Stimulus Package Could Provide $52 Million to City Coffers

In correspondence to the City Council, local residents called for the city to spend $52 million in federal aid on housing.

However, City Manager Steve Mermell reminded the City Council and the community that the city has incurred its fair share of spending since the pandemic began.

The city is expected to begin receiving the money in the next 60 days from the $1.9 trillion stimulus package signed by President Joe Biden last week.

Unlike the first package, which provided aid to cities bigger than Pasadena, the current package extends aid to all cities. 

“What an extraordinary opportunity this will present to help provide meaningful services to our unhoused neighbors and lift them out of homelessness,” wrote Sonja K. Berndt. “We have far too little interim or permanent housing for our unhoused neighbors.”

The state is experiencing a devastating housing shortage. Locally, the city is creating a housing task force to address the issue.

“Be very mindful of why this generous $52 million was given,” said Donna Sider. “It is only for leveling vast differences between citizens of this city. Namely, to provide basic human rights — primary among them housing.”

About 50 percent of the money will reach Pasadena within 60 days of March 11. The rest will be distributed over the next two years. The money will be available until Dec. 31, 2024.

“I strongly urge the city of Pasadena to use its relief check to address homelessness,” said Teresa Eilers. “Solving homelessness is challenging, but it is not impossible.”

The plan responds to three primary issues: to respond to the public emergency related to COVID-19 or its negative economic impacts, including assistance to households, small businesses, nonprofits and impacted industries like tourism and hospitality, to respond to workers providing essential work during the health emergency, and reduction in revenue regarding government services.

The money cannot be used for pension funds or tax reductions. 

The city could receive $3 million in homeless assistance funds. Rental assistance via funds would be distributed to the city from money received by L.A. County.

“I’m concerned those dollars are going directly to the county and not cities like Pasadena that bore the burden,” said Mayor Victor Gordo. Gordo asked that the item be placed on the agenda for a future joint meeting with Supervisor Kathryn Barger.

“The county does not have the best record of being responsive when it comes to resources entrusted to the county for the benefit of Pasadena,” Gordo said.

Assistant City Manager Julie Guttierez said the county could get about $122 million.

“We’ve got to ensure Pasadena receives its fair share for our residents,” Gordo said.   

The county received about $160 million for rental assistance through the CARES Act in December. 

The funds also include money for transit, utility relief, and FEMA disaster relief reimbursement. Some of the money would also go to vaccine distribution and testing, schools and restaurants, and revitalization grants. 

The Department of Treasury is scheduled to publish guidelines on the 600-page bill in the coming days.

Mermell noted that the city has been hit hard by COVID-19.

“There’s been a lot of information out there in a broad general sense as to how much financial relief is going to be provided to the city,” Mermell told the council at its virtual meeting Monday. “But the details are still unclear.”

Mermell pointed out that the city has already expended tens of millions of dollars on COVID-19-related issues, including $15 million from reserves and $3.5 million of a benefits fund to provide pandemic relief.

The city is also looking to deal with $7 million in unpaid utility bills and the $10 million used to cover the Rose Bowl’s debt, a debt the city could continue to cover into the coming fiscal year.

All told, that’s $35.5 million. Add that to the more than $13 million lost by two of the city’s operating company’s, the Rose Bowl Operating Co. and the Pasadena Center Operating Co., and the $52 million in federal funds is not only already spent, but about $11.5 million in debt would still remain.

“This is an awesome, almost scary amount of expenditures on the part of the federal government,” Gordo said. “We have a tremendous responsibility in accepting these dollars. Once we receive these dollars we have a responsibility to ensure they are impactful and we have something to show for and not just spending it on bonuses or salaries.”