CARES Act Funds: A New Playbook
November 25, 2020 by Meredith Trimble
As CARES Act funding rolled out, local governments across the country used funds to invest in technology that facilitated remote operations and enhanced the efficiency, streamlining, and responsiveness of government services in tangibly beneficial ways. A new resource, A Local Government Leaders’ Playbook for the CARES Act, includes firsthand accounts from dozens of interviews that focused on the scalability of demonstrated solutions.
One official interviewed was Tom Bonfield, former city manager of Durham, North Carolina. When asked about his experiences during the pandemic, he laughed and said, “It wasn’t in the ICMA Green Book!” This reference speaks volumes about the situation we’re in and the potential for innovation that arises from it. Without a doubt, the pandemic is removing the mental hurdle of “this is the way we’ve always done it.”
Following are some insights from the playbook and accompanying webinar around opportunity, equity, and ROI as they relate to using CARES Act funds.
Opportunity
The pandemic brought new urgency to long-standing problems in government, and the sudden availability of federal money presented the opportunity to fast-track solutions that have long been on the back burner. One of the earliest realizations was the benefit of having government operations in the cloud, particularly as leaders and staff were locked away from their systems and data when buildings closed. Agencies using cloud-based technology solutions had an easier time enabling remote work and scaling up to meet evolving public engagement needs. Cloud-based solutions have inherent scalability and take the pressure off IT departments to manage servers. The cloud also makes it easier to connect securely with remote workers. The ability to deploy software remotely has helped governments quickly implement self-service portals, remote payroll changes, mobile apps, and new financial reporting, among other solutions that contributed to the early wins noted above.
Broadband expansion goes hand in hand with the cloud and is a hot-button issue especially in rural areas with weak or little service. The state of Maryland earmarked $15 million in COVID-19 pandemic relief funds via the CARES Act and the federal Governor’s Emergency Education Relief Fund to build a wireless education network covering rural areas on a 3.5 gigahertz radio band. This method (explained well here by The Baltimore Sun) can be implemented quickly as it does not need a license from the Federal Communications Commission.
ROI
Given the probable long-term financial consequences of the pandemic, using CARES Act funds to acquire technology solutions to streamline operations and create efficiencies is a smart bet. Justin Marlowe, a research professor at the University of Chicago and a public-finance expert notes in the playbook, “Governments are really leaning into technological innovation. In many cases, they had ruled out a cloud-based system before COVID, but the ones who have those systems have done well. COVID has forced the question of how to use technology to support the work. One government has been able to run their entire operation with 40% of the staff they used to have.”
While technology solutions do not eliminate positions outright, they facilitate headcounts that flatten or diminish over time. New efficiencies allow local governments to leave vacancies unfilled, or to redirect existing staff to higher priorities or valuable projects that have sat on the back burner for years. Moving to the cloud also levels out expenditures in predictable amounts and is an incremental spend over a government’s previous run rate for paying for software maintenance. In other words, technology enables local governments to keep up with an increasing workload with fewer staff and in remote environments.
Equity
The disparities in deaths from COVID-19 between different demographics and simultaneous social unrest highlighted long-simmering issues. CARES Act spending reflects this. Leaders who were interviewed spoke to a new focus around social and human capital investment in the context of equitable service delivery and funding decisions that drive quality of life.
Minority communities have been disproportionately impacted by the pandemic in health and business. Reuters reported in June “the number of black business owners in the U.S. dropped by 41% between February and April to 640,000 compared to a 17% drop in the number of white business owners.” As government leaders across the U.S. grapple with how and when to open economic activity in the COVID-19 era, closing equity gaps has the best chance of helping communities emerge stronger, more resilient, and more equitable. In a unique attempt to address equity in recovery, Nassau County, New York, County Comptroller, Jack Schnirman, launched an equity gap toolkit that provides data to inform policy. The toolkit focuses on six specific steps that can close equity gaps in home ownership, educational achievement, and student loans.
These and other themes are explored in more depth in the playbook and webinar, along with scalable solutions – “the plays” – that can be tailored to any jurisdiction navigating CARES Act funds.