate the formal amendment process for ARPA programs with unclaimed obligations by the June 30, 2026, expenditure deadline.
On September 19, 2023, the County and SHE entered into County Agreement No. 23-493, to help SHE, on behalf of Lanare Community Services District, address interior/exterior corrosion on the community center facility, improve the center’s ventilation system, kitchen and meeting spaces, upgrade public restrooms, improve the electrical system, and improve the facility grounds and recreational areas so that the center, a public facility, can effectively continue serving as a public meeting place for civic engagement, a delivery sharing point for critical resources such as food distribution, host testing, and vaccination events.
On November 5, 2024, the County and SHE entered the First Amendment to the Agreement, which reallocated funding within the Agreement’s expenditure plan to address the increased construction costs based on the lowest responsible bidder rather than the initial engineering estimates, which were significantly short of the accepted bid. The First Amendment also updated language for the modification clause.
Since the approval of the First Amendment, SHE represents that it has completed its ARPA program. SHE represents that all program expenditures have been claimed against the award by the June 30, 2026, deadline. Approval of the recommended action will revise language in the Agreement’s timeline section and grant funding section, reduce the maximum compensation by $120,316, from $1,600,000 to $1,479,684, and finalize SHE’s program expenditure plan.
Approval of the recommended action will authorize the Chairman to execute the recommended amendment, which will finalize the program’s total budget, and accurately reflect the final funding allocations approved by your Board in support of the awarded program. Recommendations for the reallocation of available cost savings from this program will be brought forward in a separate agenda item.
REFERENCE MATERIAL:
BAI #37, November 5, 2024
BAI #38, September 19, 2023
ATTACHMENTS INCLUDED AND/OR ON FILE:
On file with Clerk - Amendment No. 2 to Agreement 23-493 with Self-Help Enterprises
CAO ANALYST:
John Toepfer