Stimulus funds in Biden’s American Rescue Plan credited with restoring a state budget surplus and keeping more than 2 million Wisconsin families afloat.
When state officials learned Tuesday that funding from President Joe Biden’s American Rescue Plan was largely responsible for a sharp increase in the forecast for a budget surplus, they became only the most recent beneficiaries of an economic stimulus and pandemic relief package that is bringing an estimated $2.5 billion to Wisconsin and another $2 billion to local governments.
Families had already received relief checks. Business owners were already putting loans from the Paycheck Protection Program (PPP) to work. And local governments are putting their aid to work in areas ranging from infrastructure to housing to public health.
The American Rescue Plan Act (ARPA) passed Congress in March with no Republican votes. Critics pointed to the $1.9 trillion price tag. Supporters pointed to the needs of a nation coping with the highest unemployment rates since the Great Depression, not to mention the coronavirus pandemic that has claimed more than 600,000 lives in the US.
Some communities, like Germantown, were hit hard by the near-disappearance of hotel revenue taxes as tourism, conferences, and business travel evaporated.
“The hotel/motel tax we received was down. We had a pretty substantial recreation program, and that covers its own expenses, and those revenues were down. We held many of those programs at a loss,” Village Administrator Steve Kreklow said. “We saw decreases in other revenues like fines and forfeitures and ambulance fees. Overall, we were down over a million dollars in revenues.”
ARPA allows these local municipalities to replace lost revenue over the past year, among other outlined purposes.
The City of Milwaukee is slated to receive $394 million, by far the largest total dollar amount of any Wisconsin municipality. Mayor Tom Barrett has set aside $3.8 million for summer employment opportunities for young people, but the rest remains undetermined.
A survey is available on Milwaukee’s ARP website which will track the allocation of the funds as throughout the process. The survey allows the general public to provide insight into what priorities they would like to see the city put the remaining funds towards. Available in English, Spanish and Hmong, it asks people to name their top three priorities out of a list that includes affordable housing, eviction prevention, early childhood education, workforce development, internet access, public health, public safety, climate change, and infrastructure and transportation. The survey is open until the end of June.
“The money Milwaukee is receiving opens an unprecedented opportunity for our city, a chance to make investments that would be impossible without the ARP funds,” Barrett said in a press release. “We already know the money will be spent to improve lives, solve problems and address racial equity issues. The opinions shared through our survey will be carefully considered as we make specific budgeting decisions about the funds.”
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The City of Kenosha is set to receive $27.8 million, $2 million of which would be through the HOME Investment Partnership Program, which oversees affordable housing projects and initiatives. Lori Hawkins, community organizer for Kenosha’s Congregations United to Serve Humanity, told the Kenosha News in April that the lack of affordable housing was having a profound impact on vulnerable populations, such as people with disabilities, people who were formerly incarcerated and the elderly.
“The lack of affordable housing in both the city and county of Kenosha has been at a crisis point since before the pandemic, but it has become even more of a crisis because of it,” Hawkins said.
Many municipalities are still in the planning and development stages of processing their ARPA funds. Cedarburg City Administrator Mikko Hilvo said the city is waiting to receive its approximately $1.2 million to start their planning and distribution process.
“We’re just waiting for the funding to come in, and we’re working on developing a plan, but that’s all we’re really doing right now,” Hilvo said.
Menomonie City Administrator Lowell Prange expressed similar sentiments. The city is receiving about $1.7 million, but he emphasized that since they have until the end of 2024 to commit the funds, they are not in a rush to figure out the details quite yet.
According to Prange, Menomonie was not hit particularly hard financially by the pandemic. “We just had to make some structural changes, but in the big scheme of things, I think we did fairly well here,” he said.
Other communities are looking to use their funds for infrastructure projects or improvements, such as water, sewer, or broadband systems.
The City of Superior adapted financially in the past year and was fortunate to have stable revenue streams that weren’t impacted by the COVID-19 pandemic.
“We came out of the pandemic looking well, but that was strictly our very resilient community and strong financial acumen and the finance team here at the city,” Nick Raverty, chief of staff to Mayor Jim Paine, said. “I think we just had a good safety net in place.”
Since the city doesn’t need to use as much of their approximately $17 million ARPA funding for revenue loss, their government officials are looking at implementing broadband networking for businesses and nonprofit organizations in the area. In addition, they have looked at completing some stormwater and wastewater projects.
Superior was already planning a city-wide broadband project, and these funds will subsidize that cost.
However, some of ARPA’s guidelines limit what they wanted to do originally to help the “most-affected, low-income citizens in the community.”
“We’re hoping that they’ll amend in the coming weeks, and we’ll be able to really hone in on providing such a critical piece of infrastructure for our citizens,” Raverty said.
UpNorthNews reporter Christina Lieffring contributed.