BUFFALO, N.Y. (WIVB) -- Acting Buffalo Mayor Chris Scanlon is rejecting a claim from Buffalo Comptroller Barbara Miller-Williams that the city may have to return nearly $2.5 million in unused ARPA funds. Under the American Rescue Plan of 2021 -- a federal law to help assist the nation recover from COVID-19 -- Buffalo received over $331 million in federal funds. The city faced a Dec. 31 deadline to designate where the funds would go. In a letter obtained by WIVB News 4, Miller-Williams wrote that $2.5 million of those funds were not designated ahead of that deadline by the city. Scanlon responded, saying he "firmly" rejects Miller-Williams' claim. "The American Rescue Plan of 2021 (ARPA) provided the City of Buffalo with an unprecedented opportunity to address the financial challenges caused by the Coronavirus Pandemic," Miller-Williams wrote. "The City received $331,356,932 in two separate disbursements of $165,678,466 each from the United States Department of Treasury." "As of January 1, 2025, $328,878,133.10 (99.25% of total funds) has been obligated, leaving $2,478,798.90 (0.75% of total funds) unobligated, per data retrieved from the City's accounting system known as Municipal Information System (MUNIS). I am contacting your Administration for clarification on the status of these remaining funds, as all ARPA funds were required to be obligated by December 31, 2024. Any unobligated funds must be returned to the USDOT and reported in the upcoming Fourth Quarter Project & Expenditure Report, due January 31, 2025." In response, Scanlon strongly rejected those claims. "Since October 15, 2024, my administration has worked diligently and performed a detailed audit review in conjunction with the city’s professional financial consultant to ensure all ARPA funds were fully encumbered by the Dec. 31, 2024, federal deadline," Scanlon said. "The Comptroller’s assertion reflects a clear misinterpretation of data. It is particularly concerning that the former Commissioner of Administration and Finance -- now Deputy Comptroller -- fails to understand the status of projects he helped oversee and were approved by the Common Council." Scanlon said that $2.55 million in funds were allocated to an unpaid taxes program with Common Council approval on Dec. 23, and that it is being applied to accounts meeting federal deadlines. This is just the latest turn of events in what has been a complicated and confusing allocation process. The Buffalo Common Council had previously voted on Dec. 24 to keep $30 million federal funds from going back to Washington D.C., and then again on Dec. 30 to take $2 million from revenue replacement and transfer it to four cultural institutions: The African American and Italian cultural centers, Colored Musicians Club and Torn Space Theater. Buffalo Common Council Member Mitch Nowakowski told News 4 that he was concerned by Miller-Williams' letter. “The comptroller’s recently filed document on face value is very concerning and demands immediate examination of validity," Nowakowski said. "I also hold concerns on the timeliness of this document, after actively knowing the comptroller's personal anger towards the approval of the capital budget regarding her previous raised concerns. It’s important that this is factual and not political payback of a bruised ego." The comptroller's letter is on the agenda for the upcoming Jan. 21 Common Council meeting. Latest Local News Bills’ 64-65 AFL champs invite fans to ‘Unbillievable’ celebration Mayor, comptroller in dispute over $2.5M in ARPA funds Two arrested after car chase, allegedly striking police vehicle, stealing from Tops Call 4 Action: Tenant without reliable heat for over a month Escort scam involving robbery reported by several victims in Erie County *** Mark Ludwiczak joined the News 4 team in 2024. He is a veteran journalist with two decades of experience in Buffalo. You can follow him online at @marklud12.