NASHVILLE - Hamilton County, the city of Chattanooga and the county's nine other municipalities can expect to see a combined $10.06 million in one-time funds courtesy of a Local Government Support Grants program created by Gov. Bill Lee and state legislators in an effort to address losses from the ongoing coronavirus pandemic.
The money is part of a $210.43 million pot getting divvied up among the state's 95 counties and 345 municipalities as the result of a decision by Lee and lawmakers to double a previously approved $100 million infrastructure grant fund for local governments.
As a result of the increase, Hamilton County government, which is getting the largest amount in the county, will see nearly $4.17 million. The city of Chattanooga comes in a close second at $4.01 million, with East Ridge ranking No. 3 with $493,968.
Soddy-Daisy is slated to receive $332,714, while Red Bank will see $289,636, closely followed by Collegedale with $283,610. The fund is providing Signal Mountain with $219,060. Walden gets $77,270, while Lookout Mountain will see $71,180. That's followed by $71,026 for Lakesite and $39,534 for Ridgeside.
The goal is providing local governments some financial relief in light of lost tax revenues due to the coronavirus pandemic, which prompted weekslong closures of many businesses while also resulting in new COVID-19-related spending.
Gone are the original provisions restricting use of the money solely for infrastructure needs such as road, building construction or repair and vehicle replacement. Local governments can use it for any purpose, including recurring programs.
Grant amounts are largely based on population. Towns, cities and counties will see the money by July 31, said Lola Potter, spokeswoman for the state Department of Finance and Administration.
The program was created despite massive cuts in the state's own budget.
Not just for infrastructure
Senate Finance Committee Chairman Bo Watson, R-Hixson, noted that "originally the governor had proposed the grant program for local governments to use for infrastructure."
But when lawmakers returned to the Capitol on June 1 and began "considering the budget and putting our fingerprints on it, we just decided that unlike the federal government had restricted our hands with the CARES Act money, we did not want to do the same thing with local government," Watson said.
Watson and fellow Republicans have bristled under spending restrictions in Congress' Coronavirus Aid, Relief, and Economic Security (CARES) Act, which is providing some $3.66 billion in aid to Tennessee.
"So we elected to just eliminate an application process and not tell local governments how they needed to spend the money because we decided they probably knew better than we did how they needed to spend their resources," Watson said. "Local people are elected by the same people who elect us and we expect them to be held accountable to their electorate in the same way we are."
That includes allowing local governments to put the funds toward recurring expenses if that's what they decide is necessary to weather the financial crisis.
Moreover, Watson said, "we would ask the same thing [flexibility] from our federal friends, that they loosen the directives so we can address some of the shortfalls in our state and local budgets."
Finance spokeswoman Potter said local governments will be audited on the use of the funds.
While Lee had asked to double the grant program to $200 million, it increased to the $210.43 million figure after House Republicans snatched $10.3 million of the funds designated for the state's three largest governments - Shelby County, the city of Memphis and Metro Nashville.
Largely rural Republicans argued that was justified since the governments were getting huge amounts of CARES Act funding. Democrats countered the federal funding was tightly restricted in how it could be spent. Republican senators trimmed the House GOP's original proposal to the $10.3 million figure.
How to use it
While Hamilton County Mayor Jim Coppinger and his spokesman didn't respond to Times Free Press inquiries last week on how the county intends to use its grant money, several local towns and cities did.
The cities of Chattanooga and East Ridge, as well as the town of Signal Mountain, are sticking with their original plans to put the money toward infrastructure and related one-time expense needs.
Chattanooga intends to use its $4.01 million allotment on road infrastructure and vehicle fleet replacement with $1,734,641 going toward paving and $2,279,975 designated for replacing aging vehicles.
"In a year where we're seeing lost revenues in Chattanooga and across Tennessee, we're grateful that funds were made available by the state so we can continue to provide services at the level our residents deserve," said Chief Operating Officer Maura Sullivan.
State Rep. Esther Helton, R-East Ridge, who is also the vice mayor of East Ridge, said, "we're really excited about the $493,000. We're going to use that on IT hardware and we're going to place some laptops in police cars."
Other plans, Helton said, call for paving projects and capital improvements including access improvements under the Americans with Disabilities Act for City Hall.
"It's already accessible, but we're going to move that to the front of the building," Helton said.
Another project: Improvements of the city's Fire and Police Station No. 1 building with plans including new flooring, painting and improved restrooms.
The town of Signal Mountain's share is budgeted for paving projects and replacing radios for the fire and police departments, also allowable uses under the original grant program.
Town Manager Boyd Veal said the town would have budgeted the same amounts for those expenditures if it had not received the funds from the state grant.
"I think that was the intent, being an assistance grant, to help us do things we normally would be doing - which it certainly does," Veal said. "Without those funds, the budget would ultimately look different. We're projecting as of now that we'll put a little bit of money into fund balance.
"Without that grant, we would be taking money out of fund balance if we funded everything that's in the budget. It helped us do everything we need to do without reducing fund balance," Veal added.
Bridgett Raper with the Small Cities Coalition of Hamilton County, which represents other towns and cities in the county, said "most cities were planning to use their grants for road projects that were removed from next year's budget. However, with the legislators' recent change in restrictions, that could possibly change."
Contact Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow him on Twitter @AndySher1. Times Free Press reporter Emily Crisman contributed to this story and can be contacted at ecrisman@timesfreepress.com.