Despite unspent allotment, Miami asks HUD not to withhold federal funds

The city of Miami, which was threatened with the loss of nearly $6 million in federal funding for affordable housing, infrastructure and anti-poverty programs, has made a pitch to save the money and is hoping for a favorable outcome.

At issue: About $13.3 million in Community Development Block Grants the city received from the U.S. Department of Housing and Urban Development over the past three years that went unspent.

The feds have strict guidelines for using the dollars on schedule, and are threatening to withhold some, if not all, of the city’s 2013 allocation, according to a stinging letter from HUD to Mayor Tomás Regalado in February.

But city financial managers spoke with HUD three weeks ago, explaining the technical reasons they were sitting on unused dollars. The federal agency agreed to take another look at get back to them in about a month, said George Mensah, the city’s director over block grants.

Other municipalities in South Florida have received the same HUD letter, including Miami-Dade County, said spokeswoman Vanessa Santana-Peñate. The county got its in early December. Three weeks later, after discussions with county managers, HUD determined the county qualified for an exception, and backed off its demand the county immediately spend $13.8 million. The letter says it will review the county’s situation again in November 2013.

Gloria Shanahan, a spokeswoman for U.S. HUD said a decision on whether Miami qualifies for an exception “is still pending.”

Right now, the millions that HUD is asking Miami to spend is earmarked for about 100 projects, Mensah said. The biggest include $2.2 million for building and rehabilitating homes citywide, $800,000 for a community center in Commissioner Frank Carollo’s district, $590,000 for a citywide façade program and $251,000 for new fire equipment.

Mensah said the city has spent about $1 million of CDBG money since receiving the HUD letter in February.

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