LOUISVILLE, Ky. (WDRB) – Louisville Metro expects to get $434 million. Shelbyville may receive just over $3 million. The suburban city of Mockingbird Valley in Jefferson County – pop. 164 – stands to take in nearly $32,000.
Local governments in the Louisville area and across the U.S. will know by next Monday how they can spend the latest round of coronavirus relief aid, part of the massive American Rescue Plan passed by Congress and signed into law by President Biden in March.
Besides pumping money into state coffers, the bill sends funds to counties, cities and towns to replace lost revenues and cover other expenses from the COVID-19 pandemic. The exact federal guidance hasn’t been released, but the Biden administration says the money can help businesses and industries affected over the last year and invest in broadband, water and sewer projects.
It also can be used as a "premium" of up to $13 per hour, for essential workers, in addition to other wages.
The new infusion of federal dollars will arrive as pandemic restrictions are being loosened or ended as more Americans get vaccinated. Local governments will receive two installments – the first half next week, and the remaining amounts starting next year. All of the funds must be spent by the end of 2024.
That’s in contrast to the emergency program known as the CARES Act, which initially required cities to seek reimbursement for pandemic-related expenses before December 31, 2020. The deadline was later extended by one year.
“There is not a rush on the part of municipal leaders the way there was with getting access to that CARES funding with a clock running,” said J.D. Chaney, executive director and CEO of the Kentucky League of Cities. “They can be more deliberative and intentional about how they spend their money.”
In Louisville, Mayor Greg Fischer has presented his budget for the fiscal year that starts July 1 without factoring in any of the new federal money. But that proposal could be amended before it’s passed to reflect some of the money the city will receive starting next week, said Bill Hollander, the Metro Council’s budget committee chair.
There have been some discussions about how to spend the money, although Hollander described those as “speculative” because the U.S. Treasury Department hasn’t yet provided its rules. Those are due Monday.
“I really hope that we can do something really significant with this,” said Hollander, a Democrat. “And I hope that we can look back in 10 years and say, ‘We had an opportunity to make real changes in the community -- and we seized on it.’”
Council member Anthony Piagentini, who leads the council’s minority Republican caucus, said decisions on how to spend the new funds ought to be made after the current budget process ends in June. He said it “muddies the water” to use one-time federal dollars in a budget that includes many recurring expenses.
In general, Piagentini said he supports spending the American Rescue Plan money primarily on pandemic costs, such as contact tracing and vaccinations, as well as to aid small businesses and others who suffered economic losses.
“And then beyond that, we should be focusing on infrastructure and deferred maintenance -- those things that will have sustained and lasting impact to this city in a positive manner,” he said. “Impacts that we will be benefiting from 10-15-20 years down the road.”
Not only is Metro government preparing for more than $400 million, but Jefferson County’s 83 suburban cities also will receive a share of the federal funds based on their populations. In all, those small cities are expected to get $27.7 million, according to estimates from the Kentucky League of Cities.
In eastern Jefferson County, for example, Douglass Hills could receive just over $1 million. Mayor Bonnie Jung said she’s hopeful some of the money can be used to replace about $135,000 the city didn’t bring in last year when its pool was closed because of coronavirus restrictions.
Jung, who is president of the Jefferson County League of Cities, acknowledged that some small cities didn’t see the economic consequences of the pandemic that larger cities did. In those cases, there may be questions about how the money can be spent.
“But if they can do things like park improvements, safety, putting up cameras -- whatever those kinds of things that we can get creative and qualify under they should allow,” Jung said.
The federal funds will flow to county governments in both states, including about $866.5 million to fiscal courts in Kentucky, according to Kentucky Association of Counties estimates. In the Louisville area, Hardin County ($21.5 million) and Bullitt County ($15.8 million) are to get the largest checks.
Among southern Indiana communities, New Albany would receive the most money: about $16.8 million. Other cities or towns expected to get more than $1 million are Charlestown ($1.7 million), Sellersburg ($1.9 million) and Clarksville ($4.5 million) in Clark County, and Scottsburg ($1.4 million) in Scott County.
New Albany’s city council voted 6-3 Monday night to put its redevelopment commission in charge of spending its funds, a move that puts a board with mostly appointed officials in control of the money. That’s in contrast to Jeffersonville and Clarksville, where elected councils plan to make spending decisions.
The New Albany Redevelopment Commission includes two council members. But the other three voting members of the six-person body are appointed by Mayor Jeff Gahan, a Democrat.
Jennie Collier, a Democratic council member who also serves on the redevelopment commission, said her personal knowledge of the board played a role in her support for moving the spending authority.
“They are more than capable of dealing with this, and I have no problem in turning over the control, power -- whatever you want to call it -- of this money to redevelopment because I want to do what's best for the city,” she said.
A directive from the Indiana State Board of Accounts, issued in March, is silent on decisions like the one made in New Albany. It says that cities, towns and counties must establish a grant fund through an ordinance.
New Albany did that after an unsuccessful amendment by Republican council member Josh “JT” Turner to let the council control the money.
Turner argued in an interview that the commission will simply act as a “rubber stamp” loyal to the mayor.
“Another reason why this council should be in charge of all this money is because we are elected and we should be held accountable for the actions that we make, whether that's getting voted back into office or voted out,” he said.
Copyright 2021 WDRB Media. All rights reserved.
