City could lose $40 million in housing funds

March 01, 1995|By Eric Siegel | Eric Siegel,Sun Staff Writer

Baltimore would lose at least $40 million in U.S. housing and community development funds under budget cuts approved last week by a House subcommittee, a high-ranking federal housing official said here yesterday.

The city would lose $17.9 million earmarked for the rehabilitation of run-down public housing units; $10.9 million in rental assistance for poor families; and $8.5 million in operating subsidies for public housing developments, said Andrew Cuomo, an assistant secretary in the U.S. Department of Housing and Urban Development.

Baltimore also would lose $2.4 million in community development block grants and an unspecified amount of money for replacing public housing high-rises, he said.

Mr. Cuomo characterized the cuts of $7 billion approved last week by a House appropriations panel as part of an "alarming, frightening" anti-urban Republican policy.

"I believe these consequences can be as dramatic as any we have seen in decades," he said.

Mr. Cuomo outlined the effects of the cuts on Baltimore even as he announced a new federal competition for $1 billion in programs to aid the homeless and redevelop dilapidated communities.

Daniel P. Henson III, executive director of the city's Housing Authority, said later that the cuts would be "devastating."

The agency is receiving $47 million in rehabilitation funds this year and $55 million to $60 million in operating subsidies, he said.

The loss of funds would leave the Housing Authority unable to make much-needed repairs on hundreds of units, Mr. Henson said, and the authority would have no choice but to lay off maintenance workers at its housing projects. The agency could begin to feel the effect of any cuts by July, he said.

"We haven't been able to do a good job [on maintenance.] We'll do an even sorrier job," he said.

Any loss of money shouldn't affect plans to tear down Lafayette Courts high-rises but could hurt similar plans to demolish Lexington Terrace, he said.

Mr. Henson, who has been under fire for his administration of a $25.6 million no-bid repair program, added, "It also shows it is a wise manager who spends federal funds before they're taken back."

In announcing the competition for $1 billion in new federal grants with homeless advocates at the Johns Hopkins University's downtown Center, Mr. Cuomo said HUD would work on an

accelerated schedule, setting a deadline for applications of April 7 and awarding grants four months later.

"We're a step ahead of the budget ax. . . . This may be the last opportunity to really make a difference for the homeless people," he said.

Mr. Cuomo presented a check for $2 million to Mayor Kurt L. Schmoke and one for $667,000 to Maryland Lt. Gov. Kathleen Kennedy Townsend, his sister-in-law, representing the city and state share of the last round of federal homeless grants.

Mr. Cuomo said later that problems in the no-bid repair program -- detailed in a recent series in The Sun and a federal audit last September -- would not affect any application for homeless funds.

"They're totally separate. One has nothing to do with the other," he said.

He also said that the $100 million empowerment zone grant awarded to Baltimore in December was immune from congressional budget-cutters.

"It's untouchable," said Mr. Cuomo, who oversaw the empowerment zone competition. "It was obligated and contractually assigned."

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