Detroit City Council approves Duggan's plan to spend $826 million in federal funds

Detroit City Council on Tuesday approved Mayor Mike Duggan's plan earmarking  how  an influx of COVID-19-related federal funds should be spent. 

The city of Detroit will receive $826 million in American Rescue Plan Act, or ARPA, dollars — the fifth largest amount among American cities. Of that, $400 million will be  set aside to address budget shortfalls, the city said. The remaining $426 million will be designated  for community investments, dubbed the Detroit Future Fund.

Most of the $826 million is going to city services and the following categories: programs to boost employment and job creation; blight remediation; neighborhood investments, such as grants for block clubs, the city's community health corps, and recreation centers. The city hopes to address intergenerational poverty through investments in home repairs, a locator for affordable housing, foreclosure and homelessness prevention as well as down payment help. 

"Today, City Council approved a plan to appropriate $826 million in American Rescue Plan Act funds so we can begin putting those dollars to use to improve the lives of Detroiters and our neighborhoods," Duggan said in a statement. 

More: Detroit is getting $426 million. Here's where Detroiters say that money should go.

More: Michigan's local governments getting huge one-time $4.4B windfall: What it means

In May, Duggan laid out broad plans for how to divvy up the funds, and kicked off dozens of community meetings and sought responses to a survey to gauge where residents want the money to go. Rebuilding neighborhoods, fighting intergenerational poverty and improving public safety were identified as the top three priorities, according to survey results that the city reported.  

During several community meetings the Free Press attended, Detroiters said they want the money to go to home repair grants, recreation centers and mental health services.

In his final plan submitted to the City Council, the mayor made some changes to his initial proposal. Among them:   setting aside $30 million for home repairs for seniors and low-income residents — up from    $20 million initially — and allocating $40 million for small business assistance, up from $26 million.

Callers during public comment Tuesday overwhelmingly expressed opposition to the mayor's plan, arguing that residents need more time to decide where money should go.

The funding is a unique opportunity to invest in projects and programs that directly benefit Detroiters, Ruth Johnson, with the Community Development Advocates of Detroit, said Tuesday. However, residents and council members  "have not had sufficient opportunity and time to fully understand, discuss and debate the various proposals and that is confusing and complex, although it's a great opportunity," she said. 

Local governments have until the end of 2024 to allocate money. Money has to be fully spent by 2026. It can't be used for pension fund payments, paying off old debt or past legal obligations, according to the city. 

Councilmember Raquel Castañeda-López and President Pro Tempore Mary Sheffield voted no on the resolution Tuesday.

Castañeda-López urged more time to decide on how to spend the federal dollars and proposed her own amendments to the mayor's plan. 

Arguing that the mayor's plan "perpetuates the status quo," Castañeda-López issued a news  release last week advocating for federal money to be given to Detroiters. 

“The intention of ARPA funds is to address the financial hardships families, businesses and the city experienced during the pandemic. My proposal does that by giving ARPA monies directly to the people and small businesses through grants, forgivable loans, and piloting a universal basic income program,” Castañeda-López said in the release.

Sheffield also proposed changes to the mayor's plan, such as a $105 million allocation for infill housing development to increase homeownership for low- to moderate-income residents; a $10 million allocation to create affordable rental units based on Detroit’s median income, which is $33,965, according to 2019 U.S. census data; and $50 million for home repair grant funding. 

"What is being proposed, in my opinion, are expenditures and not true investments designed to make the economic recovery from the pandemic equitable and transformational as the funding is intended," Sheffield said in a statement about the mayor's plan. 

City Council President Brenda Jones said the administration has worked with the  council and there have been changes to Duggan's original proposal. 

"I think people will see that council has had the opportunity to work with the administration for the past six weeks," Jones said Tuesday. 

The day before the council's vote, a group of about 40 people, representing groups including Detroit Will Breathe, the Charlevoix Village Association and the Field Street Block Club, met in front of the mayor's Manoogian Mansion to protest his plan for how to use the federal dollars. They called for their own proposal focused on $200 million for home repair grants, $26 million for sidewalk repairs and $37.5 million for a senior eviction protection program among other requests. 

Said Tristan Taylor of Detroit Will Breathe: "I think the most important thing that we have to ensure is that this money that's coming into Detroit is money that the residents of Detroit have final say over."

Free Press staff writer Dana Afana contributed to this report. 

Nushrat Rahman covers issues related to economic mobility for the Detroit Free Press and Bridge Detroit as a corps member with Report for America, an initiative of The GroundTruth Project. Make a tax-deductible contribution to support her work at bit.ly/freepRFA.

Contact Nushrat: nrahman@freepress.com; 313-348-7558. Follow her on Twitter: @NushratR. Sign up for Bridge Detroit's newsletter. Become a Free Press subscriber. 

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