VI - HACLA

VI.B1

Housing Authority of the City of Los Angeles Board of Commissioners December 19, 2019

ANNUAL BUDGET FY 2020

CONSOLIDATED OPERATING AND CAPITAL BUDGET

Table of Contents

Budget Highlights and Priorities ........... 1

Budget Summary ....................................................................................................................... 7

Revenue Projections for HCV and Public Housing .............................................................. 12

Program Group Expense Summaries .................................................................................... 16

Personnel ................................................................................................................................. 23

Property Maintenance & Capital Projects .............................................................................. 25

Program Budget Summaries .................................................................................................. 29

Appendix A – Summary Schedules and Organizational Charts

Summary by Program Group ................................................................................................ A-1

Section 8 Programs ............................................................................................................... A-9

Public Housing Programs .................................................................................................... A-13

Strategic Development Programs ....................................................................................... A-17

L.A. LOMOD Programs ....................................................................................................... A-25

Central Office ...................................................................................................................... A-27

Personnel Roster Summary ................................................................................................ A-33

Schedule of New and Converted Positions ......................................................................... A-34

Information Technology – All Departments ......................................................................... A-35

Appendix B – Detailed Schedules

Section 8 Programs ............................................................................................................... B-1

Public Housing Programs .................................................................................................... B-31

Strategic Development Programs ....................................................................................... B-51

LA LOMOD .......................................................................................................................... B-91

Central Office ...................................................................................................................... B-97

HACLA 2020 BUDGET Page 1 Build HOPE

BUDGET HIGHLIGHTS AND PRIORITIES

Our Mission The Housing Authority of the City of Los Angeles (HACLA) is committed to preserving, enhancing, and expanding deeply affordable housing and improving the quality of life for Angelenos with a focus on

People, Place, and Pathways to Opportunity. To meet this mission, HACLA has developed a 25‐Year Vision Plan, Build HOPE, which has as its foundation three pillars:

PEOPLE Build people up through investments in leadership,

community health and wellness, public safety, and trauma‐informed

services delivery to enhance residents’ well‐being and overall

quality of life

PLACE Reinforce HACLA’s role in place‐making and sustainability to benefit both our sites and the surrounding communities by preserving and increasing the supply of affordable housing

PATHWAYS Build our internal capacity,

increase efficiency, encourage innovation, and expand business

lines

To effectuate these central values, the Vision Plan identifies specific Strategies and Actions, which this Budget is intended to reflect and operationalize. At its core, a Budget is an expression of values and priorities, and the HACLA 2020 Budget demonstrates our commitment to direct our resources in ways that support our mission. Identified below are a number of specific PEOPLE, PLACE, and PATHWAYS Strategies and Actions that are advanced with this proposed budget. They are organized into three major categories: I. Pathways – Sustainability; II. Pathways – Staff Development; and III. People and Place.

I. PATHWAYS ‐ SUSTAINABILITY In many ways, HACLA is in a position to dramatically contribute to the region’s sustainability goals. We provide services to over 60,000 individuals and families; we are the Department of Water & Power’s largest customer; our properties occupy over 500 acres of land. For many years, HACLA has taken significant steps to be a good steward of the environment, including the conversion to hybrid vehicles in 2006 and 2010, the implementation of water conservation efforts in 2013 that reduced our consumption 30% by 2017, the installation of LED lights in all common areas throughout our portfolio, among many others. In 2020, HACLA will focus these efforts into a comprehensive approach to both our delivery of services to the public as well as our operations as a corporate entity. While not exhaustive, following is a list of initiatives and activities that are supported in the 2020 Budget.

PATHWAYS Strategy #5 – Optimize technology platforms to enhance customer service and better support program delivery

Promote Use of Online Portals for Key Customer‐Facing Functions:

Applications

Re‐certifications

Payments

Over the past several years, HACLA has implemented a number of initiatives to facilitate and streamline program participation by our clients, including online payments, online applications for the Section 8 waitlist, debit card for HAP and tenant utility payments, and email communication for Section 8 landlords. Even so, many tasks still rely on paper‐based or in‐person processes which are resource‐intensive for both clients and staff.


Investments: $37,500 Yardi

The annual recertification process requires clients to prepare a paper‐packet with necessary recertification documentation, communicate with staff by telephone to schedule ‐ and if necessary reschedule ‐ the recertification interview, and then attend an on‐site, one‐on‐one interview. In 2020, the Section 8, Public Housing, and Rent Subsidy programs will launch web‐based, online recertifications, which will provide significant customer service benefit – and significantly conserve resources – by allowing program participants to submit documents via a web portal at their convenience. Real‐time interactive interviews via the portal will provide an alternative to on‐site interviews. This online process will conserve paper and fuel expended for mail delivery and in‐person interviews. While the Public Housing program implemented online applications long ago, many applicants still rely on paper‐submissions. Similarly, various online payment options have been available to tenants for some time, but many still rely on paper checks and money orders. In 2020, the Public Housing program will further promote online options for both.

