Coronavirus recovery aid to Springfield tops $32M as pandemic continues

SPRINGFIELD -- The city has been awarded more than $32 million in state and federal grants for coronavirus relief as the pandemic continues to create financial hardships for city departments, schools, businesses and residents.

Millions more is needed, particularly in the form of grants from the Federal Emergency Management Agency and a new round of federal stimulus funds, city officials said this week.

“Overall, we’re in pretty good financial shape,” said Timothy J. Plante, the city’s chief administrative and financial officer. “We’ve definitely done our duty to taxpayers to maximize reimbursements from FEMA and to maximize the grants we have received.”

The city has used COVID-19-related grants for improvements to municipal and school buildings, including the purchase of personal protective equipment, installation of plastic partitions and soap dispenses, and air quality improvements. Some $2.6 million went toward the purchase of laptops for students for remote learning, Plante said.

Separately, the School Department has received nearly $7.5 million for school reopening costs, remote learning technology and to assist with its ongoing meals program.

The grants have included $4 million in federal CARES Act funding to assist economic development efforts such as small business grants, public services and job training. Another $5.1 million was awarded to aid the homeless, said Timothy Sheehan, the city’s chief development officer.

Grant assistance to small businesses has “literally kept many of them in business,” Sheehan said.

In addition, $2 million is being used to assist residents with mortgage, rent and utility costs, Sheehan said. That amount includes $1.7 million from HOME program funds and $300,000 in Community Development Block Grant funds under the CARES Act.

Mayor Domenic J. Sarno said the city is tracking all grants and will “go after every dime” available in COVID-19 relief.

The grant applications trace back to the start of the pandemic in March.

“It’s not a slush fund,” Sarno said.

The funds are needed to fill gaps as the city deficit-spends to cover coronavirus-related costs, and to assist businesses, nonprofit organizations and residents, Sarno said. The city has been able to keep all employees on the job, and to continue essential services, he said.

Plante said the city imposed a hiring freeze and spending freeze, except to fill essential vacancies and cover critical expenses.

Beyond the challenges this year, Plante and Sarno anticipate the impact of the coronavirus will continue to be felt financially in fiscal 2022 and 2023.

Since the pandemic began, the city has lost approximately $6.2 million in revenue. That does not include property taxes, Plante said. The $6.2 million loss is the result of reductions in motor vehicle excise taxes, hotel/motel room taxes, restaurant meal taxes, and other revenues, he said.

The total amount of COVID-19 grants is $32,165,017, of which $7,462,580 is for direct use by the School Department, said Melanie A. Acobe, the city’s grants director. The total amount spent by the city, from its deficit spending account and grants, totals $17,548,298, she said.

The largest grant was from the federal CARES Act coronavirus relief fund and totaled $13,6687,817 over two rounds -- was the maximum amount allowed, city officials said. The CARES Act covers expenses from March through Dec. 30.

The city used some of the funds to purchase laptops for students, to cover the cost of Zoom licensing to allow city departments to operate remotely, and to pay for COVID-19 protection measures in city buildings, officials said.

Due to the pandemic, the city was allowed by the state Department of Revenue to deficit spend -- spend beyond its budget -- by up to $10 million, Plante said. The city has not exceeded that limit by using the relief grants, he said.

One example is that the city erected and equipped large tents on Worthington Street to administer coronavirus tests and temporarily house homeless people, at a cost of more than $800,000. The effort was initially funded through the city budget ahead of grant reimbursements, Plante said.

The city is not being reimbursed for its reduced revenues, such as excise tax revenues, from any state or federal grant sources, officials said. It is hoped that a second federal stimulus package would include funds for such losses, but it is not yet approved, officials said.

The city is still waiting to find out if its first FEMA application for $2.35 million will be awarded, as well as a second round application for nearly $1 million, Acobe said. Under the program, FEMA reimburses 75% of eligible costs, leaving the city to fund 25%, possibly with other grant sources, she said.

Plante praised the partnership between city departments and the school system to strategize and maximize all funding sources “to do what’s right for the kids and residents.”

Sarno said the city has been helped by being strong on managing its finances over the years and keeping a healthy reserve fund.

“The residents are in need, the business community is in need,” Sarno said, promising to continue efforts to provide aid.

One of the major challenges facing the city is finding reimbursements for COVID-19 costs past Dec. 30, the expiration date for CARES Act funding, Acobe said.

“The request for assistance comes in daily,” Sheehan said. “Unfortunately, we’ve deployed a lot of resources and it needs to be replenished.”

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