Tracking how local governments are spending $718M in federal ARPA funds

Expanded broadband. Water and sewer infrastructure upgrades. Paying police officers and firefighters. Supporting small businesses. Addressing neighborhood blight. Improving government buildings and services. Subsidizing non-profits.

This is a small sample of the myriad ways elected officials overseeing more than 200 local governments across our region are spending a combined $718 million in federal taxpayer dollars from the 2021 American Rescue Plan Act intended to help communities rebuild from the pandemic.

Local leaders say this once-in-a-generation investment has the potential to be transformative. The Dayton Daily News is tracking the money to make sure taxpayer funds are being put to best use, and this opportunity isn’t squandered.

The clock is ticking. Program guidelines say the money has to be allocated by the end of 2024 and spent by the end of 2026. And inflation and workforce challenges are making some projects slower and more expensive than originally planned.

Dayton Daily News reporting on COVID relief funds so far has uncovered suspected fraud and abuse, and helped residents and taxpayers understand how this historic influx of federal funds is being spent locally. As government leaders finalize plans for this money, our coverage continues this year with a series comparing the ARPA spending plans of dozens of our region’s largest governments.

Follow our coverage — and submit any questions or concerns you have about ARPA spending using an anonymous form — on our website’s “Billions in COVID Aid: Where it’s going” special section.

There are restrictions and guidelines on how local governments can spend ARPA funds. The Government Finance Officers Association advised that local governments can use it to offset revenue losses that were attributable to COVID; provide assistance to individuals or small businesses who incurred losses that were attributable to COVID; pay essential workers; or even invest in public utilities such as water treatment, sewers or extended broadband access.

This leaves local leaders with broad leeway.

From the right: Focus on infrastructure

Ohio-based think-tanks have their own guidance on how localities should be spending those federal funds in a responsible manner.

Greg Lawson, a research fellow at the conservative Buckeye Institute, described ARPA funds as a “golden opportunity” for local governments to get caught up on a nearly-universal backlog of infrastructure projects, such as road repair, water systems and sewer upgrades. Lawson described these as “extremely expensive propositions” with direct impacts on health, safety and commerce.

“This could be seen as an opportunity to do these kind of infrastructural improvements that maybe you were planning on doing but they were delayed because of revenue issues,” Lawson said.

Lawson said the Buckeye Institute would also approve of more ambitious projects to provide more equitable access to broadband and educational resources, including programs that would route funds directly to lower-income families.

This would help to “close some of the learning loss and education deficits that already existed before COVID but were made much worse because of the shutdown effect,” Lawson said.

Lawson said ARPA funds could help increase the amount of housing units available, which he said would help to relieve the housing affordability crisis and provide a more permanent solution to housing instability in comparison to emergency rental assistance programs.

From the left: ‘Break down barriers’

Caitlin Johnson, the communications director for Policy Matters Ohio, a progressive group, said it’s a primary focus of her organization to ensure that residents are getting a say in how their local governments spend the “transformative” ARPA funds.

“The people living in the communities know best what they need and the people closest to the problems often have the best solutions,” Johnson said.

Policy Matters Ohio has encouraged local leaders to “do big things, make communities healthier, stronger and more resilient and break down barriers that have been in place for too long,” Johnson said.

Johnson said ARPA funded projects should take into account the impact on health and climate and should work to help individuals. Johnson cited initiatives across Ohio that attempted to relieve medical debt, make childcare more affordable, or even integrated social workers into emergency response teams.

Johnson said the projects leaders choose to fund with ARPA money could “show people directly and concretely how government can make their lives better.”

“That’s really important, I think, to repair the civic fabric of our communities,” Johnson added.

One-time money

Lawson urged local leaders to be wary of using funds to set up costly programs that couldn’t exist within a locality’s usual financial confines.

“If you’re using money to set up a program that hasn’t previously existed that you would hope would exist once those funds are exhausted, that’s something that we would be concerned with,” Lawson said. “You’re essentially establishing new programs that will require your own resources later.”

Instead, Lawson said local governments should look at making “one-time investments that will be meaningful investments but not something that is not an ongoing operation expense.”

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