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Ironically, giving away millions of federal dollars will be pretty expensive for New Hanover County

New Hanover County Government Building.
Benjamin Schachtman
New Hanover County Government Building.

New Hanover County is receiving over $45 million from the American Rescue Plan -- enough funding to tackle a host of issues. But, giving away this much money is tricky -- and expensive.

The county plans to use the funding to address mental health, broadband access, infrastructure upgrades, increase compensation for government employees, water and sewer pipes to help increase affordable housing, and more -- it’s a veritable wishlist of local projects.

But dispersing the money will actually cost quite a bit -- about $2.2 million dollars, roughly 5 percent of the total windfall.

According to the county’s top finance officer, Lisa Wurtzbacher, the money, “has a lot of strings attached to it and a lot of compliance auditing that will have to be done in a lot of reporting that will have to be done so.”

A significant portion of that $2.2 million will go towards making sure that the county and its non-profit partners are spending the money within federal guidelines and towards auditing the process after the money is spent. The audit is for compliance, not efficacy — in other words, money spent on economic development projects isn't contingent on actually generating more jobs or tax revenue, nor are water and sewer infrastructure projects contingent on generating affordable housing units.

Related: NHC says Rescue Act funding could increase affordable housing, but details aren't worked out yet

Additional funding will go towards extra time and personnel needed to actually run some of the new and expanded programs supported by the rescue act money.

“So really the administrative dollars are, for two purposes number one for these partners that we're working with, to do the different programs, they're going to require some funds to administer them. In addition, we may also need folks internally to administer some of the programs. And so we may have to hire additional folks to administer some of the programs," according to Wurtzbacher.

The county has less than three years to obligate the full $45.5 million, which is pretty quick in government time -- and that includes $6 million it hasn’t earmarked for any specific projects yet.

You can find the county's recently updated plan for American Rescue Plan funds here.

Ben Schachtman is a journalist and editor with a focus on local government accountability. He began reporting for Port City Daily in the Wilmington area in 2016 and took over as managing editor there in 2018. He’s a graduate of Rutgers College and later received his MA from NYU and his PhD from SUNY-Stony Brook, both in English Literature. He loves spending time with his wife and playing rock'n'roll very loudly. You can reach him at BSchachtman@whqr.org and find him on Twitter @Ben_Schachtman.