Leaders at odds over $5M in ARPA funds

The Lake County Board of Commissioners said the Lake County Council isn’t following federal and state guidance in allocating $5 million of American Rescue Plan Act funds to the City of Crown Point, which Mayor David Uran said he is confident will be resolved.

Uran, a Democrat, worked with the council on potential funding assistance from the county’s ARPA funds for the $99 million project that would bring a sewer treatment facility to the area currently served by septic and well water.

Uran sought $5 million from the county that will be used to secure $5 million state ARPA funding through a State Water Infrastructure Fund grant from the Indiana Finance Authority. Crown Point will also use $5 million of its own ARPA funds to secure an additional $5 million from the IFA.

Uran previously said the new facility would take 1 million gallons of stormwater out of the city’s current treatment facility reducing water backup incidents for existing customers. It would also pave the way for new development, both residential and commercial, in the southeast area of Lake County south of U.S. 231 and east of Interstate 65.

The project also would open the opportunity for the area to be served by Lake Michigan water. Currently, most of the area is in the Kankakee Valley watershed. Anything south of 133rd Avenue does not have access to Lake Michigan water. The new facility would return water to the Lake Michigan watershed through Crown Point, opening up the possibility for the area to be served by Lake Michigan water.

Last month, the council approved a resolution to allocate $5 million of American Rescue Plan Act funds to the city for wastewater projects. But, officials with the Commissioners said the allocation of the funds goes against federal guidance and the state board of accounts memorandum for spending ARPA funds.

The memorandum states the “ARP grant fund must be established by ordinance of the County Commissioners.” The funds “must be appropriated by the fiscal body before use in accordance with ... the ordinance and the plan,” the memorandum continues.

Lake County received about $94 million in funds through ARPA, and in October the commissioners heard

proposals for sewer projects that would use up the funds, said board president Commissioner Michael Repay, D-3rd.

The commissioners passed a plan late last year that identified two sewer infrastructure improvement projects in unincorporated Calumet Township and Center Township, Repay said.

Repay said the projects in the commissioner’s ARPA spending plan are underway and in the engineering stages. For the $5 million to be spent on the Crown Point project, Repay said it would have to be included in the commissioners’ ARPA spending plan.

“In order the spend, there are a lot of restrictions on the ability to spend ARPA and the way you need to spend it. First of all, the executive branch needs to pass a plan, which we have, and the fiscal body has to appropriate in accordance with the plan,” Repay said.

If the $5 million in funding isn’t made available to Crown Point, Uran said city officials would “have to regroup.” But, Uran said he believes the funding from the county will come through.

“I’m confident that the county will see the value in what Crown Point is offering,” Uran said.

Councilman Christian Jorgensen, R-St. John, who worked on the council resolution, said the council has authority over $10 million of the ARPA funds, under U.S. Treasury rules, and the $5 million for the Crown Point as the fiscal body that appropriates funds.

“Whether or not (the commissioners) go ahead and appropriate it in their plan, we are going to appropriate it,” Jorgensen said of the $5 million allocated to the Crown Point project. “There’s going to be a conflict between their plan and our resolution.”

Repay said the council allocating $15 million for other projects is “contrary to law,” which states the fiscal body has to appropriate funds based on the approved plan.

While the $10 million, under U.S. Treasury rules, is allowed for revenue replacement, the commissioners have told the council the $5 million for the Crown Point project could be allocated in an intergovernmental agreement between the county and the city to meet the qualifications of revenue replacement, Repay said.

When asked if the $5 million for the Crown Point project could be considered in the $10 million for revenue replacement, Jorgensen said the council’s position is “we can do both” in allocating $15 million. But, Jorgensen said a “possible compromise” would be to allocate $5 million for the Crown Point project out of the $10 million for revenue replacement.

“We are determined to fight for the money we appropriated for South County,” Jorgensen said.