|Date:||July 26, 2023|
By Hannah Gabelnick
Each week, PPG summarizes important takeaways from the major Buffalo Common Council meetings. We also include information from council meetings related to our Community Agenda items.
This week's summary includes the caucus meeting, regular meeting, and a special session meeting. We abbreviate “Council Member” as CM, "Council President" as CP, "Pro Temp" as PT, and "Majority Leader" as ML.
This week, the Common Council dealt with a proposed amendment to the City of Buffalo’s American Rescue Plan Act (ARPA) Spending Plan. The amendment proposed cutting $60 million of funding for community projects, including the Public Health Equity Initiative, Neighborhood Improvement Corps, Community Food Security, Frontline Arts Organizations Fund, and more. $50 million of that is to cover shortfalls in the city’s budget. The remaining $9.9 million is for council member requests to use American Rescue Plan (ARP) funds within their districts. However, PPG contends that moving $10 million of ARP funding to council member discretionary funds is not “revenue loss replacement,” and it should not be allocated in this way.
On July 24, 2023, the Partnership for the Public Good and several of our partners submitted a complaint to the Department of the Treasury Inspector General asking for an investigation into the allocation of City of Buffalo American Rescue Plan funds based on a growing body of evidence that this process was mismanaged and in violation of the federal procurement rules that the city was required to follow. You can read more about the situation in our press release and this Buffalo News article.
During the Caucus Meeting, the council revealed that a majority of the $9.9 million for council member requests would be given to the Department of Public Works (DPW). A representative from DPW said that if the ARPA amendment is approved, most of this money will be used on construction projects this season. A few CMs referred to the pushback on the ARPA amendment but they did not speak at length about it.
This week, the council was also took action on an agreement with the National Development Council (NDC) to administer a small business program with ARPA Funds. NDC was identified as the best organization for providing financial assistance to small businesses throughout Buffalo as a part of a request for applications process. NDC will work with the Buffalo Urban League and the Exchange at Beverly Gray to provide technical assistance to small businesses applying for the funding. In addition to $3.5 million of grants that will be divided among the nine council districts, small businesses can also apply for a loan from a $2 million loan fund from NDC.
During the Caucus Meeting, CP Pridgen was concerned that $300,000 of the $3.5 million grant fund would be used for administration costs to pay NDC and the partner organizations. He suggested that they find a way to pay for the administrative costs such that it is not taken out of the $3.5 million for small businesses. CM Nowakowski agreed, saying that they want as much money for small businesses as possible.
During the Regular Meeting, the council was fortunately able to acquire more funding for the small business assistance grant fund for a total of $4.3 million. This includes business grant financial assistance of $3.5 million to be divided equally amongst the nine council districts, technical assistance of $450,000, and program administration and marketing costs of $350,000. This would be supplemented with a separate optional loan fund of $2 million for grant recipients. Grant awards would predominantly be in the range of $5,000 to $50,000 per business with access to matching loan funds, and it would prioritize small businesses with less than 50 employees. Please note that while this agenda item was separate from the ARPA amendment, discussion about the two items was intertwined.
CM Wyatt, while frustrated by this ARP process, was very happy that they got more money for small businesses, especially now that they have secured separate funding for administrative costs so that more businesses can receive funding. He suggested hiring a city manager to help keep track of finances so that the city does not waste a single dollar. This is especially important to him because organizations are upset that they were supposed to receive a certain amount of funding but are no longer receiving it. He said that this is why there is such a distrust in government.
CM Rivera clarified that this small business support fund is not coming from any other organizations that were slated to get money, referring to the ARPA amendment. He said that in August 2021 the administration had a plan for spending the ARP money, but now, the 2023-2024 budget has a $30 million budget hole that needs to be covered in order to have a balanced budget, so they had to use some of the ARP money. He said, “That's the unfortunate reality of government. Priorities change, situations change, and we found ourselves having to make tough decisions. The recommendation from the administration was that we need to have a balanced budget, that we have to provide services. I want to make sure this money gets out to where it was intended to get. The longer we keep it here within our purview, I think the more chance there is to get further reductions. That's why we want to get the money out the door today, that’s why we’re voting on this today, because every quarter that goes by, more money goes to revenue replacement and less money to the organizations, that’s why we have to get this out of city hall to where it was intended to.”
CP Pridgen thanked the small businesses who came out and advocated for more funding to ensure equity for small businesses. He was very happy that in one day, the council was able to find more funding to cover the administrative costs, though he wishes there was a way to cut the administrative costs altogether. Then, referring to the ARPA amendment he said, “I want to be clear: this council did not make any promises, the council was not involved in any conversations. When I got the calls from some of the folks who were promised money, my answer was this: you gotta call where you were promised the money from.” He explained that creating the amendment was not the council’s responsibility, and if they wait any longer, the council will go into recess, the revenue gap will increase, and the city will take more money. He said, “We wanna get the money out to the people even if it’s a reduced amount unfortunately. This council did not sit here and start slashing and burning. We got a document that comes from downstairs [the Mayor’s administration] to us and this is what they said. I expect that those who sent us this document have notified those organizations of the cuts and why they’re cut because we approve or disapprove the document, but at this point if we don’t do it, it could be literally 2024 before any dime gets out to these organizations, and I don’t think we can wait that long. The businesses are suffering. Timing might not be the best, but at the end of the day, we’re getting more money out to these small businesses.”
