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$8.4 million

Helena leadership begins ARPA spending discussions

The City-County Building in downtown Helena.

The City-County Building in downtown Helena.

The Helena City Commission has started discussions on how best to spend the about $8.4 million in American Rescue Plan Act money it is receiving from the state and federal governments.

The city has received about half of the money to date with the next traunch expected in the first quarter of 2022.

The money needs to be officially committed by Dec. 31, 2024, and must be spent by the end of 2026.

City Manager Rachel Harlow-Schalk stressed at a work session last week that these are "only ideas and they are not the only ideas."

City staff broke down potential landing spots for the aid into five categories: community behavioral health and homelessness; water and sewer projects; public safety; revenue losses; and general government.

Harlow-Schalk said this summer's budget process generally carved out funds for the commission's priorities and desired "strategic outcomes." So for the spending of ARPA dollars, Harlow-Schalk said the staff tried to prioritize eligible items not tackled during the budget process.

"This conversation we really felt needed to be on things that we could not fund or ... one-time large expenses that we could never really move forward quickly," she said.

The community behavioral health and homelessness pieces could account for more than half of the city's allocation of ARPA funds, at $4.4 million.

Staff's proposals include the spending of nearly $750,000 on two mental health programs, the development of a DUI court and a CAHOOTS (Crisis Assistance Helping Out On the Streets) pilot program, which would bolster ongoing local programs such as the St. Peter's Health-administered mobile crisis response team.

Helena Police Chief Steve Hagen said the recommendation to start the CAHOOTS pilot program came from a local mental health working group recently established as part of larger police reform discussions.

Hagen said the pilot program would see "case workers and mental health professionals more involved with the police and working with those suffering from mental illness."

Staff also pitched contributing $250,000 of ARPA funds toward assisting Good Samaritan Ministries in its case management efforts.

Another proposal to spend more than $300,000 on a temporary emergency homeless shelter was scrapped due to Good Samaritan's potential purchase of Knight's Extended Stay Hotel on Euclid Avenue for about $800,000, which the organization plans to transform into transitional housing for unsheltered people.

Knight's Extended Stay

Knight's Extended Stay, 1831 Euclid Ave., Helena

In an interview Monday, Harlow-Schalk said the city is prepared to make one-time financial contributions to help Good Samaritan purchase the building and implement pilot programs aimed at helping individuals secure long-term housing.

The other category likely to see a large commitment of ARPA funds includes the city's water and sewer projects.

Harlow-Schalk said Monday the city has an estimated need of about $32 million in water and sewer infrastructure upgrades, though some estimates put that figure closer to $40 million.

City staff submitted multiple applications for the state's competitive grant ARPA dollars totaling $26 million. Of that, the city was awarded only $2 million to go toward needed upgrades to the city's drinking water system.

That Montana Department of Natural Resources and Conservation-administered grant award is separate from the city's more than $8 million in direct allocations.

Staff now has the arduous task of determining which water and sewer projects can actually be completed before the 2026 deadline considering the limited pool of contractors at the city's disposal.

Those limitations resulted in staff's recommendation to apply only about an eighth of the city's direct ARPA allocation to water and sewer projects.

The bulk of that will help pay for upgrades to the city's cross-town connection that delivers drinking water from the Ten Mile Creek water production plant to homes and businesses on the east side of town.

Helena Public Works Director Ryan Leland called that connection "the life blood of the city" and said it would be about a three-year project.

"We are going to focus on the water because that is our biggest liability out there right now," Leland told the city commissioners.

ARPA dollars are only permitted to be spent on existing water and sewer infrastructure and cannot be spent on expanding infrastructure for future development, which effectively ended the city's effort to build out water and sewer connections for a proposed affordable housing project on Our Redeemer Lutheran Church land, a proposed joint project between the city, Helena YWCA and Habitat for Humanity.

Harlow-Schalk said she is hopeful more federal government funds could be made available through Congress' recently passed $1.2 trillion infrastructure bill.

In the category of revenue losses, city staff is proposing the spending of $700,000 of ARPA funds to plug about a $325,000 hole in the Bill Roberts Municipal Golf Course budget, $130,000 for facility asset management planning, $145,000 on a Centennial Trail feasibility study, $50,000 on open lands fuel reduction efforts, and another $50,000 on consultant work for street assessment methodology.

Helena Finance Director Sheila Danielson said in fiscal year 2021 golf course concessions lost an estimated $350,000 in revenue.

The proposed financial shot in the arm would provide enough money to cover major capital improvement projects, ongoing maintenance, any needed equipment replacement and create fiscal stability that "they will need going into this budget year," Danielson said.

While the money will fill revenue losses accrued by golf course concessions, Helena Parks, Recreation and Open Lands Director Kristi Ponozzo said some of it "will help to meet our reserve fund target."

Danielson said the golf course fund is about $240,000 off its target reserve balance.

Under the category of public safety, city leaders heard proposals from the city attorney's office and Helena Police Department totaling $1.3 million.

Deputy City Attorney Erik Coate proposed spending $300,000 on a consolidated prosecution victim services program. He also proposed investing $1 million in a misdemeanor probation program.

Misdemeanor defendants in the Helena Municipal Court are often sentenced to complete chemical dependency treatment, anger management and substance abuse educational courses. Some of those defendants' sentences are revoked when they either do not have the money to complete them or do not complete them once they are enrolled.

The city attorney proposed putting up the $1 million to assist those defendants in completing those treatment programs. The city would pay for all or a substantial portion of the treatment on an ability-to-pay basis and for a dedicated staff of two to four counselors and four to five probation officers to track a defendant's compliance.

When asked by Helena Mayor Wilmot Collins what would happen to the program once the ARPA dollars are expended in five years, Coate said more funding sources would need to be found.

"I think we would have to try and come up with some money to continue the program because I think what we're going to see is that it's going to be pretty beneficial and we'll want to keep it," he said.

It is unclear from the deputy city attorney's presentation how much would be spent on new positions versus actual defendant costs.

The Helena Police Department is proposing the spending of $30,000 to bolster victims of sexual or domestic violence services.

Additionally, city staff is proposing the allocation of $125,000 under the general government category to hire outside help to administer and track the city's ARPA spending.

Sean Logan mug new

Sean Logan

City Commissioner Sean Logan expressed hesitancy in binding future city budgets to ongoing programs, such as the proposed misdemeanor probation program, by starting them with one-time federal aid dollars.

"While these discussions are very preliminary, it seems that we are seriously considering spending the majority of this one-time money to fund pilot programs," Logan stated in an opinion piece he penned for the Independent Record. "Once started, these programs will need continued funding by taxpaying Helenans when the money runs out. Thus, it seems, we could bind our taxpayers to future levies by establishing new programs that will almost certainly continue in perpetuity."

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Local Government and Crime Reporter

Nolan Lister is a reporter at the Helena Independent Record with an emphasis on local government and crime.

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