D19 Budget Exploration Session 2 Take-Aways

The District 19 Budget Exploration Session #2 took a deep dive into the operations of the Community Development Division (CDD) with a presentation and Q&A from Director James OKeefe. Here are some of the major points drawn from Director OKeefe’s presentation and answers to questions.

• CDD administers funds in three broad categories:
  • Housing: Homeless services, development of affordable housing, and small business assistance, and
  • Providing resources for communities: Neighborhoods, crisis prevention and intervention, employment preparation, and older adult services, and
  • Early childcare and education
• Madison CDD is unique in deploying some city funds in addition to county, state and federal dollars.
• CDD is not to be confused with the Community Development Authority which actually operates affordable housing developments US and is federally funded.
• Over the past 10 years CDD investments enabled 32 affordable housing projects across Madison, with 2,700 units, 2,150 of which are reserved for tenants earning 60% or less of the area median income.
• Supported the Uno’s and Westgate affordable housing projects near D19
• CDD’s 2024 capital budget is $27.2 million of which $15.1 million is being financed by general fund borrowing, results in debt service in the $1.9 million range. The balance is financed by state and federal funds.
• CDD’s budgets in recent years look like they rose dramatically then quickly came down. That was because CDD was the entity to administer emergency rental assistance funds under the pandemic federal American Recovery Act, which has now ended.
• CDD’s 2024 amended operating budget net of general state and federal grants is $21.2 million of which $11.2 million is for general purchase of service contracts as shown in the following graph.

Image credit: Madison Community Development Division

• CDD’s process for evaluating development requests funded by the capital budget and service proposals funded by the operating budget involves the release of formal request for proposals followed by a vigorous competitive vetting process. CDD uses various metrics for tracking performance. As Director OKeefe noted, there are occasional bad calls as with the developer of the Tree Lane and Roethke Terrace permanent homeless shelters, and from which they draw knowledge for future process improvements.
• The largest of the four CDD proposals for service reductions is $438,000 for case management. This is at least possible because $380,000 of this amount was for interim support of the bankrupt Tree Lane and Roethke Terrace permanent homeless shelters during their transition to a new model under different ownership.
• As a future challenge, CDD will need to find a way to fund some of the operating costs for the new men’s shelter for which construction just began.

My third and final budget exploration session is virtual, beginning at 6 pm on Wednesday, October 16. We will focus on the largest of the proposed service cuts as I’m joined by leaders of those agencies. You can register here.