With the potential of $75.7 million in CARES Act funds coming to the county, commissioners suggest allocating money to ‘neediest first’

More support for small business owners, along with funding for mental health and food delivery services, and efforts to forestall evictions among proposed uses of first $18.9-million installment

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These are among the eligible expenses for the CARES Act funding. ‘CRF’ stands for Coronavirus Relief Fund. Image courtesy Sarasota County

With Sarasota County to receive as much as $75.7 million in federal CARES Act funding, the County Commission this week voted to approve four categories for divvying up the funds, with emphasis — as Commissioner Nancy Detert put it — on “the neediest first and then the embellishments.”

“As we look to provide assistance,” Commissioner Christian Ziegler added during the July 7 discussion, the commissioners should consider the businesses that were forced to shut down in response to Gov. Ron DeSantis’ “safer-at-home” directive that went into effect on April 3.

“Those are the people, I think, that kind of get to the top of the list,” Ziegler said.

Detert mentioned All Faiths Food Bank and First Step of Sarasota, which serves people with mental health and substance abuse problems, as potential recipients. Noting that people had spent a lot of time “locked up in their homes,” Detert talked of “unmet needs” in regard to mental health services.

Rich Collins, director of the county’s Emergency Services Department, said staff would prepare a budget resolution for the commissioners to address after their summer break, which will begin on July 12.

During a presentation that was part of the board’s regular meeting on July 7, Collins explained that the CARES Act, which Congress passed in response to the novel coronavirus pandemic, totaled about $150 billion. Of that amount, Florida is to receive $8.3 billion. The funds state leaders initially distributed from that went to cities and counties with populations above 500,00, Collins continued.

(Formally, the measure that President Donald Trump signed into law on March 27 is the Coronavirus Aid, Relief, and Economic Security Act. It offers more than $2 trillion in economic relief, the U.S. Treasury notes on its webpage regarding the bill.)

More recently, Collins added, Gov. Ron DeSantis approved other allocations, including the potential $75.7 million for Sarasota County. The first phase of that process entails an $18.9 million distribution, Collins said.

These are among eligible expenditures for which the county can be reimbursed through the CARES Act funding. Image courtesy Sarasota County

Technically, he pointed out, the funding agreement is between the county and the Florida Division of Emergency Management (FDEM). That will allow the county to use the money for expenses incurred between March 1 and Dec. 30 of this year as a result of the pandemic. However, none of the money can be used to replace lost revenue, he stressed, and it cannot go toward any construction projects unrelated to the COVID-19 response.

Cities and the county’s constitutional officers — such as the Clerk of the Circuit Court and County Comptroller and the sheriff — are eligible for funds, he said, as well as private businesses, nonprofit organizations and individuals.

The guidance from the U.S. Treasury, Collins continued, is to pay out the money “as quickly as possible through existing mechanisms or agreements or programs.”

Under the emergency operating procedures for the pandemic, Collins noted, County Administrator Jonathan Lewis has the authority to sign the necessary agreements that will be crafted in an effort to ensure the money is spent appropriately.

Already, Collins told the commissioners, the county has identified $4.4 million in expenses for which it can be reimbursed.

For example, he said, the county has spent funds on three rapid response vehicles — SUVs — that it has used instead of sending Fire Department vehicles, including EMS units, to respond to calls potentially involving COVID-19 infections.

Additionally, Collins noted, the potential exists to convert the $4.3 million awarded to small businesses in May from loans to grants.

Another possibility, as indicated during the discussion, is that the county could use CARES Act money to replenish the Economic Incentive Fund, from which the loans came.

The Economic Development Corp. of Sarasota County collaborated with county staff on the program.

On July 7, Commissioner Charles Hines voiced opposition to any effort to convert the loans to grants. He voted against the loan program, explaining that the county’s Economic Incentive Fund was established to draw what he called “game-changer” companies to the county.

Among other eligible uses of the CARES Act money would be to help individuals with utility, rent and mortgage payments, Collins said. Support also could be provided to food delivery programs.

