County consortium must return $1.7M to feds
Error led to hud overpayment of home funds
Following a mistake by the federal government, the Yuma County HOME Consortium will have to pay back $1.7 million due to funding overpayment.
In an update to the Yuma City Council during a Tuesday work session, Rhonda Lee-james, assistant director of planning and neighborhood services, shared recommendations for using Community Development Block Grant and HOME project funding for fiscal year 2023/24.
In her presentation, Lee-james explained that the U.S. Department of Housing and Urban Development made a mistake in the formula when the Yuma County HOME Consortium first applied in 2016. HUD uses a formula to determine grant amounts, based on population and other multiple factors.
Yuma’s population was not enough to qualify for HOME funds so the city joined with other local governments in Yuma County and formed the consortium.
“By joining together we did become large enough to receive the funds and so that money can be used countywide,” Lee-james explained.
HUD awarded the consortium $977,984 in 2019 and $1.04 million in 2020.
In 2021, when Yuma County received $753,444, the consortium discovered that HUD had made a mistake in the formula.
HUD has now decided that the Yuma County consortium needs to pay back the $1.7 million that it overpaid in the previous years.
“We’re now being penalized, if you will. Our allocation is being reduced to the tune of $440,000 each year for the next four years in order to pay back that $1.7 million,” Lee-james explained.
“It’s unfortunate, the money that goes for affordable housing is the one that we’ve taken this pretty big hit on,” she added.
The amount for 2022, at $411,329, was greatly reduced. For the coming fiscal year, which starts on July 1, the consortium will receive $378,564.
The HOME program, which is not an acronym, is strictly for the creation or preservation of affordable housing. The process begins in November when the consortium invites nonprofit organizations and governments to submit proposals.
In January, the consortium board reviews the applications and makes funding recommendations.
Altogether, the consortium will have $419,714 this coming year due to $41,150 in returned funds that were not used in previous proposals.
Because of the reduced allocation, the consortium decided to focus on one project at a time to try to “make the biggest impact.”
The board received three applications and decided the “best choice” is to award $325,073 to Magnolia Gardens, a rental development project on Magnolia Avenue in Yuma. It’s offered by