PATHWAYS Strategy #7 – Reduce operating and administrative costs so that scarce resources are maximized PLACE Strategy #7, Action 7.6 – Convert to electric vehicle fleet

Solar Panel installation at Torrance Office Investment: $500,000

HACLA has completed an evaluation of 29 properties (primarily in the Rent subsidy portfolio as well as our 3 commercial properties) to determine their suitability for solar panel installation. Based on an assessment of projected energy production given the available rooftop surfaces, a number of sites were recommend as viable candidates, including the Torrance regional office. As proposed, HACLA would install a 144.5kw solar array on car ports at the Torrance parking lot. At this size, the array would not only cover annual electricity costs (approximately $32,000), but would also generate excess power. This would enable HACLA to participate in the LADWP’s Feed‐in‐Tariff (FIT) program, wherein LADWP will buy solar generated electricity at a set price for a term of 20 years. In addition to establishing a revenue source for HACLA, this will support the city’s goal converting to all renewable energy sources. Details of this project are being developed, and will be presented to the Board at a later time for review and approval. In addition to potentially increasing the size of the array to generate more power, we are also exploring options to include a battery system for storage, which would be available during emergencies.

Transportation & Emissions Over the past several years, HACLA has taken numerous steps to mitigate vehicle emissions. This includes replacing all public housing scooters with electric models, converting first to hybrids and now EVs for the majority of the sedan fleet, waiving parking fees for staff that carpool, and installing charging stations for staff use to encourage their private use of EV and plug‐in vehicles.


In 2020, we will continue to pursue additional measures to reduce emissions, including:

Replacement 9 more fleet sedans with EVs;

Exploring options to expand the pre‐tax transit pass program to encourage higher adoption; and

Conducting a survey of staff to determine what programs if any would encourage their use of mass transit, shared driving, or purchase of low‐ to zero‐emissions vehicles.

Resource Conservation In managing a $1.5 billion Operating Budget with 850 employees, HACLA consumes significant resources. In addition to the measures described elsewhere in this section, other conservations measures include:

E‐signature software for contracts: beginning in 2020, the Legal Department will begin using e‐signature software to execute contracts with vendors and other partners. This will not only expedite contract processing, but will reduce paper and mail delivery resources. We intend to expand this software to HAP contracts with landlords in both the Section 8 and LA LOMOD programs.

Document Management: relatedly, electronic document management software will be expanded agency‐wide. The Section 8 program has long used On‐Base software to manage its extensive client files; however, this application has generally been used as library to house scanned‐paper documents. By fully utilizing this software for more integrated document sharing, multiple printed versions of documents will be minimized.

Recycling and single‐use products: while HACLA offices have recycling programs in place, in 2020 we will seek to eliminate the consumption of single‐use and non‐recycled products. To the maximum extent possible, HACLA will only purchase office products that are intended for multiple uses and/or are made from recycled materials. This policy and plan will be rolled out to staff at the Annual State of the Agency meeting.

Interactive & Portable Technology

HACLA conducts much of its work collaboratively between departments and between units within departments. With a headquarters, two regional offices, and 14 public housing sites, this can be a challenge. Currently, staff will often be required to travel to the main office for meetings and trainings. In 2020, we will more fully deploy technologies to facilitate interactive and remote work, including:

Web and video conferencing technology for meetings and trainings will be installed at both regional offices as well as each public housing management office. In addition to significantly reducing the need for inter‐office travel, this will also give managers the ability to communicate with staff on important matters more easily and efficiently.

Portable and Remote workstations: HACLA has long made laptops and tablets a part of its equipment platform for staff who work on the go. However, as equipment has become smaller and more robust, many staff are choosing to forgo a traditional workstation in favor of a tablet that can be “docked” or moved around as needed. By having access to documents on the network during meetings, less printing will be needed and meetings can be more productive.


II. PATHWAYS – Staff Development

The foundation of HACLA’s ability to meet its mission and Vision Plan goals is fundamentally premised on our staff. HACLA’s staff is committed to serving our program participants at the highest level, and the Agency is committed to giving them the tools they need to do so effectively.

