Two committees favor proposals to use U.S. aid

Homeowner help aim of one; 2nd is to boost cybersecurity

FILE — The state Capitol is shown in this undated file photo.

Two committees on Tuesday endorsed proposed uses of federal pandemic-related aid in two areas -- one to help homeowners and the other to boost state government cybersecurity.

A legislative panel endorsed the use of $6.3 million in federal money under the American Rescue Plan Act for a fund to assist Arkansas homeowners who have experienced financial hardship associated with the coronavirus pandemic.

A different state panel later advanced to Gov. Asa Hutchinson the Department of Transformation and Shared Services' request for $33.5 million in federal relief funds for the department's cybersecurity data center modernization plan.

Under section 3206 of the American Rescue Plan Act of 2021, the nearly $2 trillion package enacted by President Joe Biden and Congress in March, the federal government is allotting about $9.9 billion for homeowners affected by the pandemic.

Arkansas is set to receive about $63 million of those funds in total to support the Homeownership Assistance Fund, Mark Conine, interim president of the Arkansas Development Finance Authority, told the Performance Evaluation and Expenditure Review Subcommittee of the Arkansas Legislative Council on Tuesday.

"The request is for us to be able to administer the program on behalf of the state of Arkansas," Conine said.

The funds will be used to prevent delinquencies, mortgage defaults, foreclosures, loss of utilities or home energy services, and displacement of homeowners, according to the agency's request.

The first 60% of the $63 million will target homeowners with household incomes up to $79,900, Conine said.

After that percentage of funding is disbursed, the next phase should be disbursed to households with incomes between $79,900 and $91,000, and the authority should be doing its best to target racial minorities, Conine said in response to a question from Sen. Kim Hammer, R-Benton.

The $6.3 million will cover the program's first disbursement; the rest of the $63 million will be available after the state develops and submits a plan to the U.S. Treasury Department, which it plans to do at the end of June, according to the request.

The Arkansas Development Finance Authority's request for $6.3 million in spending authority will go before the full Legislative Council on Friday for final approval. State entities are required to request new spending authority for the American Rescue Plan funds.

Last week, Hutchinson appointed a 15-member steering committee to recommend uses of $1.57 billion in federal funds that the state will receive under the American Rescue Plan Act. That committee is scheduled to meet today for the first time.


During a meeting of the 15-member Arkansas Coronavirus Aid, Relief, and Economic Security Act steering committee, state Department of Finance and Administration Secretary Larry Walther said the state has $36 million in unallocated funds and interest earnings from the $1.25 billion the state received in 2020 from the federal CARES Act.

Hutchinson appointed that steering committee to recommend the best uses of the federal aid that came to the state after Congress and then-President Donald Trump enacted the CARES Act.

The $36 million is sufficient to finance the Department of Transformation and Shared Services' request for $33.5 million for the cybersecurity data center modernization plan, leaving $2.5 million in unallocated funds, Walther said.

The transformation department requested the funding to centralize and modernize the information-technology infrastructure for all executive branch departments, after the pandemic created an immediate need to standardize, stabilize and secure state systems to improve cybersecurity efforts, according to the department.

In November, the steering committee endorsed the transformation department's request, contingent on the federal government extending the initial Dec. 30 deadline for spending the CARES money and the availability of the federal funds. Walter said the deadline was extended to the end of this year.

Steering Committee Chairwoman Elizabeth Smith said she would advance the transformation department's request to Hutchinson for his consideration.