From homeless shelters to parks projects, here’s how Lexington will spend COVID cash
After months of debate, the Lexington council gave initial approval Thursday to a spending plan for $121 million in federal coronavirus relief money that includes $20 million for parks projects, more than $30 million for homelessness and housing stabilization and $1.3 million for various youth violence intervention programs and initiatives.
Prior to Thursday’s vote, the Lexington-Fayette Urban County Council had approved north of $38 million of the $121 million for various initiatives and projects including nearly $18 million for bonus pay for public safety and other city employees, $10 million for affordable housing projects and $1.4 million for emergency winter housing for the homeless.
The council has been discussing how to spend American Rescue Plan Act money since last summer.
Each of the proposed projects will still need additional approval.
That spending plan includes an additional $9.8 million for a host of homelessness and housing programs including $2 million for the Hope Center and $3 million for the Salvation Army, the city’s main homeless shelters, for capital projects and improvements and a $3 million pool for new homeless initiatives.
The spending plan also includes $10 million to address the city’s parks master plan that includes updates to sports fields and courts and $10 million to build out a new park, Cardinal Run North, which has long been in the works.
Other projects the council agreed to tentatively fund Thursday include:
- $991,000 - Minority Business Accelerator
- $240,000 - “It Takes a Village,” a mentoring program
- $1,040,000 Black and Williams Center Rehabilitation
- $6,000,000 A pool for non-profit organizations for one-time capital improvements
- $960,000 Summer youth employment program
- $350,000 Safety Net, a violence prevention program
Money for Village Branch Library, Farmers’ Market
Lexington Mayor Linda Gorton’s administration had proposed setting aside $33.5 million of the ARPA allocation for a competitive grant pool for potential projects the council had previously considered.
Councilwoman Amanda Bledsoe, who chairs the council’s budget committee, said many of those potential projects -- including $10 million for a youth sports complex, do not qualify for ARPA funding. Other projects that were considered for that competitive grant pool include $7.5 million for a second entrance and other improvements to the proposed Town Branch Park, a privately funded park adjacent to the newly expanded Central Bank Center on Main Street.
Projects that serve lower-income neighborhoods and certain U.S. Census tracts qualified for ARPA funding under the final rules released by the federal government a few weeks ago, Bledsoe said.
The council agreed on Thursday to use a portion of the $33.5 million in ARPA funds to fund some government services that qualified under ARPA guidelines.
“We can use savings generated by allocating this money to city services to fund other projects that do not qualify for ARPA funds,” Bledsoe said. In addition, Congress passed a $1.2 trillion dollar infrastructure bill late last year. The city does not know how much money it could receive from those funds. Some of the projects the city thought would qualify for ARPA funds could qualify for federal infrastructure money, she said.
Those city services that will be funded using ARPA funds include:
- $6 million to fund city social services department
- $750,000 for the Office of Homelessness and Intervention
- $350,000 for workforce development grants
- $200,000 for a grant program to help homeowners fix code enforcement
- $325,000 for LexArts
- $170,000 for NAMI, a nonprofit that supports mental health
- $200,000 for mental health court
Other capital projects the council gave initial approval include:
- $9.5 million for partial infrastructure installation at the nearly 200-acre Coldstream Park, a new industrial park off of Georgetown Road
- $2 million for the relocation of the Bluegrass Community and Technical College dental hygiene program to the Newtown Pike campus.
- $1 million to go toward the building of a new Village Branch library branch on Versailles Road
- $4 million to create a permanent home for the Lexington Farmers’ Market in the Davis Bottom area off of Oliver Lewis Way. (That funding depends on matching funds)
- $2.5 million to complete the upstairs renovation of the Pam Miller Downtown Arts Center on Main Street. The building is technically owned by the state. The potential renovation would not occur until the city owns the building. That’s still being worked out with the state.
- $1.2 million for various bicycle and trail improvement projects
- $3.1 million in fire department vehicles
- $1.5 million for police vehicle replacement
That would leave $1.6 million remaining in ARPA funds. That’s on top of $8 million the council has already set aside for administration of the grant, which will include additional staff, and some contingency for cost overruns.
Distillery District improvements, youth sports complex not off the table
Projects that won’t receive ARPA funds will be considered for funding in future budgets or could be paid for with surplus funds. Six months into the fiscal year, the city is projecting a $25 million surplus. It also has $25 million in another city savings account.
Some of those projects the council has placed on a list to be considered for funding from surplus funds include:
- $5 million for a LexArts master plan
- $2.5 million for pedestrian and lighting improvements in the Distillery District on Manchester Road
- $10 million for sidewalk and other improvements on Versailles Road
- $5.7 million for low-income households to winterize and switch to solar power
- $7.5 million for the Town Branch Park project
- $10 million for a potential sports complex that could include youth sports playing fields
- $1.5 million for tree canopy improvements
- $1 million for a new disc golf course
Complicating council debate on how to spend the funds over the past six months was ever-changing rules from the U.S. Department of Treasury on how ARPA funds could be spent.
During Thursday’s meeting, Vice Mayor Steve Kay asked the council to consider using surplus funds for the previously allocated $10 million for the affordable housing trust fund. Kay said the city has since learned the federal government will not allow money from federal coronavirus relief money to be used for affordable housing projects that receive tax credits. Any loans must be repaid by 2026, when all ARPA funds are to be spent.
That will severely hamper the city’s affordable housing program to leverage money to build more housing units, Kay said. The program gives both loans, which brings in revenue into the affordable housing program, and grants that do not have to be repaid.
“It will be a much higher cost per unit,” Kay said. Also, Kay argued the city will get fewer affordable housing units due to the limits on how the money can be used.
Others argued the city will continue to give $2 million per year to affordable housing in addition to the $10 million. City money could be used for tax credit projects and for loans.
“Other cities are spending their ARPA money on affordable housing projects,” said Councilman Richard Moloney.
The city has also already reported to the federal government the $10 million in ARPA funding was going toward affordable housing
Housing Advocacy and Community Development Commissioner Charlie Lanter said various housing groups across the country are pushing the federal government to make changes to the rules so communities can leverage other money, which would decrease per unit costs and up the number of affordable housing units.
The council ultimately voted to keep affordable housing in the ARPA program.
