Monday, June 24, 2024

City reallocates ARPA funds, forgoes planned convention center pavilion to fund homelessness initiative

City staff moved around ARPA funding from its original framework after $2 million was not needed for an outdoor pavilion at the Wilmington Convention Center. (Port City Daily/file)

WILMINGTON — After reevaluating current programs funded by state Covid money, city staff recommended at council’s Monday agenda briefing a reallocation of its plan to better utilize the funds.

Of most significance is the nixed construction of an outdoor pavilion at the Wilmington Convention Center. Instead, the money will offset costs of the city/county joint homelessness assistance program.

READ MORE: City, county to consider pilot program addressing homelessness, partially funded by ARPA

The city received $25.9 million from the American Rescue Plan Act and already spent a little over $10 million toward 84 small businesses, 21 nonprofits, film initiatives, gap financing for affordable housing, substance abuse aid, community arts and more.

ARPA money has specific guidelines on how it can be used and is meant to infuse resources into the economy to help local governments recover from the pandemic. Per federal guidelines, money must be under contract or spent by December 2024. Anything not obligated at that time must be returned to the U.S. Treasury Department.

“We want to get everything allocated, obligated and spent as soon as we can to not have to return any funds,” city finance director Jennifer Maready explained to council at Monday’s meeting.

City staff preliminarily distributed the funds in 2021 into three pots: economic and community assistance, city and community infrastructure, and city response and recovery. Staff has re-dispersed roughly $3.4 million from its original strategy.

Two million dollars was allocated for an outdoor pavilion at the convention center, which is owned by the city. Yet, the area is no longer needed. 

Early in the pandemic, the Wilmington Convention Center staff considered ideas in utilizing additional outdoor space when social distance measures and indoor limits on capacity were in place. They presented the possibility last August, but city staff was concerned about the pavilion blocking the view from the lobby and “eliminating versatility that now exists” for the lawn, according to a city spokesperson. 

“Currently, the convention center can use it as a fully open space or choose to erect temporary tents,” city spokesperson Dylan Lee explained. 

City staff also anticipated a greater revenue loss at the convention center during the pandemic. They set aside $3.8 million from ARPA to cover shortfalls, but due to the city-owned Live Oak Bank Pavilion opening, only $3 million was needed.

Instead, a portion of that allocated money will shuffle toward the city and county’s joint homelessness assistance program, approved a few weeks ago. It pairs social workers with law enforcement to provide wraparound services for the unsheltered population. 

City staff at first expected the funding to be covered by resources already in place. However, the city announced this week it will pull from $1.6 million in ARPA to cover the hiring of four new police officers, uniforms, patrol pick-up trucks, supplies and to cover training through June 2024.

“Details are still being worked out with the county,” Lee confirmed.

The city’s revised plan for ARPA funds also includes increases to the MLK Center, from $590,000 to $1 million, based on a change in construction costs. Included in the expansion of the MLK Community Center is a community kitchen to establish food education programs and be a hub to offer healthy meals in a food desert-designated area. It can also serve as an incubator for startups.

The funds were originally to be used for park improvements, but not dedicated to a specific source.

It also includes the following new initiatives:

  • $1.1 million to relocate the city’s data center
  • $150,000 to install UV lighting on HVAC systems
  • $300,000 for cybersecurity efforts
  • $313,240 for repairs and replacement of skylight panels in city hall
  • $150,000 to upgrade technology in council chambers
  • $120,000 on building security measures
  • $1.6 million on the recently approved city/county joint homelessness assistance program

The changes are reflective of some city programs that did not utilize all funds received, leaving $1.5 million in reserves for future plans.

One of the largest gaps in what was allocated versus spent came with the city’s utility assistance program. Staff set aside $500,000 to assist residents with covering utility bills during the pandemic, but less people reached out than anticipated, so only  $159,833 was spent on 248 residential accounts.

“With so many programs for utility assistance, we actually got refunds back,” Maready said, also referring to county- and state-funded efforts.  

With roughly $1.4 million remaining from $25.9 million in ARPA, Maready presented council with two requested proposals:

  • The Salvation Army’s $1.3 million for road construction for its new facility, to help it expand services on a 25-acre plot at 1220 N. 30th St.
  • The Food Bank of Central and Eastern North Carolina, currently constructing a new 35,000-square-foot building at 1000 Greenfield St.

The city noted it’s not authorized to spend money on private property, but the Salvation Army officials agreed to dedicate the road to the city. The city’s engineering department determined estimated costs of construction are double what the nonprofit is requesting. Maready will bring forth a resolution for council to approve a reimbursement agreement with the organization to fund up to $1.3 million.

The Food Bank is asking for $150,000 in ARPA funds to establish a community market and teaching kitchen. Maready explained approved funds would back operational costs. The city already dedicated $50,000 annually for five years.

“If the hurricane actually had hit, with this teaching kitchen, they would be able to provide meals for everybody,” council member Clifford Barnett said Monday. “It’s desperately needed because of the number of people that are hungry throughout, not just our area, but they feed the entire region.”

Maready will bring a formal item to council in November for approval of both requests.

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