This Week in Federal Funding

Route Fifty's This Week in Federal Funding newsletter provides weekly updates on what's happening with the pandemic-era aid dollars the federal government is sending to states and localities. The newsletter goes out on Tuesdays and Route Fifty Today subscribers receive it automatically. If you don't subscribe to Route Fifty Today and would like to receive This Week in Federal Funding, you can sign up for it here.

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Welcome to Route Fifty's This Week in Federal Funding. I'm Senior Editor Bill Lucia.

From R50 this week: Liz Farmer reports on local governments tapping American Rescue Plan Act funds to award one-time bonuses to their employees; Sharon O'Malley covers how Wisconsin is planning to use millions in ARPA money on workforce development programs. And I have a piece on how the federal government is urging states and localities to carry out program evaluations and to adopt "evidence-based" policies as they spend their aid dollars.

What we're watching: Baltimore. In July Mayor Brandon Scott established an Office of Recovery Programs to manage the city's $640 million infusion from ARPA. I caught up last week with Shamiah Kerney, director of the office. Before coming onboard in Baltimore, Kerney worked as deputy director of performance management for the D.C. mayor's office and as an analyst at the U.S. Government Accountability Office. Baltimore's recovery office is slated to have 10 employees, but when I spoke to Kerney on Friday, she said they're still hiring and are now a team of three.

Looking at the office's work is interesting because it sheds light on the process one major city is using to allocate its ARPA funds. The mechanics of that process in Baltimore work like this: City agencies submit proposals to the recovery office for how they'd like to use the aid. Kerney's team looks over the plans to make sure they meet federal spending rules. If a proposal clears this initial hurdle, it goes to a seven-person review team that will see if it aligns with priorities the mayor's office has identified and meets other criteria.

The review team, Kerney said, will be made up of subject matter experts and other specialists, and will include staff from different city departments. Proposals that score well during the review process will be recommended to the mayor and city administrator, who will decide which projects to fund and at what levels. "We do want to try to fund as much as we can with the money that we have," Kerney said.

The city council also has a role. Kerney explained that her team will share a list of projects deemed eligible for funding with the council and each member will be able to endorse up to 10 projects. This, too, will factor into approvals. For now, Kerney said it's unclear how much of the money will be divided up this way, or if any might be allocated through other budgeting processes. For example, the city might want to use ARPA funding to backfill lost revenues. This fall, tentatively in October, the city plans to open a process, similar to the one for agencies, for nonprofits and community groups to apply for funds. The recovery office plans to conduct training and outreach about ARPA for these groups in the weeks ahead.

By last week, Kerney said her office had received about 50 proposals from agencies and that evaluations are about to get underway. She didn't provide specifics on the proposals, but said they were "all over the map—workforce development, economic development, police, housing." Kerney noted that, within the city's scoring rubric for proposals, "equity" is the factor with the most weight, and said her office would work with agencies to make sure programs are focused on parts of the city with issues like high unemployment rates and low levels of homeownership.

In addition to overseeing the proposal process, the recovery office is taking the lead in meeting the Treasury Department's reporting and compliance requirements for ARPA. "I certainly want to standardize as much of the reporting process as possible to make it easier for recipients of these funds to be able to report and to make it a little bit easier on us to be able to roll up that information into a report to Treasury," Kerney said. "Will it be challenging? Certainly."

As we reported last week, Treasury and other federal agencies are pushing state and local recipients of ARPA funds to engage in program evaluation, and also to adopt evidence-based policies and programs—basically stuff that's shown to work based on prior studies. Kerney said Baltimore has reached out to universities for assistance with this. She said the city will likely announce a university partner in the next few weeks to help with verifying that agencies are proposing sound practices and with comparing proposals to work that's been done in other cities.

Wrapping up the call, I asked Kerney if there was anything else she wanted to mention. What she emphasized is that the city's ARPA investment program may not bear fruit right away and that, in her view, it's better to proceed carefully allocating funds, rather than rushing and making mistakes. "It will take a little bit of time," she said. "We're working nights and weekends, really trying to put this together and just hope that people will be patient." 

"We may not ever see another investment of $640 million at one time into this city," she added. "While I recognize people wanted the money yesterday, we have to balance that with the risk of doing it too quickly."

Elsewhere… St. Louis Mayor Tishaura Jones signed a plan on Monday to spend about $135 million in aid, but vetoed $33 million for an economic development initiative supported by Aldermanic President Lewis Reed that had sparked controversy in recent weeks. Jones took the position that this part of the package did not comply with Treasury guidelines. Among the items in the approved St. Louis plan is $500 direct cash payments to 10,000 families.

Hoboken, New Jersey Mayor Ravi Bhalla released a plan on Tuesday for $13.2 million in ARPA spending, including $500,000 for a "new microtransit system," $300,000 to expand electric vehicle charging stations, $1 million to install pressure gauges and leak sensors in the city's water main system, and $600,000 in financial incentives to encourage city employees to get the Covid-19 vaccine. The plan, which will be presented at a City Council meeting on Wednesday, also includes money for small business grants and housing assistance, among other things.

In Memphis, Tennessee, there appears to be some tension brewing between the city council and Mayor Jim Strickland over how to spend the city's $161 million ARPA allotment. More on that here.

That's it for this week. In the meantime, if you have news tips or feedback on what we should be covering, if you want to share your community's story, or if you just want to say hello, please email us at: editor@routefifty.com. Thanks for reading!

This week's federal funds stories from Route Fifty:

• Governments Doling Out Bonuses for Public Employees, 'Gratitude Grants' for Grocery Workers
• One State to Spend $130M in Federal Funds to Tackle ‘Systemic Barriers’ to Employment​​​​​​​
• What Works? Evidence and Evaluation Key as States and Localities Spend Aid​​​​​​​

For last week's edition, which looks at opportunities for city-county collaboration, click here.