HomeMy WebLinkAboutMINUTES - 09092014 - HA C.3RECOMMENDATIONS
ACCEPT the 4th Quarter (Unaudited) Budget Report for the period ending 3/31/14.
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 3rd quarter period ending 3/31/14. 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.
AGENCY OVERVIEW: Budget Report
Changes in HACCC's overall budget position for the fourth 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 $852,775 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. These reserves are used to cover any shortfalls in HAP funding from HUD. However,
as funding shortfalls have become common in the voucher program, and the impact of these shortfalls has varied
dramatically among housing authorities, 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. HUD has decided to hold all
Action of Board On: 09/09/2014 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF COMMISSIONERS
AYE:John Gioia, Commissioner
Candace Andersen,
Commissioner
Karen Mitchoff,
Commissioner
Federal D. Glover,
Commissioner
Fay Nathaniel,
Commissioner
Aqueela Bowie,
Commissioner
ABSENT:Mary N. Piepho,
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: September 9, 2014
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:September 9, 2014
Contra
Costa
County
Subject:Fourth Quarter Budget Report for FY 2013-14
BACKGROUND (CONT'D)
> HCV reserves centrally so that this redistribution process can be streamlined in the future. 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, thus forcing housing authorities to spend down their local HAP reserves. HUD's current goal is that each
housing authority will maintain a local reserve that could provide HAP payments for approximately two weeks.
HACCC lost nearly $2,409,915 in restricted reserves this fiscal year because of this change.
As shown below, expenditures continue to decrease due to HACCC's efforts to cut voucher subsidy costs over the past
two years. The overall reduction in the agency's costs of $2,441,261 is primarily attributable to savings in HCV HAP
costs.
HACC Agency Summary Annual Budget
4th Quarter
Actual
3/31/14
Remaining FY
Estimate Annual Total Variance
Revenue $ 95,851,617 $ 94,998,842 $ -0-$ 94,998,842 $( 852,775)
Expenditures $100,936,725 $ 98,495,463 $ -0-$ 98,495,463 $ 2,441,262
$ (5,085,108)$ (3,496,621)$ -0-$ (3,496,621)
Analysis of Agency Reserves
Program
Beginning
Balance 4/1/13
(Audited)
4th Quarter
ending
3/31/14
(Unaudited)
Reserve
Balance period
ending 3/31/14
(Unaudited)
Restricted Reserves
Housing Choice Vouchers $ 5,102,811 $ (2,409,915)$ 2,692,896
Public Housing & Cap. Funds $ -0-$ -0-$ -0-
State & Local Programs $ 520,046 $ (24,591)$ 495,355
Housing Certificates Programs $ 6,493 $ -0.$ 6,493
Total Restricted Reserves $ 5,629,350 $ (2,434,606)$ 3,194,744
Unrestricted Reserves
Housing Choice Vouchers $ 2,858,750 $ (279,300)$ 2,579,450
Public Housing & Cap. Funds $ 1,476,043 $ (517,715)$ 958,328
State & Local Programs $ 2,366,724 $ (207,171)$ 2,159,553
Housing Certificates Programs $ 108,567 $ (57,829)$ 50,738
Total Unrestricted Reserves $ 6,810,084 $ (1,062,015)$ 5,748,069
Total Reserves $ 12,439,434 $ (3,496,621)$ 8,942,813
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
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 in the overview, HACCC lost approximately $2,441,261 in projected revenue due to HUD's
decision to maintain HAP reserves formerly held by housing authorities. Housing authorities with local HAP reserves
will receive decreased HAP funding until their local reserves are reduced to HUD's satisfaction. The reduced reserve
levels resulted in reductions in investment income that contributed to the loss of projected revenue.
Expenditures – The variance of $2,933,814 is primarily due to reduced HAP expenditures of $2,760,928 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. A reduction of $172,886 in general administrative
expenses also occurred.
