Alaska Gov. Mike Dunleavy’s administration on Monday announced the release of $20 million in federal CARES Act funds to Anchorage — the final chunk of pandemic aid that the Legislature approved for the state’s urban hub.
The nature of Dunleavy’s announcement left some Anchorage officials bristling, according to the acting mayor’s chief of staff.
Though the governor can’t decide how the city spends the funds, he urged them to divert it to the hospitality industry. Dunleavy’s statement came as Anchorage prepared to begin another “hunker down,” closing or limiting service at many businesses to slow the spread of COVID-19.
“Anchorage businesses, particularly the hospitality industry, are about to enter an exceptionally difficult time that will trigger an overwhelming need for financial relief to meet payroll and keep the doors open during the holiday season,” Dunleavy said in a written statement. “I respectfully encourage the members of the Anchorage Assembly and Acting Mayor Quinn-Davidson to take this opportunity to use the CARES Act funds for their highest and best purpose.”
Acting Mayor Austin Quinn-Davidson’s chief of staff, Jason Bockenstedt, said Tuesday that the announcement — which was titled “Governor Dunleavy Provides Additional Financial Support for Anchorage’s Small Businesses” — gave the impression that Dunleavy was giving the city more money beyond what the Legislature had already approved.
Bockenstedt also said the governor ignored Quinn-Davidson’s own effort to divert more CARES Act funding to the hospitality industry, and accused the governor of playing politics.
“It was unfortunate that a press release of that nature was put out,” Bockenstedt said. “It is very clearly not any additional funding than what was already approved by the Legislature.”
The city has released about $9 million to the hospitality industry, and has also spent millions on other small business grants and rental and mortgage assistance.
The remaining $20 million released by the state rounds out the $156 million the city will get in federal COVID-19 relief aid, which the state had already allocated to the city.
The city Assembly already voted on how to spend all of the CARES Act funds, including the final $20 million. Earlier this year, some of the Anchorage Assembly’s plans to use CARES Act funds generated backlash, especially an effort to use some of the funds for homeless and treatment services.
The state of Alaska received $1.25 billion in CARES Act funds from the federal government. Of that, the state set aside $280 million for a grant program for businesses. Some of those payments are still being processed.
The Legislature in May approved the plan to divert $568.6 million to local governments.
Anchorage got its first portion of money, about $118 million, in late June. Under the state’s plan, it needed to spend 80% of that money before it could request the next portion, which was a little less than $20 million. The city has just recently spent 80% of the second portion and was finishing up a proposal for the final portion of about $20 million, which city officials planned to file for this week.
However, Dunleavy ordered the release of the money to the city on Monday, before Anchorage had asked for it. The statement from the governor’s office says Dunleavy “expedited” the release of the funds.
Bockenstedt said the practical impact is minimal.
[Sales tax on Outside purchases projected to raise up to $10 million for Alaska towns]
Quinn-Davidson last Wednesday called on the Assembly to reappropriate $15 million in CARES Act funds to go to small business and hospitality grants, as well as rental and mortgage assistance.
“I think the governor and the state are trying to take credit for something that the mayor had already announced last week,” Bockenstedt said.
Acting Assembly Chair Felix Rivera said he does plan on calling a special meeting to take that up, likely on Friday.
Additionally, on Tuesday the city announced it was funding a $1 million voucher program for things like groceries, diapers, medication and gasoline.
Dunleavy spokesman Jeff Turner said the state still has $52.3 million in unallocated CARES Act funds, but has $109 million in state department expenses that could potentially be reimbursed with the remaining funds.
“The Governor is just encouraging all local leaders to continue that support to the greatest extent possible,” Turner said in an email responding to questions about the announcement.
“The Governor did communicate with Acting Mayor Quinn-Davidson prior to the press release going out,” Turner said.