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Recommendation for adoption of an Innovation Grant Spending Policy
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Submitted by:
John Ruggini
Department:
Finance Department
A. Issue
The City of Wauwatosa was awarded $22.8 million as an Innovation Grant in recognition of its merger of the Fire Department with the City of West Allis. The grant provides $4,563,070 annually for five years. As a significant one-time revenue, it is important to develop a spending plan.
B. Background/Options
The City has been awarded a state innovation grant that will provide $4,563,070 per year for the next five years (more than $22.8 million total) as an incentive for merging the City's fire department with the City of West Allis into the Milwaukee Metro Fire and Rescue Corporation. Similar to when the City received American Rescue Plan funds in 2021, it is important for the City to develop a spending plan that prioritizes long-term financial sustainability and is consistent with the City's One-time Revenue and Financial Resiliency policies.
The One-Time Revenue Policy establishes that, "One-time revenues will always be used for one-time expenditures as opposed for on-going operations". The Financial Resiliency Policy calls for the City to add fire vehicles to the vehicle replacement fund as part of identifying strategies to limit expenditure growth for long-term financial health.
I recommend that the Common Council allocate these funds to three priorities consistent with these policies.
1. One-time Milwaukee Metro Fire and Rescue Corporation start-up costs.
The Innovation Grant was awarded for the City's joint fire merger with West Allis. However, the full amount is not guaranteed. The amount Metro Fire charges the cities (its net cost) cannot exceed 115% over five years. There are one-time costs that will be incurred. In order to enable Metro Fire to remain within that cost restraint, it is financially advantageous for the City to utilize a portion of the innovation grant for one-time start-up co...
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