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Baltimore will get $640 million from the American Rescue Plan. How will officials decide where to spend it?

Baltimore finance officials outlined a plan Tuesday for how they’ll dole out $640 million in federal pandemic relief and announced the creation of an office to review applications from city agencies and nonprofit organizations for the aid.

Baltimore has received the first half of the money promised by the federal government as part of the American Rescue Plan passed by Congress in March to assist it with recovery from the coronavirus pandemic. However, a plan for the money hadn’t been announced.

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Aaron Moore, assistant budget director for the city, told City Council members at a Tuesday budget hearing that city departments have begun to submit applications for allocations. Later, the application process will be opened to nonprofit groups.

Baltimore is in the process of building the staff for a 10-member Office of Recovery Programs to review the applications, Moore said. Staff members will score applications using a rubric that weighs the public good a project will generate, any risks involved and available resources to achieve the project’s goal. The scoring system is weighted most heavily for a project’s impact on equity.

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Projects must cost a minimum of $250,000. Those considered eligible can be approved immediately, but some may be held back until city officials can analyze the possibility of using other streams of federal recovery funding, Moore said.

“We want to be judicious about our spending, but also swift when applicable to critical areas and impacted industries,” he said. “We do have projects that are being considered at this time, but no decisions have been made.”

Funding from the American Rescue Plan has fewer restrictions than previous recovery programs offered by the government, but there are some rules that have been outlined by federal officials. Eligible uses include public health, supplementing revenue loss and specific infrastructure projects dealing with the supply of water, sewer and broadband.

Examples provided by Moore included small business assistance; aid to the tourism, hospitality and restaurant industries; and rebuilding public sector services and staffing to prepandemic levels.

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The money cannot be used for legal settlements or judgments, infrastructure unrelated to the pandemic, “extraordinary deposits” into a pension fund, or to bolster financial reserves, Moore said.

City finance officials have set aside $130.6 million of the funding for budget stabilization, more than previously announced. About $50 million will be used to balance the fiscal year 2021 budget, as is required by law, and the remainder would be saved to stabilized future budgets. The 2021 fiscal year ends June 30.

Another $10 million would be spent to operate the Office of Recovery Programs through 2025.

Democratic City Councilman Eric Costello questioned whether the funds could be used to plant trees in the city. Moore said a project that focused on factors such as equitable distribution of trees, improving environments for children and remediating stormwater could be eligible for the funds.

Moore said federal officials have indicated that projects “indirectly” related to the pandemic could be eligible, such as ideas that improve green space, something people across the country used more during the pandemic.

Democratic City Councilman Ryan Dorsey questioned whether a road diet, in which lanes of a road are reduced to create more room for pedestrians and trees, could be eligible, although road paving is not. Dorsey said such a plan would create more equitable and safer access to transit, improve public safety and make local businesses more accessible.

“If the agency makes an application, it will be thoroughly looked into,” Moore said.

Democratic City Councilwoman Odette Ramos asked if the money could be used to create a more permanent version of the housing Baltimore has offered homeless people in hotels during the pandemic. Currently, Federal Emergency Management Agency reimbursements fund those hotel stays, although the reimbursement will be reduced to 75% in September.

American Rescue Plan money could not be used as matching funds for the FEMA money, but the shelter hotels are an eligible use for those relief funds if the city chooses to use them that way, Moore said.

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