CEDAR CITY — During a work meeting Wednesday, the Cedar City Council reviewed the State of Utah’s proposed distribution of Coronavirus Aid, Relief and Economic Security Act funding and potential uses for the money.
In order to receive funding, counties and municipalities are required to enter into a contract with the state, which dictates how the funding can be spent. Funds must be used for expenses related to the COVID-19 pandemic and cannot be used as revenue replacement or for regularly budgeted items. Any funds not spent by Nov. 30 must also be returned to the state.
City Manager Paul Bittmenn said Cedar City does not have many expenditures that qualify for coverage with the CARES Act funding, and that city staff would propose using the money for larger items, such as the Cedar City Together campaign.
“We would propose to spend $20,000 on the small business program that Danny (Stewart) ran out of his office for signage and masks and such,” Bittmenn said. “We would propose to spend $25,000 to pay for the city’s portion of the small business grant program. We would propose to spend $5,000 on a single audit.”
Bittmenn said if the city accepts the contract with the state, it will likely be audited to verify how the money was spent.
Bittmenn also discussed equipment city staff would recommend purchasing with the funding, such as portable trailers that have handwashing stations and portable messaging boards.
“You would use them primarily for larger events to encourage people to wash their hands,” Bittmenn said. “There could be secondary uses for them as well throughout the year with staff.”
City staff would recommend purchasing two portable trailers for approximately $35,000 each and two message boards for roughly $25,000 each.
Bittmenn added that the contract includes a provision related to providing services for the homeless population, as well as a provision for school districts. Iron County Care and Share reported around $100,000 of expenses that would qualify for funding.
Bittmenn said the city will likely not directly receive the majority of the funding.
“The corporate entity of Cedar City’s probably not going to get a lot of that money, it’s probably going to need to be spent in the community,” Bittmenn said. “If we want the money to benefit our local economy, we should probably structure something locally to help as many people here as we can.”
Bittmenn said focusing on the local benefits is the recommendation of city staff’s because the city has not incurred many expenses related to the pandemic.
“These aren’t large expenditures that have hamstrung our budgets,” Bittmenn said. “That’s why the recommendation is to not try to quantify every penny spent on COVID and focus more on these larger items that we’ve presented.”
Bittmenn added another potential use for the funding could be to aid small businesses, and Iron County Auditor Dan Jessen addressed the council to discuss a potential partnership with the county for a small business grant program.
Jessen said the county also has not incurred many costs related to the pandemic, and will likely only use a small part of the county’s CARES funding for equipment like hand-washing stations and new tents for the COVID-19 testing center.
Jessen said the provision of the contract that stood out to him was the potential for a small business grant program.
“We’d like to have a very simple process,” Jessen said. “We need to make sure that businesses qualify, and it has to be related to hardship due to closure.”
Jessen said the county has already entered into the contract with the state and received its first allotment of funding. As any unused money must be returned to the state by Nov. 30, the county will move forward with a grant program following a budget adjustment on June 30.
“The plan that is falling into place is we would identify a couple of industries that have been hit hard, and we would narrow down how they would have to show their hardship, it would be financial hardship,” Jessen said.
He added that the focus would be on businesses that are currently open, or will be reopening, and the county also plans to reach out to Enoch and Parowan.
“We could do some sort of a program to really put some money in to do some good on some of these businesses that have been severely impacted,” Jessen said.
Jessen also said the benefit of a grant program, rather than a loan program, is the ease of processing.
“We can expend those funds. We can get them into the local economy and wrap it all up by the end of November and not have to add staff,” Jessen said.
According to the state’s proposal, Cedar City would receive $3,018,784 total, distributed in three installments.
Iron County is set to receive $5,576,911 in total and has already received the first installment of $1,858,970.
The council will vote on whether to enter into the contract with the state to receive CARES Act funding during a June 23 action meeting.
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