Monday, August 15, 2022

Per diem payouts to displaced families reduced to manage WHA’s depleting funds

Wilmington Housing Authority cut per diems for displaced residents by 50% to be able to manage its depleting money. (Port City Daily/Amy Passaretti)

WILMINGTON — Wilmington Housing Authority’s financial struggles continue as staff re-budgets money to operate within its means. Executive director Tyrone Garrett, on the job for a little over a month, has been approaching the organization’s issues two ways, he said: with fresh eyes and a sustainable approach.

That’s the same reasoning he gave for his latest controversial move to cut per diem costs in half for 150 displaced families. Beginning July 1, they will receive 50% less than previously allotted, once $60 a day for adults and anywhere from $7.50 to $30 for children.

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WHA has been battling the aftermath of mold-ridden apartments over the last four years, with events taking a drastic turn last year. As a result, it’s been hemorrhaging funds, spent on housing families in hotels and corporate apartments, as well as paying a daily stipend for food, for those without current access to kitchens.

Garrett said the expenses were up to $100,000 per week, just for per diem costs and he couldn’t “locate” where that chosen rate transpired from by prior leadership.

“The authority came up with a dollar amount they thought was reasonable — but, remember, that money has to come from somewhere,” he said. “I had to look at it and make a decision.”

He compared the conclusion to individual households trying to balance a budget and figure out where to cut back to continue staying afloat.

“I’m not saying a per diem or support isn’t necessary, but it has to be sustained for a period of time,” he said. “Instead of going cold turkey, we can’t cut it all, I felt it would be better and more comfortable reducing it by 50% so we could at least make [the money] last a little longer.”

WHA is funded almost entirely by the U.S. Department of Urban Housing and Development, and it receives two different pots of money. Its capital budget is supposed to be used solely for bricks-and-mortar needs, Garrett explained, while the operating budget covers “soft costs,” such as salaries, utilities and administrative fees.

Out of desperation and need, Garrett presumes, along with an honest lack of awareness, prior leadership began dipping into its capital budget to cover per diem expenses. As of March 1, HUD told WHA it cannot continue funding it federally. According to a March 11 memo sent to county intergovernmental affairs manager Tim Buckland, interim executive director Vernice Hamilton explained HUD had “reversed course.”

She said in September 2021, HUD confirmed capital funds could be used for per diem and later said this was not an appropriate use. Between April 2020 and February 2021, WHA had already paid approximately $2.7 million to cover families per diem costs.

Garrett confirmed the recent $3.2-million loan from the county and city to help with construction costs to remediate and rebuild apartments, is to be used only for that purpose — “hard costs,” he said.

While the weekly food costs are being slashed, Garrett said no one will be losing their housing status — just the opposite. He still plans to get the majority of damaged units back online by the end of the year.

Any social services residents are receiving, such as food stamps, also will not be impacted. Garrett added any “extenuating circumstances” will be evaluated so families do not go unsupported.

“We can figure out ways to provide other social services available to offset the need,” he explained. “We’re not trying to leave residents out; we’re offering as much support as we can and other programs are out there to pick up the slack.”

When asked how residents responded to the per diem being cut, Garrett said some people had concerns but most continued to ask the main question of when they could return home.

Contractors’ submittals for construction bids are due Thursday and Garrett said he is “hopeful and optimistic” he’ll receive some companies willing to come on board and get the work done as quickly as possible.


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