BY EVEY WEISBLAT, SLI Reporter
Moore County commissioners have begun the process for how they can spend almost $20 million in COVID-19 relief funds.
This money comes from the American Rescue Plan (ARP), which Congress passed last year. It was the third major stimulus package to come out of the pandemic and allocates $350 billion to state, local, territorial and tribal governments to support recovery efforts from the coronavirus pandemic. Local governments’ share was based on their population.
Most local governments received half of their share last year and will receive the second half this year. The county and its 11 municipalities held onto the funds while awaiting final spending rules from the U.S. Treasury Department. That finally came last month, and local governments have a reasonable latitude in how to use the money.
Funds must go toward costs incurred after March 2021, but they don’t have to be spent until the end of 2026 — and local governments have almost three more years to obligate them. The final rule goes into effect on April 1.
At a meeting last Wednesday, county staff presented several suggestions for how to use the funds. Kara Millonzi, a professor of public law and government at the University of North Carolina School of Government, presented greater detail on managing the money.
The chief rule for local governments: they can’t just squirrel it away, nor can it be used to borrow from or pay down debt. Instead, the funds can be used in four separate categories: covering lost revenue; economic and public health response to COVID-19; premium pay to essential workers; and investment in water, sewer and broadband internet projects.
“The great news is this is a one-time infusion of a significant amount of money into our local governments from the federal government,” Millonzi said. “The more challenging news is all the things that counties and others have to do to both meet the eligibility requirements and also to deal with all the compliance, reporting (and) auditing issues that come with these dollars.”
Vest’s overall philosophy on the money is to “minimize our burden, maximize our benefit.” Of the county’s $19.5 million, he suggests $10 million go toward replacing lost revenue. The other $9.5 million would be divided into investments in broadband and water/sewer infrastructure.
Other suggestions include contracting with auditors for help with the reporting piece and evaluating the need for an additional position to help the county manage and report ARP funds.
Vest said he hopes to have a final recommendation for commissioners to review in April.
Replacing Lost Money
Local governments can use up to $10 million to go toward “general government services” in replacing revenue lost because of the coronavirus.Moore County, like most local governments, didn’t record much revenue loss during the pandemic. But now everybody gets to presume $10 million in standard allowance “even if you can’t demonstrate a penny of actual lost revenue,” Millonzi said.
She compared it to a standard deduction allowance you see on an IRS form.
While the money can’t be saved, Vest said that going for the standard allowance option will free up county funds that otherwise would have initially gone toward projects that ARP funds can now cover.
Millonzi cautioned that this doesn’t mean the county can throw the ARP rules out the window for this $10 million.
“They don’t become general fund dollars,” she said. “They still have to be spent and tracked and reported on and in compliance with all of the requirements under federal law.”
Investing Long Term
The remainder, Vest said, should be divided, with $4.7 million going toward broadband and the other $4.7 million going toward water, sewer and stormwater projects.
Information Technology Director Chris Butts gave an update on the county’s broadband research at the meeting and presented various possibilities for the ARP funds. Butts said the state has a pool of $800 million in ARP funds set aside for broadband connectivity and digital literacy. The county could pair its own funds with a share of state funds.
County officials estimate roughly 10.5 percent of Moore County residents don’t have access to broadband internet service, Butts said.
Other grant funding could also be available.
Public Works Director Randy Gould also presented several ways the ARP money could be used for water, sewer and stormwater infrastructure projects. He said that capital project needs for his department include the East Moore Water District and a water pollution control plant.
In addition, more funding is needed for the Thurlow Booster Pump Station, which pumps water to the East Moore Water District from its source in Harnett County.
Gould also outlined several potential projects for next year, as well as projects needed by 2025.
Working with Partners
There is also a possibility of Moore County teaming up with municipalities or other companies on certain projects. Millonzi explained that the process is more complicated when working with partners, especially with businesses that would have to share financial information they might otherwise keep private.
“It’s much more involved and quite frankly more invasive, both from the county’s perspective and from your nonprofit or other community organizations,” Millonzi said.
Because of this, Millonzi advised that the county steer away from giving funds to struggling nonprofits or community organizations that likely don’t have the resources to follow this process. She also noted that local governments in general should avoid working with partners if they can’t strictly monitor and oversee use of the funds.
Contact Evey Weisblat at (910) 693-2474 or Evey@thepilot.com.
