How did Akron City Council get cut out of approving ARPA spending?

City administrators are negotiating, signing and executing millions of dollars in contracts with no specific approval from Akron City Council. And it's all being funded by federal pandemic money.

So, how did the legislators of Akron, who are empowered by the city charter with explicit spending authorization, lose control over how the city is spending its $145 million share of the American Rescue Plan Act?

The short answer is they handed the mayor the right to approve or deny specific plans in legislation last year — and have been doing so in every annual budget for at least the past three decades.

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The ARPA spending bill, which gave the administration sweeping power to execute federally funded but locally designed programs, projects and contracts, was offered by Mayor Dan Horrigan and council President Margo Sommerville. It passed over the objection of five council members who saw especially concerning language in a first version of the bill.

2021 ARPA Spending Authorization Bill by Lauren Young on Scribd

With the second half of the federal relief money expected to arrive in the summer of 2022, the legislation said “any future deposits of ARPA funds, as the city may receive from the U.S. Treasury, are hereby deemed appropriated, without further action of this Council, and are permitted to be expended for any purpose consistent with this ordinance.”

“Without further action of this Council” was dropped from the version that eventually passed 8-5 with council members Nancy Holland (Ward 1), Shammas Malik (8), Tara Mosley (5), Russ Neal (4) and Linda Omobien (at-large) still unconvinced that council wasn’t giving up all right to steer, help improve or reject future spending plans.

Another line was added to that same clause. It said the mayor would spend the money in accordance with state and federal rules, any other applicable laws and “the City of Akron Charter.”

With initial plans teed up based on input and needs from long before the pandemic, the mayor lobbied council and the public to promptly begin spending the federal funds. His office issued "City of Akron Commits To Uniquely Transparent, Impactful, and Collaborative Process to Spend Federal ARPA Funds" — a document laying out how the public, from ideas yet to be collected online and meetings scheduled for after receiving spending authorization, and council would participate in the process until all the money was gone.

City of Akron ARPA Fund Framework by Lauren Young on Scribd

That mayor's framework for transparency explained that council would approve ARPA spending in yearly operating budgets, which generally lack names of contractors and vendors, or subsequent legislation tied to projects briefed in the annual capital budget.

The mayor's plan, at the time, was for council to "exercise all oversight powers set forth in the Akron Charter." Section 95 of the charter, which gives council control over approving sizable contracts, was invoked for separate legislation but not the annual budgeting process.

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Section 95 says any contract "in excess of $50,000 shall first be authorized by Council and awarded to the lowest and best responsible bidder, after public advertisement."

But administrations for years have found a way around that requirement.

In every budget bill since at least 1970 (as far back as the clerk of council could search on microfilm on short notice this past week), mayors have gotten councils to give up their right to OK many contracts with a single line approved at the beginning of each year. The 2022 budget that paved the way for most of the ARPA spending "hereby authorized” the mayor and Cabinet members overseeing law, finance, public works, safety, planning, development and neighborhood assistance “to contract for Personal Services, including special and consulting services.”

Similarly sweeping language in the spending authorization bill passed last year explicitly stated that the same top administrators “are hereby authorized to execute, certify, and/or furnish other such documents and take all other actions, including entering into separate agreements, as are necessary or incidental to further the acceptance, appropriation, and expenditure of the ARPA funds.”

Since the annual budget and spending authorization bills passed, the mayor has signed six- and seven-figure contracts on everything from non-profits fighting youth violence to stockpiling sewer construction materials to a $1.6 million agreement for Washington, D.C.-based Guidehouse, which Forbes Magazine calls the “leading global provider of consulting services."

Council will likely see the clause circumventing its charter-backed spending authorization again when it gets the 2023 operating budget in February.

Reach reporter Doug Livingston at dlivingston@thebeaconjournal.com or 330-996-3792.

This article originally appeared on Akron Beacon Journal: Here's why Akron council doesn't need to approve millions in spending