In a split vote on Tuesday, the Kane County Board decided to continue its practice of authorizing a loan to the county’s Office of Community Reinvestment in case of delayed reimbursements from the federal government.
The Office of Community Reinvestment will receive a loan of $600,000 from the county’s General Fund to cover expenses for programs like Community Development Block Grants, the Homeless Management Information Systems Program, Homeless Prevention programs and the Workforce Development Program, according to Tuesday’s meeting agenda.
The programs fund services ranging from job training to assistance for the county’s homeless population.
The county’s Director of Finance Kathleen Hopkinson said that the Office of Community Reinvestment has to spend money first for these programs before they can be reimbursed by the federal government, so not being able to front the costs in advance through the interfund loan could impact the office’s ability to provide services.
The funds the office borrows from the county are to be paid back in full during fiscal year 2025 once they’ve been reimbursed by the federal government, the meeting agenda says.
The Office of Community Reinvestment receives money from the United States Department of Housing and Urban Development, Department of Labor and the Department of the Treasury, said OCR Director Scott Berger on Tuesday. In 2023, the county received more than $20 million from the three federal departments alone, according to a 2023 report.
Although the resolution passed, some Kane County Board members were skeptical about continuing these sorts of loans in the future after the Trump administration’s recent proposal of a federal funding freeze. The freeze has since been temporarily blocked, but, on Monday, a federal judge found that some funds were still being held up.
“We were working on this resolution before everything was happening in Washington, D.C.,” Hopkinson said at the meeting Tuesday. “This is sort of a coincidence that some of these other questions are being raised.”
Hopkinson said these kinds of loans have been authorized for county departments since at least 2015. Other departments in the county have asked for loans of this variety in the past, Hopkinson said, but the Office of Community Reinvestment is the only department currently requesting one.
But several County Board members expressed concern that continued issues with federal funding may occur, and that this loan poses a risk to the county.
“If this doesn’t get reimbursed, we’re out $600,000, plain and simple,” District 9 Kane County Board member Gary Daugherty said. “We should not risk it. This is like co-signing a loan for a drug addict.”
Concern about federal funding has not been limited to local government. Several area nonprofit organizations have expressed their concerns about what a potential loss of federal funds would mean for them.
Hesed House in Aurora previously said the loss of federal money would impact its ability to keep 286 people from unsheltered homelessness, and that the shelter would have to cut roughly 100 beds, according to past reporting. Two Rivers Head Start, an Aurora-based early childhood education organization that also receives federal funding, said they were preparing to lay off at least 75 employees before the federal freeze was blocked.
Berger said that although the county’s access to federal funding was briefly interrupted by the talk of a freeze, they have since restored access for all of the county programs that rely on federal funding. The Office of Community Reinvestment is currently borrowing money from the county for several programs as it waits for federal reimbursements, Hopkinson told The Beacon-News, but clarified that its need for the loans is unrelated to the federal freeze as of now.
District 3 Kane County Board member and Jobs Committee Chair Anita Lewis told the board on Tuesday that many of the office’s programs funded by the federal government are already underway.
“We’ve already put people in programs,” Lewis said. “Could be truck driving school, could be nursing school, all those kind of things. We’ve got people already working to get these degrees and things. And we don’t get reimbursed until they fulfill that return. So these are already things that are well in the works.”
She said if the federal government stopped providing these grants to the county in the future, they’d most likely need to cut the OCR programs that rely on them.
“That’s the sad thing of it,” Lewis said. “But it’s nothing we can plan now.”
As a result, several Kane County Board members reiterated, the county will just have to wait and see.
“Federally-funded, that used to be a solid promise, right?,” District 4 Kane County Board member Mavis Bates said at Tuesday’s meeting. “Now we’re not always so sure. But I don’t want to kill these programs based on a fear of something happening at the federal level that hasn’t happened yet.”
mmorrow@chicagotribune.com
