This week, initial payments from the American Recovery Act arrived in the offices of local governments.
In the Golden Triangle, funds set aside for cities and counties totaled more than $18 million dollars with the same amount arriving in July 2022.
Columbus received its first payment of $2,897,645.12 this week. Starkville received its share, which equaled $3,153.333.10, and Lowndes County received $5,682,069.50. Oktibbeha County received $4,808,546.50, while Clay County’s payment was $1.875,953.50 earlier this month. Noxubee County received more than $1 million dollars with the City of Macon to be awarded around $275,000.
A second payment for these same amounts will be received one year from now.
The infusion of cash, part of a $65 billion stimulus passed by Congress in March to help local governments recover from the economic cost of the COVID-19 pandemic and become better prepared for future catastrophic events, turns project funding on its head.
“Usually, you start with a project and the hard part is finding the funds,” Lowndes County Administrator Jay Fisher noted. “But in this case, we have the money. The difficult part is trying to understand what we can spend it on. It is kind of backwards, isn’t it?”
The Act is administered by the U.S. Treasury, which sets the parameters for how those funds can be used in five broad categories:
■ Support public health expenditures, by funding COVID-19 mitigation efforts, medical expenses, behavioral healthcare, and certain public health and safety staff;
■ Address negative economic impacts caused by the public health emergency, including economic harms to workers, households, small businesses, impacted industries, and the public sector;
■ Replace lost public sector revenue, using this funding to provide government services to the extent of the reduction in revenue experienced due to the pandemic;
■ Provide premium pay for essential workers, offering additional support to those who have borne and will bear the greatest health risks because of their service in critical infrastructure sectors.
■ Invest in water, sewer, and broadband infrastructure, making necessary investments to improve access to clean drinking water, support vital wastewater and stormwater infrastructure, and to expand access to broadband internet.
In practical terms, the rules governing the funds are far more complex.
“The Treasury Department sent out its first guidance earlier this year,” Fisher said. “It’s 150 pages and it changes just about every week. Someone will have an idea, ask the Treasury Department if it’s covered and the Treasury Department will issue an update. It’s constantly changing. Good luck keeping up with it.”
The complexity of the program dictates a cautious approach, local officials say.
“We are still in the process of analyzing exactly what it can be spent for,” Starkville Mayor Lynn Spruill said. “We don’t want to have to pay it back.”
When the initial guidance for the funds was announced, Spruill said some of the funds would be used to cover COVID-related reimbursements not covered by the CARES Act, which was passed in March 2020.
Beyond that, Spruill said she expects some of the money to be used to fund the city’s $21 million sportsplex.
“We are comfortable that the additional fields that we have authorized will be an appropriate use and some police expenses and other park uses (expansion and improvements in qualified districts) but it is still in flux,” she said.
Spruill said she expects to hold a work session with the Board of Aldermen in the near future to begin the process of determining how to use the funds.
Columbus Mayor Keith Gaskin expects to begin work on the subject immediately.
“We will have a presentation at our next city council meeting to begin looking at how the funds can be spent,” he said. “This will be a very open process with input from the public throughout the process. This is such a great opportunity for our city, and we look forward to using these funds wisely.”
In Clay County, supervisors have already been briefed on how the program works.
“We met Thursday with Troy Johnston with Butler-Snow Law Firm,” said Clay County Chancery Clerk and County Administrator Amy Barry. “He’s been all over the state talking to local governments and has a really good grasp on it. It helped us get a little better feel for what the money can be used for. That will help us develop our plans.”
West Point mayor Rod Bobo said the city hasn’t received its funds yet, but the money is on the way.
“Based on the numbers, I’ve been told it’s $2.3 million (total) but that hasn’t been confirmed,” he said. “Based on preliminary discussions, the money will be spent on infrastructure issues.”
Initially, local officials believed the funds would have to be spent by Dec. 31, 2024.
“What we found out is that the money has to be obligated by Dec. 31, 2024 and spent by Dec. 31, 2026, so that gives us more time than we first thought,” Barry said.
Fisher said he believes the deadlines will be extended beyond 2026. In the meantime, he’s urging supervisors to move slowly and seek outside help.
“One of the provisions allows the hiring of consultants to help with this and I think that would be a very good idea,” Fisher said. “That’s what I intend to propose to the supervisors when we meet on Aug. 2. This is so complex that I think you really need an expert to make sure we’re in compliance with everything.”
Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected]