By Tom Travis
As part of the federal coronavirus stimulus bill, The American Rescue Plan (ARP), the City of Flint will receive an estimated $99.33 million. The sweeping ARP $1.9-trillion measure also includes support for small businesses, schools, counties and states. Flint households are projected to get more than $125 million in direct benefits, according to Flint Mayor Sheldon Neeley.
In a recent city council meeting, City of Flint Chief Financial Officer (CFO) Shelbi Frayer explained that the $99.33 million is to be spent over a four-year period with two disbursements. The first disbursement will happen in 60 days and the second payment will happen in two years.
“We will continue to make sure that residents have access to good, accurate information and have an opportunity to have their voices heard,” Mayor Neeley said. “This funding is a game-changer for our community so it is important that we hear from residents before making final decisions about our priorities.”
Community-wide update on YouTube
Mayor Sheldon Neeley hosted a communitywide update Wednesday to share additional information with residents about the $99 million in federal funding the City of Flint expects to receive through the American Rescue Plan Act.
How residents can share their thoughts and ideas on how to spend the ARP $99 million
Residents can weigh in with their thoughts in many ways.
Vote in this poll: surveymonkey.com/r/
Send an email to firstname.lastname@example.org
Mail comments to: City of Flint Budget Input, 1101 S. Saginaw St. Room 203, Flint, Michigan 48502
Write comments and drop them off at Flint City Hall in the red drop box outside
Call (810) 237-2000. All callers will be asked to leave a message with their comments, which will be transcribed and included in reports with other submitted comments.
$99 million cannot be used to pay pension and legacy costs
In the community update, the city’s Chief Financial Officer Shelbi Frayer said the $99 million could not be used to pay down the city’s pension and legacy costs. EVM has reported on the FY2022 and 2023 city budgets, explaining that large increases to the city’s pension system are draining the General Fund. A March 2021 press release from the City of Flint stated, “Last year’s budget projected a $12-million deficit for the FY22 budget. Through the City‘s operational audit, that $12 million gap was closed and the mayor presented a balanced budget.
“Emergency managers failed to truly fix the City‘s finances because they never addressed these known legacy costs — and at the same time they created a false sense of security by raiding the Water & Sewer funds and taking out loans that the city still is paying back,” Neeley asserted in the press release.
EVM reported in April 2021 on the continuing financial quagmire for the City of Flint to find a way to pay for the mounting pension and legacy costs.
According to the proposed budget, as way of explanation to the large increases that are draining the city’s General Fund, “The City of Flint is responsible for making employer contributions to ensure adequate funding for the City’s Pension and retiree health care commitments. Beginning in FY2021, the pension‐based employer contributions greatly accelerated by almost 40 percent in one year from $24 million a year to over $33 million a year.
“After a one‐year pause in FY2020, this figure will again increase to $39 million and then remain at that level for many years. The reason for this huge increase is that the Flint pension has been paying out more than $50 million a year and simply did not earn enough money through employer contributions or investment increases and was facing a steadily decreasing asset base.
“These overall costs and cost increases are largely borne by the General Fund, and to a lesser extent by the Water and Sewer funds. This remains as one of the most important budget challenges for the city government.”
U.S. Representative Dan Kildee joins Neeley in community update about $99 million
Mayor Neeley was joined in his update by U.S. Rep. Dan Kildee, who shared additional information about the American Rescue Plan during the community update.
Mayor Neeley outlined what he called five main pillars of funding possibilities: public Safety, blight elimination, job creation, infrastructure and owner-occupied home rehab and repairs. He asked for additional community input to help the city set priorities for the funding.
The American Rescue Plan Act also provides separate dollars for COVID vaccines and testing; mortgage, rental and utility assistance; expanded health care coverage as well as stimulus checks and tax credits for families, Neeley said.
EVM Managing Editor Tom Travis can be reached at email@example.com.