Appropriations Subcommittee Meeting
March 22, 2021
The Appropriations Subcommittee meeting was called to order at 3:00 pm on Monday, March 22, 2021. The purpose of the meeting is to discuss the distribution of FRRP funds. The group discussed the questionnaire provided by the RSA regarding assurances, use of funds and certification. The group also reviewed the answers to the FAQ provided by RSA on March 12, 2021. The meeting was attended by the following: Kurt Ponchak, Debbie Hietala, David Stevens, Rafaella Diershaw, Bernie Kaiserian, Jim Warth, Alan Risk and Bill Findley. Janet Chernoff attended to take notes and prepared the minutes. The meeting was open to all participants per Sunshine Law but only the persons listed above spoke.
Kurt Ponchak opened the meeting and Janet Chernoff called the role. The minutes from the last meetings and the agenda were adopted without objection. The first thing that Kurt addressed was the formula previously approved by the subcommittee. The formula was clarified as dividing the award by the losses to get a percentage.
Kurt reviewed the questions from the form provided by the RSA for assurances and use of FRRP funds. Kurt addressed questions regarding use of FRRP funds. Question B1 asked how the SLA will distribute the funds to the vendors. The Subcommittee is recommending that the funds be distribute proportional to losses using the formula listed in the previous paragraph. Question B2 addressed the question of administrative costs. It has been determined that there will be no administrative costs. Since there are no administrative costs the answer to question B3 is 0.
In answer to question B4 the program plans to use attestation to determine if the losses were previously compensated. Prior to the meeting a draft of a letter to all vendors was prepared. The letter included information on how much loss was calculated for the vendor and the amount of financial remuneration they should expect to receive. The letter asked the vendor to attest that any compensation they received when added to the remuneration did not exceed their loss. A separate line allows a vendor to attest to an amount that did exceed their loss. The group discussed what is considered compensation including PPP loans and disability payments. The FAQ indicated that each state would have to decide what is considered compensation. Debbie Hietala felt that payments like fair minimum return or vacation pay should apply and payments from outside agencies should not. The group review the letter and there were concerns about the wording and accessibility. There was also concern about the format as it required individual vendors to calculate their award. Kurt Ponchak wants to expedite the process and get it processed prior to the end of the state fiscal year. It was suggested that a form be prepared that would only gather information on compensation. The group will review the form and make a decision at the next meeting.
The group discussed the status of vendors who have retired, left the program or died in 2020. Per the answer to Question 1 in the FAQ any vendor that left the program in 2020 is not eligible. Bill Findley felt that if a vendor retired in 2021 they would still be eligible and the group agreed. The spreadsheet will be revised to remove those vendors who left their facility in 2020.
The group then discussed income from secondary facilities. Previously the subcommittee had voted not to consider income from secondary facilities. Kurt Ponchak, Debbie Hietala, Jim Warth and Bill Findley feel that all income from facilities should be calculated. They felt that there was language to that effect either in the rule or in subsequent communications. Debbie Hietala asked about lost inventory and David Stevens felt that those losses should be accounted for in inventory costs on the monthly report. Debbie sited an example of buying product in anticipation of an opening that never happened.
Kurt returned the group to the questons listed on the Assurances and Use of FRRP Funds. The answer to question B5 is yes as the BBE plans to give all the money to the vendors. Because all money will go to the vendors no answer is need for question B6. Question B7 is asking for an explanation of active participation by the Committee in this process. Subcommittee meetings are well documented and the Committee has been updated. The Committee will vote on any recommendations and will make the final decision. Question B8 asks to identify a date for distribution of the funds. This will be determined once the plan is finalized but the program will definitely distribute it before the September 30, 2022 deadline.
The subcommittee will review the attestation document and readdress the decision about secondary facilities at the Wednesday meeting. Kurt told the group that because the Division has decided that there will be no administrative costs the answers to questions from the FAQs 7, 8, 9 do not apply. There was a discussion about how to distribute the attestation and Janet Chernoff advised the group that certified mail is not an effective way and that it is better to use email. BBE staff will monitor the responses. Bill and Kurt agreed that any vendor that is not eligible for the award should be notified. Debbie felt that any communications should include wording that this is a Committee decision and is based on direction from the RSA.
The subcommittee adjourned at 4:25pm. The next meeting is Wednesday, March 24 at 2pm.