Housing Choice
Vouchers Annual Budget
4th Quarter Actual
3/31/2014
(Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 77,678,861 $ 76,611,936 $ -0-$ 76,611,936 $ (1,066,925)
Expenditures $ 82,234,965 $ 79,301,151 $ -0-$ 79,301,151 $ 2,933,814
$ (4,556,104)$ (2,689,215)$ -0-$ (2,689,215)
Analysis of Program Reserves:
Housing Choice Vouchers
Beginning
Balance 4/1/13
(Audited)
4th Quarter
3/31/2014
(Unaudited)
Reserve Balance
period ending
3/31/14
(Unaudited)
Restricted Reserves $ 5,102,811 $ (2,409,915)$ 2,692,896
Unrestricted Reserves $ 2,858,750 $ (279,300)$ 2,579,450
Total Reserves $ 7,961,561 $ (2,689,215)$ 5,272,346
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
housing.
Summary of Difference Between Budgeted and Year-End Annual Estimate:
Revenue –The $367,118 increase in revenue is primarily attributable to the increase in public housing occupancy and
the corresponding increase in tenant rents. Net tenant rental income has increased by $160,078 while vacancy loss is
down by $207,040.
Expenditures - As occupancy rates have increased, so have attendant costs to manage the properties as more units
had to be prepared for tenants, work orders increase, etc. Costs were also driven up by the hiring of temporary
replacements for staff out on extended medical absences. The increase in projected costs of $710,710 is a result of
the following items: Temporary Maintenance - $283,879; Temporary Administrative - $187,297; Police Services -
$104,139; Management Fees to COCC - $135,395.
Public Housing
Operating and
Capital Fund
Annual Budget 4th Quarter Actual
3/31/14 (Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 9,558,091 $ 9,925,209 $ -0-$ 9,925,209 $ 367,118
Expenditures $ 9,732,214 $ 10,442,924 $ -0-$ 10,442,924 $ (710,710)
$ (174,123)$ (517,715)$ -0-$ (517,715)
Analysis of Program Reserves:
Public Housing & Capital
Fund
Beginning
Balance 4/1/13
(Audited)
4th Quarter
3/31/14
(Unaudited)
Reserve Balance
period ending
3/31/14
(Unaudited)
Restricted Reserves $ -0-$ -0-$ -0-
Unrestricted Reserves $ 1,476,043 $ (517,715)$ 958,328
Total Reserves $ 1,476,043 $ (517,715)$ 958,328
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 $ 96,941 growth in revenue compared to the budget is primarily related to the increase in allowable
management fees from the public housing and HCV programs.
Expenditures - The $7,917 increase in expenditures was due to costs associated with a file purge project in central
office.
State & Local
Programs Annual Budget
4th Quarter Actual
3/31/14
(Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 5,173,102 $ 5,270,043 $ -0-$ 5,270,043 $ 96,941
Expenditures $ 5,493,988 $ 5,501,905 $ -0-$ 5,501,905 $ ( 7,917)
$ (320,886)$ (231,862) $ -0-$ (231,862)
Analysis of Reserves:
State & Local Programs
Beginning
Balance 4/1/13
(Audited)
4th Quarter
3/31/14
(Unaudited)
Reserve Balance
Period ending
3/31/14
(Unaudited)
Restricted Reserves $ 520,046 $ (24,691)$ 495,355
Unrestricted Reserves $ 2,366,724 $ (207,171)$ 2,159,553
Total Reserves $ 2,886,770 $ (231,862) $ 2,654,908
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 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 4th Quarter Actual
3/31/14 (Unaudited)
Remaining FY
Estimate Annual Total Variance
Revenue $ 3,441,563 $ 3,191,654 $ -0-$ 3,191,654 $ (249,909)
Expenditures $ 3,475,559 $ 3,249,483 $ -0-$ 3,249,483 $ 226,076
$ (33,996)$ (57,829)$ -0-$ (57,829)
Analysis of Reserves:
Housing Certificate Programs
Beginning
Balance 4/1/13
(Audited)
4th Quarter
3/31/14
(Unaudited)
Reserve Balance
period ending
3/31/14
(Unaudited)
Restricted Reserves $ 6,493 $ -0-$ 6,493
Unrestricted Reserves $ 108,567 $ (57,829)$ 50,738
Total Reserves $ 115,060 $ (57,829)$ 57,231
FISCAL IMPACT
None. Information item only.
CLERK'S ADDENDUM