• Both Laurens, Clinton due over $4 million
Laurens Mayor Nathan Senn and mayors from other small municipalities around the state are frustrated that American Relief Plan funds from the federal government are being held up at the state level.
Senn, who was recently elected to the Municipal Association of South Carolina Board of Mayors, said he was on a conference call Tuesday with other mayors who have been expecting the ARP funds for about two months but have not received them.
South Carolina Gov. Henry McMaster has not requested the around $4.4 billion earmarked for smaller municipalities with populations under 50,000. The other have of the $8.8 billion due to the state has been collected directly from the federal government by 17 larger municipalities such as Greenville, Spartanburg and Charleston, and each of the state’s 46 counties. Laurens County recently was notified that it will receive $13.1 million.
Senn said South Carolina is among only seven states that have not drawn down funds from the ARP, which means potential lost interest gains as well as falling behind on potential projects as other, larger cities move forward with theirs.
“Anybody who is a small government conservative ought to be outraged,” Senn said, noting that the federal statute outlining the distribution of ARP funds allows says the money should be distributed to the states within 60 days of passage of the law (March 11). It has taken nearly twice that amount of time with no clear indication as to when the money will be requested by the state. After the state secures the funds, it has 30 days by law to distribute them.
Once the funds become available, Laurens is slated to receive about $4.4 million, and Clinton is due about $4.2 million.
“There are a lot of questions going on at the state level,” said Clinton City Administrator Thomas Higgs. “There’s worry that the funds won’t be appropriated correctly and, more so, I think, on the back end where it needs to be recorded correctly and accounted for.”
To that end, McMaster and the Department of Administration has contracted with a private firm, Guidehouse Consulting, to oversee the distribution of funds to the smaller municipalities.
Under terms of the contract, Guidehouse is to be paid a percentage of each allocation as an administration fee and that money would come from the municipalities’ portions, Senn said.
Guidehouse would also hear and approve plans for expenditures from each of the municipalities, presumably to assure they adhere to federal ARP guidelines.
Senn, who is also a Laurens-based attorney, said he and the other mayors on Tuesday’s conference call question the legality of involving a third party in the distribution of ARP funds.
“I think it may warrant requesting an opinion from the (State) Attorney General,” Senn said. “The law said that the state cannot impose further restrictions on the money beyond that which the federal government has placed.
“I think contracting with that sort of trustee is an additional restriction because they can’t give the money to us within that 30-day time period if they’re saying they’re going to hold it back and you have to submit your projects to Guidehouse – and then and only then if Guidehouse deems that it fits within federal guidelines as some unaccountable third party, then you can get your money.”
He also said the third party is unnecessary because the federal law states that municipalities who do not properly spend the money within ARP guidelines will have to repay it to federal government.
Senn said he has also contacted members of the Local Delegation about the hold up. He also said the mayors on the conference call discussed the possibility of legal action against the state.
“It’s not about months or weeks,” he said. “It’s about days. Think about the amount of money we’re losing daily just in interest on $4.4 billion.”
ARP funds are designed to help municipalities and communities make infrastructure improvements but can also include capital projects.
Higgs said Clinton has been proactive in obtaining community block grants from the U.S. Department of Housing and Urban Development as well other state grants, but the expected $4.1 million will be a boon to the city.
“It’s going to relieve a lot of expenditures that are straining those grant funds,” he said. “We’ll able to get where we need to be a little faster. . . . Someone I saw described it as ‘FDR’s New Deal on steroids.’ That’s the best description I’ve heard.”