PATHWAYS Strategy #8, Action 8:3 – Launch training program with a focus on both career development as well as program‐specific expertise

Training Plan Investment: $300,000

HACLA will continue to focus on skills and subject‐matter training. The Human Resources (HR) department has designated a staff member to coordinate and track the many training opportunities provided to staff. Among these are:

Public Housing Management Certification for CHP‐A members who seek to promote to the Manager classification.

Section 8 and Public Housing staff or reasonable accommodations and customer service training

IT training on core systems, including Oracle, Yardi, and Elite

Financial and technical training on topics such as tax‐credits

Skills training, such as management, communication, and interviewing

MCLE Training Investment: staff time

One of the many benefits of establishing the Legal Department is the opportunity to cultivate in‐house expertise. In that vein, we have registered HACLA with the California State Bar as a Minimum Continuing Legal Education (MCLE) provider, and will have Legal Department staff provide training to HACLA attorneys as well as program staff on relevant topics for HACLA. For example, in October, Legal staff provided training to the Ladders to Leaders cohort on conflict of interests, housing authority law, and landlord‐tenant law. Future potential topics include legal ethics, environmental law (CEQA/NEPA), and Fair Housing. Over time, as a library of trainings is developed, these sessions may be made available to outside parties interested in these topics as a public service.

Conferences & Training Investment: $30,000

In addition to the hosted trainings described above, conference attendance is an invaluable tool for learning from our colleagues about best practices, innovations in program delivery, and solutions to common challenges. Each department has its own Conference budget for this purpose, and in addition, HR manages a $30,000 fund dedicated to conference attendance for represented employees. Attendees are asked to provide an informational training to their departments to ensure knowledge is shared.

Educational Reimbursement Investment: $20,000

For many years, HACLA has offered an educational cost reimbursement program to staff which allows staff to pursue study in their areas of interest. Requirements of the program are that courses should relate to their current position or their promotional goals, be provided by an accredited institution, and that coursework is completed before reimbursement is provided. We have expanded the program to include books, which can be cost prohibitive.


PATHWAYS Strategy #8, Action 8:2 – Evaluate opportunities for new classifications that are better tailored to program realignments and new initiatives and engage in strategic hiring

New classifications Investment: staff time

As HACLA continues to evolve our program types, staff skills sets and areas of expertise will continue to diversify. While the Strategic Development programs are currently where most of our growth is focused, there are opportunities throughout the agency that give staff an opportunity to learn new skills and grow within the agency. This includes:

Housing Support Specialist – focus on outreach to landlords and tenants

Assistant Project Manager – career ladder for redevelopment

Construction Project Assistant – career ladder for construction

Investigations Assistant – career ladder for investigations and compliance

Fund Developer/Grant Writing – focus on resource and program expansion

Re‐organization for Customer Contact Center

The area where we anticipate the most change in the near future is with the implementation of Customer Contact Center, which will require customer service expertise as well as detailed knowledge of the agency’s programs. This will afford existing staff new promotional opportunities. A detailed assessment and workflow redesign is currently underway lead by a team composed of both front‐line staff as well as managers. This work will culminate in a staffing and reorganization plan by mid‐2020.

PATHWAYS Strategy #9 – Improve staff morale and productivity; host regular interactions with CEO to discuss Authority mission and initiatives; improve on‐boarding and orientation for staff

Annual State of the Agency & Employee Recognition Investment: $35,000; $20,000

In February 2019, HACLA launched the first State of the Agency meeting, where our President & CEO met with all agency staff to communicate important agency business, including introducing the Build HOPE Vision Plan. The second Annual State of the Agency meeting will be held in late January 2020, and will again be focused on interactive communication with all HACLA staff. As before, important agency business will be presented, as will employee recognition, including service pins.

New Staff Orientation Investment: staff time

The Ladders to Leaders program has benefited not only the participating staff through skills and knowledge development leading to promotions, but has also benefitted the agency through special projects, such as informational videos on HACLA programs. In 2019, one of these projects includes assisting the HR department with the development of a comprehensive new employee orientation program, which are now held bi‐weekly and cover all aspects of HACLA’s administrative operations. In 2020, these orientation sessions will be expanded to include more formal subject‐matter and programmatic training.


III. PEOPLE AND PLACE

PEOPLE Strategy #4 – Develop and implement onsite and offsite service linkages to support resident needs

Computer Learning Centers Investment: $300,000

The Computer Learning Centers (CLCs) at the public housing sites serve as an important resource for residents of all ages. However, they have been in need of enhancement and program enrichment for some time. In 2019, data bandwidth for all sites has been upgraded, and one‐time PILOT funds are being used for complete equipment replacements. In 2020, we will add an Administrative Program Specialist within the Program Partnerships Unit who will coordinate services and new programs with the WorkSource Center, and who will supervise the work of interns at each CLC.

