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Renovations using COVID relief funds drew criticism
Nearly $10 million in federal coronavirus relief funds designated for renovations at Dutchess Stadium in Wappingers Falls will be redeployed for housing, Dutchess County Executive Marc Molinaro said April 7.
Because supply chain delays are driving up construction and material costs, “it is not prudent” to undertake the project, which was awarded $11.6 million of $57.1 million Dutchess is receiving from the American Rescue Plan (ARP), a $1.9 trillion COVID relief bill signed into law by President Joe Biden in March 2021.
Dutchess will instead use $9.5 million of that funding as part of a $20 million housing and homelessness plan, Molinaro said in a statement, and find “an alternative route” to fund the stadium renovations in collaboration with the New York Yankees, whose minor league affiliate, the Hudson Valley Renegades, plays at the stadium.
His announcement was welcomed by Democrats on the county Legislature, who united in opposition when that body’s Republican majority unanimously approved, in June 2021, using funds from ARP to outfit the ballpark with a new clubhouse, pitching and batting facility and a premium club space and seating area.
The Legislature also unanimously approved spending $630,000 in ARP funds to buy the land beneath the stadium from the Beacon school district.
In addition to drawing criticism from Democrats, the project has been highlighted as an example of questionable ARP spending in news stories published in the last month by The New York Times and The Associated Press.
The estimated cost for the renovations ballooned from $12.5 million to $21 million based on proposals and bids for the project, said the county.
“Even if our residents weren’t struggling with skyrocketing inflation and the lingering effects of the pandemic, the stadium should not be the county government’s top priority,” said Minority Leader Yvette Valdes-Smith, a Democrat whose district includes part of Beacon.
The allocation to Dutchess Stadium represented the county’s largest ARP-funded project, according to a report released by Comptroller Robin Lois, a Democrat, on March 31. It is less than the revenue Dutchess will receive under a 25-year lease with the Renegades that the Legislature also approved in June 2021.
The lease, which requires Dutchess to undertake the renovations, calls for the Renegades to pay rent that starts at $308,000 annually and rises $10,000 every five years, topping out at $348,000 for the last five years. The Renegades will pay $8.2 million overall before the lease expires in 2046.
Before the Legislature approved the lease, Dutchess received its first installment of ARP funding, $28.6 million on May 24. The second installment, for the same amount, is expected next month.
Congress imposed two limits on ARP spending: It cannot be used to contribute to pension funds or to cut taxes. The U.S. Treasury also issued guidelines for local governments on acceptable uses, which include:
- To respond to the pandemic or its economic impacts, including assistance to households, small businesses and nonprofits, or to provide aid to impacted industries such as tourism, travel and hospitality;
- To provide extra pay to workers who performed essential work during the pandemic;
- To pay for government services that had a reduction in revenue because of the pandemic; and
- To invest in water, sewer or broadband infrastructure.
The Treasury noted that: “Large capital expenditures intended for general economic development or to aid the travel, tourism and hospitality industries — such as convention centers and stadiums — are, on balance, generally not reasonably proportional to addressing the negative economic impacts of the pandemic.”
As of Dec. 31, Dutchess had budgeted $34 million of the funds and spent or allocated $8.5 million, according to Lois’ report.
“Investment in water, sewer and broadband infrastructure is surprisingly low at $1.7 million, particularly compared to the stadium spending,” she said.
While that remains unchanged, ARP spending on housing will grow from the $6 million that had already been set aside for housing for the homeless and case management, including the proposed construction of a new emergency shelter in the City of Poughkeepsie.
Molinaro told the Legislature on April 7 that his housing plan will be unveiled “in the coming weeks.” It will include, he said, “creating new housing opportunities, investing in rehabilitation … advancing projects through the environmental review processes of local municipalities.”