Berkowitz in Mask2

Anchorage Mayor Ethan Berkowitz might not be able to use federal CARES Act funds to purchase homeless shelters after all.

On Aug. 12, just one day after the Anchorage Assembly voted to grant the mayor authority to buy four properties in Anchorage, the Inspector General’s Office has indicated that the CARES Act funds, which are intended to provide relief during COVID-19, cannot be used to purchase buildings for homeless services.

Assembly Chair Felix Rivera issued a statement following a discussion between the Inspector General’s Office and municipal officials.

“Today the Inspector General’s (IG) Office, after preliminary discussions with the U.S. Department of the Treasury, talked with municipal officials and I regarding the purchase of three of the four properties within AO 2020-66(S) as approved last night by the Assembly,” Rivera said. “According to the IG’s interpretation, these property purchases would not be an allowable use of Coronavirus Relief Funds. The IG’s office, which made it clear that they could not make a determination, recommended seeking policy guidance directly from Treasury, who is the final decision maker on allowable uses.”

Rivera said the IG’s conclusion is contrary to advice he and fellow Assembly members received from municipal attorneys.

“The next immediate step is to request policy guidance directly from Treasury, the final decision maker on allowable uses,” Rivera added. “While I am disappointed in the conversation today, I remain hopeful that further discussions with Treasury will resolve this issue.”

Mayor Berkowitz has pushed hard to use the coronavirus relief funds to buy properties in Anchorage, but the idea has been met with strong resistance from the community.

On Aug. 11 the Assembly approved letting Berkowitz spend $22.5 million from CARES Act funding and money from the pending sale of Municipal Light & Power to Chugach Electric to buy the Bean’s Café building in downtown, the old Alaska Club on Tudor, The Golden Lion hotel on 36th Ave., and America’s Best Value on Spenard.

A public hearing on the matter spanned five days with hundreds of residents speaking out against the plan last month. Many have argued that using CARES Act funds to expand the city’s homeless outreaches was a misappropriation of money intended to help struggling businesses and individuals who have been impacted financially from the economic fallout due to COVID-19.

The final say will now come from the U.S. Treasury Department.

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Inspector General halts Anchorage mayor’s plan to spend COVID funds on homeless shelters

Joel Davidson
Joel is Editor-in-Chief of the Alaska Watchman. Joel is an award winning journalist and has been reporting for over 24 years, He is a proud father of 8 children, and lives in Palmer, Alaska.