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Dallas expects at least $270 million in federal relief for the coronavirus

City officials on Wednesday said they need more flexibility in using Treasury Department funds, which are restricted to immediate impacts from COVID-19.


Dallas can expect to receive at least $270 million in federal relief funds to help the city with expenses related to the coronavirus pandemic.
But the city’s anticipated revenue losses, coupled with an increase in costs to provide services, are still likely to have a big impact on its $3.8 billion budget for the fiscal year that ends in September.
The largest chunk of the federal funding — over $200 million — is expected to come from the Treasury Department, but there are strict limits on how that money can be spent, said Elizabeth Reich, the city’s chief financial officer.
City advocates are aggressively lobbying for more flexibility on the funding to allow Dallas to fill holes in its budget, Brett Wilkinson, director of the city’s Office of Strategic Partnerships and Government Affairs, told the City Council on Wednesday.
City officials expect the pandemic to devastate its sales tax revenue after nonessential businesses were forced to close to help slow the spread of the virus. Travel and tourism effectively shut down. Property tax revenue could also decrease.
“We would like flexibility that we need to help us with, quite frankly, what we know are going to be huge revenue losses this year,” Wilkinson said.
Texas will receive about $11.4 billion in federal relief, and that money will be doled out to local governments based on population. Dallas is the state’s third-largest city, after Houston and San Antonio.
Dallas also expects $53.8 million in aid for Love Field, Wilkinson said. The airport has seen just a fraction of its usual flight bookings since the pandemic reached Dallas.

About $14.4 million will come from the U.S. Department of Housing and Urban Development, and $2.8 million is earmarked to respond to the coronavirus among law enforcement and medical personnel.
Transit agencies in the Dallas-Fort Worth region will also get $318.6 million in federal relief, Wilkinson said.
The U.S. Conference of Mayors and National League of Cities said in a news release Tuesday that 88% of cities surveyed expect a revenue shortfall this year because of the spread of COVID-19; many of them expect to furlough employees.
Christy McFarland, director of research at the National League of Cities, said local governments’ revenues will suffer significantly.
She said it’s important that Treasury Department funds, which currently can be used only for eligible reimbursements of money spent to fight the pandemic between March and December, have “less strings attached” to allow cities to fill their revenue gaps.
The immediate coronavirus expenses are only "a small share of what cities are dealing with right now when it comes to fiscal impact,” McFarland said Wednesday.
The city has approved $4.3 million in spending related to the pandemic and has rented 100 hotel rooms for the homeless, bought 10 recreational vehicles to quarantine first responders and ordered more personal protective equipment for city staffers. That doesn’t include any additional costs to open an emergency shelter for the homeless at the Kay Bailey Hutchison Convention Center.
Reich has told council members that she expects Dallas to have some tough decisions to make to balance its budget.
“We will certainly see a drop in sales tax revenue, and we are working with our economist to determine the extent," Reich said in a statement Tuesday. "At the same time we are facing an increase in demand for our services, we are forecasting a major decline in revenue. That is why we need direct and flexible funding from Congress that will enable us to fill revenue gaps.”
Reich said it’s too early to tell how big a hit the city will take. But she told the council that the previous recession reduced city sales tax revenue in 2009 by 10% — which currently would be about $30 million.
The city could also see a reduction in property tax revenue next year in the tens of millions of dollars. McFarland, of the National League of Cities, said many municipalities expect an uptick in the number of businesses and residents who can’t pay their bills
Wilkinson said the city could face an even bigger challenge with the budget this year. “The scary thing about all of this … is that big question mark of how long this is going to last,” Wilkinson said. “When you take that into consideration, it could potentially be a lot worse. We just don’t know.”
In a news release Tuesday, the National League of Cities said more than half of cities expect their budget shortfalls to affect police or public safety.
In Dallas, about $8.9 million of the federal aid will come from Community Development Block Grants, which will help the city provide financial assistance for rent or utilities to residents for up to three months, small-business operations affected by the pandemic and $1.8 million in administrative oversight.
Council member Chad West, who represents north Oak Cliff, asked staffers for more detailed information about the administrative costs.
An additional $4.5 million of the HUD money will go toward emergency shelter, rapid rehousing for the homeless and homeless prevention assistance as well as housing assistance for people with AIDS.
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