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Municipal use of COVID relief funds for shelters contested after meeting with US Treasury

 Anchorage City Hall
Anchorage City Hall (KTUU)
Published: Aug. 12, 2020 at 5:24 PM AKDT
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ANCHORAGE, Alaska (KTUU) - Coronavirus relief funds allocated in an assembly ordinance have come into question after the U.S. Department of the Treasury Office of Inspector General received several complaints about the plan.

Municipal officials met with representatives from the OIG Tuesday to discuss the proposed uses of the funds, specifically as it relates to the purchase of three buildings outlined in the ordinance.

“[They] did have concerns specifically concerns about whether or not the buildings we purchased need to be temporary or not,” Municipal Attorney Kate Vogel said.

Jason Bockenstedt, chief of staff for Mayor Ethan Berkowitz, said they will ask the Assembly to continue moving forward with the plan for the funds, but he expects several amendments may be needed to clarify that no money will be spent until the Treasury Department has decided on what is eligible.

“If word comes back that these are all eligible, we will move forward and fund those,” Bockenstedt said. “If not then we will be required to bring a different proposal back in front of the Assembly to spend that funding in a different way.”

The Assembly voted to pass AO 2020-66 Tuesday night, which authorized the purchase of four Anchorage buildings for substance use disorder treatment or as shelters for those without homes. Three of those buildings would be funded using Coronavirus Relief Funds. The Municipality is planning to set up a meeting with the Treasury Department to determine if relief funds can be allocated to permanent shelters.

Bockenstedt said the buildings are in line with the Municipality’s interpretation of how the funds should be used. Because of COVID-19 and the need to put at least 6 feet of distance between people, the Municipality’s health emergency shelter providers have lost around half of their beds.

“The question still remains if Treasury deems this ineligible, what do we do with individuals that, because of COVID and the direct impact that COVID has had on our shelters, what do we do with these individuals,” Bockenstedt said.

Vogel said the OIG was not able to offer a determination, but that the Municipality could seek a private ruling on this issue. She said that meeting should happen before the Dec. 30 deadline to spend the funding.

Several Anchorage Assembly members were also a part of the call with OIG, but they say OIG believes the property purchases would not be eligible for use of Coronavirus Relief Funds.

“The next immediate step is to request policy guidance directly from Treasury, the final decision maker on allowable uses,” Assembly Chair Felix Rivera said in a statement. “While I am disappointed in the conversation today, I remain hopeful that further discussions with Treasury will resolve this issue. Regardless, we must never stop making progress to assist our houseless population.”

Another Assembly member, Jamie Allard, posted on Facebook saying, “I look forward to partnering together with my fellow Assembly members to get back to the drawing board.”

If the Treasury Department decides the purchase of the three buildings for homeless shelters are ineligible, the Municipality will have to come up with a new plan to spend relief money.

The Anchorage Assembly is meeting again Wednesday night to continue Tuesday night’s agenda, including public hearing on a resolution establishing the priority areas and framework for allocation of COVID-19 relief funds.

Copyright 2020 KTUU. All rights reserved.

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