On August 30, the Greenbelt City Council and city staff held their initial discussion on how best to spend the $22,881,666.47 of American Rescue Plan Act (ARPA) funding that was provided to the city in July. In a memo presented to council, staff laid out the permitted uses and restrictions of the funds, as well as staff recommendations on how to use them, both in the short, as well as long term. The uses are based for the moment on the Treasury Interim Final Rule, with the Final Rule in the works. Council and staff expressed the goal to make the most balanced decisions possible to help the greatest number of people and assist in the city’s economic recovery. The spending will expire in 2024.
The memo presents the eligible uses, including: support of public health expenditures; support for negative economic impact due to Covid-19; replacing lost public sector revenue; providing premium pay to essential workers; and investing in water, sewer and broadband infrastructure.
The ineligible uses include: offsetting of the reduction of net tax revenue due to a change in law from March 3, 2021; funding of pension funds; debt service; legal settlements or judgments; or depositing to financial reserves.
Staff recommends an immediate use of funds, mainly around rental and business assistance. The suggested amount for each to be set aside is $500,000, both to be dispersed through the city and Greenbelt CARES. Another $125,000 is suggested for other immediate uses. This represents 5 percent of the entire ARPA funding.
City Treasurer Bertha Gaymon calculated that the city’s lost revenue up to December 2020 was $2.2 million, mainly from cutbacks in services due to Covid-19 and the closing of facilities. On December 15, 2021, Gaymon plans to reassess the amount of lost revenue.
Economic Development Coordinator Charise Liggins stressed that Greenbelt businesses continue to struggle. This second round of business assistance now includes nonprofit organizations, as well as an expanded list of expenses such as rent, utilities, advertising, employee hiring and recruitment, employee training and onboarding, personal protective equipment and outdoor space build-out or expansion.
Details of the business recovery plan still await development before final council approval. Certain ideas are being discussed by staff, like a $20,000 grant total and the ability for businesses to apply again for city assistance.
Greenbelt CARES Director Dr. Liz Park reported that the rental assistance program will be solely for Greenbelt residents who have undergone hardship due to the pandemic. She said it may be possible for residents to apply again, with a total cap of $10,000 being set. For example, if someone received $5,000 before, they would only be allowed an additional $5,000. Residents must choose whether to use city or county funds. Last time, Greenbelt CARES dispersed $400,000, with 98 percent of applicants serviced.
This time the city will be providing mortgage assistance. Park said that the city awaits the guidelines for the state’s Homeowner Assistance Fund, established on March 11, 2021, in order to devise the city’s program, as it will provide an effective blueprint.
Councilmember Emmett Jordan stressed that another need for residents will be help with homeowners association and condo fees.
A frequent comment by the public and council was that the proposed $500,000 for rental assistance would not be sufficient to meet the current need. Staff pointed out that this is only an initial amount, with a later increase being expected.
A large discussion focused on the plight of landlords with only one or a few properties who experience a loss of revenue due to Covid-19. Staff is looking at the Small Business Administration guidelines to see if they qualify as a small business, thus allowing them to use ARPA funds.
Councilmember Edward Putens proposed the idea of a revolving business fund, allowing businesses to repay loans into a continuous pool. Staff was amenable and will investigate its feasibility, yet Assistant City Manager Timothy George stressed that the 2024 spending deadline might make this problematic.
Council will vote on this initial 5 percent expenditure of funds at its next meeting on Monday, September 13, with the application process likely to begin in October, if approved.
The next three to four months will see a series of community engagement forums and work sessions, leading to a final vote on the ARPA Implementation Plan in January.