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Cook County approves $53 million ARPA reclassification after hearings over audit risk
Summary
After questioning from several commissioners about audit and legal scrutiny, the board approved reclassifying $53 million in December 2024 expenses as ARPA 'revenue loss' so those funds remain federally eligible; Guidehouse/NIEHS consultants told the board the move complies with SLFRF guidance.
The Cook County Board voted to recognize $53,000,000 of December 2024 operating expenses as ARPA revenue-loss funds to preserve federal eligibility and spending flexibility, a procedural reclassification staff said must be completed before the annual-close deadline.
Commissioner Lowery and county finance staff explained the move as a one-time recognition needed to avoid forfeiting ARPA eligibility for those expenses. Dean (county finance staff) told the board that the transfer is done as part of the annual-close 'chargeback' process and must be completed by January 15 to preserve the county’s ability to use the funds under federal SLFRF rules.
Commissioner Sean Morrison said he would probably support the transfer but sought assurances that the reclassification would withstand legal and audit scrutiny. "If we make this transfer of funds... will it be able to sustain both legal and audit scrutiny?" he asked. County staff and their federal grants consultant replied that the proposed reclassification follows the U.S. Treasury guidance. Jennifer Jeladek, identified in the transcript as a director who oversees federal grants work in the Midwest, told commissioners: "We believe all of this is federally compliant, and the county is right in its actions."
Board members pressed for more detail on which subrecipients failed to spend ARPA awards and on past instances where ARPA funds were retracted; staff said monitoring had identified programs that may not meet spending benchmarks and that the county has previously reduced awards when subrecipients could not execute.
The board approved direct approval of the transfer to preserve the county’s ability to account for those expenses as eligible ARPA revenue-loss dollars. Several members asked that staff return with a list of awards reduced or rescinded in past practices and a clear process for future reallocations.
Next steps: County finance staff will provide follow-up briefings including the list of entities whose awards have been retracted historically and proposed processes to reallocate funds before the statutory/administrative deadlines.
