City Council debates use of $70,700 in ARPA interest

The City of Sheridan on Sept. 28 debated how to use $70,700 in interest that accrued to American Rescue Plan Act (ARPA) money previously earmarked for a housing land trust project.

"The interest earnings are not restricted to any particular, project or priority," City Treasurer Darla Hawkins said, noting the earnings could be used for other housing-related projects, given to a group such as Habitat for Humanity, or retained in the general fund for future needs. Hawkins said the original ARPA grant expenditures were reported and that the interest was earned separately.

Several council members urged caution. One councilor warned against treating the sum as a windfall to be spent immediately, saying the city faces potential revenue declines next year if a property-tax proposition passes. "I do believe we are going to look at some tough times," a council member said, urging the council to consider holding the funds for reserves or equipment needs rather than approving immediate disbursement to an organization that has already received ARPA support.

Another council member asked legal counsel to confirm whether interest earned on ARPA funds must be used for the original ARPA purpose. Hawkins and staff said the interest appears to be unrestricted but recommended formal legal confirmation before a final decision. The issue will be placed on a future council meeting agenda for formal action.