The city of Edina has formulated a plan for spending the nearly $4 million it is receiving in federal relief related to COVID-19.

As part of the Coronavirus Aid, Relief and Economic Security Act – commonly known as the CARES Act – Edina was awarded $76 per capita. The Edina City Council on July 21 unanimously approved a plan to dedicate $2.7 million of the funds to personnel costs incurred in response to the virus.

The funds will help make up for costs for overtime, materials and contracted services. The money will mostly benefit the city’s general fund, the hope being that the boost will help position Edina for post-pandemic times and any continued consequences of the virus.

“The healthier our General Fund can be coming out of 2020, the greater our chances will be in 2021 for a softer landing if the commercial or residential real estate markets weaken as predicted,” City Manager Scott Neal said.

Also receiving an infusion of money are two funds – the Emergency Rental Assistance Program and the Emergency Business Assistance Program – that were created by the city to help people better cope with the economic ramifications of COVID-19.

After the city initially put $100,000 into each program, $500,000 in CARES Act funding is now headed to each initiative. The money will be used to recoup the city’s initial investment, making for $400,000 in new funds for each program.

Meant to benefit smaller enterprises in Edina, the business assistance will come in the form of $10,000 grants or forgivable loans and will prioritize minority-owned and women-owned businesses.

Addressing the CARES Act funds, a city of Edina staff report summarizes the economic hardship that businesses have experienced since spring. “The disruption has been extensive to nearly every type of business enterprise in Edina and throughout Minnesota. The disruption continues with no immediate end in sight,” the report states.

The prospects regarding housing are equally dire. With the $600 per week federal unemployment benefit about to expire, “it is estimated that 25% of Minnesotans will be facing eviction, according to a survey completed by Housing Link and estimated by Aspen Institute researchers,” a staff report states.

Councilmember Kevin Staunton wondered aloud how worse the damage could get for the low-income renters and small businesses in need of assistance. “Who knows? Maybe, you know, two or three months from now they may need even more,” Staunton said.

The city also plans to spend CARES Act funds on the response to COVID-19 itself, dedicating $250,000 to a community testing program to be run by M Health Fairview.

Citing the hospital’s recent pandemic-related losses, Mayor Jim Hovland suggested that more of Edina’s CARES money might go to Fairview. He noted Fairview lost $32 million when elective surgeries were banned, although it received $6 million in federal assistance.

“Over the years that I’ve been mayor, I think they’ve been one of the finest – if not the finest – corporate citizen that we’ve had here,” Hovland said, noting that Fairview is Edina’s largest employer.

If Edina led the way, Fairview would plan to ask the other cities in its primary coverage area for their own pro-rated contributions. City Manager Scott Neal resisted the idea, however, reasoning that the help wouldn’t have significant impact given the large size the health care provider.

“If we gave them all of our CARES dollars it still wouldn’t have a very big impact on their bottom line,” Neal said, adding city leaders don’t know what other kinds of assistance the organization might be in line for anyway.

The city has until Nov. 15 to spend the CARES Act funds, and would have to return any sum left unspent.

– Follow Andrew Wig on Twitter @EdinaSunCurrent

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