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Cleveland Tabs $20M of American Rescue Funds for Broadband

The Cleveland City Council on Monday approved legislation to set aside $20 million of the city’s $511 million in American Rescue Plan stimulus money for an ambiguous plan to expand broadband access in the city.

Downtown Cleveland
(TNS) — In an unusual move, Cleveland City Council on Monday approved legislation to set aside $20 million of the city’s $511 million in American Rescue Plan stimulus money for an ambiguous plan to expand broadband access in the city.

The proposal had not been heard by a committee until Monday afternoon — a couple hours before it came before council for approval. Councilmen Kerry McCormack and Brian Kazy voted against it.

The legislation was proposed by Council President Kevin Kelley — a candidate for mayor, who advanced through the primary election last week and will face off with non-profit executive Justin Bibb in the November general.

Kelley introduced the ordinance for a first reading at the Aug. 18 City Council meeting — one of dozens of pieces of legislation read into the record at rapid succession that night. But the proposal bypassed a proper vetting when it was referred straight to Council’s Finance Committee, usually the last stop for legislation before passage. And unlike other high-dollar projects, for which City Council typically authorizes the administration to seek bids or proposals, the broadband legislation encumbers tens of millions of dollars without a notion of who would own or operate the project, how long it would take to complete, or how far the money would go.

In a written statement Monday, Bibb criticized Kelley’s proposal as a manipulation of tax dollars for “backroom political grandstanding.”

“Tonight, Kevin Kelley is about to take $20 million of your money and put it into broadband expansion,” Bibb said. “There’s no plan. There was no public input, or even a public council hearing. There’s no bid. No sensible partnership with expert organizations. He wants to look good, but it’s bad government… This will lead to the same shoddy public internet service that Kelley brags about in Ward 13. He wants to brag again, and he’ll say anything to get elected.”

Kelley’s proposal followed weeks of councilmembers expressing frustration and begging for more discussion and planning on how the city’s American Rescue Plan money will be spent. And despite a lack of a framework for spending, Kelley has admitted that he “jumped the gun” in introducing two widely popular expenditures while campaigning for mayor: $20 million for broadband expansion and $5 million for the Greater Cleveland Food Bank.

Interim Finance Director Sharon Dumas — speaking on behalf of Jackson, who has endorsed Kelley — told the Finance Committee on Monday afternoon that earmarking money for the Food Bank and the vague broadband project were needed “immediately.” However, once the legislation passes, Dumas acknowledged that the matter would mostly fall to the next mayor and that “nothing will happen on this piece beyond contemplation” during the final months of Jackson’s tenure.

Broadband expansion is widely regarded as an overdue need for bridging the digital divide in Cleveland, which Census data shows is the worst-connected big city in the country. It is also a problem across the nation that became more pronounced as the COVID-19 pandemic pushed school and work online. For that reason, expanding broadband access is one of the main suggested uses of cities’ American Rescue Plan money.

Councilmembers are generally in favor of increasing broadband. But some raised concerns about this legislation, which authorizes the Finance Director to employ consultants, computer software developers or vendors to develop or provide a broadband network on a citywide basis, and to acquire licenses or other services necessary to maintain the network.

At Monday’s hearing, McCormack sought clarity on whether the ordinance was authorizing an expenditure or simply earmarking money as “a legislative statement” that the city is setting aside $20 million to begin work on expanding broadband.

Dumas said the expenses covered by the ordinance would be “contemplative” of the undetermined broadband project as a whole — and that the cost of digitally connecting the entire city would exceed the $20 million.

When McCormack asked how the city arrived at $20 million for this ordinance, Dumas initially responded by saying, “There was no science to the $20 million.”

Kelley interjected.

“It was the estimate that was given to leverage the matching funds that were available to get to a goal of 40,000 households that could be quickly connected through some of the existing models that don’t involve going into one’s home,” Kelley said, raising more questions than he answered. “But this is a way to get to 40,000, which would essentially cut the underserved households in the city in approximately half.”

Kelley said the Meyer Foundation and the Mandel Foundation would chip in an additional $20 million if the legislation is passed, although there are no signed documents for those agreements. The State of Ohio is also considering dedicating $20 million to broadband services in urban neighborhoods, Kelley said.

McCormack asked whether the to-be-decided broadband plan will involve decisions, such as who will build the network, who will maintain it and what technology already exists. When Dumas confirmed that all of those aspects are still “unanswered questions,” McCormack said, “Okay. I just wanted to make sure that I didn’t miss, like, two years of research and collaboration.”

McCormack contrasted it to the work put into lead abatement. He pointed out that the Lead Safe Coalition has requested $17 million of the city’s American Rescue Plan funds, a dollar figure informed by two years of “intentional, collaborative work” involving hundreds of interested parties, who spoke at numerous committee and council meetings.

In an interview with and The Plain Dealer, McCormack explained why he intended to vote against the ordinance Monday evening.

“I don’t know the intent behind it, but it feels rushed, like there was a tremendous lack of information and data put into it,” McCormack said. “The digital divide is a top priority for me, too, but what I can’t do is vote for something that’s essentially a blank check of $20 million of taxpayer dollars that we don’t have a good grip on what it’s going for or how it’ll be spent. I have and will continue to cheerlead for [digital] connectivity, but I think (this ordinance) is kind of irresponsible.”

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