Prince William County is set to receive $92 million in direct federal funding through the American Rescue Plan Act earmarked for COVID-19 relief. The question now is, what will they do with it?
The American Rescue Plan Act was signed into law on March 11. The $1.9 trillion stimulus package will provide more than $350 billion of new COVID-19 relief directly to state, local and tribal governments.
County Finance Director Michelle Attreed gave an update to the Prince William Board of County Supervisors Tuesday, April 13, about the impending funds being sent to the county. The funding will come in two $46 million tranches – the first in May 2021 and the second in May 2022.
Unlike the CARES Act, Attreed said the county can use American Rescue Plan Act funds to replace lost county revenues incurred due to the pandemic.
In Prince William, several county revenue streams were heavily impacted by the pandemic including the county’s transient occupancy tax, or hotel tax, and agency revenue streams, such as fees for services associated with parks, recreation and tourism programs.
It’s still too early, however, for county officials to know how much lost revenue is eligible to be replaced by the federal funding, Attreed said.
Attreed said the county will need to spend the $92 million by Dec. 31, 2024. Because of the deadline, the finance department is recommending using the money to fund one-time expenditures that will not require an ongoing financial commitment.
It is not yet known whether the funds can replace county tax revenues in the budget.
“Are there things in our current budget that could be funded by ARPA? Perhaps. Or perhaps it's new capital projects that aren't yet funded,” Attreed said.
At-large Chair Ann Wheeler (D) said she is in favor of looking at ways to use those funds for certain capital improvements projects. Capital projects are funded through debt payments that are factored into the budget annually. Some projects, like a proposed new homeless shelter in Woodbridge, may be eligible for American Rescue Plan Act funding, Attreed said.
“There are certainly structural things we can do with the money that actually might effectuate long-term change in the county [such as] capital projects that will make a real difference in people's lives,” Wheeler said.
Supervisors Yesli Vega, R-Coles, and Pete Candland, R-Gainesville, asked whether the funds could be used to reduce the county’s proposed real estate tax rate. Attreed replied the county would not recommend using the funds for that purpose.
“Once you cut a tax rate, it's not sustainable unless you have an ongoing source of revenue to support that. So, I would not recommend that you use this funding to reduce the tax rate,” Attreed said.
Candland said the board needs to be very careful in how it plans to spend the money. Candland, who has served on the board since 2012, said the funds coming into the county via the American Rescue Plan Act represent the largest one-time infusion of money coming to the county in recent memory.
“We've got a very unique opportunity here,” Candland said. “... I think we have an opportunity to make some investments that we wouldn't have the opportunity to if these [funds] weren't there.”
Reach Daniel Berti at email@example.com