September 19, 2020

Mallory Herrmann
Staff Reporter

The city council voted at a special session this week to approve a disbursement process for CARES Act funding.

Lee’s Summit was assigned about $5.9 million in funding by Jackson County in June. Those dollars were made available through the Coronavirus Aid, Relief, and Economic Security Act, a federal economic stimulus tool approved by Congress. The funds must meet specific eligibility requirements related to the impact of the COVID-19, including medical, public health and economic support expenses.

Of the $5,921,527 available to Lee’s Summit, more than half (nearly $3.5 million) will help cover city expenses for communication of public health orders, acquisition and distribution of PPE (personal protective equipment), disinfection of public areas and facilities, and other public safety measures.

Other funding is earmarked for public health payroll expenses, compliance with public health measures like telework capabilities, and emergency medical response expenses.

$560,000 was set aside as grant funding for small businesses and nonprofit organizations who have faced business interruption due to the pandemic.

Nonprofit Funding Assistance
City staff reviewed 15 applications from local nonprofit organizations requesting a total of about $624,000. They recommended approval of $335,000 total funding across 13 organizations.

The organizations recommended for funding had to show a clear and specific correlation between the use of funds and the impact of COVID-19, as well as the number of Lee’s Summit citizens or businesses that benefit from their services, among other criteria.

The funding will function as a reimbursement toward costs already incurred by organizations. Those organizations who receive CARES Act funding will be responsible for providing documentation of those eligible expenses should the city be audited.

Councilmembers Bob Johnson and Andrew Felker cited potential conflicts of interest in connection with one or more of the organizations; they recused themselves from the discussion and vote, leaving the dais at the start of the agenda item. The remaining councilmembers voted unanimously to approve the funding allocations.

Small Business Support
Velocity Lee’s Summit, Inc. will disburse an additional $225,000 in CARES Act funding to eligible small businesses on behalf of the city. Velocity, a nonprofit economic development agency, will serve as a third-party administrator for disbursing grants of up to $5,000. Again, organizations who receive CARES Act funding will be responsible for providing documentation of those eligible expenses.

But some councilmembers worried that it wasn’t clear enough how exactly that third-party relationship would function.

Councilmember Andrew Felker wondered how the dots would be connected once funding leaves the city’s hands and how to ensure accountability and compliance with the CARES Act requirements.

“It seems like we’re releasing funds and then it’s in Velocity’s hands going forward,” Felker said.

Steve Arbo, city manager, likened the agreement to the many CIDs (community improvement districts) throughout the city, which are not driven by the city but which spend public money and are subject to audit.

Councilmember Hillary Shields pointed out that the agreement doesn’t specifically reference small business grants. She said that an agreement with another vendor for services such as repaving roads would at least mention the construction work they would be doing.

“I just don’t like that I’m voting on basically a contract with an organization that doesn’t spell out anything about what that organization’s being expected to do,” Shields said.

Mayor Bill Baird expressed both his appreciation and frustration that the council was so focused on the details of the agreement.

“I know that we’re not going to have a perfect document tonight,” Baird said, but suggested that the council needed to find a way to move forward. All funds must be expended by Nov. 23 and there was a sense of urgency throughout the evening in getting this funding approved.

Councilmember Trish Carlyle proposed an amendment stipulating that the disbursement of funds shall be contingent upon final approval by the office of the city manager. The change would ensure additional accountability from Velocity and offer some additional oversight by the city, without overwhelming city staff. That amendment was approved unanimously.

The council also voted unanimously to approve the amended agreement with Velocity. All councilmembers were present, either in person or via teleconference, for the Sept. 14 special session.