Council votes to distribute first tranche of COVID grants
By Diana Haecker
In a special meeting of the Nome Common Council the panel decided on the distribution of the first tranche of Alaska CARES Act funds that were allocated to the City of Nome from the State of Alaska. The state distributes nearly $5.68 million to the City in three payments of $2.74 million, $1.47 million and $ 1.47 million. The first tranche of payments to the City has been made and the Council’s job was now to allocate the funds. The Council decided in prior meetings that some of the money should be used to upgrade city infrastructure but also to grant some of the funds to residents and businesses that experienced economic hardship due to the shutdown of the Nome economy during Iditarod time and subsequent months.
The current economic situation warranted a fast distribution of monies to Nome residents and businesses, the Council said.
In work session the Council last week narrowed down the mechanism of how to distribute the funds by utilizing the NSEDC model to disperse their energy assistance funds: via a simple sign up sheet and a NJUS utility credit.
After a lengthy discussion on how the money should reach those who need it the most, the Council went with city administration’s proposal to allocate $300,000 in utilities credits for businesses and non-profits, $275,000 in utilities credits for individual households and $25,000 in $300 checks for artists, carvers or other craftspersons.
The funds are grants and are not to be paid back.
Who qualifies? Businesses or non-profit organizations with less than 50 full time equivalent employees, a location within the city limits and in business as of January 1, 2020. Excluded are marijuana stores. How does it work? For businesses, it is expected those who did not suffer economic hardships refrain from applying to allow monies to be distributed to those businesses that suffered. Business owners and non-profits sign an application for grant assistance, declaring they were negatively impacted by loss of revenues or additional expenses to address the COVID-19 pandemic.
After long discussions on how to level the playing field for applicants, the council decided to leave it up to the City Manager and his staff to use discretion on granting or denying the applications. A $3,000 grant would then be applied to the businesses NJUS account.
The same mechanism would work for the individual applicants whose households would receive a $300 NJUS credit.
Artists, carvers or other craftspeople would have to also sign a declaration of financial hardship to receive upon approval a $300 check.
The remainder of the first round of AK CARES Act money would go to city employee salaries and benefits ($724,015); equipment upgrades including an aging phone system, distance delivery, personal protective equipment and touchless IT options, and the lion share of upgrades going to overdue overhaul of the Rec Center’s Ventilation ($703,580) and Heating systems (583,000).
The Council also gave City Manager Glenn Steckman the authority to reallocate funds up to $600,000 between line items and to prorate the amounts distributed to businesses and residents if necessary. For example, if less applicants than expected apply for a grant, the funds would then be redistributed. In this regard, Councilman Jerald Brown wanted to see estimates from businesses on their actual losses. The Council discussed how that data could be collected to give the panel a better idea of the actual COVID-19 damage to the economy. A motion to add the question of a dollar estimate of losses to the grant application failed.
Councilmember Mark Johnson said that the panel and administration would work on mechanisms on how to distribute the following two tranches of the CARES Act funds once the arrive in Nome. For now, the artisan grants and the NJUS energy credits are decided on.
This was the first meeting held under the leadership of Interim Mayor John Handeland, who was sworn in as the first agenda item. City Manager Glenn Steckman participated via phone as he left Nome last Friday for a long-awaited vacation.