Johnston County Spending Nearly 98% Of CARES Act Funds On Employee Salaries

SMITHFIELD –  The CARES Act, approved by Congress to help individuals, families, and businesses impacted by the COVID-19 pandemic, recent provided $3,656,014 to the County of Johnston for COVID-19 response efforts and reimbursement costs.  Johnston County officials disclosed last week they will use 97.7 percent of the money to pay for salaries of current Johnston County employees. The county potentially had the option to offer grants to small businesses or to help low-income families avoid eviction but elected not to establish those programs.

Responding to a public records request, the County confirmed $3,569,609.61 will be used to pay for salaries for county employees involved in public health.  This is an allowable expenditure under the CARES Act, and many local governments are earmarking federal CARES Act dollars for salary costs, even though public health salaries were already funded in their fiscal year budgets.

Of the remaining 2.3 percent, Johnston County will use $78,577.13 to improve telework capabilities for employees working remotely.  $4,896.81 will be spent on legal fees and $263.09 will be used for other COVID-19 related expenses from various county departments.

County Manager Rick Hester said, “For the county portion, the funds are used for allowable personnel expenses for emergency services which includes emergency management, fire marshal and EMS. This will certainly help with our budgeted county expenses for Fiscal Year 20-21.”

According to the US Treasury website, CARES Act funds can be used by local governments – like Johnston County – to establish a consumer grant program to prevent eviction and to prevent homelessness.  Governments can also develop and fund programs to help small businesses obtain grants to offset the costs of business interruption, or for businesses that closed voluntarily to promote social distancing or that were affected by decreased customer demand as a result of the COVID pandemic.  Legislation prohibits the funds from being distributed to businesses or individuals to pay for property taxes or utility bills.

Johnston County did not establish any of these allowable programs with their CARES Act dollars due to conflicting data, Mr. Hester said. “We have researched and will continue to explore ideas (and) options. Regarding the small business grants, there has been conflicting opinions about the use of the federal COVID-19 funds in North Carolina. We have not established any of these type of programs to date. That possibility will continue to be explored.”

Mecklenburg County recently announced a program to loan qualified small businesses between $5,000 and $35,000 if they have been affected by COVID-19. The City of Raleigh recently established a $1 million fund to support small businesses with grants up to $10,000 or two months of rent, whichever is less.

Second Round Of Funds
Johnston County was recently notified they will receive a second allotment of $4,062,840.  Counties will be required to allocate at least 25 percent of these funds to municipalities within the County. Johnston County will be allocating the funds to 11 towns as follows:

Archer Lodge $154,103.46
Benson $117,153.28
Clayton $743,394.63
Four Oaks $67,328.79
Kenly $47,315.35
Micro $16,040.62
Pine Level $60,309.15
Princeton $41,759.38
Selma $212,112.56
Smithfield $387,872.35
Wilson’s Mills $82,323.93

Johnston County will receive just over $2.1 million from the second allotment. They must spend the money by December 30, 2020. Current plans are to use the additional funds for public safety payroll and additional telework improvements for employees.  There are no current plans to assist Johnston County citizens or small businesses with loans or grants with the second round of CARES Act funds.