Gate City Neighborhood Association

Community Development HUD Audit Results in NA Changes

Fenstermaker Letter to CAB President Tyson

March 30, 2009

Sheila Tyson, President

Citizens Advisory Board

1233 14th Place SW

Birmingham, AL 35211



Re: HUD Audit and Citizens Participation Program

Dear Ms. Tyson:

As we discussed today, you are aware that the Department of Housing and Urban Development (HUD) has entered an audit finding against the City of Birmingham in regard to our expenditure of CDBG funds for Citizen Participation. It in no way impacts other HUD programs or other divisions within our department. The HUD Audit was conducted on March 16th & 17th, and resulted in HUD declaring ineligible all CDBG expenditures for staffing, communications, etc. related to the Citizens Participation Program. The finding requires that the City stop immediately spending CDBG dollars on what is now deemed by HUD to be an ineligible activity. In addition, we are being required to reimburse our block grant program for all funds spent on citizen participation during the current fiscal year.

As a result of this finding, we have immediately taken the following actions:

1) All mail-outs, including Friday mail-outs to officers and the monthly flyers to neighborhoods, have been halted.

2) We are redirecting the efforts of all 13 staff members funded within the Citizens Participation portion of our CDBG budget. We are in the process of either reassigning staff to our Housing and Grants Division, which remain eligible within the CDBG program, or seeking assignments of staff to other departments.

As such, until alternative arrangements are made, there will be no flyers and no Friday mail-outs. In addition, as staff is redeployed, we will be unable to process Citizen Participation projects, liquor license applications or zoning requests.

It is my understanding that the mayor intends to discuss with the City Council alternate measures to continue working with neighborhoods on Citizen Participation projects so as to not compromise the HUD audit findings.

Sincerely,

Jim Fenstermaker, Director

Community Development

City of Birmingham

JF:swg

Deborah Vance-Bowie
Chief of Staff

Friday Officer Mail Outs and NA monthly Flyers