Sixteen Idaho cities decline federal coronavirus relief money

BOISE — Sixteen Idaho cities have rejected a combined $700,000 in federal coronavirus rescue money, and one city that accepted $550,000 might have to return it if it doesn’t approve spending it.

It’s a small part of the $5.74 billion Idaho received in the $1.9 trillion American Rescue Plan Act signed by President Joe Biden in 2021. But it can be a significant amount for some Idaho cities.

Many elected officials at the 16 small cities are volunteers or receive token payments. Some officials said they have been confused about allowed uses for the money or strings attached. Others said the cost of administering and tracking the money outweighs the benefit. Some didn’t appear to have the staff or expertise to evaluate federal guidelines for using the money. One mayor said the city declined because they didn’t want to declare a health emergency and impose a mask mandate, neither of which was required.

Guidance from the federal government came in late, but it allows cities that receive less than $10 million to consider the relief money as lost revenue. That means it can be used just as the city would spend revenue it received as part of its general operations.

Most of Idaho’s roughly 200 cities have accepted the money, a total of about $232 million. Idaho’s nine largest cities received a combined $124 million directly from the U.S. Treasury, with Boise topping that list at $37 million.

The remaining smaller cities received a combined $108 million distributed by the state. But the 16 cities either rejected the money or didn’t respond to letters, emails or phone calls from state officials.

Of the 16 cities that haven’t taken the money, the south-central Idaho city of Hansen with a population of about 1,400 is leaving the most on the table at about $276,000. But Mayor Joe Ratto said he wants to give it another look now that it’s clear the money could be used for infrastructure projects. The city has an annual budget of about $1 million, he said.

“We could still use it because we’ve still got to do upgrades,” he said. “We can upgrade water. We can upgrade sewer. I believe we can upgrade playgrounds. All three of those things we’re working on now to upgrade. We’re just a small town trying to make things work.”

Alex Adams, Idaho Division of Financial Management administrator, said the $700,000 is in the state treasury, and the state has asked U.S. Treasury officials how to return it. It’s not clear if cities that declined their share could still get it if they changed their minds.

The tiny city of Hope on the shore of Lake Pend Oreille in northern Idaho turned down about $21,000. The town has about 100 residents.

“All the red tape, and we’re a small town,” Mayor Bob Breen said. “The added cost of just monitoring when the money is handed out. It takes hours and hours of time. Those are real dollars being paid for that.”

The northern Idaho town of Wardner, population 250, declined $38,000.

“My understanding was you had to declare a mask mandate and a COVID emergency,” Mayor Joe Guardipee said. “We’re a small community, and we didn’t feel that was necessary.”

Guardipee said it wasn’t a political decision, and the city accepted a $68,000 grant from the state to improve broadband that came from federal coronavirus relief funds.

Spirit Lake in the Idaho Panhandle accepted about $545,000, but the city council has declined to spend it. Mayor Jeremy Cowperthwaite said outsiders who don’t live in the area show up at city council meetings to argue against using the federal money that Cowperthwaite hopes to use on badly needed water and sewer projects.

“As mayor, I would prefer to accept the money and use it wherever Spirit Lake needs to use it,” he said. “It would be the fiscally responsible way to use it, in my opinion.”

The city has an annual budget of about $6.75 million. It needs a new well to meet the demand for water and two more to meet expected growth. It also needs to buy land to expand its sewage treatment capacity.

Island Park, a city of about 300 in eastern Idaho’s vacation area not far from Yellowstone National Park, declined about $57,000,

“We had the attorney look over things, and there was nothing we could use it for,” said City Clerk Reeca Marotz.

She said the city has no public works department because Fremont County takes care of the sewer and all the water comes from private wells.

Other cities that declined the relief money are Acequia ($28,608), Clayton ($1,721), Drummond ($3,442), Hamer ($22,370), Huetter ($24,091), Irwin ($53,129), Onaway ($40,438), Parker ($62,593), Placerville ($12,260), Reubens ($13,766), Swan Valley ($52,699) and Warm River ($645).