AUBURN — Municipal employees will receive $1,200 “premium pay” bonuses after the City Council approved the expenditure Monday using American Rescue Plan Act funds.

In total, the council allocated $565,000 for the bonuses, which officials called a retention method during a time when it is “extremely challenging to recruit, train and retain quality staff.”

The city approved $1,500 hazard pay bonuses to public safety staff in December, and school officials are set to vote on similar bonuses for school staff this month.

The federal funding approved Monday will pay for bonuses to full-time staff, but also sets aside $65,000 for a police retention program, upping the starting pay for entry-level patrol officers.

The council voted unanimously on the motion to add money for staff bonuses.

Auburn spent $175,000 on the bonuses for police and fire personnel in December after representatives from both police and fire unions spoke to the council.

City Manager Phil Crowell said staff looked at what other communities had allocated for premium pay, and after a federal definition for premium pay was introduced, began talks to offer the bonuses to municipal staff.

According to a memo, the police retention program would increase starting pay “for entry-level officers all the way through officers entering their fourth year.”

Auburn received $13.5 million from the federal relief bill and has been slowly allocating the funds. Also approved Monday was funding for design work for water and sewer infrastructure projects and information technology needs.