Editor's note: Montgomery County Commissioners Court was scheduled to discuss additional uses of CARES Act funding on Dec. 15.

As the last month of 2020 began, both Harris and Montgomery counties had earmarked or spent most of the federal Coronavirus Aid, Relief and Economic Security Act funds designated for their use by the U.S. Treasury Department for COVID-19 relief during the pandemic-strained year, with millions slated for use by school districts and other governmental entities.

However, local officials have said the difference in distribution methods between the two counties is particularly visible in The Woodlands Township, where most of the population is in Montgomery County, but a larger amount of CARES Act funding appears to be coming from Harris County.

Township officials said they expect $715,000 in CARES Act funds from Harris County based on $55 per capita for 13,000 residents and requested $317,000 in funds from Montgomery County for 110,000 residents.

Todd Stephens, the intergovernmental relations manager for The Woodlands Township, said at a Nov. 18 township meeting most counties with populations greater than 500,000 are allocating CARES funds to small cities on a per-capita basis.

For example, Harris County designated almost $30 million for small-city relief, and in Central Texas, Travis County allocated $7.3 million for small cities.

However, Montgomery County officials said they stand by the decision, which has allowed them to designate funds for countywide public safety expenses and a $300 per-student allotment to public school districts located entirely within the county, including Conroe ISD.

“I know that our interpretation is different than Harris County,” Precinct 3 Commissioner James Noack said in a phone interview, noting that he feels the county should be the body providing COVID-19-related services. “The Woodlands ... is basically a homeowners association. ... I think all governmental entities are best to stay focused on the core services they are there to provide. The county has been the one responsible for providing direct aid when it comes to COVID[-19]-related activities.”

Local governments

Harris County, which has a population of 4.7 million as of 2019, according to the U.S. Census Bureau, received $417.23 million in federal CARES Act funds, and Montgomery County received $105 million for its 607,391 population. According to guidance from the U.S. Treasury, counties with populations of more than 500,000 can—but are not required to—distribute funds to cities and other governmental entities within their boundaries, such as townships and other municipalities.

Monique Sharp, the assistant general manager for finance and administration for The Woodlands Township, said a complication arose when township officials submitted a request to the state for reimbursement after some requests for CARES Act reimbursements were declined by the county.“The state declined the township’s request, stating that we were ineligible to seek funding from the state because the township is located in counties that have populations greater than 500,000,” Sharp said in an email. As a result, the township has not received CARES Act funds from Montgomery County at the same rate it has from Harris County, but it also cannot apply to the state for that funding.

Harris County is following U.S. Treasury recommendations with $55 per-capita reimbursements to local governmental units for expenses incurred through Dec. 30, including payroll costs for public safety employees.However, Montgomery County is reimbursing expenses from March 27-Sept. 30, and it is not including payroll costs or a per-capita allotment. The rate at which The Woodlands was reimbursed would translate to less than $3 per capita, officials said. If it was reimbursed at the same rate as Harris County and for the same expenses, the township would receive an additional $5.8 million above the $317,000 requested from Montgomery County, officials said.Gordy Bunch, the chair of The Woodlands Township board of directors, said the additional $5.8 million is needed largely for salaries of emergency responders.

“The [township] could use the ... additional funds it should have received to fund its fire department and first responders who are the frontline defense to this virus,” Bunch said in a statement. “Montgomery County has given itself over $40 million for public safety expenses, including salaries. The Woodlands Fire Department first responders continue to respond to COVID-19 calls, and the exposures these men and women have suffered have caused increased overtime costs and staffing challenges, yet the department is not eligible for CARES Act funding from Montgomery County.”

Despite this, the township board sent a request for the full amount to the county in two pieces—the $317,000 that meets the county criteria and the additional $5.8 million officials said they believe the township deserves. The county agreed to pay about $274,000 of that amount. As of Dec. 9, about $7 million remained of county CARES funds, County Auditor Rakesh Pandey said. However, one more commissioners court session remained on Dec. 15.

School districts

Instead of assigning a per-capita allotment to local governments, Montgomery County has put about a third of its funds toward public school districts, with $34.46 million slated for those located entirely within the county.

The districts—Conroe, New Caney, Splendora, Willis, Magnolia and Montgomery ISDs—will receive a total of $300 per student in CARES Act funds for expenses related to COVID-19 after a Nov. 17 Commissioners Court decision.

The amount was an increase from $40 per student originally adopted by the court at its Oct. 27 meeting, or $4.4 million.

“It’s important to this court that we use this money in a way that it was intended and that it provides the most benefit, and there’s no better place to put it ... than back into schools and our kids and to the future of Montgomery County,” Noack said at the meeting.

As for the districts, CISD Superintendent Curtis Null said the infusion of funds will be helpful in dealing with the year’s expenses. The district will receive about $16 million in funds from the county.

“It means that we can continue to purchase the [personal protective equipment], the cleaning supplies. ... It allows us to continue with hiring additional staff that’s needed, and significantly ... it goes in and backfills some of those expenses that we’ve already incurred and puts us in a position next year ... to hopefully protect jobs and protect the solvency of our district moving forward,” Null said at a Nov. 17 board meeting.

Harris County did not make a specific funding allocation per student for districts, although $48.71 million was designated for student digital services as of Dec. 1.

Approved expenses

Although Montgomery County did not fund coronavirus-related payroll costs for cities or The Woodlands, it has designated $43.24 million in CARES Act funds for county-level public safety personnel expenses.

“The fund will be sitting as a restricted amount until it is fully cleared out, just in case,” Pandey said. “We are going to make sure we have a green light before we do anything with it.”

Pandey added the CARES Act funding will expire Dec. 30 and he is unaware whether it will be extended.

Noack, who voted against the personnel expenses, said he wanted to be sure the county would not have to pay the money back.

A previous proposal in June from Noack to provide $500 to many county residents in stimulus money from the CARES Act funding was dialed back after county officials learned the program might not be deemed directly related to COVID-19 relief.

Among the cities of Shenandoah and Oak Ridge North, officials from Shenandoah submitted a request for expenses to the county, but Oak Ridge North did not. Each city has a population of around 3,000, according to the U.S. Census Bureau.

“We are hoping through [the Texas Divison of Emergency Management] that we will receive that money which comes down from the state,” said Heather Neeley, Oak Ridge North’s city manager.

She said the city incurred about $40,000 in COVID-19-related payroll expenses.

Shenandoah Finance Director Lisa Wasnet said the city sent a request for $2,662 in reimbursement for COVID-19 supplies. The county approved that and other municipalities’ requests at its Dec. 8 meeting, totaling about $453,500. Commissioners did not discuss how the remaining funds would be used at the meeting.

“The remaining funds and whether funds will be returned is up to Commissioners Court and I can’t speak to what future decisions they may make as it has not been discussed in court yet,” said Jason Millsaps, Keough’s chief of staff.

Stephens said it remains to be seen whether future federal stimulus packages could include language that will change how funds are distributed if they are approved.

“Congress ... actually had a provision included in the stimulus that would incentivize ... localities or states that weren’t providing dollars to their lower jurisdictions to do so,” Stephens said. “Obviously, that negotiation is still in play.”

Andrew Christman, Ben Thompson and Eva Vigh contributed to this report.