By Joanne Bailey-Boorsma
joanne@wktv.org

It was a pretty exciting in the fall when the City of Wyoming, like municipalities across the state and country, learned it would be receiving $13.1 million in federal COVID-19 relief funding.

Similar to the most recent round of stimulus checks the U.S. government gave to American residents, the City of Wyoming’s $13.1 million also was part of the American Rescue Plan Act (ARPA) designed to rescue the economy. The federal government gave states about $350 billion dollars, of which Michigan received $250 million.

Deputy City Manager John McCarter said the city has received about $6.5 million of the estimated $13.1 million with the remainder expected to be paid out this year.

But like anything that comes from the federal government, there are a few strings attached to the money, such as what it can be spend not, when it needs to be spent and how cities must report expenditures. According to the U.S. Treasury, those guidelines are:

• Revenue replacement for the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency, relative to collection in the most recent fiscal year prior to the emergency.
• COVID-19 expenditures or negative economic impacts of COVID, including assistance to small businesses, households, and hard-hit industries, and economic recovery
• Premium pay for essential workers
• Investments in water, sewer, and broadband infrastructure
  
  

While cities can use the funding for premium pay for essential workers, according to the National League of Cities, Government Finance Officers Association , and the Michigan Township Association, the money cannot be used to relieve other payroll costs, deposited into any pension fund or used to cute taxes

The money must be used for COVID-related needs. An example given by the Michigan Township Association (MTA) is because of the COVID pandemic, a community’s parks had high usage which resulted in damage and higher than normal maintenance needs, the ARPA money could be used for those parks.

Also, according to the MTA, the ARPA money could be used to bring staffing back to pre-pandemic levels, but only if reductions were a direct result of the COVID pandemic.

How ARPA funds impacts city staffing

The question of using the grant funding has been raised instead of the city seeking an income tax, which is one of two proposals Wyoming residents will vote on May 3.

The additional police and fire staffing that are required to address the community’s needs are a recurring expense that should be support by recurring revenue, McCarter said.

“When you consider the ARPA funding, it is a one-time payment, it will not support the recurring expenses that hiring additional staff includes.” McCarter said, adding that the leaders at the federal level have referred to the bill as a “once in a generation funding opportunity.”

“Because it is a one-time payment, using it to fund police and fire, which is an ongoing expenditure, would not be fiscally responsible as the city needs long-term funding to maintain staffing levels,” McCarter said.

The question of using the grant funding has been raised instead of the city seeking an income tax, which is one of two proposals Wyoming residents will vote on on May 3. The first proposal is the income tax, which would be up to 1 percent for Wyoming residents and .5 percent for non-residents, which according to state law, is the maximum cities are allowed to levy an income tax. City officials have stated that if passed, the income tax would be up to .8 for residents and .4 for non-residents.

The second proposal is to reduce the city’s property taxes for homeowners and businesses by about 58 percent, going from around 12 mills to 5. Both proposals must pass to take effect.

It is estimated that the city would generate about $6 million annually if the proposals are approved. The money would be used to fund 27 additional firefighters (doubling the department), 13 police officers and 1 crime analyst with $600,000 annually being dedicated to update and maintain the city’s parks.

 

City of Wyoming projects being considered for ARPA funding

The city has used $437,280 of the ARPA funding to make modifications at city hall which has included a drive-thru for the treasurer’s office, court building upgrades, a city hall kiosk, police flock cameras, and a police desk officer reporting system, McCarter said.

In November, the city did conduct a survey of residents to determine what they would like to see the funds used for. From that survey, residents indicated that their top priorities were equipping first responders and improvements to water and sewer systems. Also receiving strong support was construction of affordable housing and a community clean-up program. Other projects listed were improvements to city facilities to address public health, assistance with home repairs, improvements to parks and grants for improvements to businesses and mobile parks and recreation programs.

The remaining $10 million, which also must follow the ARPA use guidelines, will be used on large scale capital investments and matching funds for grants and other funding sources. City Council is scheduled to resume discussions about how to spend ARPA funding in June.

Municipalities have until Dec. 31, 2024 to obligate the ARPA funds and must spend the APRA money by Dec. 31, 2026.