Program officials anticipate a budget shortfall for 2016 due to changes in housing priorities from the state, plus the sunset of a grant program that’s helped provide housing services.
“We received a large grant — a $152,000 grant — from the National Mortgage Settlement, and that grant is about to expire,” Grand Haven Neighborhood Housing Coordinator Char Seise said. “Those funds are not intended to be replaced, and I don’t anticipate anything like that coming in the future.”
The grant funds three part-time positions for the city’s housing program: a housing educator, an educator assistant and an AmeriCorps member. It also helps provide funds for a portion of Seise’s position.
The grant expiration is coupled with changes in the state’s housing funding priorities.
”A reduction in federal funds for housing is directly impacting the state’s ability to provide resource to communities like ours that are applying for funds for housing,“ Seise said. ”When we look at MSHDA (Michigan State Housing Development Authority) funding, in 2010, there was significant more money than there is today in 2015.“
The state plans to shift priorities, giving top preference to rental rehabilitation efforts above downtown storefronts, followed by homeowner rehab grants to preserve homeownership, and then the home purchase rehabilitation program.
“Those shifts are really nothing we can control, but they directly affect our ability to provide services to our residents in the ways we have done in the past,” Seise said.
And, as the economy recovers, homeownership affordability remains a challenge, Seise noted.
”Even though we’re recovering from the Great Recession, we’re still challenged in the income levels that we’re providing in our community,” she said. ”According to the Chamber of Commerce, eight out of 10 employers focused on Northwest Ottawa County are manufacturing, and those are typically lower wage-paying jobs. Those are the kinds of people we’re serving with these kinds of services.“
As the economy recovers, Seise said this increases property values and rental costs, which can put a squeeze on lower-income workers looking to purchase or rent in the community where they work.
”When we rebound, we rebound really well,“ she said.
With challenges still facing area residents, and with funding changes coming down the pike, city staff has evaluated several strategies that would allow housing-related services to continue.
“We’ve had several conversations between the city manager and the city planner about how we could go about overcoming these challenges,” Seise said.
Ideas being considered include:
— No change: programs and services would be reduced or ended in September 2016.
— Create a Tri-Cities Community Development Housing Organization (CHDO).
— Merge with an existing non-profit community development partner.
— Re-orient the housing division to community development.
Pros listed for this plan are that it would maintain current housing programs and services, it would provide a certified grant writer to research and write grants, and it would offer a unique approach to community development.
Seise said the new option could re-orient the housing division to a coordinated community development approach, which includes housing, arts and culture, healthy food, and disaster preparedness.
“I really think the new strategy has the most diverse funding options for us to consider,” Seise said. “It’s a strategy that we would be in the most control over.“
Added Seise: ”With this type of focus of looking at the resilience of our community, this to me sounds like a really promising alternative to what we’ve done in the past.“
City Council members were divided over what the city should do regarding the future of the program.
”I think that these services are good for people, it’s just where does the money come from to fund them?“ Mayor Geri McCaleb said. ”Do we want another line item in our city budget? Not particularly, at least in my perspective.“
McCaleb said she is more than willing to look at alternatives to continue to provide services that are needed.
”If we don’t need as much in the housing foreclosures, what do we need and where are those funds available?“ she asked. ”I think there’s plenty of money out there to tap into, it’s just what services do we provide?“
Councilman Denny Scott said he is also concerned with the city going at it alone.
”Hopefully, we can reach out to other parts of our Tri-Cities area and see if we can do it that way,“ he said. “To stand alone with this project, I’m not sure we can do that. ... I just think it’s awfully expensive to keep up this project with the city going alone.”
Others say it is time for the city to be involved in the program.
”The grant funding you’ve had, and the track record you’ve established, has given us an opportunity to see the value of these programs.“ Councilman Bob Monetza said to Seise. ”We’ve all sat here and acknowledged that these are important to our people.“
Monetza said the city should continue to provide the services in some form.
”It’s making our neighborhoods more valuable and our citizens more reliable,“ he said. ”There’s value in that.“
Councilman Mike Fritz also backs the program, and noted that the department has relied on grant funding since its inception.
“We need to put a little skin in the game and move forward with this,” he said.