Springfield Debates How to Apply Rescue Funds
Last Monday, Sept. 13, Springfield’s city council held a work session meeting to talk about how to apply the money received from the American Rescue Plan Act of 2021.
This meeting was not added to Youtube until Sept 21.
The city’s Finance Director, Nathan Bell, prepared the council with background information for the evening’s discussion. The meeting agenda explained that the ARPA was signed into law by President Joe Biden on March 11, 2021.
The ARPA allocates $65 billion in funds to U.S. cities. Springfield will receive $13.95 million, split into two payments. The first payment of $6.98 million was deposited into the city’s bank account on May 19, 2021.
Due to the late notification of the total award, Springfield was unable to include this money in the budget for the 2022 fiscal year. The funds were announced in May while the city was finalizing the budget which was adopted on June 21.
The federal government released guidelines regarding the use of the funds and held training to explain those guidelines to city staff. A broad summary of qualified use of funds was presented to council.Those guidelines include:
- Support for Public Health Response
- Replace Public Sector Revenue Loss
- Water and Sewer Infrastructure
- Address Negative Economic Impacts
- Premium Pay for Essential Workers
- Broadband Infrastructure
Bell explained that the best practice for these one-time rescue funds is to apply them towards one-time expenses with limited duration timelines. He explained that the funds are not recurring funds and, as such, they should not be used for recurring expenses.
Recommendations include using the funds to cover losses due to the COVID-19 pandemic. Bell said that investments for critical infrastructure improvements are an appropriate use of these funds – provided that they do not incur ongoing operating costs.
Other best practices, according to Bell, involve efforts to partner with state and local jurisdictions, especially concerning infrastructure improvements. Bell said that local jurisdictions should be aware of potential funding from state sources, as well as any existing or new legal requirements.
The ARPA also recommends that local jurisdictions consider regional initiatives, partnering with possible community beneficiaries. Examples include schools, transportation agencies, and economic development authorities. It also recommends that the council take their time and make careful efforts to use the funds to lead recovery from the pandemic.
Bell noted that this was a good time to begin these conversations so they can include it with the 2021 supplemental budget, which is scheduled for release in October. Based on the federal guidelines, estimates show that the city has a $7 million operating deficit and potentially has the ability to claim all of the $14 million rescue as replacement revenue through December 31, 2024.
According to Bell, this would be the easiest way to qualify the funds from an audit and administration perspective, however, doing this means the city cannot, according to guidelines, use the funds to “cover debt services, settlement agreement expenses, or put into a reserve.”
Based on the federal guidelines, the budget team prepared a proposal for the potential uses of the funds. These include:
- Covering the General Fund Deficit
- Limited Duration Positions
- Carter Building Remodel
- City-wide Legacy Street Light Replacement
- Justice Center Roof Replacement
- City Hall Roof and HVAC Replacement
- Website Enhancement
- Council Chambers and Court Security
- FLS Radio Replacement
- Museum Elevator
- City Hall Space Remodel
- Revenue Share for Parks
Mayor Sean VanGordon said that, for now, he is comfortable labeling all of the funds as “revenue replacement.” He said that this will not prohibit the city from re-addressing where to allocate the money after further conversations are held, and agrees that funds should be used for “one-time projects, not for ongoing programs.”
Then he opened up the discussion to the council.
During work session meetings, the council listens to responses from each council member, allowing at least one opportunity to speak each. After that each member is given the opportunity for a second reply if they choose.
In the meeting questions were raised over the estimated deficits, previous budget cuts, and the Willamalane partnership request letter.
Leonard Stoehr was the first to ask questions regarding the proposal the budget team prepared.
He asked if the deficit in the budget would carry forward or whether the city should expect it to increase. He also brought up questions about the cuts already made to the budget and said he supported funding “wish list items” — projects the city wants to do but just doesn’t have funding for.
Bell explained that the deficit is based on federal guidelines. The city estimates a deficit within the $4-5 million range but they have reserve funds. There were full-time positions eliminated in the city’s budget, two vacant positions in the police department were cut. In addition, cuts were made in operations, IT, and previously cuts were made in HR pre-COVID19.
