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City spends all $150M in CARES money

Most of Albuquerque’s CARES Act money went to salaries for first responders. Albuquerque Fire Rescue personnel attend to a patient in March at the Alvarado Transportation Center. (Jim Thompson/Albuquerque Journal)

ALBUQUERQUE, N.M. — New federal legislation has given local governments an extra year to use the COVID-19 relief money they received last spring, but Albuquerque city officials say they actually have nothing left to spend.

City finance officials say the municipal government has spent or otherwise applied all $150 million in CARES Act money it received in April, having focused on trying to meet the original spending deadline of Dec. 30, 2020. Most of it went to personnel and, more specifically, to paying first responders.

The extension “gives us a little more time to reconcile everything, but we don’t have that issue of running out of time (to spend it),” said Sanjay Bhakta, the city’s chief financial officer.

The money propped up municipal government as tax revenue dipped in 2020, helping the city avoid employee cuts and service reductions. In fact, the CARES funding enabled the city to expand services where necessary, including eviction prevention, meal delivery for homebound seniors and operating costs associated with increased use of city parks. It also covered more than a quarter — 28% — of all city personnel costs from March through December.

“Without this money, it would’ve been very, very difficult,” Bhakta said of the city’s budget. “I can’t imagine what kind of cuts we would have to make (without it).”

Instead, the city avoided worker furloughs and layoffs by applying $120 million — or 80% of its CARES pot — to personnel costs.

The CARES Act restricted how local governments could spend the relief money, requiring that it go only to COVID-19-related expenditures that were not already included in budgets prior to March 27, 2020.

However, the U.S. Treasury Department’s CARES Act guidance ultimately permitted cities to apply the funds to public safety payroll, which is Albuquerque’s largest recurring expense.

The city estimates that $45.8 million of the CARES money will be spent on Albuquerque Police Department personnel, while another $45 million will go toward Albuquerque Fire Rescue salaries.

The guidelines also allow cities to use CARES money for public health, human services or other personnel “substantially dedicated to mitigating or responding to” the public health emergency. In Albuquerque, about $17 million will go to Senior Affairs staffing costs, while the remaining $12 million in salary expenditures are spread among many city departments, including Family and Community Services, Cultural Affairs, Parks and Recreation, Planning and Environmental Health.

Paying salaries with CARES money has likely provided the city a financial cushion, essentially preserving some of the other revenue that would normally cover personnel. Bhakta estimates the city could have a $40 million balance when the fiscal year ends June 30, though lower-than-expected revenue over the next six months could eat into it.

Outside of personnel, the city used CARES money on direct economic relief for various populations and entities. That includes $11.2 million for various business grants, $2.5 million in emergency grants for vulnerable residents — including those who did not receive the federal stimulus checks — and $1 million for nonprofit grants.

The city spent another $3 million to assist people who are homeless. That includes street outreach, handwashing stations and portable toilets, and staffing at “wellness” hotels the city established to separate people with COVID-19 and those vulnerable to the virus from the general shelter population.

CARES money also funded personal protective equipment for both city workers and for local businesses, extra cleaning at city facilities and equipment city employees needed to work from home.

Smaller CARES expenditures included $112,000 to translate public health orders and other written materials for non-English speakers, and for sign language interpretation of verbal COVID-19 announcements. The city also allocated $180,000 for swimming pool disinfecting systems and $40,000 for promotional videos.

“Albuquerque’s economy took a significant ​hit over the course of the closures and restrictions required in the interest of public health. At the same time, people are moving from big cities to midsize cities so ​​​the Economic Development Department worked with local contractor JAK+FLUX to produce a video promoting Albuquerque to remote workers and site locators,” city spokeswoman Jessica Campbell said in an email to the Journal.

While the city has not completed the account reconciliation outlining all final CARES Act spending, other planned expenditures included:

■ Mobile Wi-fi units throughout the city ($2.4 million).

■ Assistance for organizations helping domestic violence survivors ($250,000).

■ Grants for artists ($450,000).

■ A new projector for the city’s Emergency Operations Center ($58,000).

The city focused its CARES spending locally. Over $9 million was spent on goods and services from companies with a local presence, compared to about $3 million from out-of-state firms, said Haley Kadish, from the city’s finance office.


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