OPINION: Anchorage pads payroll at the expense of the public
Forty. Nine. Million. Dollars.
According to a state summary of CARES Act relief fund spending, that is how much the Municipality of Anchorage has dedicated to payroll, or nearly one-third of the $156 million it was allocated to mitigate the devastating economic impacts of pandemic-related business closures and job losses.
Meanwhile, on Nov. 13 the muni announced that the $20 million it set aside for rent and mortgage assistance has been exhausted.
On Oct. 1, the muni likewise announced that it received more applications than it had available for a $6 million small business relief fund and had to make awards based on a random draw.
To be clear, these payroll costs are not increases over what has already been budgeted for 2020 from existing funds. The Anchorage Assembly is taking advantage of a perceived loophole in the Treasury Department guidance for spending CARES funds that allows the municipality to presume every dollar of payroll for first responders through the end of the year is related to COVID-19 despite the obvious fact they are not.
In an Aug. 10 email to the Assembly, a week into former Mayor Ethan Berkowitz’s month-long “reset” that closed bars and restaurants to indoor service without any relief available, Chief of Staff Jason Bockenstedt wrote regarding what was then a $21 million allocation to first responder payroll that “This is NOT an increase to either of these departments. These costs may be presumed to be related to COVID-19 for the entire period that the Title V CARES Act provisions are in effect, or from March 1, 2020 through December 30, 2020.”
Since then, the Treasury Department also told the municipality that spending CARES funds as previously proposed to purchase various properties to provide homeless services was questionable at best. By dedicating additional money to payroll, the municipality may use its own unrestricted funds to purchase the properties.
Time, like the days, is shrinking to provide the necessary economic relief that threatens thousands of lives and livelihoods across Anchorage as cases increase, more people stay home and the threat of additional restrictions looms.
The Assembly is now nearly out of financial tools to address those needs thanks to its ill-thought out plan to pounce on the opportunity to use CARES Act money to deal with the long-standing problem of homelessness. Dedicating more to the payroll budget than to economic and rent relief combined is an unconscionable dereliction of duty.
And to be sure, helping the homeless is necessary, but the muni also has a funding source through the alcohol retail tax set to take effect on Jan. 1, 2021.
The premise of the alcohol tax is to use the hospitality industry as the muni’s piggy bank to pay for those services, but whether that anticipated revenue matches expectations sort of depends on the hospitality industry surviving this economic crisis.
The muni, through the Assembly, is stuffing its own coffers instead.
Andrew Jensen can be reached at [email protected].