As local leaders start to think about deploying American Rescue Plan funds in their communities, we wanted to share principles that we believe can help Ohio’s legacy cities and communities fully benefit from these dollars. These principles are based on the great thinking of local leaders, national thought leaders, and our own research and work in legacy communities across Ohio.
Slow down the spending, speed up the planning. Cities have until December 31, 2024 to spend their ARP funds. Spending a few months planning the use of those dollars will pay dividends for years to come.
Think about ARP money in three buckets: Dig out of the COVID hole; stabilize; invest in the future. Hat tip to a number of other thinkers who also thinking roughly in these categories (Brookings, New Localism, Enterprise).
Use ARP to begin rectifying inequities. ARP offers the opportunity to invest heavily in residents and neighborhoods that have been marginalized or under-invested. Beyond the local allocations, there are other ARPA “funding pots” that can be utilized to help communities pursue more equitable outcomes, such as the EDA Economic Adjustment Assistance, Child Care Stabilization Funds, or EPA grants for pollution in low-income communities.
Plug ARP funds into existing plans to achieve the community’s vision faster than had been expected. Quantitatively and qualitatively, the strongest performing cities in Ohio have visions; they bend new funds to their needs. They do not change course every time new funding opportunities appear. Sometimes, this means working within an inch of program noncompliance to achieve the desired outcomes.
Always ask—to what end are we making this investment? Does it advance a strategic community priority? Pet projects of city council members or local nonprofits may or may not always help advance a community priority. Think critically on whether former ways of doing things need to be the way they are done in the future.
Be aware of the limits of one-time money. ARP funds must be spent by December 31, 2024. Avoid hiring new staff that will have to be laid off in 3 years unless there is a plan to keep the program sustainable in the long term.
One-time money should go into programs that become self-sustaining through debt repayment or by attracting private/nonprofit/philanthropic capital. Think about seeding revolving loan funds, credit enhancement tools, risk-mitigation tools like loan loss reserve funds. Our friends at CDFA and NDC have lots of good examples and ideas for creating financial tools for a range of common community priorities.
Be transparent about how the money will be used and how funding decisions were made. Tying funding decisions to clear community priorities and community plans make it easier for everyone to understand why some programs or ideas are funded and others are not. Clearly spell out how funding decisions are in support of a community priority to limit confusion.
Invest in existing places. Ohio has hundreds of cities and villages with historic architecture, solid homes, and walkable neighborhoods. Many of these places are older and may need repairs. Invest in broadband, sewer/water, streetscaping of existing places to keep them vibrant for existing residents and potential new residents. Limit (ideally, avoid) investing in new development that will add to long term maintenance costs. Strong Towns makes the case here.
Assign a city project manager or multi-sector team to help cities tap every available dollar, coordinate resources, and avoid redundancy.
Collaborate. Get input from all sectors, get input from historically marginalized voices. Communities have the opportunity come back from COVID stronger and more equitable than before if they work together. Talking across sectors and stakeholders (like schools, hospitals, etc.) can help cities surface a range of diverse, strategic, projects that can utilize other pots of ARP funds besides the local allocations. Collaboration can also lead to leveraged or matching dollars from other sources.