Pine Bluff Mayor Debe Hollingsworth provided an explanation Thursday for her veto of a resolution passed by the Pine Bluff City Council at its Dec. 16 regularly scheduled meeting that altered the way the city distributes funds to a contractor that constructs low-income housing in the city.
Hollingsworth said in a written statement that she vetoed the resolution because the change in how the Jefferson County Community Development Corporation receives proceeds from the sale of houses it constructs removed a level of oversight from the city. This is particularly important, according to Hollingsworth, because the city is under increased scrutiny from the Department of Housing and Urban Development after that agency determined the city must repay nearly $500 million in funding because it was either misspent or lacked documentation.
“It is important for Community Housing Development Organizations to realize financial returns from their developments to ensure sustainability of the effort and their organization,” Hollingsworth said. “However, it is imperative that with public dollars this return is not excessive and that an appropriate level of public benefit is attained. Therefore, if the Council elects to award JCCDC the proceeds, I am asking that the award be contingent upon modifications to the CHDO proceeds agreement.”
Hollingsworth said these modifications are necessary to ensure that funding is used for the construction of all outstanding units before the use of the funds for other housing related activities or allowable costs.
“JCCDC will have to submit invoices with eligible expenses to Economic and Community Development to receive payment,” Hollingsworth said in her explanation. “In light of the issues the city has been confronted with, it is incumbent upon the city to employ this system of checks and balances to insure that the monies are spent in accordance with the agreement and HUD guidelines.”
Hollingsworth will submit a resolution to the City Council on Monday night for its approval that will include her changes to the original vetoed resolution.
“Whereas the city council on Dec. 2, 2011, previously contracted with and allocated the sum of $319,147 to Jefferson County Community Development Corporation to undertake community housing development organization-related activities, which included the construction of three housing units,” the Hollingsworth resolution says in part. “Whereas the city council on July 23, 2013, contracted with and allocated the sum of $268,036 to JCCDC to undertake CHDO-related activities that included the construction of three additional housing units. Whereas JCCDC has requested the City of Pine Bluff amend the existing contracts to permit JCCDC to retain CHDO proceeds upon the sale of each unit of housing.”
The text of the resolution goes on to state that because of the city’s issues with HUD funds in the past, the city council denies JCCDC’s request to modify the contracts to directly receive the CHDO funds and instructs JCCDC to continue to submit invoices and supporting documentation to the city via the Economic and Community Development Department to ensure the eligibility of all expenses as set forth in local, state and federal regulations.