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City prioritizes utilities, broadband with federal relief money

Stormwater, water and sewer infrastructure improvements, along with broadband projects have been identified as city priorities with the roughly $30 million it will receive in American Rescue Plan Act money.

The city is getting the money in two payments — $15 million it received about two weeks ago and another payment of about the same amount in late June 2022. It has until Dec. 31, 2024, to completely obligate the money for a specific purpose, and it has to be completely spent by Dec. 31, 2026.

It has identified $20.5 million in projects to target sewer, water and drainage improvements in Oakland, along with water and stormwater improvements in the Williamstown area and stormwater improvements in Pughsville, Pleasant Hill and South Suffolk.

The city is also proposing $8 million in spending to improve broadband infrastructure in the city — $5 million as part of a regional effort by the Southside Network Authority to build Phase I of the regional connectivity ring, and $3 million for last-mile expansion of broadband in rural areas of the city.

“The $3 million component, which to our understanding would qualify for this,” said Interim Deputy City Manager Kevin Hughes, “we would take the existing infrastructure and expand it into neighborhoods and parts of the city that currently are not (served).”

The city is also proposing to spend $1.5 million to provide support for non-profits that have and are continuing to help residents negatively impacted by COVID-19.

City Finance Director Tealen Hansen and Hughes laid out the parameters of how the city could spend its share of the federal money during a July 7 City Council work session.

Hansen said the city could spend the money on five categories — supporting the public health response to COVID-19; address negative economic impacts to employees, families, small businesses, impacted industries and the rehiring of public sector workers; address public sector revenue loss during the coronavirus pandemic; premium pay for essential workers; and sewer, water and broadband infrastructure.

The ARPA money could not be used as non-federal matching funds unless specifically authorized, general economic development and infrastructure projects, extraordinary deposits into pension funds, paying for debt service, legal settlements, deposits to rainy day funds and general economic development or workforce development activities unless they directly deal with negative impacts from the pandemic.

In Oakland, Hughes said the city would look to expand the sewer system and take residents off of private septic systems without impacting sewer rates. The water infrastructure project there is part of the plans to finish a previous Capital Improvements Program and Plan project by replacing an older two-inch water main with a six- and eight-inch water main to improve water service to residents and fire service, also without impacting the rate.

The stormwater improvements in Oakland would include an improved drainage system to help reduce flooding.

City Manager Al Moor said potential savings could come by combining work on the projects in Oakland by tearing up roads just once to do the work.

In Williamstown, the city would replace an older two-inch water main with an eight-inch water main to improve water and fire service, and improve the drainage system there.

Hughes said in Pughsville, since it is served by an older ditch drainage system, the city wants an improved drainage system there and accelerate work that had been proposed with CIP money in fiscal years 2023 and 2024.

Like Pughsviille, the Lloyd Place and Rosemont neighborhood, along with those in Pleasant Hill and South Suffolk, have an older ditch drainage system, and in Lloyd Place and Rosemont, the city has identified four areas for phased drainage improvement in the CIP over the next 10 years. It wants to use the federal money to accelerate the improvement.

“If we take an existing project that we have on the books that is taking space in the CIP in our current funding that we’re now replacing with federal funding, what that can do, is, the next CIP,” Hughes said, “is we begin to enter new locations, improve service in other parts of the city. And so, really, it has the ability to supplement and create new projects.

“Although it’s really exciting to get this $30 million, kind of midstream of the year, what it will allow us to do is have greater legs, another $30 million, or $20-some million in other parts of the city. I think there’s great opportunity as we look at the next CIP as well to introduce new locations for improvements.”

The regional broadband project’s Phase I cost of $23.8 million fiber ring would be split evenly by the five members of the authority — Suffolk, Chesapeake, Portsmouth, Norfolk and Virginia Beach. The network’s ring will eventually connect to transatlantic subsea cables, and the network ring is to serve as the backbone of the south Hampton Roads region’s digital ecosystem.

Hughes said the authority’s legal counsel has determined that the project’s “middle-mile” distribution qualifies for the federal money, and if approved, would be completed by December 2023.

Council voted to set public hearings for July 21 to amend the current operating and capital budget to accept and appropriate the federal money. Moor said city staff would continue to hone in on project costs, timelines for the proposed projects and more specifics on them.

“What we’ve looked at here is what we feel is a start,” Moor said, “which is some projects that we’ve had lingering for a while.”

Councilmembers were generally supportive of the city’s spending plan for the ARPA money, but said they want more specifics and a copy of the proposed ordinance.

Councilman Lue Ward said he wants to know how much money will be needed to complete projects, and how long those projects will take.

Councilman Roger Fawcett said $3 million for broadband is “not even scratching the surface,” while Tim Johnson said there needs to be more discussion about broadband, along with 5G with Verizon and other suppliers, and what the city can do on its own to put in its own system.

“We need to make sure that we hit the whole city with this thing,” Johnson said, “and everybody in this city benefits from this ($30 million).”

Said Mayor Mike Duman: “I think it’s a very appropriate and prudent use of the funds that’ll have an immediate impact on some of our underserved communities.”