Half of pandemic relief funds spent, Detroit must use the rest by 2026

Detroit has spent just over half of its $827 million pandemic relief fund, and the window has closed to budget the rest for any new programs. 

Chief Financial Officer Jay Rising briefed the City Council on Thursday about progress toward allocating and spending federal dollars from the American Rescue Plan Act (ARPA). Every penny must be obligated for specific contracts before the end of 2024 and spent by the end of 2026, or else be returned to the federal government. 

ARPA projects are set in stone, Rising said – 99% of the funding has been obligated. The council has no ability to create new initiatives. 

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The council approved roughly 350 contracts related to 100 projects. Before the end of the year, the council is tasked with approving contracts for roughly $40 million in affordable housing development loans and $4.7 million in various other contracts like electric vehicle charging stations, park improvements and community violence intervention grants.

Some City Council members wanted more input on how to use an unprecedented dump of one-time money to address needs in their districts and meet council priorities. Mayor Mike Duggan’s administration held public meetings during the COVID-19 pandemic and proposed 15 categories of projects, a plan that was approved by a previous version of the council.

Council Member Angela Whitfield-Calloway said each council member should’ve had discretion over a pool of ARPA dollars to address problems raised by residents in their districts. 

“Council really didn’t have a whole lot of input on those buckets (of funding),” Whitfield-Calloway said Thursday. “I wish I had more of a say-so in a small portion of those ARPA dollars to go to my district because I know exactly where the needs are. We are in direct contact with residents and you are not.”

Council Member Gabriela Santiago-Romero was disappointed to hear the body “lost the opportunity” to reconsider the city’s spending plan. 

“When there was an opportunity to reallocate we never got the flag to have a discussion to reallocate funding,” Santiago-Romero said. “I’m glad we’re not going to send any money back, but I think we had a missed opportunity to come together and reallocate funding to our priorities.” 

Ruth Johnson, public policy director for Community Development Advocates of Detroit, expressed concerns with a lack of ongoing community input once the 15 spending categories were decided. 

“My concern now is I hope we have not missed opportunities,” she told the council on Thursday. “I’m astounded and somewhat disappointed that we never had a category for affordable housing, given the significant and serious problem with affordable housing. The council passed two resolutions in support of the right to counsel law that has not been fully funded.” 

President Joe Biden signed ARPA into law in 2021, delivering $65 billion to local governments across the country. Detroit received the fifth-largest share of federal dollars, behind New York, Chicago, Los Angeles and Philadelphia. 

Spending has ramped up in the last six months. Some programs established with ARPA funds include blight remediation and demolition, Skills for Life job training, Renew Detroit home repair, basement flooding protection program, Community Health Corps, foreclosure prevention outreach and eviction defense, tree removal, alley cleanup, streetscape projects, the Joe Louis Greenway, recreation center upgrades and more.

“All good things must come to an end,” said Council Member Fred Durhal III. “This is one of the large sums our city has received and we’re looking at this list of very good programs that helped a lot of residents in our city.”

Federal guidelines allow surplus funds to be shifted between projects that were approved before the end of 2024. Rising said extra money from programs that finish under budget can be moved to fund programs that are more expensive than anticipated.

Council President Mary Sheffield said the body will have a role in deciding which programs will be boosted with surplus funding.

The city is exploring additional funding sources for some programs once ARPA funds are exhausted, including grants. If signed into law, a public safety trust fund would keep the city’s community violence intervention program running. General Fund dollars will be used to pay for some staff members hired with ARPA money, officials said. 

Sheffield asked whether President-elect Donald Trump could revoke pandemic funding once he takes office in January 2025. Rising said it’s unlikely, and the city could have legal remedies if Trump attempts it. 

“I can’t tell you what someone else might do,” Rising said. “We take every action we can and use legal counsel to advise us how to make this as strong as possible.”