How will Hilton Head spend $5.2M in COVID-19 relief money? Who will get the funds?
Hilton Head Island plans to use $5.2 million in federal COVID-19 relief money to address a litany of big-ticket issues on the island, including the pandemic’s economic fallout and the lack of workforce housing.
The Town Council recently approved by a 7-0 vote a broad framework for how to spend the federal American Rescue Plan funds.
Town Manager Marc Orlando, who proposed the framework, in a Thursday interview stressed that town staff members are still ironing out the details on how exactly Hilton Head will use some of the federal dollars.
But Orlando said he’s working quickly to use the council-approved framework to create actionable policies and programs to roll out for the island.
The first item on his agenda: A new grant program that will award federal money to local groups that provide housing, child care, education or rental assistance to people living on Hilton Head.
The town plans to allocate $1 million of its American Rescue Plan money to the Community Foundation of the Lowcountry so the nonprofit can set up the program and issue grants to organizations that have been helping underserved Hilton Head residents pay bills or eat during the pandemic.
Orlando said he’s 90% finished in drafting a memorandum of understanding, or MOU, for the program. The MOU could be completed as early as this week.
Once the document is signed, the town can transfer $500,000 to the Community Foundation of the Lowcountry, Orlando said. (The town has received only about $2.6 million of its American Rescue Plan funds so far. The other 50% of the federal money will be sent to Hilton Head in May 2022. The town will transfer another $500,000 to the Community Foundation of the Lowcountry in fiscal year 2023.)
Details on how to apply for the grants will be released later.
What is the American Rescue Plan?
Congress passed the $1.9 trillion American Rescue Plan, or ARP, in early March. The ARP included $350 billion in emergency funds for state, local, territorial and tribal governments to use on a variety of projects related to the pandemic.
“This is a huge opportunity for us,” said Kim Likins, director of the Boys & Girls Club of Hilton Head Island, during a Town Council workshop in June.
Local officials now have broad authority on how to spend the federal money. The U.S. Department of the Treasury has prohibited governments from using ARP dollars on only a handful of issues, such as funding tax cuts or making contributions to public employee pension plans.
Governments can use their ARP funds to support COVID-19 mitigation efforts, address the pandemic’s economic crisis, provide services to hard-hit communities, replace lost public-sector revenue, provide hazard pay to essential workers or invest in water, sewer and broadband infrastructure.
Some of those spending categories are wide-ranging.
For example, Hilton Head’s government has lost more than $4 million in public-sector revenue due to the pandemic, said Orlando, who used a federal formula to calculate that number.
In other words, the town could technically use about $4 million of its $5.2 million in ARP funds on a number of projects that do not fall under the other ARP spending categories.
Hilton Head must obligate all of its ARP money by late 2024 and spend it by December 2026.
“(The ARP) will make historic investments in infrastructure, manufacturing, innovation, research and development,” President Joe Biden said earlier this year.
What else is Hilton Head planning?
The Community Foundation of the Lowcountry’s grant program is currently the most detailed of the town’s ARP spending plans. Staff members could return to the Town Council sometime this fall with specifics on other ideas, Orlando said.
Here’s what we know so far:
The town is planning to spend $400,000 on a home repair program that Orlando has proposed. Island households with incomes at or below 60% of the area median income would be able to apply for grant funds to fix leaking roofs, unstable or unsafe floors, failing septic tanks and inaccessible private roads, among other things. The money also could be used to help native islanders obtain the paperwork needed to clear title on heirs’ property. This idea, Orlando said, might be reviewed by a Town Council committee in October. There’s a similar home repair program in Bluffton, he added.
Hilton Head plans to spend $1 million on Town Hall security and technology upgrades. The ARP’s lost revenue category would cover this funding, according to a memo sent to the Town Council. Some of the $1 million in funds will be used for new electronic locks, magnetometers, security cameras “and other safety/security related infrastructure” at the Town Council chambers, records show. Elected officials have recently raised concerns about the chambers’ security after a chaotic anti-mask protest on Aug. 17. The town also wants to use these ARP funds to improve live-streaming capabilities at public meetings.
The town owns 3.27 acres at 23 Marshland Road on the island’s north end. The property is known as the Patterson Tract. Hilton Head plans to spend $1 million to install amenities and other infrastructure there to create a neighborhood park. The town, Orlando said, is also interested in partnering with a private developer to build workforce housing on part of the property. The Town Council would need to review that idea again in the future, Orlando said. Some of the $1 million in ARP funds might be used to support road, water, sewer or utility infrastructure for the workforce housing, records show. Orlando said this idea requires a significant amount of work. The town needs to gauge developers’ interest in the concept and issue a request for qualifications.
Hilton Head is expected to spend roughly $1.6 million in ARP funds on various capital improvement projects, records show. Details about this remain unknown. Orlando has suggested that Hilton Head could use some of this money for regional housing initiatives if the Town Council is interested. The Southern Lowcountry Regional Board has recently been considering a proposed multimillion-dollar trust fund to build affordable housing in Beaufort and Jasper counties.
The town also wants to use $200,000 to offer grants to property owners living on the island who have not connected to an existing sewer line. Residents could use the grants to link to the public sewer system. The federal money may be offered to the Community Foundation of the Lowcountry so the nonprofit can bolster its existing Project SAFE, which is a program that provides funds to low- or moderate-income homeowners on Hilton Head who have septic tanks and struggle to afford sewer connections. The details are still being worked out, Orlando said. Some of the ARP funds could be used to pay for services not already covered under Project SAFE, including inspection costs and new connection fees, according to the town. Septic systems frequently fail on Hilton Head due to the high groundwater table and numerous tree roots, according to the Hilton Head Public Service District. “It seems like a positive approach,” said Pete Nardi, the PSD’s general manager, of the town using ARP funds for sewer connection grants.
