Keeping Up With All the Paperwork

The News & Advance
Published: October 1, 2008

When City Council members sit down again to review the federal Community Development Block Grant program, no one could blame them for wondering if the program is worth the grant money provided by Washington.

According to documents released by the U.S. Department of Housing and Urban Development, which administers the program, the city has been cited for numerous concerns and regulatory violations in connection with its yearly allocation of federal dollars to some 30 local nonprofit agencies that include economic development and housing rehabilitation. In the current fiscal year, the city received just more than $874,000 from HUD.

City Council is responsible for deciding how to allocate the money. City officials, in turn, are responsible for monitoring the projects, making sure they meet HUD regulations. The federal agency is most concerned about deficiencies in those monitoring efforts.

HUD officials visited the city in May to perform a review of both the block grant program and a second, smaller program referred to as the HOME grant. The resulting report distributed to the council last week cited 13 statutory or regulatory violations, four deficiencies that could lead to future violations and 28 “comments,” defined as errors and discrepancies that should be corrected or avoided.

Wow. That sounds like the beginning of a large headache that will take city officials months to sort through. Such intricacies of rules and regulations are enough to warm the heart of any good federal bureaucrat.

City Manager Kimball Payne probably understated the task that lies ahead for the city when he said, “This is the beginning of what I think will be a lengthy process — discussing this with HUD and understanding where we stand.”

Payne and Community Development Director Charlene Montford, whose department oversees the grant programs, have suggested a large part of the program is the sheer number of organizations that must be monitored.

Montford urged council members to move quickly to enact reforms before next year’s allocations. “In order for us to do our job and not risk the wrath of HUD, we have to make some changes,” she said. “And I think they have to be made quickly, some of them.”

The federal money provided through the CDBG program does contribute to the vitality of the city, especially the nonprofit organizations that are working to improve living conditions for families in need. In short, the city is glad to have it.

And no one, including the HUD investigators, has suggested any malfeasance on the part of anyone in the city in connection with the program.

But if it takes two city staff members working full time to monitor the program to ensure that all the federal rules and regulations are being met, city officials and the council have to ask themselves if the money is worth the effort.

One resolution of the problem that has been suggested is reducing the number of agencies that benefit from the money. That’s a practical solution that warrants further consideration as the city works its way out of the mound of paperwork that HUD is piling up around them. If that would reduce the paperwork and improve the monitoring system, it would make the federal money more attractive to the city.

And that, in turn, would make the block grant program more valuable to the city and its taxpayers.