PEOPLE Strategy #7 – Enhance resident access to workforce readiness training and skills development

New WorkSource Center Investment: $2.2 million

With the renewal in 2019 of Workforce Investment Opportunities Act (WIOA) funding for the WorkSource Center, HACLA is establishing new partnerships with education and training facilities as well as employers to expand the opportunities it can offer residents for career‐pathways and skill‐building. Increasing its partnerships also requires an investment in improved shared space, which currently very limited. In 2020, staff will install an expanded, modular center that will allow for staff from Imperial Courts and Jordan Downs to co‐locate. The center will be adjacent to the bridge housing site, creating a new opportunity for the WorkSource Center to improve services to recently homeless and hard‐to‐serve populations. The relocation of the WorkSource center will increase the number of residents participating in existing programs, create new partnerships and create additional employment opportunities which will offer families greater self‐sufficiency. Please see Property Maintenance and Capital Projects section, page 25, for more detail.

Place Strategy 1: Stabilize the physical and financial viability of the conventional public housing portfolio

Restoration of 4 residential units at Imperial Courts Investment: $800,000

As four (4) units are currently offline to accommodate the current WorkSource Center at Imperial Courts, moving the Center to the new Imperial site will allow the units to be returned to residential use, and since they are ground floor units, they will also be converted to meet current ADA standards and help address the shortage of one‐bedroom, fully accessible units in the Public Housing portfolio.

Capital Grant Staffing Investment: $136,000

With the infusion of Capital Grant funds in the past two years, HACLA has been able to prioritize infrastructure improvements, including water, sewer, and gas line, and electrical systems. While Per Diem staff are the primarily labor source for this work, the demands on project management staff have increased. In 2020, we are adding a Construction Project Assistant to support the work of the more senior Construction Project Managers and Field Superintendents. This position will take on many of the administrative tasks freeing up the others for more hands‐on project supervision.


BUDGET SUMMARY

FEDERAL APPROPRIATIONS As of mid‐November, Congress has not enacted a federal appropriations bill for the federal fiscal year that began on October 1st. Consistent with the past several years, a Continuing Resolution, which maintains funding at current levels, is in effect through December 20th, and it is not yet clear whether another short‐term extension or full appropriations bill will be adopted. However, House and Senate proposed budgets for U.S. Department of Housing and Urban Development (HUD) programs, including Section 8 Housing Choice Voucher and the Public Housing, are available. For comparative purposes only, below is a summary of the proposed funding levels.

Both the House and Senate proposals would increase funding an average of 3%. This includes a 5.35% and 5.85% increase, respectively, for Section 8 Housing Assistance, which would match HUD’s projected inflation cost, but would not meet HACLA’s projected increases. (Please see REVENUE section for more detail.) While both increase Section 8 Administrative Fees, the House’s more modest increase of 2% is insufficient to cover standard inflation; the Senate proposed increase of 4.8% would be more aligned with actual cost increases. For Public Housing, both the House and Senate versions increase Capital Fund by almost 3%, which is very welcome and a good indication that the significant increases in 2018 and 2019 will be continued. However, with respect to Operating Fund, the House proposal would increase funding approximately 2%, while the Senate version will reduce funding slightly. Given the lack of an appropriations bill, for purposes of this Budget, proration levels – which are adjusted annually to reflect total funds available for public housing agencies nationally – for Operating Subsidy, Housing Assistance Payments, and Section 8 Administrative Fees will be the same as current year. As has been the practice for the past several years due to the delay in the enactment of final federal appropriations, final funding levels will be included in the Mid‐Year Budget Modification.

2018 2019

Enacted Enacted House Senate

Section 8 Housing Choice Voucher

Housing Assistance 19,525 20,313 21,400 21,502

Administrative Fees 1,730 1,886 1,925 1,977

Public Housing

Operating Fund 4,500 4,653 4,753 4,650

Capital Fund 2,750 2,775 2,855 2,855

Table 1 ‐ National Appropriations (in millions)

2020 Proposed


2020 REVENUE BY TYPE Total 2020 Revenue is projected at $1.5 billion, representing an increase of $93.8 million, or 6.7%. Housing Assistance Payments represent 85.8% of all revenue, followed by 5.3% for Section 8 Administrative Fee, 4.8% for Operating Subsidy/HUD Grants, and 3.9% for Rental Income.

$1.3 billion for Housing Assistance Payments (HAP): an increase of $89.3 million or 7.5%. Most of this increase is attributable to LA LOMOD’s PBCA contract, which will incorporate increases to fair market rents and will add 58 properties to its portfolio, which includes the transfer of the New Construction program. HAP revenue for the Section 8 Housing Choice Voucher (HCV) program will increase $23.8 million.

