09-26-88 Personnel & Finance and Residential Neighborhood

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Human Resources and Economic Development Committee Cont'd page 2 f particular home would be up for sale. He stated that in his opinion the $40,000.00 each year which would be set aside through a reverting fund did not provide enough assurance. The Council Attorney noted that both the Legal Department and herself agree that both mechanisms, that being the establishment of either a non-reverting or reverting fund, are legal. Therefore, it would become a policy decision of the Common Council as to which is the better vehicle to create. Councilman Voorde noted that if a non-reverting fund would be established, that in his opinion, a self fulfilling prophesy would be set up. He noted that basically we would be purchasing a $40, 000.00 insurance policy on a yearly basis. He noted that he expects high standards which would be carried out by Mr. Watson as well as the South Bend Housing Authority. Councilman Niezgodski stated that he was against the non- reverting ordinance. He stated that the Mayor pledged that he would do everything in his power to provide back-up assurance to the South Bend Housing Authority. Councilman Niezgodski believed that the Common Council was jumping ahead of itself. Councilman Coleman stated that he saw the City's involvement as a "third line of defense. " He had concern that the Housing Development Corporation may be a possible source of additional monies and therefore was reluctant to support a non-reverting fund. He further stated that the money should not be tied up when there are critical needs of the City to be addressed. Councilman Slavinskas noted that the establishment of either a non-reverting fund or reverting fund would in both cases tie up the $40,000.00 allocation each year. He agreed with Councilman Niezgodski that the Council may be jumping the gun, however, the citizens feel uncomfortable with the current program. He stated that he would agree to a cap of $100,000.00 or $120, 000.00 and would further agree to allow the interest earned on such funds to be diverted to the General Fund. He believed that there were alternatives which could be discussed. Council person Puzzello stated that all future Council Members would be as interested in the program as current ones. She stated that she prefers the reverting fund and suggested that pagagraph (d) in Section 2-169 be amended to read as follows: "Monies will be appropriated for this fund from other sources, if necessary." She asked to the Council Attorney whether such an amendment would be legal and the Council Attorney advised her that it would be. It was