The Johnson County Board of Supervisors voted unanimously on April 3 to halt $1.5 million of funding through the American Rescue Plan Act, or ARPA, designated for an affordable housing project.

Supervisor chair Rod Sullivan said that this vote was initially taken out of context.  He said funding for the affordable housing project is being reallocated from the county’s ARPA budget to the county’s general funds.

“We’re not really halting it,” Sullivan said. “We’re still doing the affordable housing, but paying for it in a different way.”

Supervisor V Fixmer-Oraiz said the supervisors are legally restricted from elaborating on the specifics of the affordable housing project at this time.

“Because it is procuring potential property, it has to be during a closed session,” Fixmer-Oraiz said.

Before the April 3 vote, the affordable housing project was slated to receive $1.5 million in ARPA funds. While Fixmer-Oraiz said they could not disclose details, they said the reallocation of funds has not led to a budget cut for the project.

“We are absolutely continuing to spend, if not that much money, potentially even more, to address affordable housing,” Fixmer-Oraiz said.

ARPA is a $1.9 trillion economic stimulus bill signed into law by President Joe Biden in 2021. This legislation provided state, local, and tribal governments with resources to respond to the COVID-19 pandemic and its negative economic impacts.

Johnson County received $29.3 million in ARPA funds, according to the Johnson County website.

Recipient governments can use these funds for a variety of purposes, including replacing lost revenue, providing essential worker pay, investing in infrastructure, and disaster relief.

The county has 62 projects funded using ARPA dollars. Some of these projects include the direct assistance program, which provided direct financial assistance to 1,919 residents who suffered hardship due to COVID-19.

The county also used ARPA dollars to fund three rounds of grants issued to local farms and food businesses to strengthen local food systems.

This funding also comes with guidelines and restrictions from the U.S. Department of Treasury.

On April 3, the board of supervisors held a work session specifically to address the use of ARPA funds in the county, following up on a similar meeting held in February.

During this session, Fixmer-Oraiz revealed that on March 29, less than a week earlier, federal guidelines for ARPA funding changed significantly from the guidelines the board received in November 2023. Fixmer-Oraiz described this change as “a surprise” which they said added complications to the allocation of ARPA dollars.

“We spent a good four months taking a lot of steps to be in compliance with that guidance, and now we’ve received contradictory guidance,” Fixmer-Oraiz said at the April 3 meeting.

Jessica Andino, executive director of the Johnson County Affordable Housing Coalition, said in an interview with The Daily Iowan that the guidelines and red tape around ARPA create challenges for the supervisors.

“ARPA is a whole other beast. If you don’t use it in the correct way, it can come back and bite you,” Andinosaid.

One restriction on housing is that ARPA funds can’t be used for the purchase or development of multi-family units serving more than five individuals, including apartments and duplexes.

Also, the Department of Treasury requires that each city that received ARPA funding must “obligate” its funds by the end of 2024, and must spend them by the end of 2026.

As stated in the “Final Rule” on eligible ARPA uses, obligation means “an order placed for property and services and entering into contracts, sub-awards, and similar transactions that require payment.”

Sullivan said the supervisors were unsure if the county’s affordable housing project would be able to meet that deadline. The Final Rule also states that ARPA funds that are not obligated by the end of 2024 will have to be returned to the Department of Treasury.

During the April 3 meeting, Fixmer-Oraiz said county infrastructure has struggled to keep up with the “unprecedented funding that came from the pandemic.”

Supervisor Vice-Chair Jon Green expressed a similar sentiment about the complications surrounding ARPA funds.

“One of the biggest lessons I have personally learned from the American Rescue Plan Act is that we made a lot of decisions in 2021 without the benefit of good information on ARPA itself. We didn’t know what we didn’t know and now we’re going to have to make hard choices,” Green said at the April 3 meeting.

Fixmer-Oraiz and Sullivan said the board of supervisors recognizes housing shortages in Johnson County and remains committed to affordable housing initiatives.

The affordable housing report from 2023 found that Johnson County had the highest percentage of cost-burdened households in Iowa. Households are considered cost-burdened if they spend more than 30 percent of their income on rent or mortgage.

The 2024 affordable housing report found that 55 percent of renters and 17 percent of homeowners in Johnson County are cost-burdened, and the affordable housing supply has not kept up with Johnson County’s rapidly increasing population.

“We should all have a safe, decent, affordable place to lay our head,” Fixmer-Oraiz said.  “Housing is a human right, so we take it very seriously.”

RELATED: Pilot project aims to help Johnson County families find affordable housing

Fixmer-Oraiz said the county also partners with nonprofit organizations to address the need for housing in the community.

On April 1, the county issued a request for proposals for nonprofit participation in a three-year housing program called the Permanent Supportive Housing Pilot Program, which aims to provide rental assistance and other support to low-income families with children and households at risk of homelessness.

Andino said while the term ‘halt’ might appear misleading in the affordable housing project vote, supervisors could not clarify the ongoing nature of the project because Iowa’s open meetings policy restricts them from deviating from the meeting agenda.

“We are very blessed to have elected officials that really do support affordable housing initiatives here in Johnson County and who cater these projects to fit our local population,” Andino said. “They don’t want to be tied with all that red tape. So they’re actually being more creative, and I applaud them because it takes more time and effort to do so.”

Despite the challenges of ARPA, Sullivan said he is grateful for the federal funding, which has had a significant positive impact in Johnson County.

“It’s been a great federal program, and we’re really glad we had an opportunity to participate,” Sullivan said. “And there are some things that will have been done with it that are going to impact generations of Johnson County residents.”