Coronavirus - COVID-19 money - cash

ALLENTOWN, Pa. – Allentown City Council discussed a budget to allocate a financial windfall of American Rescue Plan Act funds designated to combat COVID-19-related losses during a special meeting Wednesday night.

The city presented an ARPA budget to designate how it will spend its first installment of federal money totaling $28,574,240. The City of Allentown will eventually receive a total of $57,483,557.17 as its cut from the federal government.

Council did not vote on any bills during Wednesday night's meeting.

"We're not going to debate tonight who gets money," said President Julio Guridy. "We will continue the discussion."

"Our concentration on this money is to have long-lasting affects on the community that will take us beyond 2026," said Mayor Ray O'Connell.

The money is designated to pay for public health emergencies, to assist Allentown with loss of revenue due to the pandemic, and for the city to make necessary investments in their water, sewer and broadband infrastructure impacted by the pandemic.

The rules were determined by the U.S. Department of Treasury. The final rules, however, have not come out, according to Leonard Lightner, the city's director of community and economic development.

Lightner said there was community involvement in ascertaining how the money would be spent. He said that was based on input of residents from the the Allentown Vision 2030 Plan.

"We need to be strategic about this," Lightner said. "We want to be smart and leverage the money."

Councilwoman Ce-Ce Gerlach disagreed with Lightner's assertion.

"I don't feel like it's for us to decide when I have not heard from the public," Gerlach said. "We don't have to spend this money right now."

"The worst thing we could do is dilute this money so much so that it doesn't have an impact," said Councilman Joshua Siegel. "The American Rescue Plan is supposed to rescue people. We really need to think about it. I disagree with this draft proposal and I think we can do a hell of a lot better."

Siegel said there are short-term needs that could be addressed immediately, but the long-term issues should receive additional review.

The O'Connell administration presented a draft budget proposing how to spend the money during the meeting. Most of the money — about $32.6 million — is assigned to the fix the city's infrastructure. Roughly $8.2 million is slated for the city's broadband, with $7.2 million designated for water filters at the distribution plant and another $6.3 million for three miles of water main replacements. The city's storm sewers would receive improvements totaling $5 million. Manufacture Allentown Economic Development Corporation would get $3 million for a proposed water/sewer hook up and then the city would spend $2 million on new sewer linings. Finally, public safety would get $865,500 to spend.

The mayor is designating a total of $10 million to pay for government services and for a reduction of revenue created by COVID-19. This includes $4.35 million to pay for fund contractual wage increases from 2022 through 2024, $1.5 million for a backup data center, $1.8 million for the fire academy, $1 million for the Jordan Pool and another $150,000 for 2024 operating costs for Jordan Pool and Irving Spray Park. The city will also spend another $400,000 on Irving Spray Park. Also, Allentown will designate $800,000 on roof replacements.

Tourism and nonprofits are also winners when it comes to raking in American Rescue Plan money, as they stand to pocket $6.5 million under the O'Connell proposal. Local nonprofits will receive $2.5 million, with the Da Vinci Science Center claiming $2 million in coronavirus-related funds. The city will give $1 million to the tourism organization and another $1 million will go to the Lehigh Valley IronPigs baseball team.

A total of $4.7 million will go to housing assistance, with $2.7 million going to housing authority for the demolition and construction of government housing, with $2 million spent on development, homelessness and rehabilitation.

The city will allocate $3 million of the $57.5 million American Rescue Plan act money — roughly 5.2 % — on economic assistance for small businesses.

The city will spend $700,000 of the roughly $57.5 million on COVID-19 response and prevention efforts with ambulances receiving $400,000 and a health mobile clinic getting $300,000.

After a public comment session and further discussion by council, Lightner indicated the administration will "go back to the drawing board" on how the funds are allocated. 

Council will eventually offer its input after hearing from various experts. 

President Joe Biden signed he American Rescue Plan Act of 2021 into law March 11. A total of $45.6 billion is going to cities, with $350 billion overall sent to state, local, territorial and tribal governments.

Most local governments are expected to receive their funds in two installments with 50% coming now and the rest coming next year, unless other criteria are met.

Council will hold another meeting on the ARPA funds Oct. 13.

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