Bell said there was one recommendation he would make that wasn’t included: “Human resources training programs.”
He said that it was wise to invest in training programs that reduce the risk of future expenses. He believes replacing the street lamps with white LED’s was also a good investment as the project would pay for itself in 11 years. After that, it would greatly reduce the cost of running the lamps.
Councilor Kori Rodley told the council that, as she reviewed the proposal, her thoughts were focused on the “future looking back.”
She hopes that, in ten years, the city council can “look back and say that we invested the funds well.” She urged the council to replace the HVAC system and focus on projects that avoid higher expenses in the future.
Most of the council agreed that infrastructure updates were a good place to invest the ARPA funds. Council also supported the recommended updates to the HVAC system, remodeling city hall, and possibly expanding the library by moving the city manager to the old fire department office. Many also supported updating the street lamps from high pressure sodium amber lamps to white bright LEDs for safety.
Safety, for the entire community, seemed to be of little concern again. Based on scientific studies, The International Dark Sky Association suggests that cities use warm white LEDs instead, because bright blue-white LEDs cause problems for some individuals and wildlife. They also reduce night sky visibility.
There was little support for funding the FLS Radio Replacement, which would replace the Fire Department’s existing radios. These radios, according to the city, “are approaching the end of their life and cannot currently be used in buildings.” It is listed on the agenda as a “planned replacement” item “without identified funding.”
Councilor Joe Pishioneri took the time to summarize every item on the list that was important to him. He said that there were at least $20 million in proposed projects and not all will get funding.
Pishioneri believes that the funds should be spread out and partnerships should be considered to cover full expenses for certain projects. Referring to the city hall roof he recommends that due diligence be done to ensure the city doesn’t miss recouping any losses. He also wants to create a fund to help cover developer costs in creating bioswales for new development.
Councilor Damien Pitts encouraged other council members to think differently about these funds. While he thinks that infrastructure is a good investment, Pitts also wants to “increase cultural learning spaces.” He wants to work with Sister Cities International to promote cultural connection and exchange focused on arts, culture, youth education, business, and trade.Mainly, Pitts wants the city to work on increasing community events working with Willamalane to host things like BBQs.
“When you feed people, you make them happy,” said Pitts, who believes events like this will “attract more people to the city, and could even add or enhance elements of culture.”
Speaking last, Mayor Sean VanGordon said that he likes the list prepared by the budget team. He supports the idea of becoming a sister city. He also concurred with Rodley about ensuring that 10 years down the road the money will be considered well-spent.
He would also like to address the “desperately needed website enhancements” and to talk about other possible one time projects like “taking care of the city’s trees.” He believes the trees are important to the overall well being of the city and they should consider “replacing downed trees, and trimming and pruning others to enhance the image of the city.”
Council quickly took second round replies, in which many agreed with Pitts about creating a sister city. Stoehr recommends looking for cities who have a history of wildfires to learn new techniques for mitigation to learn from, as he claims “wildfire is a new issue for Oregon.”
Pishioneri said he liked the idea of BBQ’s and taking care of the city’s trees before saying “don’t forget about the bioswales.”
Eventually, VanGordon asked the council to comment on the request letter from Willamalane — who partners with the city to provide Parks and Recreation. Willamalane sent a letter requesting $1.7 million of the ARPA to recoup losses and to re-establish pre-COVID service and operating levels for things such as childcare and education.
Michael Wargo, the Superintendent of Willamalane, joined the meeting to discuss the program’s needs. After speaking, the council asked him to provide more detail about their initial request letter for the council to consider.
Before adjourning, VanGordon said that this was just the first go around to discuss how to appropriate these funds. No decisions were made at this time.
For now, it seems that the city plans to move forward with this “windfall,” as council member Marilee Woodrow called it, and to apply these funds in ways they say will best benefit the city, in line with their constituents. Work sessions are normally held every second and fourth Monday of the month. The public may attend these meetings, but public comment is not allowed.