Counties received lump distributions of federal funding to fill public revenue losses, invest in broadband and other infrastructure projects, and provide additional pay for essential workers, according to the U.S. Department of Treasury in a news release. Federal guidelines required ARPA funds to be obligated by December 2024 and spent by December 2025.
Three of the counties which received funding in the Houston area include:
- Fort Bend: $157.6 million
- Harris: $915.5 million
- Montgomery: $117.9 million
"You've got to find some other source to cover that cost. It's basic budgeting," said James Thurmond, a professor at the University of Houston's Hobby School of Public Affairs.
Counties such as Harris, Fort Bend and Montgomery could be faced with absorbing several million in additional costs or eliminating jobs or programs.
Zooming in
One of the major expenses counties may need to cover are employees funded by ARPA. In all three counties, a number of employees were hired for positions on mental health teams, law enforcement and general infrastructure projects, such as a $21 million contract in Montgomery County to reopen a Tri-County Behavioral Healthcare center and a contract to expand the Harris County jail-based competency restoration program.
During fiscal year 2023-24 budget workshops, all three counties outlined how to spend the remaining funds on new projects and infrastructure efforts, while also considering the salaries which may need to be absorbed by the counties or eliminated once funding is depleted.
According to officials in each county, Harris County’s remaining funds are being targeted toward additional affordable housing efforts. Montgomery County reserved roughly $2 million to fund another year of salaries for ARPA-based employees. Fort Bend pushed to help additional small businesses with employee funding and grants.
What the experts say
Thurmond said that while local government officials have their reasons for choosing what to spend funding on, he believes they also have to be careful. The one-time federal payout was historic for counties and provided an easy way to fill budget holes without requesting additional tax dollars.
While ARPA funding was intended to help replace lost public sector revenue to counties, the responsibility of monitoring any budget deficits with county funds fell to the counties themselves.
“You just need to be aware when you create a new demand or a new service, is it sustainable with your current revenue? If it's not sustainable, then what do you cut? Are you going to create user fees, new taxes?” Thurmond said.
Stay tuned
During the FY 2024-25 budget workshops next year, Harris and Montgomery county officials said the counties will need to discuss employee and program needs to determine whether positions and programs have to be cut or if they can be sustained on county budgets or grants.
