Housing Authority will run in red on purpose next year
The Warren County Housing Authority will be running in the red next year, but it’s intentional.
The authority’s board of directors reviewed the proposed 2014 budget at its October meeting, but had some additional questions at its Tuesday meeting.
The budget will run approximately $500,000 over budget next year.
Board member Frank Wilcox asked how the authority intended to run under a budget with such a large deficit.
Staff explained the authority has reserves in excess of what the U.S. Department of Housing and Urban Development feels is appropriate, and could reduce subsidies if those reserves are not reduced.
HUD pursued that policy in 2012 during a “recapture” period in which the authority did not receive any subsidy funding.
Authority Financial Assistant Stacy Kranak pointed out operating with negative income is the only way to spend down reserves.
Authority Executive Director Tonya Mitchell-Weston noted the authority would likely continue to run negative budgets for two to three years.
“That should put us in line with where our reserves should be,” she said.
For this year, the authority is currently running, in part, on reserve spending.
Kranak reported a decrease in available cash of $141,767 through Oct. due to reserve spending.
Board members approved payment of $105,348.38 in new bills.