City eligible for over $1 million in federal fundingJul 27, 2020 10:44AM ● By Cassie Goff
Local service districts might be able to retrieve some of their monetary losses through Cottonwood Heights’s allocation of the CARES funding. (Photo courtesy of Cottonwood Heights Recreation Center)
By Cassie Goff | [email protected]
Cities within Salt Lake County recently received funding from the Coronavirus Aid, Relief and Economic Security (CARES) Act. This funding must go directly towards expenses related to the current public health emergency by October, or the funds will be forfeited back to the county.
The State of Utah, Utah County, and Salt Lake County were the only municipalities to receive direct funding from the CARES Act within the state. In total, the State of Utah received $1.25 billion of federal funding. Salt Lake County received $203,603,981.20, which has been distributed to cities on a per capita basis.
Cities like Cottonwood Heights are eligible for their portion of the funding upon agreeing to strict terms and conditions set up by Salt Lake County pertaining to expenditure. “There are big restrictions and limitations because if the funds are used improperly then the county is on the hook,” explained Community and Economic Development Director Mike Johnson.
Allowable uses include those that have been necessary expenditures incurred with respect to COVID-19 between March 1 and Dec. 30, 2020. Such expenditures were previously unaccounted for in the budget most recently approved as of March 27.
Prohibited uses include revenue replacement, repeat funding for expenditures, and additional limitations laid out by the United States Department of Treasury.
Any funds that are not expended by October 2020 must be returned to Salt Lake County. The key word here is expended. Funds must be spent by October; they cannot be placed in an account and saved for later expenses.
“Expending those funds by October is a quick turn around and we could recover costs,” said Mayor Michael Peterson.
Based on the county’s per capita distribution, Cottonwood Heights is eligible for $1,007,868.56 of federal funding.
On June 16, the Cottonwood Heights City Council discussed creating a grant program for small businesses within the city with their portion of the CARES funding.
“We could develop a grant program to help city businesses,” Johnson said. “They could be funded on a first-come first-serve basis, without setting a hard deadline.”
Salt Lake County previously expended $40 million through small business grants. Eligible businesses under the county were businesses with under 100 employees, food service establishments, hair salons, spas, gyms, and recreation centers. Many businesses that were forced to shut down during the pandemic were eligible for the county’s grant if they could demonstrate loss.
Cottonwood Heights would not be able to mimic Salt Lake County’s grant for small businesses, but they could make some adjustments. One of the suggested adjustments would include different types of businesses eligible for funding.
“Very small businesses have been left behind. This could be an opportunity to help fill in some of the gaps,” Johnson said.
However, Salt Lake County has since stated that they are working to expand their small business grant to include business types that were previously ineligible. Cottonwood Heights will be waiting to see the details of the County’s expanded grant program before moving forward with any city funded grants.
Johnson and his staff are hoping for details from the County rather quickly because “building out a grant is not an easy task.”
Once the grant is drafted, covering city expenses and input from different city departments, it must go through a legal process. Then, it must come back to the city council for final review and approval. Then, it has to go to Salt Lake County for their approval as well.
Councilmember Scott Bracken suggested sharing some of CARES funding with organizations that provide services within the city. “Local districts like water may not have been eligible for any type of CARES funding. It would be great to find and share those expenditures.”
“We could use that money for the fulfillment of other expenditures for community organizations who may not have been available for county resources, like the rec center,” Johnson emphasized.
On July 21, the Cottonwood Heights City Council unanimously approved entry into an agreement with Salt Lake County for distribution of funding under the CARES Act.
Additional CARES Act programs include stimulus checks, tax deferral, Small Business Administration Paycheck Protection, Economic Injury Disaster Loans, Rental Assistance Programs, and Small Business Impact Grants.