HomeMy WebLinkAboutMINUTES - 12172013 - HA C.3RECOMMENDATIONS
ACCEPT the 2nd Quarter (Unaudited) Budget Report for the period ending September 30, 2013.
BACKGROUND
This report is intended to provide the Board of Commissioners with an overview of the financial position of the
Housing Authority of the County of Contra Costa (HACCC) for the 2nd quarter period ending 9/30/13. The report
begins with a summary of HACCC’s overall fiscal standing at the end of the quarter. The overall numbers are then
broken down by individual funds. Each fund overview includes a brief program summary and an explanation of the
variance between budgeted and actual performance.
Action of Board On: 12/17/2013 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF COMMISSIONERS
AYE:John Gioia, District I
Commissioner
Candace Andersen, District II
Commissioner
Mary N. Piepho, District III
Commissioner
Karen Mitchoff, District IV
Commissioner
Federal D. Glover, District V
Commissioner
ABSENT:Geneva Green, Tenant Seat
Commissioner
Contact: 925-957-8028
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the
Board of Supervisors on the date shown.
ATTESTED: December 17, 2013
Joseph Villarreal, Executive Director
By: June McHuen, Deputy
cc:
C.3
To:Contra Costa County Housing Authority Board of Commissioners
From:Joseph Villarreal, Housing Authority
Date:December 17, 2013
Contra
Costa
County
Subject:2nd Quarter Financial Report
BACKGROUND (CONT'D)
AGENCY OVERVIEW: Budget Report
Changes in HACCC's overall budget position for the second quarter are shown in the chart below. Major changes in
Section 8 voucher program (HCV) funding had the most significant impact on HACCC's budget.
Revenue is down $534,708 versus projected primarily due to an ongoing reduction in housing assistance payments
(HAP), or subsidy, received from HUD. Until recently, housing authorities kept excess HAP received from HUD in a
locally controlled reserve fund. HAP reserves are to be used to cover any shortfalls in HAP funding from HUD.
However, because funding shortfalls have become common in the voucher program. On several occasions HUD has
had to take money from housing authorities with excess reserves to distribute to agencies with too little money on
hand to pay their monthly HAP costs. In order to speed-up this redistribution process in the future, HUD has decided
to hold all HCV reserves centrally. In order to deplete each housing authority's reserves, HUD sends less HAP each
month than is needed to fully pay all owners on the HCV program forcing housing authorities to spend down their
local HAP reserves. HUD's goal is that each housing authority will retain about two weeks worth of HAP locally.
HACCC lost nearly $1,000,000 in revenue during this quarter because of this change. This was somewhat offset by
an increase of nearly $500,000 in public housing revenue that is directly tied to improved occupancy rates.
As shown below, expenditures have decreased due to HACCC's efforts to cut voucher subsidy costs over the past two
years. The overall reduction in the agency's costs of $1,774,025 is primarily attributable to savings in HCV HAP
costs.
HACC Agency Summary Annual Budget
2nd Quarter
Actual
9/30/13
Remaining FY
Estimate Annual Total Variance
Revenue $ 95,851,617 $ 47,391,099 $ 47,925,810 $ 95,316,909 $ (534,708)
Expenditures $100,936,725 $ 48,694,337 $ 50,468,363 $ 99,162,700 $1,774,025
$ (5,085,108)$ (1,303,238)$ (2,542,553)$ (3,845,791)
Analysis of Agency Reserves
Program
Beginning
Balance 4/1/13
(Unaudited)
2nd Quarter
ending
9/30/13
(Unaudited)
Reserve
Balance period
ending 9/30/13
(Unaudited)
Restricted Reserves
Housing Choice Vouchers $ 5,102,811 $ (1,152,054)$ 3,950,757
Public Housing & Cap. Funds $ -0-$ -0-$ -0-
State & Local Programs $ 480,516 $ (44,472)$ 436,044
Housing Certificates Programs $ -0- .$ 6,805 $ 6,805
Total Restricted Reserves $ 5,583,327 $ (1,189,721)$ 4,393,606
Unrestricted Reserves
Housing Choice Vouchers $ 2,933,483 $ (38,261)$ 2,895,222
Public Housing & Cap. Funds $ 1,652,868 $ 67,394 $ 1,720,262
State & Local Programs $ 1,511,431 $ (96,607)$ 1,414,824
Housing Certificates Programs $ 115,183 $ (46,043)$ 69,140
Total Unrestricted Reserves $ 6,212,965 $ (113,517)$ 6,099,448
Total Reserves $ 11,796,292 $ (1,303,980)$ 10,493,054
As a reminder, almost all reserves are restricted for use within each program. The designation of restricted or
unrestricted reserves merely indicates that the funds are obligated for special use within the program (restricted) or
that they can be used for any purpose tied to the program (unrestricted). The only reserves that can be used freely are
unrestricted reserves within the State and Local Programs that are not tied to the tax credit properties. These reserves
can be used to support any of HACCC’s programs.
