City commission floats ideas for ARPA funds

·3 min read

Sep. 15—Owensboro city officials are beginning to discuss how they could spend the millions of federal dollars they will receive over the next year.

While no decisions have been made, some potential uses for the funds discussed at Tuesday's city commission work session included helping finance projects planned by Owensboro Municipal Utilities and Regional Water Resource Agency, and undertaking a stormwater drainage project in the York area neighborhoods of the city.

The funds could potentially also be used to reimburse the city for projected revenue it didn't receive because of the pandemic.

The city will receive a total of $13.3 million in American Rescue Plan Act funds. ARPA was passed by Congress earlier this year to provide relief to people and governments affected by the COVID-19 pandemic.

"I've got no less than 55 requests to spend this money" from non-profit agencies, Mayor Tom Watson said.

The funds, which have to be committed by the end of 2024 and spent by the end of 2026, can only be used in certain categories: Public health emergency and economic impacts; premium pay for workers; recouping lost revenue; and improving infrastructure.

City Manager Nate Pagan presented four potential uses for the funds, including giving $2.5 million each to OMU and RWRA to help finance major projects on their lists, spending $4 million on stormwater drainage in the York area, and using up to $8.3 million to replace lost city revenue.

"This is a starting point. I'd say it will be a multi-year, multi-month process at least to fully allocate these funds," Pagan said.

The funds could be allocated over a long period of time rather than all at once, Pagan said.

Watson said the money would be used for one-time initiatives.

"We are looking at things that are not recurring expenses, which is very different than building something you have to pay for for 40 years," Watson said.

Any lost revenue city recouped through ARPA would be placed in a separate account, to be used for general government projects, such as maintenance, roads, health services or other areas, said Angela Waninger, city finance director.

In the York Drive area, the city is doing modeling to determine what drainage improvements can be made in the neighborhoods, Pagan said. The modeling study will be complete in November, so any drainage projects in those neighborhoods couldn't begin until next summer, Pagan said.

"It will probably be somewhere in the $3.5 million to $4 million range," Pagan said of a York area project. "... It is a pretty involved and sizable project."

RWRA has $60 million to $70 million in projects on its list, including expanding the agency's treatment plant. Allocating city dollars to RWRA to finance projects would help city residents, Pagan said.

"Our city taxpayers are RWRA customers, and so by funding a project of that nature, or lowering the cost RWRA would have, we're saving everyone money," said Pagan, adding the same would be true if the city helps fund OMU projects with ARPA dollars.

The commission could also use the funds to help impacted populations, such as seniors, our could allocated ARPA dollars for improvements in certain city parks, Pagan said.

Commissioners will decide how to ultimately spend the money.

While discussing pandemic relief, Pagan said the city spent $1.673 million on relief projects last 18 months.

City officials allocated $750,000 for restaurant worker payments, $285,000 for small business grants, $184,000 in rental assistance payments and put $300,000 into the Green River Area COVID Assistance Fund. The city also waived sanitation fees for businesses for two months, and waived fees for bars and restaurants.

"I would say we went above and beyond," Pagan said. "We did more than most cities, I would say."

While other communities had funds like the COVID Assistance Fund, the city's relief effort "was far more targeted, and frankly invested far more than the typical city in the commonwealth," Pagan said.

James Mayse, 270-691-7303,, Twitter: @JamesMayse

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