$79.9 million in Administrative Fee revenue: an increase of $1.5 million or 1.9% is primarily attributable to the LA LOMOD PBCA program ($2.5 million), which is offset by the loss of $1.3 million in administrative fee for the Section 8 New Construction program.

$58.1 million in Rental Income: an increase of $2.9 million or 5.3% is projected for the Public Housing program ($1.5 million) due to increases to tenant income and fair market rents, and for the Rent Subsidy program ($1.3 million) mainly due to contract rent (subsidy) increases. Notably, Rental Income for the Public Housing program reflects the loss of approximately $460,000 due to the conversion of units at Jordan Downs. This is discussed in more detail in the REVENUE section.

$71.2 million in Operating Subsidy and HUD grants: an increase of $0.3 million or 0.4% is due primarily to increases to HAP subsidies in the Rent Subsidy program of $2.4 million offset by the reduction in the Public Housing Operating Subsidy ($1.1 million) due to the tenant revenue offset per HUD’s formula and the reduction of public housing (ACC) units at Jordan Downs. This is also discussed more fully in the REVENUE section.

$3.7 million in Other Revenue: a decrease of $0.2 million or ‐4.2% is primarily due to the elimination of processing fees for LA LOMOD for the New Construction program for the Section 8 program, which will instead by administered directly.

2020 REVENUE BY PROGRAM GROUP1 The 2020 Budget reflects two important revenue shifts between HACLA programs:

First, with the redevelopment of Jordan Downs, there is a shift of revenue and costs from Public Housing to Section 8 HCV. As Public Housing (ACC) units are converted to Rental Assistance Demonstration (RAD) units, Revenue in the form of tenant rent and operating subsidy received directly by the Public Housing

1 Although the HACLA budget includes five (5) major program groups including the Central Office, the Revenue Summary excludes the Central Office since revenue to the Central Office is in the form of fees from the four other program groups. Also, the LA LOMOD budget is presented here for information only; it will be separately reviewed and adopted by the LA LOMOD Board of Directors.

Type of Revenue 2018 Actual 2019 Budget 2020 Budget % of Total

Housing Assistance Payments 1,114,861,966 1,192,023,975 1,281,309,887 85.8% 89,285,912 7.5%

Administrative Fees 77,624,459 78,403,590 79,860,091 5.3% 1,456,501 1.9%

Rental Income 52,709,793 55,127,672 58,067,555 3.9% 2,939,883 5.3%

Operating Subsidy/HUD Grants 36,847,607 70,865,962 71,184,063 4.8% 318,102 0.4%

Pass‐through and Other 6,382,790 3,904,328 3,738,717 0.3% (165,611) ‐4.2%

Total 1,288,426,615$ 1,400,325,526$ 1,494,160,313$ 100% 93,834,787$ 6.7%

$ change from Prior Year 111,898,911$ 93,834,787$

% change from Prior Year 9% 7%

Table 2 ‐ REVENUE SUMMARY BY TYPE

2019 v 2020


program is terminated. In its place, the Section 8 HCV program receives an administrative fee for each RAD voucher unit, with the HAP assistance and tenant rent received directly by the developers. From an operating perspective, the loss of revenue in the Public Housing program should be aligned with the elimination of operating/maintenance costs for the corresponding ACC units. However, the realignment of staffing resources at the Jordan Downs site will have to be incremental as redevelopment phases occur over the next several years. In 2020, no staffing adjustments are proposed. For the Section 8 program, the RAD vouchers are incorporated to the large pool of vouchers and do not represent a significant revenue or operating cost change. Finally, the platform conversion will affect revenue for the Central Office in the form of a reduction to management fees, which is estimated to be $200,000 in 2020. As more Jordan Downs phases and additional properties, including Rose Hills and Rancho San Pedro, are redeveloped, there will be an increasingly significant impact to HACLA Public Housing and Central Office operations. To prepare for this, we have made it a priority to ensure HACLA participation in the redevelopment partnerships to ensure replacement revenue and cash flow, and are maximizing efficiencies in these operations.

Second, LA LOMOD will assume direct administration of the New Construction program – previously administered by the Section 8 Department – as well as other contracts currently administered directly by HUD. From an operating perspective, the transfer of the program from Section 8 does not pose appreciable challenges since the program was largely administered by LA LOMOD via an administrative fee, and no staffing will be affected. For LA LOMOD, the addition is very beneficial since operating costs are low, which will result in additional unrestricted proceeds.