FUNDS OVERVIEW:
Housing Choice Vouchers
Program Summary - The HCV program provides assistance to families in the private rental market. HACCC qualifies
families for the program based on income. These families find a home in the private rental market and HACCC
provides them with a subsidy via a HAP contract with the property owner. HAP is paid by HACCC directly to the
owner. Through its HCV program, HACCC is authorized to provide affordable housing assistance to a maximum of
6,781 families. However, due to funding constraints, the program is only able to support approximately 6,300
families currently.
Summary of Difference Between Budgeted and Year-End Annual Estimate:
Revenue – As discussed broadly in the overview, HACCC lost $975,105 in projected revenue due to HUD's decision
to maintain HAP reserves in the future. Housing authorities with local HAP reserves will receive decreased HAP
funding until their local reserves are exhausted.
Expenditures – The projected variance of $2,062,842 is due primarily to reduced HAP expenditures as HACCC's cost
saving measures of the past two years continue to take effect. A slight decrease in the number of vouchers under
contract also occurred, leading to further reductions in HAP costs. As approved by the Board last month, increased
payment standards will result in rising HAP costs in future quarters.
Housing Choice
Vouchers Annual Budget 2nd Quarter Actual
9/30/2013 (Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 77,678,861 $ 37,864,325 $ 38,839,431 $ 76,703,756 $ (975,105)
Expenditures $ 82,234,964 $ 39,054,640 $ 41,117,482 $ 80,172,122 $ 2,062,842
$ (4,556,103) $ (1,190,315)$ (2,278,051)$ (3,468,366)
Analysis of Program Reserves:
Housing Choice Vouchers
Beginning
Balance 4/1/13
(Unaudited)
2nd Quarter
9/30/2013
(Unaudited)
Reserve Balance
period ending
9/30/13
(Unaudited)
Restricted Reserves $ 5,102,811 $ (1,152,054)$ 3,950,757
Unrestricted Reserves $ 2,933,483 $ (38,261)$ 2,895,222
Total Reserves $ 8,036,294 $ (1,190,315)$ 6,845,979
Public Housing Operating and Capital Funds
Program Summary - HACCC owns and manages 1,179 public housing units at 16 different sites throughout the
County. Operating funds for these properties come from tenant rents as well as an operating subsidy received from
HUD that is designed to cover the gap between rents collected from the low-income tenants and annual operating
expenses. HUD allocates the Capital Fund annually via formula to approximately 3,200 housing authorities. Capital
Fund grants may be used for development, financing, modernization, and management improvements within public
Fund grants may be used for development, financing, modernization, and management improvements within public
housing.
Summary of Difference Between Budgeted and Year-End Annual Estimate:
Revenue –The $491,205 increase in revenue is primarily attributable to the fact that public housing occupancy has
increased significantly. Net tenant rental income is up roughly $184,240 and Operating Subsidy received from HUD
is $142,000 greater than budgeted. Operating subsidy is tied directly to occupancy rates.
Expenditures - Increased occupancy also leads to increased costs. The jump in costs versus budgeted is largely the
result of increased utility usage. Water and electricity cost increases represent $268,546 of the $336,749 variance.
The remainder of the increase is due to unit turnover costs.
