Assembly Priority: Get Money to Sitkans

Category: Local News
Created on Wednesday, 20 May 2020 15:38

Sentinel Staff Writer

From “Keep It Simple, Stupid” to appointing a subcommittee to discuss the matter further, the Assembly on Tuesday considered various routes for the first distribution from the city’s $14 million in COVID-19 relief funds, under the CARES Act.

The first distribution, or tranche, expected for Sitka is $6,819,089.87, City Controller Melissa Haley said today.

At next Tuesday’s regular meeting the Assembly is to consider an ordinance that would help Sitkans suffering financial hardship because of the COVID-19 mandates to pay their utility bills.

The were no objections at the work session to City Administrator John Leach’s proposal for a “working group” to create categories and distribution amounts for each, before moving forward – although some on the Assembly favored moving more quickly than others.

“If we can come up with categories and the working group develops the numbers, we can bring it back to the Assembly table,” Leach said.

The structure of the working group is not yet known, although a few Assembly members have volunteered to participate.

Using guidance from the U.S. Treasury rules and the city’s own finance staff, Leach suggested the subcommittee consider the following five categories:

– Grants for small businesses and nonprofits: how much and criteria.

– Utility payments: how much in funding, and criteria.

– Rent and mortgage relief: how much and criteria.

– New programs, such as food relief for those in need: How much and criteria, with the possibility of bidding the services out to a local agency.

– Rapid testing, personal protection equipment and other expenses related to fighting the spread of COVID-19.

Other ideas raised included funding a homeless shelter, school district expenses for distance learning (computers), COVID testing supplies, and city buildings to improve air circulation and filtration (for COVID prevention).

All seven Assembly members attended the work session. Kevin Knox attended remotely by videoconference and the others were present in person at Centennial Hall, some with face coverings and some without.

Leach’s suggestion for a working group came after the Assembly heard advice from city finance staff about what to keep in mind, including opportunities and restrictions. Assembly members also shared their own ideas and concerns that certain groups, businesses and individuals not be left out.

At a recent meeting, Thor Christianson and Kevin Mosher said they planned to co-sponsor an ordinance for utility relief. Christianson said he wanted the process to be simple and get funds to those who need it as soon as possible.

“The faster we can get it out, the faster we’ll be ready in the next round,” Christianson said. Quoting the saying, “Keep It Simple, Stupid,” he said the city should not over-complicate the process.

Mayor Gary Paxton agreed that the Assembly needs to act quickly, and stated his concern for the nonprofits and businesses suffering immediate losses due to COVID restrictions.

Richard Wein stated his opposition to an overly simplified, one-size-fits-all process, since some people have experienced great losses and others none at all. He advocated for a “measured solution” going forward.

“It’s very easy to run through your bank account if you don’t know where you are going,” Wein said. 

He noted that the spending decisions on CARES Act funds will be subject to oversight, through a state audit. 

City Chief Financial and Administrative Officer Jay Sweeney added that it’s “possible if not probable” distribution decisions are subject also to a “federal single audit.”

Finance staff provided several attachments for review, with a summary memo to help guide the discussion:

“All funding must be expended (payments made) by December 31, 2020; any unexpended funds must be returned to the State of Alaska,” the finance staff memo said in the second paragraph. “Funding will be received in 3 tranches, and each tranche must be expended before the next tranche is received.”

There are references to the city’s “White Paper” on CARES Act guidelines and restrictions, and sections on “Important Restrictions,” “Unknown Requirements” that may impact expenditures, “Major Areas for Consideration for Possible CARES ACT Fund Use (e.g. first responder costs, small business and nonprofit grants), Administrative Resource Requirements, and “Appropriations.”

The city must spend 80 percent of each of the three tranches before requesting more funds.

“Guidelines are still being developed as to legitimate use of funds,” Sweeney said.

Controller Melissa Haley said CARES Act funds can’t be used to replace lost revenues for local or state governments.

In general, the funds “must be tied to COVID hardships,” Haley said. Sweeney said the funds are not a “windfall” that could be used to cover such expenses as deferred maintenance, close a deficit, or pay for a capital project unrelated to COVID.

Knox said that while it’s important to address the immediate needs of citizens and businesses, the Assembly should also keep in mind other effects, including the “childcare crisis” created by COVID.

He noted “the changes (childcare centers) are going to have to consider,” such as operating at one-third capacity of former operations.

“We’re asking families to return to work, but we don’t have a place to put a lot of kids,” Knox said.

Steven Eisenbeisz brought up the need for testing supplies as an investment in the future, as well as the needs of the schools. At the end of the meeting he suggested working with the Sitka Tribe of Alaska to avoid duplicating efforts. STA has received $7.2 million from the nationwide CARES Act funds for tribes.

“It’s extremely important to work together,” Eisenbeisz said, noting the government to government relationship between STA and the city.

Two members of the public spoke at the meeting.

Robin Sherman, program manager of the Sitka Legacy Foundation and a member of the city’s Economic Resiliency Task Force, agreed it’s important to get the funds to those who need it most, and encouraged the Assembly to work with organizations with experience administering funds to those in need, such as STA and the Salvation Army.

Sherman asked the Assembly to consider help not only for nonprofit organizations that provide social services but also those who improve the quality of life for the community.

“We are working directly with nonprofits to provide recommendations to the city on the grant process for nonprofits,” she added today.

KCAW-FM General Manager Becky Meiers agreed with Sherman that nonprofits should be considered in the distribution of CARES Act funding, including those outside the social services. She noted the resources spent by KCAW to provide information to the community on COVID.

“I would ask for consideration for nonprofits serving the community to make sure people are safe,” she said.