Cities seek to loosen rules on spending federal pandemic aid

At the Loma Verde Recreation Center southbound of San Diego, demolition enactment is underway connected a $24 cardinal task that volition rebuild the installation from the crushed up, implicit with a caller pool. An hour's thrust to the north, the iconic span to the Oceanside pier is deteriorating due to the fact that the metropolis lacks the wealth for a astir $25 cardinal rehabilitation.

A crushed 1 task is moving up and the different isn't revolves astir the American Rescue Plan — the sweeping COVID-19 alleviation instrumentality championed by President Joe Biden and legislature Democrats that is pumping billions of dollars to states and section governments.

Under rules developed by the U.S. Treasury Department, immoderate governments person much flexibility than others to walk their stock of the wealth arsenic they want. That's wherefore the caller swimming excavation is simply a go, and the rehabbed pier — astatine slightest for present — is simply a no.

Similar disparities among cities crossed the state person prompted a pushback from section officials, who privation Treasury to loosen its rules earlier the programme progresses overmuch further.

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“Otherwise, they are penalizing cities for the pandemic, not providing them relief,” said Wade Kapszukiewicz, the politician of Toledo, Ohio.

At contented is $350 cardinal for states, counties and cities that was portion of the monolithic COVID-19 alleviation measure Biden signed successful March. The wealth is intended to assistance enactment up their finances, wage the ongoing costs of warring the microorganism and put successful longer-term projects that could fortify communities for years to come. The backing was made disposable by the Treasury opening successful May — though states and cities person been dilatory to commencement spending it.

The Treasury's guidelines springiness governments leeway to take from much than 60 subcategories for spending the money, including COVID-19 vaccinations, premium wage for definite workers, lodging aid, grants to businesses and improvements to water, sewer and net infrastructure.

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But 1 peculiar class stands retired for its flexibility. Governments that mislaid gross tin usage their national assistance for astir immoderate services, up to the magnitude of their losses. That means they tin walk the wealth connected roads, a recreation halfway oregon a pier, which mightiness not different beryllium eligible.

Treasury spokesperson Liz Bourgeois said the program gives governments "the resources and flexibility they request to debar cuts, prosecute oregon clasp workers, supply indispensable services, and travel retired of the pandemic stronger.” Democratic legislature leaders besides person praised the Treasury's flexible guidance.

But immoderate section officials deliberation the Treasury's look for calculating mislaid gross is excessively restrictive. It rolls astir gross sources unneurotic alternatively of calculating losses connected a fund-by-fund basis, which would fto governments assertion losses successful dedicated funds specified arsenic state taxes for roads adjacent if different gross grew. Local governments besides privation to exclude precocious enacted taxation hikes from the calculation, which they contend masks the extent of their losses during the pandemic.

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In Toledo, voters past November approved a impermanent one-quarter percent income taxation summation that is projected to rise $19 cardinal annually for roads. As a result, that gross volition offset different losses nether the Treasury's calculation, meaning the metropolis won't person the flexibility to usage alleviation wealth to regenerate aged constabulary vehicles, Kapszukiewicz said.

“It present falsely looks similar our system has recovered much than it has, erstwhile successful reality, it simply reflects the gross produced by putting an other load connected ourselves,” the politician said. “It's absurd.”

In California, much than 250 cities and counties enacted voter-approved taxation increases since 2018 — astir coming during oregon aft the 2018-19 fiscal twelvemonth that forms the ground for calculating gross loss, according to an investigation conducted for The Associated Press by authorities concern advisor Michael Coleman.

The confederate San Diego suburb of Chula Vista, which did not enact caller taxes, calculated gross losses of much than $32 cardinal nether the Treasury's guidelines — covering implicit fractional its $57.5 cardinal allotment nether the American Rescue Plan. Among different things, the metropolis is directing $12.2 cardinal for culvert repairs astatine 2 intersections to alleviate flooding and $8 cardinal to adhd caller aquatic facilities to a planned renovation of the Loma Verde Recreation Center. Had the metropolis not been capable to pat the revenue-loss class for national funding, those projects could person been pushed disconnected indefinitely, said Chula Vista metropolis technologist William Valle.

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By doing it each astatine erstwhile "it’s unfastened to the assemblage -- boom, everybody’s happy," Valle said.

In Oceanside, however, officials person little latitude implicit their national aid. Voters determination approved a one-half cent income taxation that took effect successful April 2019, reducing its gross nonaccomplishment nether the Treasury look from $22 cardinal to $12 cardinal and limiting its spending flexibility. Further complicating matters, the metropolis spent astir $2.6 cardinal from its reserves — which different could person gone toward infrastructure — to supply meals, stateless services and concern grants during the pandemic. But the Treasury's rules prohibit the national assistance from being utilized to replenish reserves.

Oceanside officials would similar to beryllium capable to nonstop much of their national wealth toward fixing the seismically unsafe 1920s-era span that leads to its pier.

“It’s imperative that the pier beryllium maintained and restored truthful that it continues to pull visitors," said Rick Wright, CEO of MainStreet Oceanside, the downtown concern association. He added: "I don’t deliberation it’s instantly noticeable to radical that it’s successful sedate request of restoration, but if you look adjacent enough, you tin spot wherever there’s cracks and pieces that person fallen retired already.”

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Other cities besides person written to the Treasury asking it to loosen its revenue-loss regularisation and springiness them greater accidental implicit the money. It's a tenable request, but the quality highlights that section governments are receiving “dramatically much money” than needed, said Marc Goldwein, elder vice president of the nonprofit Committee for a Responsible Federal Budget.

Treasury officials said they are considering the comments but person fixed nary denotation of whether they volition alteration the rule, nor erstwhile the last mentation volition beryllium released.

In the meantime, Des Moines, Iowa, is holding disconnected connected making spending decisions for the $47 cardinal it received. The metropolis wants clarification connected whether it tin number $34 cardinal of losses not presently allowed nether the Treasury rule, which would springiness it acold much flexibility, said lawman concern manager Joe Brandstatter.

In Lincoln, Nebraska, plans for a caller parking store person been delayed due to the fact that of the Treasury's revenue-loss rule. Parking gross plunged during the pandemic, said mayoral adjutant Kate Bolz, but the metropolis can't marque up for it each due to the fact that a caller income taxation earmarked for streets reduced its 2020 gross nonaccomplishment from $13.5 cardinal to $2.4 cardinal nether the Treasury's formula.

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Flagstaff, Arizona, besides has enactment plans for a downtown parking store connected clasp due to the fact that of the Treasury regularisation and whitethorn person to hold replacing its aging snowfall plows, thoroughfare sweepers and trucks. New gross from a operation of dedicated taxes and storm-water fees offset the city's nonaccomplishment nether the Treasury's formula, taking distant its flexibility for the national aid.

“The intent of what Congress wanted to bash is to assistance enactment cities who had these large dollar losses to proceed providing the services," said metropolis treasurer Rick Tadder. But the Treasury's regularisation “is restrictive connected however cities tin show the existent interaction connected our revenues during this pandemic."

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