This special edition of our council summary series focuses on recent discussions about the City of Buffalo’s American Rescue Plan (ARP) funds.

Common council meetings for the end of 2024 were dominated by the federal government’s looming deadline for American Rescue Plan (ARP) funds. Cities had until December 31st to either spend or commit all of their allotted funds. For context, The federal government sent out one-time ARP funding back in 2021 to help municipalities deal with the impacts of COVID-19. For example, many municipalities didn’t receive as much sales tax revenue in 2020 as they would in prior years due to COVID, so the ARP funds could help fill those budget gaps. The funds were also earmarked for use in communities hit especially hard by COVID, to address systemic inequities.

Originally, the plan was for the city to use about a third of the money to make up for lost tax revenue, overtime pay, and unexpected budget shortfalls caused by the pandemic. The rest, over $200 million, was to be spent throughout Buffalo, for:

• projects, like building affordable housing or replacing sewer lines with lead in them
• emergency assistance, like cash to households without enough food
• community services, like job training, violence prevention, and support for cultural institutions

As the years rolled on, however, the money only made its way out slowly, and more and more money was swept into “revenue replacement.” Instead of going out into the community, the funds were put into the city’s own general fund.

Each time this happened, the mayor’s office had to file an amended plan with the common council, and each time, the council approved. However, this month, when city representatives came before the council with their final proposed amendment to the spending plan, some council members balked.

The suggested plan would leave several organizations unfunded despite having complied with all the city’s requests and being told by the city they would get money. The plan also did not account for the $16-$20 million the city has earned in interest while waiting to spend the ARP funds.

The plan would require some legal gymnastics too. The city would have to explain the fact that instead of spending $11 million to help residents with water bills as the council had approved, Buffalo Water had spent that money on infrastructure projects. This illegitimate use of federal funds, however, could be justified if the council went back and retroactively changed the spending plan. Still, opined Council Member Rivera, “It’s like violating the law, and then changing the law to make it fit what you want.”

Council members spoke about how slow and opaque the whole process had been and said they wished more of the money had made its way out to community groups. Niagara District representative David Rivera noted that it was hard to trust the Department of Administration and Finance; the department said that they had run the process by a team of auditors–who apparently charged nothing and didn’t leave any written record of having seen the proposal.

Another proposal coming from the mayor’s office asked the Council to approve of the use of $2.5 million to help property owners with tax bill arrears. Eligible residents would not need to apply. The city would figure out who was eligible and just adjust their bills. University District Representative Rasheed Wyatt asked for an investigation into the whole process. One meeting was paused for an hour as council members left council chambers to make sure community organizations would get the money they needed. Ultimately, however, the council approved the amendments on December 23, with only Majority Leader Halton-Pope, Council Member Wyatt, and Council Member Rivera voting against the proposal to shift money away from community organizations and into the general fund.

That wasn’t the end of things, it turned out.  A week later, on the cusp of the new year, the council reconvened. Along with the remaining $17 million in the ARP budget, the city had swept up about $2 million in funds that had already been legally contracted to groups in the community. This time, the acting mayor himself came before the council to ask for their votes and to apologize for the poor arithmetic that had somehow snuck by everyone. 

At this same meeting, council members pressed Acting Mayor Scanlon about organizations, including Ujima Theater Company and the King Urban Life Center, that felt misled and misused by the application process. The terrible process, Council Member Rivera noted, raised his suspicions because the more contracts that the city failed to execute, the more money that would simply end up as revenue replacement. City project managers, in other words, had had an incentive to drag their feet. Acting Mayor Scanlon guaranteed that he would find money to fund the organizations in the new year. He didn’t know where the money would come from, he said, but he promised, “You have my word. We will get those organizations their money.”