CM Nowakowski said, “Almost half of the money that we have gotten from the federal government will be used to close a budget gap that we’ve had due to 16 years of not raising revenue. That’s a long time to not build a tax base, and revenue replacement is funds that go to pay the city’s bills. So, if we don’t pay the city’s bills, we’re gonna have to borrow money that we have to pay interest on. And if our credit rating fails, it’s going to be more expensive to borrow. These are serious budget gaps. Instead of placating the public and placating this Common Council, we have to come up with an actual plan of how we’re gonna fill these budget revenues.”
CM Golombek raised a concern that the request for applications required the small business program applicants to be located in the City of Buffalo. Corporation Counsel confirmed that this requirement also applied to businesses applying to facilitate the grant program, including NDC, Buffalo Urban League, and the Exchange at Beverly Gray, who were selected. Because NDC is located in NYC, this would make it ineligible to be a third party facilitator of the grant program. Corporation Counsel confirmed this and gave the council two options.
After a lengthy discussion about these options, the council did not feel comfortable taking a vote without learning more about the legal implications and talking to the organizations. Some CMs wondered if NDC would no longer want to supply the $2.2 million if they were not the lead facilitator. Others wondered if the third-party facilitator was even necessary, or if Buffalo Urban League or the Exchange at Beverly Gray would have the capacity to be the lead facilitator. CM Golombek was concerned that if the council’s process was not legal, the process could be struck down in court, and the small business funding could be held up.
The Common Council decided to move the item to a Special Session. CP Pridgen did not feel comfortable voting on the Annual Action Plan Amendment that would provide over $500,000 to Braymiller Market without voting on the Small Business Program. While the ARPA Amendment was a separate agenda item, the council also wanted to postpone voting on that. All three items were sent to the Committee of the Whole to be discussed at a special session.
In addition to lengthy discussions on these issues, the council also voted to adopt a request that the Mayor and the Administration consider an ARPA amendment that would create a gig workers assistance program, for those who were affected during COVID-19. Gig workers are independent contractors who typically engage in short-term work for multiple clients, such as Uber drivers or DoorDash delivery drivers, for their full-time jobs. CP Pridgen expressed his gratitude and support for this request because gig workers are a significant and vital workforce within the City of Buffalo. This item will be discussed further in the Finance Committee after the August recess.
The council approved a partnership between the Douglas Development Corporation and the Richardson Center Corporation to support redevelopment efforts at the Richardson Complex, a 42-acre parcel of land with at least 14 historic buildings. They intend to create multifamily housing, a commercial hotel and conference center, restaurants, retail facilities and commercial offices. The council also approved Douglas Development to develop former Public School #51 to restore the building and turn it into market rate apartments.
Last, CM Golombek raised a concern that the Buffalo Board of Education did not go through a “reapportionment” (more commonly known as redistricting) process after the 2020 Census. Federal law requires that after each decennial Census, each political entity, including Boards of Education, must redraw their districts based on the new population numbers. In 2022, the Buffalo Board of Education held an election using the same district map as 2010, violating federal law. This item will be discussed further in the Community Development Committee after the August recess and was also sent to the Law Department for further investigation.
During the Special Session meeting, the council received a letter from Corporation Counsel that said that the National Development Council (NDC) can be the primary third-party facilitator of the small business grant program.
The small business program includes $3.5 million of grants to be divided equally amongst the nine council districts. CM Wyatt suggested amending the item so that if there is money left over after small businesses apply for the grants, the remaining money will be left in its respective council district. CP Pridgen, CM Bollman, PT Scanlon, and CM Golombek agreed with this suggestion.
CP Pridgen requested a monthly report and timeline of the application process so that the council can understand when money will actually start being distributed to small businesses. He explained, “We have been informed by the corporation counsel’s summary that the actions of OSP are legal.” The council approved the agreement with NDC to administer the Small Business Program with $3.5 million ARPA funds as amended.
Next, the council approved the amendment to the American Rescue Plan Act (ARPA) Spending Plan, cutting $60 million of funding for community projects for revenue replacement. CM Rivera said that if they had gotten this money out two years ago, many of the organizations whose funding is being cut may have been able to receive the amount of funding that they were originally supposed to receive. He added, “Unfortunately years have gone by and we have used much of the ARP funds to cover our budget shortfalls. As a result of that, the administration has proposed to cut those agencies. That is why we want to get this money out the door. Every quarter that goes by, every year that goes by, there seems to be less money for these organizations. I don’t want the blame to lay on the foot of this council. We have asked for two years now to release this money, to send the budget amendments. I know those organizations are doing great work out in the community, and certainly those services are very important. At the same time, we have to deal with our budget shortfalls and the tough decisions we have to make here to keep the city operating, to keep the services going forward, so it’s a very difficult decision to reconcile those two things. We’re pleased today that it's getting out but certainly not pleased with the cuts that had to be made.”
CM Wyatt referred to a letter they got from the Partnership for the Public Good citing legal concerns with the ARP process. He said, “We would have liked this money to be out a long time ago and I am concerned about the transparency of the process.” CM Bollman said, “it is unfortunate that the pot for these community agencies got smaller and it’s a very difficult decision to make between community agencies who are doing great work and then you got to also balance the budget which could affect city services or put a further burden on our taxpayers if the budget is imbalance.”
Lastly, the council approved the Annual Action Plan amendment to provide $562,557 of funding to Braymiller Market. CP Pridgen remarked that this amendment is what inspired the council to get millions of dollars for small businesses in the community in addition to helping Braymiller Market.
The council will be on recess through August and will return Tuesday, September 5th with a full council meeting at 2pm.