Local governments all over Alaska are trying to figure out the best way to get relief funds to their communities. The Kenai Peninsula Borough, being the largest local government on the peninsula, is getting the largest amount and is working on a plan to issue grants quickly and responsibly.
The borough is getting about $37.4 million through the state, which received the CARES Act funding from the federal government for coronavirus relief. That's going to go out in three payments, the first being about $21.2 million, followed by two more just over $8 million.
Like most local governments, the borough is looking at giving out grants to businesses, nonprofits and other entities. Those thresholds would be based on sales tax receipts, with the bottom threshold being $20,000 in annual sales. During a borough assembly worksession on options of how to do this, borough Finance Director Brandi Harbaugh said that threshold is because the funds should go to businesses, not hobbies or auxiliary income.
"Anything less than $20,000 would be a fairly small grant program, which would be a huge amount of participants and then would likely produce a situation where we would be providing very smart amounts, which would not be beneficial for the borough as a whole," she said.
The grant amounts would be based on gross sales, with the awards starting at up to $1,500 for businesses with between $20,000 and $50,000 in annual gross sales, up to $28,000 for businesses with more than $500,000 in gross sales. Publicly traded corporations and nationally owned chains, excluding locally owned franchises, would be excluded.
The funds coming through the CARES Act are federal funds, even after they're passed through the state and borough. Brenda Ahlberg, community and fiscal projects manager for the borough, said that means they'll be subject to auditing. The federal government will want to know how those funds will be spent and there are particular rules. She said if the borough makes a mistake and the federal government finds it when it audits the state, the funds will have to be returned, which the borough would likely have to recoup by making a business pay it back.
"That's one of the reasons it's so important to do this right out the door, because I can't imagine asking a small business to pay back a $4,000 grant because we made a mistake," Ahlberg said.
Applicants would have to make sure they had all their paperwork in a row and ready to provide to the borough upon request. Harbaugh said businesses would be encouraged but not required to provide it up front but should have it ready for an audit.
Business and nonprofit grants aren't the only places the money would go. The borough is looking into using some of it for projects that would have broad benefit and help address some of the impacts of the COVID-19 crisis. One of those is internet infrastructure, which is notoriously slow, patchy and often unreliable, particularly in remote areas of the peninsula. Ben Hanson, borough IT department director, said the department has been looking into ways to help improve that coverage for a while, initially looking into setting up a borough network where private coverage could be secondary. The importance of public digital access to government, work and other functions led them to accelerate, looking into working with the private sector to build more towers to improve coverage.
Borough Clerk Johni Blankeship said the clerk's office is also into using some of the money to help set up an absentee-by-mail voting system to help decrease crowding at polling stations this fall, and Office of Emergency Management Director Dan Nelson said he hopes to use funds to set up a secondary location for emergency response dispatchers to promote social distancing and create redundancy in case of an outbreak of COVID-19 in the current emergency response center.
Cities in the borough are getting their own COVID relief funds and most are still working on their relief distribution plans. Kenai is one of the first to get the ball rolling with a goal of distributing funds by June 30. Harbaugh said the finance office estimates that there are about 2,300 businesses that operate outside city limits in the borough, but not all of them may apply.
"Some are not going to apply because it's difficult for them and they're not going to be able to overcome that," she said. "Some are not going to apply because they may be out of compliance with the borough and they may not want to make themselves known."
Ahlberg said the borough's goal is to have applications available by July 15 and to cut checks by early August. The applications will be online, though help will be available for those who need it at some in-person locations and by phone. After the assembly approves the program, Ahlberg says the borough plans to host more public outreach through its website and Facebook Live events.
The ordinance approving the grant program is on the assembly's agenda for next Tuesday.
Reach Elizabeth Earl at eearl@kdll.org.
