As the next Roanoke budget nears approval with job reductions proposed and projects being tossed aside, questions remain about millions in pandemic relief money and surplus school funds, which the city now controls.
About $19 million in former school money is available — and the city may have millions in unspent pandemic relief funds to also allocate. Key questions preceding a scheduled city council budget vote Monday: What is the exact amount of money available, and what will the council agree to do with it?
Roanoke received $64.5 million — the highest amount in the region — in pandemic relief, also known as the American Rescue Plan Act of 2021, or ARPA. As of March, more than $15 million of that money remained in a city account, according to municipal documentation. That includes about $6 million in interest earned on the ARPA money since the program began, according to city Treasurer Tasha Burkett.
Roanoke’s most recent available federal filing — covering the quarter ending in September — lists 34 projects that have funding committed, including Market at Melrose, Virginia Tech Carilion Labs, Blue Ridge Continuum of Care permanent supportive housing and Total Action for Progress.
The ARPA money must be spent and final documentation filed by the end of 2026. Any money that remains would be returned to the federal government.
The city is working to determine how much of the remaining ARPA money is committed and how much could be free to spend, City Manager Valmarie Turner told the city council during its May 4 meeting. Any available ARPA funds would need to be spent in areas already approved as part of the program in 2024, she said.
Trinity Kaseke, the city’s budget manager, told the city council at that same meeting that it has a total of about $21.5 million available for reallocation from the schools’ general fund balance, the schools’ capital project fund balance, funding set aside for the Riverdale redevelopment and funding from an E911 unit. ARPA funding was not included in this list, which makes up that $21.5 million.
The council discussed using those funds toward replacing some items removed from the city’s capital improvement program, including Fire Station #2 on Williamson Road and an expansion on the Belmont Branch Library, as well as several parks projects.
During the council’s conversation on May 4, Councilman Peter Volosin stressed that the city shouldn’t use all of the available funds in the upcoming year.
He suggested holding onto at least $5 million to “see what happens over this next year.”
The Downtown Ambassador Program, which is funded by an external agency, has been funded with $300,000 in ARPA funding for each year for the last four years, Mayor Joe Cobb said during the discussion.
More on the ARPA situation
Instead of using its finance department — which had been handling quarterly ARPA reports required by the federal government — the city hired a consultant to complete the most recent one.
The city paid Washington, D.C.-based Robert Bobb Group $30,000 to complete that filing. The contract was signed in February, the Bobb Group completed the report and it was sent to the U.S. Treasury Department, according to an emailed city statement.
The Bobb Group was hired because the city was dealing with reporting delays caused by a “transition to the Oracle Financial System and ongoing staffing limitations,” according to the statement. The city has cited the computer software switch for numerous problems over the past year, including the police department’s overspending of a state gun violence prevention grant by close to $100,000.
Heather Ness, a principal with the Bobb Group, declined to talk about specifics regarding Roanoke. But responding to general questions via email, she said the most significant ARPA-related issues localities across the country face right now are “officially closing out completed projects, ensuring all documentation is collected, and confirming all contracted services have been fulfilled.”
Some ARPA-funded projects remain unfinished. And many of those projects “involve politically connected individuals who assure the government they will meet the deadline,” Ness wrote. Governments should reclaim funds from grantees at risk of not completing their projects and reallocate them to initiatives that can be finished by the end of 2026, she wrote, adding that the Bobb Group’s advice to governments is that decisions about reallocating funds must be made by June 30.
Roanoke Councilwoman Evelyn Powers, the city’s former elected treasurer, has asked during numerous meetings about the ARPA issues, including spending on one-time projects versus those that could require funding after the ARPA program ends. She’s also asked if the city is sure ARPA money has been spent appropriately. Powers has not received answers to those questions during those public meetings.
At the May 4 meeting, Powers asked for an explanation of what ARPA funds are left to use. Turner said she is working through that now to ensure she has “at least six months to expend the funding” before the December 2026 deadline.
“I’m still amazed that we’re at this point, this late in the game, and we don’t have things reconciled,” Powers said during a phone call Thursday. “That’s a problem for me.”
Jack Reagan is managing director at UHY Advisors Inc., which works with the Bobb Group. In an email, he wrote that oversight and monitoring requirements are based on whether a grantee of ARPA funding is a subrecipient or a vendor.
Subrecipients are generally nonprofits, other governments and tribal entities, he wrote. For subrecipients, a grantor such as the city of Roanoke must follow specific provisions of federal code.
However, for vendors, a grantor should monitor their performance — but only as a best practice, he wrote.
“I personally think they should do exactly the same thing” as for subrecipients, but that is not required, he wrote.
Roanoke’s breakdown of vendors and subrecipients was not immediately available.
The Roanoke municipal auditor will likely analyze the city’s ARPA projects and spending once the program ends, according to discussions at several city meetings.
More on the school surplus
For the first time in more than a decade, the city council required the school system to return any unused revenue, or fund balance, from the 2024-25 budget year, as is required by law. That amounted to about $26 million.
For years, based on a situation that was driven by a funding formula between the city and the schools, the division kept its surplus and the city asked few, if any, questions.
The city reallocated some of that money to the schools, including $2.1 million as part of a $4.3 million funding allocation for trailers to be used at Patrick Henry and William Fleming high schools. After that, the school division decided not to use the money for that purpose due to budget constraints.
During last week’s city council meeting, members discussed potentially allowing the schools to keep the $4.3 million for other needs, including activity buses or the city’s PLATO program, which became prominent topics when cuts were discussed for the 2026-27 budget year.
