Tennessee Delays Some ARPA Federal Spending Approvals

Photo: Sen. Bo Watson, R-Hixson Photo Credit: Senator Bo Watson (TN-11) / Facebook

The Center Square [By Jon Styf] –

The Tennessee committee reviewing the state’s spending of federal money from the American Recovery Plan Act pushed several decisions to January on Tuesday as it came closer to completing its spending of $3.7 billion.

An $85 million new state testing lab in Knoxville was delayed after additional questioning from Sen. Bo Watson, R-Hixson, while $90 million for the Tennessee Housing Development Agency related to increased building costs for low-income rental housing also will be discussed in January.

A Tennessee State University agricultural lab, which increased its initial $18 million estimated cost to $32 million, had its approval delayed as more information was gathered on the cost increase.

The Tennessee Financial Stimulus Accountability Group did approve $50 million in funding Tuesday for agricultural labs in the University of Tennessee system and $195 million in technological improvements for the state’s Strategic Technology Solutions (STS) department.

Butch Eley, commissioner for Tennessee’s Department of Finance and Administration, said he believes the funding for STS would have had to come from the state eventually for the five areas of technological improvements, which include cybersecurity, if the ARPA funds could not be used.

“I know it’s a large amount, but it’s an amount we would have had to spend over the next few years,” Eley told the group.

Entering the meeting, the group had approved $2.876 billion in funding for 17 projects in what it calls the Tennessee Resiliency Plan, while $246 million in ARPA funding remains unallocated.

The group also accepted grant applications until Nov. 30 for relief for entities in COVID-19 affected industries, such as nonprofit health and social service organizations, totaling $275 million. More than 60 applications for $650 million in funding were received and will be reviewed in January.

After previous questions from Watson about the state testing labs, the Department of Health determined its previously approved $200 million main testing lab in Nashville was sufficiently sized to expand as capacity changes in the future.

That again led Watson to question the $85 million investment in a second lab in Knoxville, which also is home to the regional health hub. The department has said redundancy is important in testing labs in case the Nashville lab cannot be utilized, and the current Knoxville lab is in a deficient building in need of improvements. It also would have to move from its current location in order to meet the future lab needs.

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Watson, however, was not convinced the project is necessary and was concerned he never had seen a capital request for the lab before the ARPA funds were available for such projects.

“I am still not convinced on the East Tennessee project,” Watson said. “It’s a project that has never been on our board before. I’m just not sold on this one.”

Tennessee also applied for $215 million in additional ARPA funding from the Coronavirus Capital Projects Fund. Projects that fit the grant are those that “directly enable work, education, and health monitoring” and are designed to fix a “critical need that resulted from or was made apparent or exacerbated by the COVID-19 public health emergency.”

An example provided Tuesday was certain work done on a library to increase student access.

About the Author: Jon Styf, The Center Square Staff Reporter – Jon Styf is an award-winning editor and reporter who has worked in Illinois, Texas, Wisconsin, Florida and Michigan in local newsrooms over the past 20 years, working for Shaw Media, Hearst and several other companies. Follow Jon on Twitter @JonStyf.