The Section 8 Program group, which includes Housing Choice Voucher and Special Programs, are budgeted to receive $670.8 million, a decrease of $1.1 million; this is the net effect of a $24 million increase for the HCV program, offset by reductions to other programs, particularly New Construction and Continuum of Care. Housing Services is budgeted to receive $81.3 million, an increase of only $0.1 million, due to the reduction of Operating Subsidy and the conversion of Jordan Downs units. Strategic Development programs are budgeted to receive $44.9 million, a $3.8 million increase mainly from rent subsidy payments. LA LOMOD is projected to receive $697.2 million, an increase of $91.0 million, mainly from additional properties through the transfer of the New Construction program and increases to contract rents. 45% and 47% of total revenue is attributable to the Section 8 and LA LOMOD programs, respectively, which is primarily pass‐through Housing Assistance Payments. The Public Housing program represents 5% of total revenue, while the Strategic Development program represents 3% of total revenue.

Program Group 2018 Actual 2019 2020 % of Total

Section 8 621,245,944 671,903,631 670,797,770 46% (1,105,861) ‐0.2%

Housing Services 72,559,084 81,132,019 81,274,926 5% 142,907 0.2%

Strategic Development 18,898,960 41,100,628 44,922,759 3% 3,822,131 9.3%

LA LOMOD 575,722,627 606,189,248 697,164,858 47% 90,975,610 15.0%

Total 1,288,426,615$ 1,400,325,526$ 1,494,160,313$ 100% 93,834,787$ 6.7%


% change from Prior Year 9% 7%

Table 3 ‐ REVENUE SUMMARY BY PROGRAM GROUP

2019 v 2020


2020 EXPENSES BY TYPE Total Expenses for 2020 are budgeted at $1.6 billion, an increase of $132.1 million, or 9.3%. By type of expense, Personnel represents 7% of budget at $104.0 million and Non‐Personnel is 7% of budget at $113.3 million. Housing Assistance Payments represent 85% of costs at $1.3 billion and Extra‐ordinary Maintenance is 2% at $23.6 million.

Personnel Costs will increase $2.7 million, or 2.6%, and are more fully explained in the PERSONNEL section. The increase is primarily the result of Cost of Living Adjustments (COLAs), step increases, other benefit adjustments negotiated in various labor agreements, and the addition of 17.5 positions, net of the elimination of the year‐end additional pension contribution Non‐Personnel Costs will increase $3.3 million, or 3.0%, primarily due to various administrative costs in the Strategic Development programs, including redevelopment costs. Housing Assistance Payments are budgeted to increase $123.5 million, or 10.4% primarily due to cost per unit subsidies in the Housing Choice Voucher program ($58 million) and additional properties and contract rent increases in the LA LOMOD program ($89 million), offset by a reduction to projected Continuum of Care ($7 million). Extra‐Ordinary Maintenance will increase $2.7 million, or 12.7%, mainly due to the construction of the new WorkSource Center at the Imperial lot. (See PROPERTY MAINTENANCE AND CAPITAL PROJECTS section for more detail.)

2020 EXPENSES BY PROGRAM GROUP2 Total expenditures for the five major program groups are:

2 Unlike for Revenue, for Expenses the Central Office Cost Center (COCC) is included as a program group to more accurately reflect total operating costs for the Agency.

2018 Actual 2019

Personnel 83,990,271 101,353,898 104,007,318 7% 2,653,420 2.6%

Non‐Personnel 99,778,141 110,019,805 113,323,623 7% 3,303,818 3.0%

Housing Assistance Payments 1,117,827,905 1,191,776,844 1,315,319,836 85% 123,542,992 10.4%

Extra‐ordinary Maintenance 6,882,839 20,905,746 23,557,726 2% 2,651,980 12.7%

Total 1,308,479,155$ 1,424,056,293$ 1,556,208,504$ 100% 132,152,211$ 9.3%


% change from Prior Year 8.8% 9.3%

Table 4 ‐ EXPENSE SUMMARY BY TYPE

2020 2020 v 2019

Section 8 Public Housing Strategic Dev't LA LOMOD COCC Total % of Total

Personnel 41,261,733 32,334,103 6,610,813 5,087,300 18,713,369 104,007,318 7%

Non‐Personnel 22,660,154 34,722,210 35,173,817 6,484,870 13,277,572 112,318,623 7%

Housing Assistance Payments 643,319,836 ‐ ‐ 672,000,000 ‐ 1,315,319,836 85%

Extra‐ordinary Maintenance ‐ 16,046,371 7,511,355 ‐ 1,005,000 24,562,726 2%

TOTAL 707,241,723$ 83,102,684$ 49,295,985$ 683,572,170$ 32,995,941$ 1,556,208,504$ 100%

Percent of Total 45% 5% 3% 44% 2%

Percent without HAP 27% 34% 20% 5% 14%

Table 5 ‐ 2020 EXPENSE SUMMARY BY PROGRAM GROUP


Overall, the Section 8 Program Group and LA LOMOD represent 45% and 44% of total Agency costs, respectively, when Housing Assistance Payments are included. If excluded, total operating costs are $240.9 million and are somewhat more evenly distributed between the major program groups. Section 8 Personnel costs are the greatest between the programs representing 40% of total costs, followed by Public Housing at 31%.

