‘The infusion can’t be treated as an all-you-can-eat buffet’
By Tim Carrington — For Foothills Forum
A $643,000 infusion of federal monies is lifting the strained Rappahannock County budget to help cover costs related to the COVID-19 crisis.
The aid represents the county’s slice of a $150 billion relief fund within the recently enacted Coronavirus Aid, Relief, and Economic Security (CARES) Act. The Board of Supervisors discussed the financial injection at its June 1 meeting, but it is holding off on allocation decisions. The month of June is seen as a time to “dig into options,” and some decisions will take shape in July, when the new fiscal year starts. The funds must be spent by the end of 2020, and unspent monies must be returned to the federal treasury.
The infusion can’t be treated as an all-you-can-eat buffet, but is subject to specific guidelines on what’s covered and what isn’t. Significantly, the government funds cannot be used to make up for shortfalls in revenue resulting from the pandemic and associated lockdown. That’s important because county coffers are suffering from a radical falloff in meals and lodging taxes and sales taxes, reflecting shuttered restaurants and businesses, closed hiking trails, and bed-and-breakfasts pushed into hibernation. There also are fears that the largest source of revenue — taxes on private property and real estate — will be subject to delays and payment failures if residents are swamped by business losses combined with other financial obligations, such as mortgages and commercial loans.
The relief funds go to counties based on population. Rappahannock’s $643,000 is less than 2 percent of the $41 million to be sent to Prince William County, where 470,335 people reside. Within the county, the Town of Washington, which maintains a separate budget, will receive $8,332.
County Administrator Garrey Curry Jr. notes that the new relief program is essentially the mirror image of historic federal emergency programs. In the past, local governments would tally up outlays made under emergency conditions, and then apply for reimbursement. “This event is the first in my experience to work the other way around,” Curry says. “That is, the federal government pushed money to the states, and Virginia is pushing funding to the counties. The counties must then carefully track how the funds are used and maintain ‘auditable’ records for subsequent review.”
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What the government injection can help cover is essentially any outlay between March 1 and the end of the year that was brought on by the COVID-19 crisis. Eligible expenses should be for items that weren’t part of the last adopted budget. Government documents stress that the assistance isn’t meant to cover investments and programs that were already scheduled, but those that were forced on the county by the pandemic, or the regimen of isolation, business lockdown, and safety. Here are examples of eligible, COVID-related outlays:
— Purchases of protective equipment and overtime payments to front-line workers.
— Unemployment costs or increased workers’ compensation expenses that result from the pandemic.
— The costs of planning a strategy for recovering from the pandemic and lockdown.
— Payroll support for employees whose duties involve mitigating the health emergency.
— Costs of establishing trained contact-tracing teams, which some jurisdictions have found crucial to identifying those who are infected or at risk.
— Preparations for a second wave of COVID-19 infections, as happened with the flu pandemic of 1918. The federal guidance states that monies can be used “to create a reserve of personal protective equipment or develop increased intensive care unit capacity.”
Beyond these types of county outlays, the new funds can be directed to individuals and families suffering from the pandemic or from loss of work caused by the health crisis. For example, funds could be used to help individuals avoid eviction or foreclosure by picking up overdue rent bills or mortgage payments. The federal money could even be used to help residents with funeral costs or other financial setbacks attributable to the pandemic. However, the relief money cannot be used to help individuals pay their local taxes.
The shift to distance learning and remote working has put a spotlight on Rappahannock’s patchy and frustrating broadband coverage. But the relief fund won’t solve the county’s long-term connectivity problem. It covers only direct costs connected to the adaptations put in place to deal with the immediate crisis. According to government guidance, investments “to expand rural broadband capacity to assist with distance learning and telework” can be covered only to the extent “they are necessary for the public health emergency.” Many investments in strengthened broadband would expand capacity, but wouldn’t be in place until after the crisis has eased. Those wouldn’t be eligible.
In general, capital improvement projects — even if they contribute to the county’s economic resilience — wouldn’t be covered unless they link to local efforts to contain or mitigate the pandemic. Being a good investment isn’t enough to qualify.
Local businesses do stand to realize some benefits. The guidance states that the new money can be used to assist “small businesses with the costs of business interruption caused by required closures.” Local governments are given considerable leeway in managing small business assistance.
Farmers also could see some relief. The federal documents note disruptions in the meat-processing sector, stating that the program can include “payments to facilitate livestock depopulation incurred by producers due to supply chain disruptions.”
Some proposals already appear to be likely items for consideration under the relief fund. In Monday’s discussion, supervisors cited the recruitment of paid EMS workers at Chester Gap after volunteers suspended their service in response to policies encouraging isolation and social distancing. The community organization Businesses of Rappahannock wrote to suggest an advertising campaign tied to Rappahannock’s reopening as COVID restrictions ease statewide.
Rappahannock schools are in line for two COVID-related cash injections independent of the CARES Act fund: $150,000 for COVID-19 expenditures in the fiscal year ending June 30, plus another $200,000 that can be carried over to the fiscal year beginning July 1. The schools’ distance-learning program, including technology and training, along with student and family support services, and meals, have added significant outlays since the State of Emergency took effect in mid-March.
Broadly, the relief funds are generating hope for a needed economic lift. “Even a little amount of money can go a long way with businesses that need help,” says Supervisor Debbie Donehey, vice chair of the Board of Supervisors.
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