$2M in federal aid in limbo as Schenectady City Council, administration spar over transparency


SCHENECTADY — The city is facing a $12 million financial shortfall and the mayor has said cuts will be inevitable by the end of the month without a federal relief bill to aid local governments.

But as much as $2 million in emergency federal funds allocated as part of a previous stimulus package are now in jeopardy after the City Council claimed City Hall dragged its feet on providing an itemized breakdown for how the funds will be spent. The funds, approved in March as part of the federal CARES Act, are designed to aid low-income families battered by the coronavirus pandemic.

“For two weeks, we were asking for information and there was no acknowledgement,” said City Council President John Mootooveren. “None whatsoever.”


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The City Council’s Finance Committee tabled the resolution on Monday after a straw poll revealed the motion wouldn’t pass out of committee.

City Finance Commissioner Anthony Ferrari said failure to act may result in the U.S. Department of Housing and Urban Development (HUD) withdrawing the aid under the impression that it is not needed.

“If we don’t pass this now, they’re just going to take it away from us,” said Ferrari, who contended discussions with the federal agency were “fast-paced” and pledged to get information to lawmakers quicker in the future.

But, he said: “Once we lose this, we’ll never get it back. [HUD] won’t accept our applications after this.”

Mootooveren asked for the motion to be tabled for two weeks so lawmakers could study which agencies and service providers will receive the funding and how it will be utilized.

“You can’t just bring something to us as a [City] Council to approve, expect us to approve it and we do not have details,” Mootooveren said. “That is troubling.”

Councilman Ed Kosiur, who also serves as director of the county Youth Bureau, questioned why he wasn’t brought into the fold to discuss how to allocate $400,000 for summer programming and youth employment.

“I was not informed or invited to any meetings from the get-go,” Kosiur said.

The $2 million is broken into two categories:

About $1.4 million has been slated for economic aid and technical assistance to small businesses; there are funds for housing assistance (including rental relief), while $20,037 has been flagged to offset costs for the purchase of personal protective equipment for vulnerable populations.

Of that, $273,009 has been broken out for administrative costs — or 20 percent.

A separate $671,793 package contains emergency funds for housing assistance, including resources to stave off evictions and assist up to 200 households at risk of losing permanent housing.

That includes money for “case management, court advocacy, landlord-tenant mediation, legal services and financial assistance through security deposit, utility assistance and/or rental assistance for a maximum of three months,” according to a memo outlining the legislation.

The impasse comes as the virus is surging across the country and as the nation enters a uncertain new phase:

Without further action from Congress, an additional $600 in weekly federal unemployment benefits will end next week, while the state’s moratorium on evictions is scheduled to expire Aug. 20 (although state lawmakers approved several additional protections last month).

Director of Development Kristin Diotte stopped short of identifying a hard-and-fast deadline for the city to accept the funds.

“They need to be spent and they need to be utilized as soon as possible,” Diotte said. “That is critical money that needs to be spent immediately.”


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Mayor Gary McCarthy urged lawmakers to take action, noting they’ll ultimately be required to approve any contracts awarded as part of the regular legislative process.

“When we actually award the contacts, they will come back to the council,” he said.

And details on which agencies will administer the funds are still being ironed out, he said, largely because officials and non-profits are continuing to determine who has the reach to provide which services, a process complicated by the ongoing pandemic. 

Mootooveren countered that approving contracts one-by-one may result in change orders, which can be a lengthy process.

Tensions flared at times between council members and administration officials.

City Councilwoman Leesa Perazzo said the verbal sparring is just the latest example of “disrespectful behavior on all sides,” citing last-minute changes made to Community Development Block Grant funding approved earlier this year, prompting finger-pointing between City Hall and City Council.

Perazzo urged everyone to put aside their “hurt feelings and frustrations.”

“God forbid we don’t get this money because of this conversation,” Perazzo said. “Taking this risk is absolutely insane to me because again, people are frustrated.”

City Councilwoman Marion Porterfield questioned the need to hit the pause button for two weeks, arguing lawmakers could simply move the request out committee and later pull it from the agenda before next Monday’s vote if needed, a common procedural tactic.

“We’ve done it time and time and time again,” Porterfield said. “Why aren’t we doing it here?”

McCarthy on Tuesday implored lawmakers to make a move.

“The council president doesn’t have authority to just stop these things without taking action,” he said.

Mootooveren didn’t immediately return a call seeking comment on Tuesday.


Categories: News, Schenectady County

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