Please see Appendix A‐1 through A‐7 – PROGRAM GROUP SUMMARIES


REVENUE PROJECTIONS FOR HCV AND PUBLIC HOUSING

SECTION 8 HOUSING CHOICE VOUCHER (HCV)/VASH

Total Revenue for the HCV program is projected to be $605.3 million, an increase of $24 million or 4.1%.

Housing Assistance Payments (HAP) Budget Authority for HAP is expected to increase $23.8 million; however, HAP expense is expected to increase $58.3 million resulting in the use of $36.8 million of HUD‐held HAP reserves.

Budget Authority for 2020 HAP is based on actual HAP expense in the last quarter of 2019, projected to be $529.9 million when annualized. From this baseline, HUD adds an inflation factor to capture rent increases and other adjustments, which establishes the Baseline Eligibility of $557.8 million. Since HUD has not made the 2020 inflation factor available, we have relied on the current year percent of 5.26%. Based on this formula, funding from HUD is expected to be $555 million; once FSS forfeitures and Fraud recoveries are considered, total Projected Revenue is $555.7 million, a $23.8 million increase. However, Projected HAP Expense is expected to significantly exceed this: despite a reduction to projected Units Leased, the Average per Unit Cost is expected to increase 11.3%, double HUD’s assumption, resulting in Projected HAP Expense of $592.5 million. The Average Cost per Unit is driven by a number of factors, including standard rent increases, an increase to the Voucher Payment standard which is tied to Fair Market Rents, and an increase in PBVs for higher‐needs clients, who require deeper subsidies.

2019 2020 $ Increase % Increase

Housing Assistance Payments 531,109,454$ 554,983,831$ 23,874,377$ 4.5%

Administrative Fees 50,245,309 50,337,615 92,306 0.2%

Total 581,354,763$ 605,321,446$ 23,966,683$ 4.1%

Table 6 ‐ SECTION 8 ‐ HOUSING CHOICE VOUCHER/VASH

2019 2020 Inc/(Dec)

Year‐End HAP Expense $ 507,104,641 $ 529,899,956 22,795,315

Inflation Factor 5.26% 5.26% 0.00%

Baseline Eligibil ity $ 533,778,345 $ 557,772,694 23,994,349$

Proration 99.5% 99.5% 0.0%

Budget Authority 531,109,454$ 554,983,831$ 23,874,377$

FSS Forfeitures/Interest 736,492$ 665,000$ (71,492)$

Fraud Revenue 74,721$ 80,000$ 5,279$

Projected Revenue $ 531,920,667 $ 555,728,831 23,808,164$

Unit Months Leased 531,118 529,251 (1,867)

Average Per Unit Cost 1,004$ 1,118$ 11.3%

Total HCV HAP Expense 533,300,343$ 591,571,741$ 58,271,398$

FSS Escrow Deposit 880,097$ 950,000$ 69,903$

Projected HAP Expense 534,180,440$ 592,521,741$ 58,341,301$

USE OF RESERVES $ 2,259,773 $ 36,792,910 34,533,137$

Table 7 ‐ SECTION 8 ‐ HCV/VASH ‐ Housing Assistance


For this reason, it is projected that HACLA will draw $36.8 million from HUD‐held HAP reserves, which are $43 million as of November 2019.

Administrative Fee Revenue Administrative fees are tied to actual units leased, which is expected to decline slightly in 2019. However, it is expected that HUD will increase the rate per unit by 2.57%, based on the most recent three‐year average. As such, the baseline eligibility for Administrative Fee funding is projected at $63.1 million, an increase of $1.4 million. However, once the Proration of 79% is factored in, administrative fee revenue is projected to be $50.3 million, resulting in essentially no additional revenue for the administration of program.

PUBLIC HOUSING PROGRAM Total Revenue for the Public Housing Program is projected to be $80.4 million, essentially the same as 2019 due to the reduction of Operating Subsidy, which offsets Tenant Revenue.

