At the request of the Lawrence Common Council, City Controller Tyler Douthit has provided information about American Rescue Plan Act fund spending approved for 2022 that has not yet been spent.
Douthit also provided information about the benefits of purchasing first-responder vehicles rather than leasing. Both issues came up during the council’s July 10 back-to-back Finance Committee and regular council meetings.
A spreadsheet detailing the city’s ARPA funds spending for 2022 shows that about $5.5 million had been allocated for sewer and stormwater projects, street paving, trail improvements, parks department expenses and bonuses for city employees.
By the end of 2022, about $2.5 million remained unspent, but much of that was encumbered and will be spent by the end of this year, according to the spreadsheet. What’s left unspent and unencumbered is about $102,000.
A proposal submitted in early May calls for about $3 million of the city’s American Rescue Plan Act funds to be spent on a variety of city projects. The council has repeatedly postponed action on that proposal while waiting for the Finance Committee to review it. The first committee review was on July 10. The council decided later that same night to refer the proposal to a committee of the whole, which is not yet scheduled to meet.
The proposal would fund:
- $1 million to match a state grant for street improvements
- $280,000 to match a grant for trail development and improvements
- $1.6 million to replace public safety vehicles
- About $50,000 for public safety education and training, and facility repairs for the fire department’s training tower
- About $95,000 for police cameras, and for the police department’s new-hire and promotions process
Council members had questions about purchasing public safety vehicles. The city has leased vehicles for the past few years, citing cost savings, and council members wondered why purchasing vehicles now is considered a better option.
In his report to the council, Douthit lists the pros of leasing, which he said is normally a better option. Leasing spreads out payments, which helps with annual cash flow, for example, and financing matches the useful life of the vehicles.
“Overall, leasing does help us manage our cash flow by spreading the cost out across the useful life of the asset,” he stated. “I, like many others, am a fan of leasing versus outright paying cash in most cases. However, we continue to face funding challenges with our public safety tax fund that we are attempting to address with this (ARPA) proposal.”
Douthit stated that city revenue remains steady but flat, and costs continue to rise. Those costs can’t be covered by the public safety tax fund, he stated, so the overages are shifting to the city’s general fund.
“With this in mind, we are asking to utilize (ARPA) funding to make one-time cash purchases of public safety equipment/vehicles,” he stated. “This will lower our annual debt obligation and will provide relief to the general fund as it continues to take on the costs from the public safety tax fund. This will lower a recurring cost within public safety’s operational budgets. Lowering a recurring cost is typically a difficult thing to do but, in this instance, we have been given a unique opportunity to do so.”
The City of Lawrence received about $11.2 million through the federal ARPA pandemic relief plan. If the council approves the 2023 ARPA fund spending proposal, about $2.6 million will remain for 2024 projects.
