WILMINGTON –– As the City of Wilmington prepares for a hefty bank deposit of American Rescue Plan (ARP) funds next week, staff and council are shaping the preliminary strategy for doling out the money over the next three-and-a-half years.
Monday morning staff pitched some rough spending recommendations to council it presumes the federal government will authorize. Some criteria for how to allocate the money is still forthcoming from the U.S. Department of the Treasury and is expected by May 11, the day the first half of funding drops into the city’s account, according to Tony McEwen, legislative affairs director for the city.
“We’ve done our best with what the legislation says at this point, the guidance that we’ve gotten, but again there’s still a lot of blanks that need to be filled in,” McEwen said. “What we’re trying to obviously do is work towards getting you all a good blueprint.”
Signed into law by President Joe Biden Mar. 11, the ARP dispersed $1.9 trillion throughout the nation, specifically for Covid-19 relief and economic recovery. Locally, New Hanover County is receiving $45.47 million and Wilmington is anticipating $25.93 million. The county is asking the city to collaborate on a number of initiatives utilizing the funds, city staff told council.
The second half of the city’s allocation is slated to arrive May 2022. Local governments must use up the dollars by December 2024 or return them.
Before the bill even passed, top city staff formed a working group to draft proposed spending options. The group identified three overarching categories:
Economic and community assistance ($7 million)
The city is considering engaging the Wilmington Chamber of Commerce to administer assistance, such as grants, to small businesses struck by the pandemic. As well, it is eyeing support for job training and placement programming.
New Hanover County also expressed a $3.8-million interest in business assistance, nonprofit assistance and job training as part of its ARP spending strategy. It has approached the city about partnering on its efforts, McEwen said.
Councilman Kevin Spears asked staff to examine how funds could also help aspiring entrepreneurs launch new businesses, in addition to supporting existing ones.
“I see a lot of stuff circling around about PPP and, you know, potentially some people trying to get PPP and SBA loans, but they don’t have a business, already,” Spears said.
The city is also weighing options to back nonprofits and expand workforce housing, a clear priority of the council’s, if the use is found to be allowable.
Council members Clifford Barnett and Spears both voiced support for tackling the area’s lack of affordable housing with the extra assets.
“The affordable housing issue is a no brainer,” Spears said.
City and community infrastructure ($6 million)
The city is eyeing technology upgrades that would bridge the digital divide – another need the county has invited the city to team up on.
New Hanover County plans to allocate $5.7 million of its ARP funding to bring broadband to 8,000 homes. It will concentrate on families who receive Medicaid or Food and Nutrition benefits.
Mayor Pro Tem Margaret Haynes highlighted this as one of her priorities for underserved communities as well. She added she’d like to join forces with the county to serve the unsheltered population, possibly by establishing a day shelter.
City response and recovery ($12.93 million)
About $3.7 million of the funds could make up for lost revenue at the Wilmington Convention Center and $300,000 could supplement the dwindled parking fund. With scarce events held, the facility is estimated to lose about $8 million from the pandemic.
The city is currently dipping into its fund balance to cover the cost of the center while room occupancy tax and event revenue linger below pre-pandemic levels.
The ARP will cover other Covid-driven expenses, such as personal protective equipment, heightened cleaning services in city buildings, and sick leave for employees who contract the virus.
The city is planning to set aside some money to cover the cost of administering and managing the funds. Local governments are required to submit detailed documentation of their spending to the U.S. Treasury.
Lastly, some funds will be left untouched in the case of any unexpected, pandemic-related expenses that arise through 2024.
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