Louisville officials have received hundreds of suggestions for how to spend new federal coronavirus relief, from building new affordable housing to expanding access to broadband internet.
Louisville expects to get about $388 million over the next two years as part of the American Rescue Plan Act (ARPA) passed by Congress in March. More than 1,700 people have given feedback through two different online surveys on the city’s website since early June. Dozens more attended a series of in-person meetings hosted by Metro Council’s Budget Committee. The final meeting happened Monday night at the West Broadway Church of Christ.
What will the city use the COVID relief money for?
Reverend David Snardon of Joshua Tabernacle Baptist Church was one of the Louisville residents in attendance. Snardon told council members that he sees access to mental healthcare as the city’s biggest challenge.
“The need for mental health should be of the utmost priority, not just for those experiencing homelessness but also for those that are dealing with the violence plaguing our city,” he said. “In fact, addressing mental health should be built into the fabric of this city in light of the communal trauma we all face, either directly or indirectly, from COVID.”
Other residents spoke about the need to end childhood poverty, treatment for sickle cell anemia and reparations for the city’s Black residents.
Council Member Bill Hollander (D-9), who chairs the Budget Committee, attended all three public feedback sessions. He said one of the most talked-about issues has been homelessness in Louisville.
“I think that’s reflective of what people are seeing in our streets,” Hollander said. “We’ve heard a lot about affordable housing in general. We’ve heard a lot about economic opportunity. We’ve heard some about public safety.”
Metro Council’s online survey soliciting public feedback will remain open until the end of July.
In addition to public meetings and surveys, Mayor Greg Fischer also created the Louisville Accelerator Team. It is working with city agencies, Metro Council and other community-based organizations to set priorities for the ARPA funding.
Fischer tapped Margaret Handmaker, who heads the consultancy firm Ellico, to lead the Accelerator Team. Handmaker said they’ve put together a short list of broad categories for ARPA spending based on what they’ve heard from the public. They include:
- Homelessness and affordable housing
- Economic opportunity and broadband
- Healthy neighborhoods
- Public safety
- Youth development and education
- Arts, culture and tourism
- Environmental justice
“We’ll also be looking at impact,” Handmaker said. “How long does it take to implement? How long does it take to get results? How much ongoing money is needed?”
Handmaker recently told Metro Council that the city has already received more than a billion dollars worth of project proposals from various individuals and organizations that want to utilize ARPA funding.
What will the city do with all of this feedback?
Louisville Metro Council and the Fischer administration are expected to start meeting in August to whittle down the list of priority areas. Council President David James has appointed Hollander and Budget Committee Vice Chair Kevin Kramer (R-11) to negotiate on the body’s behalf.
City officials plan to issue requests for proposals from individuals and organizations that want to use the ARPA money. Winning proposals will be based on which projects can best tackle the issues lawmakers and residents have identified.
The new federal funding also comes with strict guidelines from the federal government on what the money can be used for.
Local governments are prohibited from cutting taxes and then using the ARPA funding to fill the gap. They are also prohibited from using the money on general infrastructure like roads and bridges.
In a presentation to Metro Council, Colin Higgins with the Nowak Metro Finance Lab at Drexel University stressed that the funding must go to projects directly related to the COVID-19 pandemic and its negative impacts on the economy.
“The crucial element here is that general economic development and workforce development programs are not permitted uses of these funds,” Higgins said. “However, if you were to target a job training program at workers who are unemployed as a result of COVID, that is permitted because it’s tied specifically to an impact caused by the pandemic.”
Higgins said the guidance from the U.S. Treasury Department so far has indicated that low-income residents can be assumed to have been negatively impacted by the pandemic. That means programs targeting homelessness will be permitted, and low-income residents won’t have to submit documentation explaining how the pandemic impacted them.
While the rules seem to eliminate the possibility of using ARPA funding to build new affordable housing, there is an exemption for so-called “qualified census tracts.” These are areas with a concentration of low-income residents or residents living in poverty.
In the Louisville metro area, qualified census tracts are mostly concentrated in the West End and some areas in the southwest, such as Shively and Iroquois. The federal government has said ARPA funding can be used in those areas to cover equity-focused investments like childcare, affordable housing and lead paint remediation.
Because ARPA funding is being distributed over a two-year period, only about $190 million will be available this year. Metro Government already spent nearly $20 million of that on continued vaccination outreach, contact tracing and eviction diversion and prevention.
Officials are hoping to start distributing the federal coronavirus funding sometime in the fall.
