05-27-75 Council Meeting Minutes

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REGULAR MEETING I MAY 27t 1975 REGULAR MEETING - RECONVENED (CONTINUED) ORDINANCE AN ORDINANCE APPROPRIATING $49,500 FROM THE LOCAL ROADS AND STREETS FUNDS AND $5,500 FROM THE CUMULATIVE CAPITAL IMPROVEMENT FUND TO PROJECT R & S 70 -1975, MIAMI ROAD FROM KERN ROAD TO JACKSON ROAD. This ordinance had first reading. Councilman Taylor made a motion to set the ordinance for public hearing and second reading on June 9, 1975, seconded by Councilman Horvath. The motion carried. ORDINANCE AN ORDINANCE APPROPRIATING THE SUM OF $5,000.00 FROM THE CUMULATIVE SEWER BUILDING AND SINKING FUND FOR PROJECT CS9 -1975, MIAMI HIGHWAY SANITARY SEWER EXTENSION. This ordinance had first reading. Councilman Taylor made a motion to set the ordinance for public hearing and second reading on June 9, 1975, seconded by Councilman Horvath. The motion carried. ORDINANCE AN ORDINANCE FOR THE TRANSFER OF FUNDS WITHIN THE FIRE DEPARTMENT BUDGET IN THE AMOUNT OF $5,000.00 FROM LINE ITEM 110, "SERVICES PERSONAL ", TO LINE ITEM 262, "MEDICAL- SURGICAL - DENTAL ", BOTH ACCOUNTS BEING WITHIN THE FIRE DEPARTMENT BUDGET OF THE GENERAL FUND OF THE CITY OF SOUTH BEND, INDIANA. This ordinance had first reading. Councilman Taylor made a motion to set the ordinance for public hearing and second reading on June 9, 1975, seconded by Councilman Miller. The motion carried. PRIVILEGE OF THE FLOOR Council President Parent indicated that he had requested the Housing Allowance Office to be presen- at this Council meeting in order to answer the questions that had come up atthe last Council meeting. He asked if Mrs. Irene Mutzl wished to restate her questions at this time. He stated that he would allow her and anyone else in the audience to ask questions, after which the repre- sentatives of the HAO would try to answer the questions. He indicated that he hoped a debate wouli not be entered into. Mrs. Mutzl indicated that she would again pose her questions. She asked why the county was surveyed when the housing program was a city program. She asked how the test cases were arrived at when, in fact, all the cases would be test cases because the program was an experimental one. She asked about the landlords raising the rent and advising people to go to the HAO to make up the difference. She stated that she appreciated the fact that Mr. Lennon had for - warded the amounts spent to date, and she indicated that Mr. Shea had also done this. She cal- culated that, thus far, the amounts totalled about one and a half million dollars being expended, and only a little over $6,000 had actually gone to the recipients. At the end of 1974, according to the audit, $18 had gone to a recipient. She stated that Rand, Westad and the HAO have funds. Rand and Westad are reimbursed for their expenses. Rand has spent $150,000, Westad $700,000 and the HAO over $500,000. She questioned this amount of money for getting the program off the ground She also questioned how many people of the low and medium- income groups had to pay taxes to get back this amount. She also wondered why the audit that was made was done by a firm in Milwaukee and not a firm from South Bend. She questioned why the Council had approved a program over which it had no control. She also mentioned the "harrassment" received by a certain party about partici. pation in the program. Mr. Charles Lennon, Executive Director of the Housing Allowance Office, made his presentation. He stated that, on April 2, there were many questions concerning the pro- gram and the response of the citizens in the community. The housing market was looked at in the county in general. Test cases totalled approximately 139 - -there was one test case in 1974. He explained that these test cases enabled the HAO to open its doors and accept participants into the program. Regarding the raising of rent by landlords, he indicated that, if a landlord makes certa: improvements in a home, he most certainly would have the right to raise the rent to compensate for this. He stated that this had not happened in Green Bay, however. He referred to the overhead projector and briefly explained the program. He indicated that an audit had been done by the same firm doing the audit in Green Bay. He talked about the number of preliminary applications being received by the HAO. He stated that one in every ten households responded. One in twenty actuall, applied for the program. Under the direction of Hollis Hughes, six interviewers have completed 695 interviews. The allowance payments reflected that of the 215 people paid as of last Friday, 41 were renters. He explained that the average payment going out to the 215 applicants was $76.16 for the renters, and $62.40 for the home owners. He talked about the objectives and guidelines used in the budgeting process. He talked about the high cost of administering the program during its first phases. He stated that these costs would decrease greatly from the third year on. He indicated that the HAO must account for its administrative costs and expenses. The proposed budget was submitted to HUD and the Housing Authority and the budget was officially accepted. He felt there were no inflated costs in the administrative expenses. He explained that, in the second year of the program, participants would be enrolled; however, administrative costs would decrease. Mr. Lennon indicated that 9,638 families could be enrolled per year during the life of the program. Salaries and fringe benefits would undoubtedly go up each year. He talked about the per unit cost per month. He stated that he was pleased with the response of the community. He indicated that some interviews are already being scheduled in August, but he hoped the backlog would be decreased soon. Mr. Michael Shea, Director of the Rand Corporation, talked about the higr administrative costs; however, he indicated that HUD felt it was worth spending this amount of money in an effort to save money that might be spent otherwise. Nationally, the amount of money spent for administrative expenses was quite small. Councilman Taylor indicated that he was glad to see the program in South Bend. He felt that the dangers of the program were brought out before and were never hidden. It was pointed out that there would be a need to monitor the program, and he felt that millions of federal tax dollars would be coming back to South Bend with the program, and he supported anything that would bring tax money back to the citizens. He stated that, if the program was not being started in South Bend, it would be started elsewhere and another city would benefit from the tax money. Councilman Kopczynski wondered if any community that had voted in favc of the program had eventually terminated it, and Mr. Shea indicated that there had not been one community to accept the program and then terminate it. Councilman Kopczynski wondered if there was any way that the program could adversely affect the stock of old rental housing. Mr. Shea felt