By all accounts, the Phoenix suburb of Gilbert hasn't made much of the $24 million it received in federal pandemic aid.
The site where most of the money for the crime victim center is planned to be spent remains an empty lot. And only a quarter of its funds have been allocated for projects, according to the latest federal data. But city officials say contracts should be awarded soon to spend the rest.
For Gilbert and thousands of other local governments across the U.S., the clock is ticking to use their share of the $350 billion in COVID-19 relief funds approved by Congress and President Joe Biden in 2021. Governments must commit all their Funding the American Rescue Plan for specific projects by the end of this year or return the remainder to the U.S. Treasury.
About 80% of all funds had been allocated as of March, according to the latest data provided to the Treasury by more than 26,500 local, state and territorial governments. That's just on pace to finish on time.
However, some governments appear to have much more work to do than others.
About one in five governments reported disbursing less than half of their funds as of this spring, according to an Associated Press analysis, and about 3,500 had pledged less than 25%. That includes 2,260 governments that reported no projects, leaving it unclear whether they had any plans for the money. Some may have already used the money, but failed to describe the purpose to the federal government.
The Finance Ministry said it was conducting extensive outreach to help the public understand the reporting requirements.
From the very beginning, the American Rescue Plan faced criticism from some Republicans and government watchdog groups for allowing unnecessary and excessive spending, including on things that are barely related to the coronavirus pandemic. But some state and local officials say the funding has allowed them to carry out long-awaited projects they otherwise couldn't afford.
Gilbert officials have decided to direct nearly all of the American Rescue Plan funds to one project — a $43 million facility where survivors of sexual assault, child abuse, and domestic violence can undergo forensic examinations and interviews needed for prosecution, as well as counseling and therapy. Officials had identified the need for the center years before the pandemic but had no funding source. Federal money will cover just over half the cost, with the rest coming from Gilbert’s general funds.
The goal is to create “a comprehensive center where a survivor of interpersonal violence can come and have a truly safe and healing journey,” said Assistant City Manager Leah Reinheimer. It’s “one of the most meaningful projects the city can do.”
City officials hope to award a construction contract this fall — a move that would satisfy the Treasury Department's request for money by the end of the year — although actual construction won't begin until next year, Gilbert Police Chief Michael Solberg said.
Under Treasury rules, a commitment typically requires a government to place an order for services or property, enter into a contract, or make a grant to another entity. Governments that meet the commitment deadline then face a second deadline to finish spending the funds by the end of 2026.
Other local officials interviewed by the AP described a mix of reasons for not reporting the release of much of their funding. Some said they felt no need to detail how the money was used because they classified it as a replacement local revenues are lost during the economic downturn caused by the pandemic. Others described the difficulty of knowing what to do about it.
“There's no question that some of that money was unnecessary and wasted,” said Tom Schatz, president of Citizens Against Government Waste, a Washington, D.C., nonprofit.
The Detroit suburb of Dearborn Heights, which received more than $24 million, listed just one liability in its spring Treasury report — about $79,000 for administrative costs to select and implement federally funded projects.
Dearborn Heights Mayor Bill Bazzi said the federal funding arrived soon after he took office, making it difficult to simultaneously “understand what the city needs” and staff it. The city plans to use the money for stormwater and water projects, among other things, and should receive most of it soon, Bazzi said.
The process was delayed, he said, because “we had to go through a tedious process” before putting the projects out to tender.
As the federal deadline approaches, some states and local governments are developing backup plans to ensure all allocated funds are used.
Missouri reported to the Treasury this spring that it had disbursed 99% of the nearly $2.7 billion in funds it had been allocated. But some projects have fallen through or appear unlikely to require full funding.
So lawmakers and Republican Gov. Mike Parson approved a revised spending plan that eliminated $49 million earmarked for COVID-19 response efforts and $16 million to renovate an old mental health facility for use in a sex offender rehabilitation program, among other things. Those funds were reallocated to dozens of new projects, including a college of engineering building and a health care training program.
The Missouri Legislature also allocated $150 million from the American Rescue Plan for K-12 public schools as a fallback if other projects fail. Several lawmakers in the conservative Freedom Caucus voted against it, suggesting that federal pandemic aid is driving up the federal debt and inflation.
“I’m not against it if we put it back,” Sen. Rick Brattin, a Republican and chairman of the Freedom Caucus, told the AP. “We could at least hold our heads up high and say we didn’t continue to contribute to the financial collapse of the American dollar.”
Missouri Senate Appropriations Committee Chairman Lincoln Hough, a Republican, said lawmakers do not have to agree to federal funding to use it.
“I think when we have that, we have to invest in our communities and our future workforce,” Hough said.
Faced with the prospect that some of Connecticut's $2.8 billion in American Rescue Plan funding may go unused, State General Assembly reallocated $365 million to new purposes this year. The bill also laid out a backup plan, directing Democratic Gov. Ned Lamont's administration to reallocate any funds that are not likely to be appropriated by Oct. 15 to cover budget deficits and higher education.
The city of New Orleans reported using 55% of its $387.5 million federal appropriation as of this spring. But it has moved quickly to use the money. As of September, 86% had been used, said New Orleans Chief Administrative Officer Gilbert Montano. Over the summer, the City Council shifted pandemic funds from several projects that had run into deadline issues to homeless shelters and illegal dumping cleanups. Other projects, slower to materialize, are on a watch list for possible reallocation before the end of the year.
“We're not going to give that money back,” Montano said. “There's too much need.”
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Associated Press writer Kavish Harjai contributed to this report.