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The Operating Budget does not reflect the additional availability of HUD Capital Fund Program (CFP)
<br /> funding which has been approximately $45,000 per year over the past several years. The CFP funds
<br /> further assist the project by funding necessary capital projects that help offset continued inflationary
<br /> costs for landscape maintenance and utilities.
<br /> The table below summarizes changes in the main budget line items for 2014-15 as compared to last
<br /> year's approved budget (2013-14):
<br /> DESCRIPTION ACCT. 2013-14 2014-15 Diff($) D1ff r4I
<br /> RENTAL INCOME 1 5100 163,189 189,809 26,620 16.3%
<br /> GRANT REVENUE(OFND) 5130 120,000 156,000 36,000 30.0%
<br /> VACANCY LOSS 5152N -1,500 -1,500 0 -
<br /> INCOME 5300 0 0 0 -
<br /> FINANCIAL REVENUE 5400T 0 0 0 --
<br /> OTHER REVENUE 5900T 0 2,018 2,018 --
<br /> TOTAL REVENUE 50001 281,869 346,326 84459 22.9%
<br /> ADMIN EXPENSES 6263T 98,396 121,530 23,134 23.5%
<br /> UTILITIES 6400T 67,554 63,147 (4,407) -6.5%
<br /> OPER+MAINT EXP 6500T 77,810 83,113 5,303 6.8%
<br /> TAXES+INSUR 6700T 28,645 35,968 7,323 25.6%
<br /> FINANCIAL EXP 6800T 0 0 0 -
<br /> EXPENSES 6900 3,821 11,400 7,579 198.4%
<br /> TOTAL EXPENSES 6000T 276,227 315,158 38,931 14.1%
<br /> Total Cash Requirements 276,227 315,158 38,931 14.1%
<br /> Less Total Revenue 281,689 346,328 64,639 22.9%
<br /> Net Surplus Cash!Deficiency 5,462 31,170 25,708 470.7%
<br /> Income
<br /> As in the past, approximately 60% of the $315,158 in operating costs will be met through rents, which
<br /> are forecast to remain relatively stable at approximately $189,809 (as observed over the past several
<br /> years, any increases in overall tenant rents are anticipated to be offset by new tenants with "zero-
<br /> income"). Note that under the terms of our annual operating contract with HUD, the rents at Kottinger
<br /> are fixed at 30% of the tenant's annual income, and this formula cannot be changed. As a result, if
<br /> lower income tenants move into the development, the total rental revenue will decrease. Conversely, if
<br /> higher income tenants move in, rental revenue will increase. Applicant selection may be based on
<br /> tenant income provided that an applicant does not exceed the maximum amount which is 50% of the
<br /> Area Median Income (currently $31,000 for a household of one person).
<br /> The difference between total operating expenses and total income leaves an overall surplus to the
<br /> project of $31,170. In the past, Kottinger Place routinely experienced a deficit of $30,000 or more in its
<br /> annual operating budget. The deficit was typically covered through the Kottinger Place investment
<br /> account or by the City. Since the availability of the CFP grant by HUD in 1995, the additional funds for
<br /> capital improvements have helped to offset the budget deficit and eliminate or reduce reliance on
<br /> project reserves or City assistance. In addition, the Housing Authority has received annual OFND
<br /> grants since 2006 ranging from approximately $100,000 to $150,000 per year. These funds are
<br /> generally transferred to the Housing Authority account in monthly or quarterly disbursements.
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