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COUNTY OF SAN MATEO
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Inter-Departmental Correspondence
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Human Services Agency
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DATE:
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June 2, 2003
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BOARD MEETING DATE:
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June 24, 2003
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TO:
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Honorable Board of Supervisors (sitting as Board of Commissioners)
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FROM:
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Maureen Borland, Director, Human Services Agency
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Steve Cervantes, Director, Office of Housing
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SUBJECT:
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RESOLUTION 615-C APPROVING THE TRANSFER OF $2,100,000 FROM THE SECTION 8 OPERATING RESERVE TO THE MIDWAY VILLAGE RESERVE ACCOUNT.AND THE SHELTER + CARE PROGRAM
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Recommendation
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Adopt Resolution 615-C approving the transfer of $2,100,000 from the Section 8 Operating Reserve to the Shelter + Care Program and to the Midway Village Reserve account.
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Background
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In the past, housing authorities were allowed to build unlimited reserves as a result of efficient operations of the Section 8 Program. By statute, these reserves could be used for future operations of the Section 8 Program or other housing related activities. Transfers require the approval by the Board of Commissioners and concurrence by the Department of Housing and Urban Development (HUD).
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The 2003 Federal appropriations bill imposed a limit on the total amount of Section 8 reserves a housing authority can retain. Any excess could be recaptured by HUD. The amount subject to recapture from our reserves is approximately $2,100,000. Resolution 615-C will authorize the transfer of this excess to Midway Village and the Shelter + Care Program. Both transfers are permissible according to the 1937 Housing Act as amended
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Discussion
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Midway Village financial operations have been adversely affected by the significant number of vacancies and the cost of unit improvements to return them to the rent roll. A transfer of $1,850,000 will restore the operating reserve of Midway Village, which at this point is in a negative position.
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The Shelter + Care Program has a $250,000 shortfall in the 1995 Sponsor Based component. HUD has rejected our request to transfer funds from the 1995 Tenant Based component to help offset the deficit. Therefore, the transfer is urgently needed.
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The Resolution has been approved by the County Counsel’s Office as to form.
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Vision Alignment
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The application for the transfer of funds keeps the commitment stated in goal #9 – “Housing exists for people at all income levels and for all generations of families”.
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Fiscal Impact
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There is no Net County Cost associated with this action. All funds requested come from the U.S. Department of Housing and Urban Development.
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