“Not happy” was how Borough Manager Jeff Good described his mood last week when he received word that Wrangell was left off the list of Alaska communities sharing in $27 million in the final round of federal pandemic assistance funding.
Wrangell was not alone in receiving nothing. Juneau, Sitka and Anchorage also came up empty. The funding formula was based on federal acreage within each borough, with population and economic conditions, such as poverty levels and unemployment, factoring into the formula.
“I think Treasury got it wrong,” Nils Andreassen, executive director of the Alaska Municipal League, said of the U.S. Treasury Department allocations.
The American Rescue Plan Act of 2021 appropriated $2 billion for fiscal years 2022 and 2023 to provide additional payments to eligible counties nationwide — which, in Alaska, are boroughs — and eligible tribal governments “for use on any governmental purpose” except lobbying. It’s the last batch of federal aid payments that started in 2020.
The money comes without any of the limitations that governed much of previous federal relief payments to states and municipalities during the pandemic. “Under this program, recipients have broad discretion on uses of funds, similar to the ways in which they may use funds generated from their own revenue sources,” the Treasury Department website says.
The Kenai Peninsula Borough is on the list for $6 million over the two years; the Ketchikan Gateway Borough’s allocation is $4.1 million; the Kodiak borough will receive almost $2.4 million; with $1 million for the Petersburg borough and $621,000 for the Haines borough.
Andreassen thinks maybe the Treasury Department was confused about the borough designation in Alaska. The communities left off the list are all incorporated as “city and borough,” not simply borough. And Anchorage goes by “municipality” in its name, not borough.
The allocation decision, however, was not consistent. The City and Borough of Yakutat received $211,000.
There are additional examples of similar inconsistency nationwide, he said.
Andreassen said he hopes the Treasury Department will be willing to redo its allocations in Alaska, though he noted that giving money to the communities left off the list could mean taking some away from others since the national pot of money is limited.
Andreassen estimated that the $27 million allocated for Alaska boroughs would more than double if the missing communities are added to the list, along with unorganized areas in the state. He acknowledged, however, that adding the unorganized areas of the state that are not part of a borough and do not provide services could be more difficult.
The municipal organization is working with Alaska’s congressional delegation and the National Association of Counties to convince Treasury to correct the mistake, Andreassen said. “I think there should be some high-level attention to this,” he said in an email to municipal officials last week.
“This isn’t a fair outcome and we would strongly encourage federal legislation or action to remediate the situation,” he said in the email.
Of the $2 billion, the Treasury Department will distribute $750 million a year to municipalities nationwide for each of the two years, and $250 million each year to tribes nationwide.
The department’s website defines eligible municipalities as “any county, parish or borough that is independent of any other unit of local government, and that is the principal provider of government services for the area within its jurisdiction.” That appears to apply to Wrangell.
Good said he is talking with the Alaska Municipal League “to figure out what is going on,” adding that it is unfair for Petersburg to receive $1 million and Wrangell nothing. Both municipalities are surrounded by federal land and both receive payments in lieu of taxes on federal acreage in the Tongass National Forest that is within borough boundaries, a similar criteria to the pandemic aid allocation.
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