Washington County cities prepare COVID-funded projects

With the promise of federal dollars from the American Rescue Plan Act on the horizon, cities in Washington County are planning projects to make up for lost time during the pandemic.

The federal legislation passed in March includes payments to states and local governments to offset the fiscal impact of COVID-19. For every city in Washington County, that money will go through the state before being distributed based on population size.

Towns under 50,000 population will get federal funds through the state, while larger cities get the COVID recovery funds directly, according to a Department of Treasury website.

While the funds can be used for a wide variety of projects, they are only intended for a finite list of eligible uses, and come with strings attached to ensure compliance.

Generic guidelines are already available in a packet released in June. The money must be spent on ostensibly pandemic-related costs accrued between March 3, 2021, and Dec. 31, 2024. The funds must be exhausted or returned before 2027, and virtually every use of them must be reported in full detail back to the Treasury Department.

Guidance on specific uses, however, remains unfinished.

Washington City Administrator Brent Hinson said water and sewer projects were the only outlets with clear-cut expectations four months after the legislation passed.

“At this point, we’re not really seeing good guidance for anything else,” he said. “It’s pretty hazy at this point as far as administrative rules.”

Though no city councils in the county have formally committed to plans yet, Hinson said projects other than water and sewage spending would be difficult to justify.

“I’ve read the interim administrative rules enough to understand that it’s going to be incredibly complex,” he said. “Our staff recommendation at this point is to just stick to what we know is fund-able and emphasize the water and sewer work. We’ve got plenty of things that we could use that money toward that would really benefit the community in the long term.”

Other options for the funds listed in the existing Treasury Department guidelines include road infrastructure, broadband installation, replacing lost government revenue, and assistance to businesses and households, among others.

Many cities seem to agree with Hinson’s assessment. Like Washington, Brighton, Ainsworth and West Chester are poised to use the money on water and sewage projects, according to their respective mayors.

Riverside City Administrator Christine Yancey said that while the City Council was considering water projects, it was keeping its options open, eyeing a potential replacement to lost funding from the Riverside Casino, a sizable source of the town’s tax revenue.

“We’ve talked about putting it toward some capital projects,” Yancey said. “We’ve got Third Street, we’ve got the park, we’ve got water, sewer, streets, that type of thing. It may go to infrastructure because of revenue shortfalls because of the casino. They were closed, and it is a legitimate use to replace revenue shortfall.”

Yancey said waiting on a decision would not jeopardize the funds.

“It was asked at the last Zoom meeting I was in if that was a requirement to getting the funding and it is not,” she said. “We’ve talked about it … they just have not made a total commitment as far as what they’re going to use it for.”

Wellman and Kalona have been reluctant to announce any plans. The city of Crawfordsville did not reply to requests for comment.

“What we’ve been hesitant to do is get the cart before the horse, and until we know those stipulations, not to get any one entity or the public excited about a project that may or may not be realized,” Kalona City Administrator Ryan Schlabaugh said. “We want to make sure we’re targeting the right direction as the rules and regulations come out on those expenditures.”

As for Wellman, City Administrator Kelly Litwiller said the delay was a matter of scheduling. The city plans to address its use of ARPA money in August as part of its discussion on a new 5-year capital projects plan that happened to line up with the legislation.

“We’re just at that time right now,” Litwiller said. “There’s no lack of guidance anywhere, it just happens to fall right now.”