The Leesburg Town Council will soon have to determine how to spend $3.5 million in remaining CARES Act funds, with the latest idea of a restaurant gift card program a no-go.
On Monday night, the council discussed an idea put forward by Councilwoman Suzanne Fox to send a $50 gift card to be redeemed at a Leesburg restaurant to every town household. The cost of such a program would be at least $800,000, Deputy Town Manager Keith Markel said, accounting for the town’s more than 16,000 households.
Markel said, however, that such a program could not be supported by CARES Act funding, because it “does not have a direct nexus to financial hardship.” CARES Act funds can also not be used to supplement lost revenue, he said.
Markel drew comparisons to a similar program run by the Town of Middleburg during the summer, when the town government provided $20 vouchers to 16 participating restaurants to all 420 in-town households. The town used the entire$74,824 of its first installment of CARES Act funding to partially pay itself back for the money it spent on that program.
Fox said she was disappointed that Leesburg could not find justification for a similar program using CARES funds.
“I’ve always realized that there needed to be a direct relationship with a known hardship and not revenue replacement,” to utilize CARES funding, she said. “I have a hard time with that because what family has not been impacted in our town.”
Fox also noted that, as a small business owner herself, all revenue businesses receive goes into one pot, not for specific line items.
“I would argue everything is revenue replacement. I just feel like after the last presentation you gave and the amounts you were telling me that there were that we could find a way to help,” she said in addressing Markel.
Other council members also expressed disappointment that such a program could not be supported by CARES funds, especially considering the large amount the town has remaining in the pot. Leesburg has received two rounds of CARES funding, for a total of $9.8 million. Thus far, Leesburg’s CARES grant program has supported two rounds of grants for small businesses and nonprofits, along with reimbursements for COVID-19 related expenses, such as the purchase of additional cleaning supplies and personal protective equipment, and building modifications. The town also recently rolled out a grant program for town food and beverage establishments to allow them to be reimbursed for the purchase or rental of heaters and tents to keep outdoor operations running through the cold weather months.
Councilman Ron Campbell pointed out that he first brought up the idea of a restaurant gift card program in late May, and said it was important for the public to realize that the conversation of creative ideas on how to spend CARES funds did not just begin.
“At the end of the day that’s a lot of money to leave on the table and it’s unfortunate that we’re in this situation,” he said.
Markel is expected to return to the council’s Nov. 24 meeting with recommendations on how to spend the remaining $3.5 million in CARES funds. He has said there is not a sufficient amount of time to do a third round of funding to businesses or nonprofits. One idea that has been floated by town staff is a provision in CARES Act regulations that would allow municipal governments to reimburse themselves for police department salaries incurred during the pandemic.
Under current rules, CARES Act funding not spent by Dec. 31 must be returned to the federal government.The town staff would like to have its paperwork in order by mid-December to report its expenses to Loudoun County, which distributed funding to each town on behalf of the federal government.