The members of the group who had been working on the possibilities included staff from the county’s Office of Financial Management, the Office of the County Attorney and the office of the Sarasota County Clerk of the Circuit Court and County Comptroller, Collins added. They identified four funding categories: Safety and Security, which would include support for law enforcement agencies, for example; Health and Medical, which would encompass medical care and mental health assistance; Food, Water, Shelter, which would apply to individuals and nonprofits; and Economic Recovery, which would deal with assistance to small businesses.

All Faiths Food Bank features this box on its website for people needing assistance because of the COVID-19 pandemic’s effects on the economy. Image courtesy All Faiths Food Bank

The initial recommendation, he said, was to allocate 25% of the county CARES money to each category.

However, he added, funding could be shifted around, in accord with commission direction.

The county will need to maintain detailed records of all the expenditures to ensure that they can be justified, Collins explained. The goal is for staff not to be surprised a few years down the road by a demand from the federal government to return millions of dollars deemed to have been allocated for ineligible purposes.

Collins also stressed that the money must be spent by the end of the year. Otherwise, it will have to be returned to the U.S. Treasury.

Determining the best approaches

“This could be literally life-altering stuff for the people that are most impacted by COVID,” Chair Michael Moran pointed out of the CARES Act support.

Commissioner Alan Maio. File photo

“I am intensely curious about us getting reimbursed for that $4.3 million [that the commission distributed through the Small Business Resiliency Loan Program],” Commissioner Alan Maio said. “That is just a great thing if we can manage to get it done.”

As for the prospect of ending up with the entire $75.7 million, Commissioner Detert told her colleagues, “I wouldn’t get anybody’s hopes up on that,” especially because of the necessity of dispersing all the money by the end of the year.

Then Detert brought up her objection to the staff recommendation for divvying up the CARES Act money equally — in 25% increments — to the four categories Collins had proposed. Her top priority for the funding, she continued, would be the Health and Medical category. Her second, she said, would be Food, Water, Shelter, followed by Economic Recovery at No. 3.

Detert did advocate for sharing the federal funding with the municipalities in the county. “Their budgets are smaller. Any extra expense has hurt them probably more than it’s hurt us.”

Further, Detert said, “Shelter is becoming a problem,” with people who are out of work unable to make rent and mortgage payments, and landlords with tenants in arrears struggling to pull together money for their mortgages.

Would the money reach the people who were “hurt physically, financially and economically?” Detert asked.

Hines then raised his concern about the potential of transforming the small business loans to grants. “This was a loan program; very minimal criteria to get in this,” and it was first-come, first-served, he emphasized. “If we suddenly just convert that [program] to grants, that is just an incredible windfall to people.”

Some business owners elected not to apply for a loan, Hines added, because of the county’s requirement of a commitment to return the money — with interest, if the funds were not paid back at the end of the first year. “These businesses promised to pay us back. That was the deal.”

These were facets of the Small Business Resiliency Loan Program, as shown in an email blast the Siesta Key Chamber of Commerce sent to its members in April. Image courtesy Siesta Key Chamber of Commerce

Moreover, Hines emphasized, the money provided through the CARES Act is not federal funding. “They’re taxpayer dollars.” At some point, he continued, people in the nation would be liable for covering that outlay approved by Congress — for example, “My children; my grandchildren.”

“We really need to take a little harder look at the businesses and the people that were truly impacted by [the economic downturn resulting from the pandemic], not just first in the door to get the money,” Hines said.

He did add that he concurred with Detert on modifying the percentages Collins had presented.

People at risk of being evicted from their homes should be one priority, he said, along with nonprofit organizations that have provided funding to keep people in their homes.

In response to the board members’ comments, Collins pointed out that the recommendation about the percentages was — as Commissioner Ziegler characterized it — “a rough outline.”

Collins also emphasized once again his concern, as director of Emergency Services, about the need to be able to justify to the federal government that all of the CARES Act funds have been spent appropriately, after the county has distributed the money.

He also explained that while the commission is on its summer break, staff will delve into more details of potential outlays of the funding and bring the information back to the board in August.

Staff will be working, too, on the agreements with entities identified as potential recipients of the money, so those will be in place as needed, Collins added.