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<br />Proposed Solution <br />Staff has proceeded as HUD advised and revised the Summary of Funds Available for <br />Reprogramming with the express intent to allocate Program Income funds to activities <br />that can expend all of the Program Income cash by June 30. One source of the City's <br />cash is in an account held by a third party fiscal agent (Rolison Road Repossession - <br />rents). In order to reduce the cash in that account, $20,000 in program income funds <br />are being allocated to the Housing Accessibility Modifications program, an ongoing <br />activity where there is a demand for service and a standing waiting list. <br /> <br />6.28 <br />Page 2 <br /> <br />Most Program income payments are received monthly. Finance will develop a system to <br />review and reprogram accrued program income throughout the year. Staff will <br />coordinate this review with the quarterly preparation of the Federal Cash Transaction <br />Report. <br /> <br />Conclusion <br />It is recommended that Council approve the new focus of the Reprogramming which <br />now seeks to: 1) Reduce Cash, and 2) Allocate grant funds to activities previously <br />funded with program income funds to activities that can expend funds in a timely <br />manner, <br /> <br />The requested budget changes result in an amendment to the 2007-2008 Annual Action <br />Plan. Finance will be able to expend all of the excess Program Income in the month of <br />May and record expenditures from prior year funds to bring the City into compliance <br />with federal spending rules by the end of this fiscal year. <br /> <br />ALTERNATIVES <br />Direct staff to return excess program income cash to the U.S. Treasury to be deposited <br />into the City's Letter of Credit. <br /> <br />FISCAL IMPACT <br />The re-appropriation of $911,029 in COSG and HOME funds to projects represents no <br />net change to the budget balance. Amendments simply move sources of funding from <br />one activity to another within the budget already approved by Council so that the City <br />can meet spending rules. There is one net change of $20,000 where funds held by a <br />third party fiscal agent are being allocated to an ongoing project in order to reduce cash <br />in that account. <br /> <br /> <br /> <br />Peter Ingram <br />I ntarim City Mana r <br /> <br />ATTACHMENTS <br />1. Resolution Amending FY 07/08 CDBG/HOME Budget <br />2. Summary of Funds Available for Reprogramming - First In First Out <br />3. SF-272 Second Quarter Federal Cash Transaction Report (111/08 - 3/31/08) <br /> <br />RELATED DOCUMENTS IN CITY CLERK'S OFFICE None <br />