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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 $50,000 per year over the past several years. The CFP funds
<br /> further assist the project by funding necessary capital projects that help offset continued inflationary
<br /> costs for landscape maintenance and utilities.
<br /> The table below summarizes changes in the main budget line items for 2015-16 as compared to last
<br /> year's approved budget(2014-15):
<br /> DESCRIPTION ACCT. 2013-14 2014-15 Diff($) Diff(%)
<br /> RENTAL INCOME 5100 189,809 181,931 (7,878) -4.2%
<br /> GRANT REVENUE(OFND) 5130 156,000 154,512 (1,488) -1.0%
<br /> VACANCY LOSS 5152N (1,500) (550) 950 -63.3%
<br /> INCOME 5300 0 0 0 ---
<br /> FINANCIAL REVENUE MOOT 0 0 0 ---
<br /> OTHER REVENUE 59007 2,018 3,445 1,427 70.7%
<br /> TOTAL REVENUE 50007 346,328 339,338 (6,990) -2.0%
<br /> ADMIN EXPENSES 6263T 121,530 116,443 (5,087) -4.2%
<br /> UTILITIES MOOT 63,147 71,417 8,270 13.1%
<br /> OPER+MAINT EXP 6500T 83,113 81,886 (1,227) -1.5%
<br /> TAXES+INSUR 6700T 35,968 33,636 (2,332) -6.5%
<br /> FINANCIAL EXP 6800T 0 0 0 ---
<br /> EXPENSES 6900 11,400 10,278 (1,122) -9.8%
<br /> TOTAL EXPENSES 6000T 315,158 313,660 (1,498) -0.5%
<br /> Total Cash Requirements 315,158 313,660 (1,498) -0.5%
<br /> Less Total Revenue 346,328 339,338 (6,990) -2.0%
<br /> Net Surplus Cash 1 Deficiency 31,170 25,678 (5,492) -17.6%
<br /> Income
<br /> As in the past, approximately 58% of the $313,660 in operating costs will be met through rents, which
<br /> are forecast to decrease by 4.2% from $189,809 to $181,931 (as observed over the past several years,
<br /> rental income has tended to decrease from year to year based on a trend toward new tenants with
<br /> "zero-income"). Note that under the terms of our annual operating contract with HUD, the rents at
<br /> Kottinger are fixed at 30% of the tenant's annual income, and this formula cannot be changed. As a
<br /> result, if lower income tenants move into the development, the total rental revenue will decrease.
<br /> Conversely, if higher income tenants move in, rental revenue will increase. Applicant selection may be
<br /> based on tenant income provided that an applicant does not exceed the maximum amount which is
<br /> 50% of the Area Median Income (currently$32,500 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$25,678. 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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