Support for local businesses and investments in housing and mental health resources are among the Savage City Council’s top priorities for spending the city’s latest share of federal relief aid.

The city council met in a work session Monday to discuss options for spending the city’s $3.53 million allocation of American Rescue Plan Act funds.

While no spending plan is yet finalized, council members expressed support for project proposals aimed at helping local businesses and improving access to housing and mental health resources.

Last year, the council committed $40,000 in ARPA funds to initiate a months-long public engagement process to gather feedback on how the remaining funds should be spent.

Many of the projects under consideration reflect priorities identified by both the city council and local residents, such as offering assistance to local businesses.

Business recovery

The city council is looking at several proposals for ARPA spending aimed at bolstering economic recovery in Savage.

Ideas for spending include developing pop-up events in the city’s shopping districts, business grants and membership with an outreach program through the Minnesota Chamber of Commerce.

The pop-up events being considered would cost anywhere between $187,000-$266,000, according to the city’s proposal. The events would be re-occurring over the span of two years and aim to attract new businesses and shoppers to the city’s commercial areas.

Around $108,000 is being considered for another round of business grants, which would be administered by a third-party.

A membership to Grow Minnesota, an outreach program offered through the Minnesota Chamber of Commerce, would cost $24,000.

Housing

Last year, the Savage City Council identified housing investments as a top priority for spending ARPA funds.

Constructing a five-unit apartment complex on vacant, city-owned land is the largest of the four housing projects being considered by the city council.

The project, estimated to cost $1.66 million, would aim to provide quality affordable housing to local residents facing significant barriers, including residents re-entering the community after incarceration and young adults leaving the foster care system.

Each housing project being considered in Savage would be developed in partnership with either the Community Development Agency or Scott County.

“We’ve all been talking together to see how we can partner to make some of these things happen,” Savage Mayor Janet Williams said in an interview.

The apartment complex, for example, would be built near Highway 13 and South Park Drive on city-owned land, but the property would be managed by the CDA.

Williams said the costs associated with each project proposal are not yet firm, and the city may explore cost-sharing with Scott County.

Scott County’s ARPA share totals $28.9 million.

Other housing projects under consideration in Savage involve placing properties in the CDA’s Housing Land Trust program, which aims to keep costs down for homebuyers and recycles sale revenues for future projects.

Two city-owned properties in downtown Savage are being eyed for new affordable housing powered by ARPA. Project proposals include a $1.33 million four-unit townhome and a $720,000 twin home.

Another idea on the table involves purchasing existing homes to rehab and place in the Housing Land Trust.

At the work session Monday, Williams said she would support any of the four housing proposals, but her top priority would be the five-unit apartment complex.

While considering the list of proposed projects, Councilman Gene Abbott said he’s focused on helping residents who’ve been hit the hardest by the pandemic.

“Whatever we can do to ‘rescue,’ whether it be businesses or those who are vulnerable within the city,” he said.

Mental health resources

Input gathered from local residents this summer highlighted an ongoing need to expand access to mental health resources, according to a report by a city consultant.

Proposals for ARPA spending include partnerships with local school districts to help provide no-fee mental health services to students.

Williams said the city is exploring a partnership with the National Alliance on Mental Illness to provide local events aimed at highlighting treatment resources and furthering mental health education.

“We’re always talking about it and hopefully removing the stigma so other people will talk about it, too,” she said.

Other projects

While business support, housing and mental health initiatives are among the city council’s top priorities, other project proposals have also received positive feedback for further consideration.

One infrastructure project, estimated to cost $950,000, would route storm water and run-off to Community Park’s irrigation system, potentially saving millions of gallons of water each year.

Other city projects, such as a remodel to expand the Savage Library, may also be supported under ARPA’s flexible spending guidelines.

ARPA guidelines allow the city to dedicate around $2.3 million towards lost revenues, which would infuse the dollars directly into the city’s general fund, according to Savage City Administrator Brad Larson.

“That’s a long way of saying these funds become more flexible when you put it towards lost revenue,” he told the council Monday.

With that in mind, city staff have identified nearly two dozen other projects to consider for the ARPA spending plan, such as an electric vehicle fleet study and land acquisitions.

Local governments must obligate or spend aid funds by Dec. 31, 2024. Obligated funds must be spent by Dec. 31, 2026.

Both the Scott County Board of Commissioners and the Savage City Council are expected to adopt ARPA spending plans sometime next month.