Newport council approves two restricted grant funds to keep federal and other grants separate

The Newport City Council voted to establish two restricted grant accounts to improve grant accounting and ensure externally funded projects are tracked separately from the general fund.

Mayor Rick Alfred Chase told the council that staff member Frank Cheney’s review of grant accounting showed a need for clearer, legally enforceable segregation of funds. "These funds would be restricted for only their intended purpose," Chase said, "That's a legal restriction that cannot be subverted, even with a council action." The council moved and seconded the proposal and approved it by voice vote.

City Clerk-Treasurer James Johnson will open one account dedicated to USDA grant receipts for the Causeway project and a second account to receive and disburse miscellaneous restricted grants. Councilors discussed whether the city should open one combined account or separate accounts; the approved motion establishes the two separate funds the mayor recommended.

The council and staff clarified that the label "restricted" carries a legal meaning: funds restricted by grant agreements must be used only for grant-authorized purposes and cannot be repurposed by local vote. The motion passed with ayes recorded; no roll-call tally was provided on the record. The council did not identify a mover or seconder by name in the minutes; the motion and voice vote are recorded in the meeting transcript.

The action aims to streamline tracking of incoming grant dollars, allow prompt disbursement when awards arrive, and reduce the risk of mixing restricted dollars with the city’s general operating and capital funds. The council did not specify implementation dates beyond directing the clerk-treasurer to open the accounts.