Earlier this year, the Sitka Assembly budgeted $5 million of available CARES Act money for business and nonprofit grants, without really knowing how many businesses would take advantage of the program. The application period closed last month, and on Thursday (9-25-20), the assembly had the opportunity to take stock of how much coronavirus relief funding is left in the pot.
City administrator John Leach said they had around $2 million leftover from the first round of business and nonprofit grants. Add that to the remaining funds from the city’s utility subsidy program, and the assembly had around $3.8 million dollars left to distribute to Sitkans.
Leach and the CARES Act Working Group recommended that the assembly put three million of the leftover funds toward another round of business and nonprofit grants, this time with a $50,000 cap per organization.
“The entry requirement for revenue loss is at 40 percent year over year,” he said. “We want to target the businesses that had the most impact and are then, again, are gonna provide the most economic impact back to the community.”
Nonprofits must report 25 percent in revenue losses in order to qualify. Leach said that although the money for both businesses and nonprofits would come from the same pot, only around $450,000 of the money should go toward nonprofits, since nonprofits make up around 15 percent of the local economy.
Member Valorie Nelson said she’d rather see another round of utility subsidies for Sitkans, instead of more support for businesses and nonprofits.
“My preference is that…anything we have left over to go to the people,” she said.
Member Richard Wein agreed with Nelson, and said he’d like to appropriate $2 million for businesses, $1 million for utilities, and $800,000 to the school district, as long as the district returns the recently transferred Secure Rural Schools money. That funding doesn’t have as many parameters as CARES Act funds, and can be used by the city for road improvements, beyond this calendar year.
City staff said a wave of utility subsidies could pose challenges. That money has to be spent before the end of the calendar year, unless congress extends the deadline. City controller Melissa Haley said without a change to the rules, the city could see problems if it disburses utility subsidies to citizens who may not be able to spend it all before December 31.
Kevin Mosher who is on the CARES Act working group argued that the assembly should go with the presented plan.
“We don’t have time to redo all this stuff. Every little thing takes…you’d be amazed at how much work it takes just to do one little thing,” he said. “I’m just asking that you would consider scrapping these ideas and just going with what’s presented, that’s my two cents.”
Ultimately the assembly voted to allocate $3 million toward another round of business and nonprofit grants on a 5-2 vote with members Valorie Nelson and Richard Wein opposed.
The assembly approved the leftover $800,000 for another round of residential utility subsidies and added around $200,000 that the city originally set aside for a day shelter for unhoused people. A “request for information” to find a party that would be interested in operating a shelter received no responses.
Kevin Knox pushed back on putting that money toward utilities, saying that the money could be moved to the city’s new rent and mortgage relief program instead. Knox said the housing funds were already in high demand.
“That program went live tonight,” Knox said. In the first two hours of that being live, for residents of the city of Sitka, there have been over 40 applications to it already.”
The amendment to tack on the two-hundred-thousand passed four to three with members Kevin Knox, Gary Paxton and Richard Wein opposed. The million dollar allocation for utility subsidies passed unanimously.
Read about the city’s entire $14 million coronavirus relief budget here