TEHRAN, November 12 -The city scrambled to find money when officials found a housing shortfall much worse than they expected.
TEHRAN, Young Journalists Club (YJC) -The city scrambled to find money when officials found a housing shortfall much worse than they expected.
After dodging a $30 million bullet, San Francisco officials said they will now pay much greater attention in managing the city's low-income housing ledger -- after a serious shortfall nearly put a number of needy out in the street.
The U.S. Department of Housing and Urban Development alerted San Francisco's Housing Authority in September there would be a major deficit in its low-income voucher program, which pays private landlords who own the city's public housing properties.
Audits last month by global accounting firm Binder Dijker Otte and HUD revealed the gap was in the $25 million range for fiscal 2018, and $5 million for the beginning of 2019. As a result, the authority had nothing to subsidize landlords and nonprofit developers.
HUD provided $10 million and the housing authority more than $7 million. City officials said once they became aware of the problem, they acted immediately -- as the city's low-income residents were running out of time. Officials feared the cash problem might force many of the tenants out of their homes by the end of the year.
How it happened
At a meeting of the housing authority last week, Executive Director Barbara Smith said unqualified financial employees failed to keep up with the agency as it began more aggressively pursuing housing programs with HUD funding -- after having underused those government funds for years. Part of that effort expanded the voucher program by more than 4,600 units.
"Our finance department was unable to keep up with all these additions to our programs and actually, quite honestly, was not able to perform some routine reporting to HUD," she said. "Our data that we were reporting to HUD wasn't correct."
HUD provides the authority with a two-year forecasting tool, but poor reporting that failed to account for specific situations caused that gauge to produce inaccurate numbers -- a problem Smith said was created by her department.
"This is not HUD's fault," she said. "The housing authority is fully responsible for projecting any potential shortfall. Those projects can be complicated with the portfolio and housing units we've added."
About 3,500 Rental Assistance Demonstration units that opened this year were major factors in the flawed calculations. The forecast tool requires accurate reporting and necessary adjustments to work correctly. Smith said her agency didn't make some of those adjustments.
"We were fast becoming overutilized based on commitments we made in 2017," she said.
City officials expected a shortfall, but not nearly as large as the one they found. It's not uncommon for cities to experience funding deficits for housing. In fact, HUD routinely covers such gaps at the end of the year -- but those amounts are typically in the hundreds of thousands, not tens of millions.
Source: UPI
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