Richmond creates Special Projects Reserve Fund, allows temporary borrowing for FEMA-declared disasters and approves $795,287 transfer

Richmond, Vt. — After extended discussion about ARPA‑eligible projects and recent flood costs, Richmond voters approved creating a Special Projects Reserve Fund on Nov. 9 and authorized a transfer of town surplus into it, with a narrowly framed borrowing clause to respond to FEMA‑declared disasters.

Article 3 proposed placing remaining ARPA (American Rescue Plan Act) money into a restricted Special Projects Reserve Fund for uses spelled out in the warning: projects that improve town aesthetics, public‑land and building improvements, public safety, wellness, COVID‑19 impacts, or investments in broadband infrastructure (citing 24 VSA §2804). Select board members and staff said moving the money into a reserve would preserve ARPA‑eligible uses and avoid federal deadline issues.

An amendment on the floor sought to give the select board authority to borrow from the reserve “in the event of the need for funding due to a FEMA‑declared disaster,” with the explicit requirement that borrowed money be repaid upon FEMA reimbursement. Supporters said the clause would give the town flexibility to respond quickly to major disasters without taking an external bond; critics worried about mixing restricted ARPA purposes with emergency borrowing and about limiting non‑FEMA emergency options.

The amendment passed by standing count (78 affirmatives, 27 negatives) and the amended Article 3 passed. The assembly then considered Article 4, which would deposit up to the remaining ARPA balance into the new fund. Staff updated the assembly on post‑August commitments and expenditures and an amendment reduced the transfer from the earlier figure to $795,287 (the uncommitted balance after earmarks). The amended Article 4 passed by voice/standing vote.

Select board and staff clarifications - Town Manager Josh explained that the town moved remaining ARPA money into the general fund in August to avoid any federal deadline; the question today was whether voters wanted to restrict those dollars back into a reserve for the ARPA‑eligible uses. - Finance staff said that while the town had roughly $1.5 million in unassigned/restricted funds at fiscal‑year end, flood expenses (estimated about $1.9 million) had created a near‑term cash shortfall that FEMA reimbursement is expected to cover in part. Voters debated whether restricting funds now would constrain the town’s near‑term emergency options; the borrowing amendment was offered to address that concern.

What this does and does not do - It creates a voter‑authorized Special Projects Reserve Fund that restricts the transferred dollars to the ARPA‑eligible project purposes listed in the warning. - It authorizes the select board to borrow from that fund for FEMA‑declared disasters, with repayment required upon FEMA reimbursement; it does not create a permanent rainy‑day fund or override the select board’s duty to bring future transfers to the voters.

Votes at a glance - Article 3 (create Special Projects Reserve Fund with FEMA‑borrowing amendment): Amendment passed (78–27); amended Article 3 passed. - Article 4 (deposit into the fund): Amended to $795,287 and passed.

Follow-up: the select board and finance staff will document the remaining ARPA commitments, finalize the accounting treatment, and publish a timeline showing expected FEMA reimbursements and the schedule for any project spending drawn from the reserve.