Santa Cruz County is fine-tuning when and how to begin disbursing some of the $9 million of American Rescue Plan (ARP) funds allocated by the State. The County received half the funds in 2021 and will receive the second half in 2022. Spending must be accomplished by 2024.
Angie Donelson, of Donelson Consulting, LLC, briefed the County Supervisors during a study session at their regular meeting on Dec. 7 on proposed fund distribution strategies for small businesses and nonprofits. Donelson’s strategy foocused on financial asset building to construct and preserve financial wealth to fall back on during times of stress. She highlighted industries who experienced higher unemployment and reduced capital because of the pandemic, which include logistics, produce, services, retail, artists, hospitality, construction, and entrepreneurs.
Donelson proposed allocating up to $500,000 for capacity grants, ranging from $25,000 to $45,000, for nonprofits, to be used to develop competencies, strategies, systems, and structures to improve organizational effectiveness. She also suggested allocating $1 million for business loans, forgivable loans up to $25,000 each, and grants to artists, up to $2,500. Proposed implementation would be late January through February 2022. The County also plans to create a reserve of $2million in the county budget for future emergencies.
Supervisor Manuel Ruiz suggested that Nogales and Patagonia be included in the County’s fund distribution. Supervisor Bracker explained to the PRT that the County would invite Nogales and Patagonia to utilize the County’s internal processes for grant and loan distribution; however, the funds would come from their allocations. The state previously allocated American Rescue Plan funds directly to Nogales ($4.7M) and Patagonia ($291,000).
The County also tentatively allocated $1 million of ARP funds to expand broadband infrastructure, contracting with consultant Jim Palmer of Community Broadband Advocates, LLC who specializes in bringing services to rural communities. Palmer spoke to the Board during the Call to the Public at their Board meeting on Dec. 7. He assessed county-wide broadband needs and said, “We reached out to carriers to give us some proposals of how they would address this.” Four carriers responded. He added that the cost came in much higher than anyone anticipated and noted that the project “perhaps will never get built unless there is an infusion of funding.”
Palmer reported that he and the County’s IT Director, Juan Balderas, concluded that, “the area that had no service and probably needed it the most is Patagonia, Sonoita and Elgin.” Palmer then pared down the scope of the project to fit within the funding and he sent another inquiry to the four carriers; responses were pending at time of the meeting. Palmer concluded to the Board, “Once we identify what the proposal will be and what carrier will fit that need, then we will proceed to work with that carrier with your support and apply for the grant funding and then proceed with building that out and providing service to an area of Santa Cruz County.”
County Manager Jennifer St. John recently stated that, “the AZ Commerce Authority will be the next grant we apply for in regards to broadband, but there are other grants we intend to apply for so that we can build our broadband infrastructure around the County. We are also working with private partners to potentially help fund some of the grant matches that may be required. The County plans to hold a study session the week of January 10 to discuss broadband in more detail…I am certain that our study session the week of the January 10 will have much more detail and more answers as to our overall plan.”
St. John is concerned that the final ruling from the U.S. Treasury outlining the details of how the funds may be used has yet to be issued. “The county is trying to balance the need to get this money out to the community versus the unknown of the details of how this money can be spent, so that’s why more exact timelines haven’t been provided,” St. John stated. She also mentioned that revenue replacement is another option for the funds. The County is hopeful that their road fund may qualify, especially important because the gas tax revenue decreased dramatically over the past 18 months.