Relief funds still helping city’s recovery, 2023 budget shows
Before City Council meets this Thursday to approve the $3.4 billion budget for fiscal year 2023, a business session and public hearing at 2 p.m. on Tuesday will give citizens one more opportunity to make their To hear.
Council members will discuss, among other things, how to use the $75 million given to the city in CPS Energy’s annual revenue split, which this year rose from $361.2 million to $430 million, thanks to extreme summer weather and rising energy costs.
Meanwhile, the $1.51 billion General Fund budget for 2023 will include $195.5 million in American Rescue Plan Act (ARPA) funds drawn from the $326,919,408 in state and local stimulus funds. received by the city.
Of the $195.5 million, $119.9 million will be distributed to nonprofits, small businesses, arts organizations, and San Antonio housing and infrastructure projects; $29.6 million will cover lost revenue from the hotel occupancy tax fund and the general fund; $26.4 million will be used to fund Metro Health’s ongoing response to COVID-19; and $19.6 million will go to airport operations and capital projects.
Click here for a deeper dive into the city’s use of federal coronavirus aid. Since April 2020, the city has received more than $1.2 billion in federal and state relief funds, while it has lost nearly $1 billion in projected revenue over the same period.
By the end of the month, the city will have spent $852.17 million of that $1.2 billion. The 2023 budget is expected to include an additional $195.5 million, leaving $162.3 million to spend in fiscal years 2024 and 2025.
Budget articles and columns have bored most readers, but like school board elections, budgets matter a lot and, in this case, pandemic relief funds have proven to be, quite literally, a lifeline. Without such funding, San Antonio and every other city (and county) in the United States would have fallen off a fiscal cliff and descended into deep unemployment and recession.
Yet one complaint I hear with increasing frequency is that the $5 trillion in federal COVID-19 relief and recovery funding ($3.9 trillion under the Trump administration and $1.9 trillion dollars under the Biden administration) distributed to states, cities and counties were excessive and unnecessary and contributed to the inflationary economy. People complain about the growing federal deficit.
The complaints are legitimate if the target is the $800 billion Paycheck Protection Program (PPP), approved by Congress and the Trump administration and operated by the US Small Business Administration. According to the Department of Justice and other federal investigative agencies, billionaires, dishonest business owners and outright con artists have embezzled tens of billions of dollars in loans from the program. Most of these loans have been cancelled.
A total of 1,500 people or entities have been criminally charged and 450 people have been convicted. A staggering 39,000 PPP fraud cases are under investigation, according to The New York Times. Bexar County businesses have received more than $2.3 billion in P3 funds intended to protect jobs and prevent small businesses from going bankrupt.
People who make false statements face legal action, but do not expect most of their ill-gotten gains to be recovered.
The so-called PPP relied on the honor system, which, in retrospect, may be one of the most ridiculously naïve federal government decisions in memory. The US Treasury Department, on the other hand, has implemented much stricter guidelines controlling how local government entities allocate ARPA funds.
The city’s allocation of ARPA funds was preceded by numerous public meetings, council workshops, and opportunities for online outreach and feedback. Allocations were made carefully to avoid future budget years with funding shortfalls.
Bexar County has yet to allocate all of its ARPA funding, but the municipal process has been conducted transparently and without political interference. The city’s most vulnerable citizens, who have suffered the most during the pandemic, will be the primary beneficiaries of ARPA-funded programs and projects.
It is as it should be. Too many people took advantage of the pandemic to pocket federal relief funds they neither needed nor deserved.