Public Housing
Operating and
Capital Fund
Annual Budget 2nd Quarter Actual
9/30/13 (Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 9,558,091 $ 5,270,250 $ 4,779,046 $ 10,049,296 $ 491,205
Expenditures $ 9,732,214 $ 5,202,856 $ 4,866,107 $ 10,068,963 $ (336,749)
$ (174,123)$ 67,394 $ (87,061)$ (19,667)
Analysis of Program Reserves:
Public Housing & Capital
Fund
Beginning
Balance 4/1/13
(Unaudited)
2nd Quarter
9/30/13
(Unaudited)
Reserve Balance
period ending
9/30/13
(Unaudited)
Restricted Reserves $ -0-$ -0-$ -0-
Unrestricted Reserves $ 1,652,868 $ 67,394 $ 1,720,262
Total Reserves $ 1,652,868 $ 67,394 $ 1,720,262
State and Local Programs
Program Summary - HACCC administers a variety of programs and activities that are either not funded by HUD or
that involve non-restricted HUD funds. Currently, HACCC is the managing general partner for two tax credit
projects (DeAnza Gardens & Casa Del Rio) and also has a contract with the City of Antioch to run their rental
rehabilitation program. HACCC receives management fees for administering the Public Housing and HCV programs
under HUD’s asset-management model.
Summary of Difference between Budgeted and Year-End Annual Estimate:
Revenue –The $80,137 growth in revenue compared to the budget is the result of an increase in allowable
management fees from the public housing and HCV programs.
Expenditures - The $60,773 increase in expenditures reflect costs associated with the elimination of the County's
rental rehabilitation loan program along with HACCC's contract to manage that program.
State & Local
Programs Annual Budget 2nd Quarter Actual
9/30/13 (Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 5,173,102 $ 2,666,688 $ 2,586,551 $ 5,253,239 $ 80,137
Expenditures $ 5,493,988 $ 2,807,767 $ 2,746,994 $ 5,554,761 $ (60,773)
$ (320,886)$ (141,079) $ (160,443)$ (301,522)
Analysis of Reserves:
State & Local Programs
Beginning
Balance 4/1/13
(Unaudited)
2nd Quarter
9/30/13
(Unaudited)
Reserve Balance
Period ending
9/30/13
(Unaudited)
Restricted Reserves $ 480,516 $ (44,472)$ 436,044
Unrestricted Reserves $ 1,511,431 $ (96,607)$ 1,414,824
Total Reserves $ 1,991,947 $ (141,079) $ 1,850,868
Housing Certificate Programs
Program Summary - HACCC administers two separate Housing Certificate Programs; Shelter Plus Care and
Moderate Rehabilitation (Mod Rehab). The Shelter-Plus Care Program provides rental assistance for hard-to-serve
homeless persons with disabilities in connection with supportive services funded from sources outside the program.
HACCC assists approximately 285 clients under this program. The Mod Rehab program was designed in 1978 as an
expansion of the rental certificate program. Mod Rehab was designed to provide low-cost loans for the rehabilitation
of rental units in an effort to upgrade and preserve the nation's housing stock. In return, the owner agreed to provide
long-term affordable housing for low income families. The program was repealed in 1991 and no new projects are
authorized for development. HACCC administers 28 Mod Rehab units.
Summary of Difference Between Budgeted and Year-End Annual Estimate:
Revenue - The reduction in revenue is related to a slight drop in Shelter Plus Care funding for both HAP and
administration.
Expenditures - Most of the reduction in expenditures is tied to decreased HAP funding for the Shelter Plus Care
program.
Housing
Certificate
Programs
Annual Budget 2nd Quarter Actual
9/30/13 (Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 3,441,563 $ 1,589,836 $ 1,720,782 $ 3,310,618 $ (130,945)
Expenditures $ 3,475,559 $ 1,629,074 $ 1,737,780 $ 3,366,854 $ 108,705
$ (33,996)$ (39,238)$ ( 16,998)$ (56,236)
Analysis of Reserves:
Housing Certificate Programs
Beginning
Balance 4/1/13
(Unaudited)
2nd Quarter
9/30/13
(Unaudited)
Reserve Balance
period ending
9/30/13
(Unaudited)
Restricted Reserves $ -0-$ 6,805 $ 6,805
Unrestricted Reserves $ 115,183 $ (46,043)$ 69,140
Total Reserves $ 115,183 $ (39,238)$ 75,945
FISCAL IMPACT
None. Information item only.
CLERK'S ADDENDUM