Title
Resolution to Approve the County Mental Health Millage Grant Agreement between the City of Ann Arbor, the Ann Arbor Housing Commission, and the Ann Arbor Housing Development Corporation and To Appropriate Up To $177,618 from the County Mental Health Millage Fund Balance (8 Votes Required)
Memorandum
Attached for consideration is a resolution authorizing a grant agreement between the City of Ann Arbor, the Ann Arbor Housing Commission (“AAHC” or “Commission”), and the Ann Arbor Housing Development Corporation (“AAHDC”), a Michigan non-profit corporation, whose sole member is the Commission (the “Grant Agreement”).
In 2017, county residents approved an eight-year “Washtenaw County Community Mental Health and Public Safety Preservation Millage,” a portion of which is rebated back to the City from the County annually (the “Millage”). In May of 2020, City Council adopted a resolution, R-20-177, allocating 40% of the Millage rebate revenue for affordable housing and related services. Revenues and expenditures were included in the City’s approved budgets for Fiscal Year 2019 through Fiscal Year 2024 in the Commission’s budget line item. The portion of the Millage rebate to be used for affordable housing and related services has generated approximately $880,000.00 to $1,134,000 per fiscal year. The Commission’s proposed annual budget to the City Administrator and City Council includes expenditures for the development of affordable housing and related services.
The Millage is currently used to pay local non-profit partners to provide tenant support services for AAHC residents and AAHC tenant-based voucher participants. Those services include:
• Mental Health Support
• Medical Care
• Substance Abuse Recovery Support
• Domestic Violence
• Conflict Resolution
• Parenting and Child Welfare
• Youth and Community Center Programs
• Education and Employment Support
• Coordination of Entitlements
• Money Management and Financial Literacy
• Assistance with Basic Needs
• Legal Services
• Child Care
• Transportation
• Security
• Household Maintenance and Activities of Daily Living
• Connections to Mainstream Services and Community Resources
• Tenancy Problems and Lease Violations
• Guest Monitoring and Support
• Regular meetings with property managers to address problems and coordinate plans
Up to five percent (5%) of the Millage is used to cover staffing and overhead costs of the AAHC and AAHDC in the administration of the funds.
The AAHC currently has contractual common performance metrics for all of its service providers for AAHC residents. The contracts for service providers who work with participants in the tenant-based voucher program have different performance metrics than for AAHC residents, depending on the voucher program.
The AAHC has adopted a simple formula for allocating funding to service providers. The formula takes into consideration the program intensity and the service intensity. The AAHC conducts an annual review prior to the start of the fiscal year, to readjust the funding allocations, based on the following formula:
1) $2,000/rent-subsidized household for on-site service providers for locations where the service provider has an office/community center on an AAHC property.
2) $1,000/rent-subsidized household for off-site service providers for locations where there is not an office/community center on an AAHC property.
3) $100/unsubsidized household. This is currently Lurie Terrace, which is primarily households that pay full rent (although below market rent) without a rent subsidy.
4) $2,000/household who were homeless at the time of lease-up. This is in addition to the funding provided for in numbers 1-3 above.
5) $1,000/household per year for emergency support for tenants of all voucher programs who are in danger of losing their voucher.
6) $3,000/unit per year for lease-up support and ongoing case management for youth aging out of foster care in the Family Unification Program (FUP).
Due to an unanticipated increase in admissions of homeless households into the AAHC’s housing programs during Fiscal Year 2023, the total amount of funding needed based on the formula above exceeds the Fiscal Year 2024 revenue. Therefore, AAHC requests appropriation of the anticipated fund balance of $177,618 as of June 30, 2023. This is an estimate and shall be confirmed after all applicable expenditures have been recorded against Fiscal Year 2023. If needed, the AAHC will meet this funding commitment by paying for the balance needed through the AAHDC.
Through the attached Grant Agreement, the City proposes a change to the administration of the County Mental Health Millage Fund to reduce duplicative processes, while maintaining accountability. The Grant Agreement outlines the roles and responsibilities of the City, AAHC, and AAHDC, related to administering the Millage.
The AAHC will continue to work with the City’s finance staff to propose an annual budget to the City Administrator and City Council. The AAHDC will continue to execute contracts with non-profit service providers, process invoices and pay non-profits. However, instead of getting reimbursed by the City for expenditures, the AAHDC will pay invoices directly from the Millage revenue granted to it. This new process will remove duplicative invoice processing by the City and the AAHDC.
The AAHDC financials will continue to be included in the AAHC audit and provided to the City for its own audit. In addition, the City may request detailed Millage-related financial reporting from the AAHC at any time.
The duration of the Grant Agreement coincides with the duration of the Millage, through fiscal year 2026.
Staff
Prepared by: Jennifer Hall, Executive Director, Ann Arbor Housing Commission
Reviewed by: Michelle Landis, Senior Assistant City Attorney
Approved by: Milton Dohoney Jr., City Administrator
Body
Whereas, In November 2017, county residents approved an eight-year Washtenaw County Mental Health and Public Safety Preservation Millage, a portion of which is rebated back to the City from the County and put into the City’s “County Mental Health Millage Fund;”
Whereas, Beginning in Fiscal Year 2019, in cooperation with the City Finance Department, the Ann Arbor Housing Commission (AAHC) has been administering a portion of the County Mental Health Millage Fund through the Ann Arbor Housing Development Corporation (AAHDC), a Michigan non-profit corporation whose sole member is the AAHC; and
Whereas, The current process is duplicative between the City and the AAHDC, requiring the AAHDC to pay for goods and services and submit invoices with back-up documentation to receive reimbursement from the City;
RESOLVED, That the City Council approve the County Mental Health Millage Grant Agreement between the City, the Ann Arbor Housing Commission, and the Ann Arbor Housing Development Corporation (the “Grant Agreement”);
RESOLVED, That the City Council approve the expenditure of County Mental Health Millage funds pursuant to the annually adopted budget for each fiscal year of the Grant Agreement;
RESOLVED, That City Council appropriate up to $177,618 from the County Mental Health Millage Fund fund balance to the Fiscal Year 2024 Ann Arbor Housing Commission County Mental Health Millage Fund expenditure budget, subject to actual fund balance calculation after the close of Fiscal Year 2023 and payment of all applicable Fiscal Year 2023 expenditures;
RESOLVED, That the Mayor and City Clerk be authorized and directed to execute the Grant Agreement, consistent with this resolution, subject to approval as to substance by the City Administrator and approval as to form by the City Attorney;
RESOLVED, That all amounts granted, and annual appropriations made pursuant to the Grant Agreement, shall be authorized for expenditure without regard to fiscal year; and
RESOLVED, That the City Administrator be authorized to take any necessary administrative action to implement this resolution.