Operating Subsidy Estimated Operating Subsidy is based on preliminary calculations for 2020 eligibility using HUD’s calculation workbook, which considers various factors. First, HUD sets the Expense Level each year for every public housing site, which includes an inflation factor. The Expense Level is meant to capture the actual operating cost needs for each site, adjusted for inflation. This inflation rate varies every year, and while HUD has not yet provided the 2020 rate, our preliminary estimate is 2.8%, consistent with recent years. Second, HUD captures Utility Expenses for the prior three years on a rolling basis. HACLA has continued its conservation efforts, and despite rate increases, HUD’s workbook projects a 10% reduction in average utility costs. It should be noted that HUD’s projection may not align with actual costs in 2020. Third, increases to fair market rents and HUD’s policy regarding proration for mixed families, the Per Unit Income, or tenant rents, is projected to increase 5%.

2019 2020 $ Increase % Increase

Operating Subsidy 20,603,590$ 18,846,808$ (1,756,782)$ ‐9%

Tenant Revenue 38,490,538 40,057,518 1,566,980 4%

Capital Grant 21,028,738 21,000,000 (28,738) 0%

Other 280,905 468,600 187,695 67%

Total 80,403,771$ 80,372,926$ (30,845)$ 0.0%

Table 9 ‐ PUBLIC HOUSING Revenue

2019 2020 Inc/(Dec)

Unit Months Leased 531,118 529,251 (1,867)

Rate Increase 2.57% 2.57% 0.00%

Col A/B Rate Per Unit $124.34/116.06 $127.54/119.04 $3.87/3.62

Eligibil ity 61,701,171 63,065,809 1,364,638

Proration 81% 79% ‐2%

Administrative fee funding 49,977,949 50,061,639 83,691

Project Based Unleased 267,360 275,976 8,615

Total Administrative Reven 50,245,309$ 50,337,615$ 92,306$

Table 8 ‐ SECTION 8 ‐ HCV/VASH ‐ Administrative Fee


In effect, while the Unit Expense Level will increase, this is more than offset by increases from tenant revenue, resulting in a decrease of Operating Subsidy by 9%. Once the estimated proration level of 97% is considered, we anticipate $18.8 million in Operating Subsidy, a reduction of $1.76 million.

Tenant Revenue As noted above, Tenant Revenue has increased, which is primarily driven by increases to tenant incomes, and the adoption of Small Area Fair Market Rents (SAFMR) per HUD’s policy at the various housing development sites, which vary widely by location. Since the tenant rent contribution is limited to 30% of adjusted income, increases to

2019 2020

Average Per Unit Expense Level 573.45 589.28 15.83 2.8%

Average Per Unit Util ity Expense 115.97 104.56 ‐11.41 ‐10%

Average Per Unit Income 472.86 498.32 25.46 5%

Average Per Unit Operating Subsidy 256.79 240.16 (16.63) ‐6%

Estimated Eligibil ity 21,240,815$ 19,429,699$ (1,811,116) ‐9%

Proration 97.00% 97.00% 0% 0%

Total 20,603,590$ 18,846,808$ (1,756,782)$ ‐9%

Increase/(Decrease)

Table 10 ‐ PUBLIC HOUSING ‐ Operating Subsidy Calculation

2019 2020

Avalon/Gonzaque 1,200,263 1,201,998 1,735 0%

Estrada Courts 997,126 862,309 (134,817) ‐14%

Imperial Courts 1,906,610 1,902,064 (4,546) 0%

Jordan Downs/Mosaic 2,457,678 2,170,520 (287,158) ‐12%

Mar Vista Gardens 1,481,416 1,238,378 (243,038) ‐16%

Nickerson Gardens 3,878,566 3,609,145 (269,421) ‐7%

Pico Gardens 516,862 413,705 (103,157) ‐20%

Pueblo del Rio 2,579,899 2,437,844 (142,055) ‐6%

Ramona/Rose Hil ls 2,057,094 1,776,691 (280,403) ‐14%

Rancho San Pedro 1,215,831 1,165,078 (50,753) ‐4%

San Fernando Gardens 918,140 950,555 32,415 4%

William Mead 1,256,391 1,118,521 (137,870) ‐11%

Lankershim/87th 137,716 ‐ (137,716) ‐100%

Total 20,603,590$ 18,846,808$ (1,756,782)$ ‐9%

Table 11 ‐ PUBLIC HOUSING ‐ 2020 OPERATING SUBSIDY Revenue Projection

Increase/(Decrease)

2019 2020

Avalon/Gonzaque 1,594,646 1,676,836 82,189 5%

Estrada Courts 2,601,955 2,711,773 109,818 4%

Imperial Courts 2,275,051 2,395,175 120,124 5%

Jordan Downs/Mosaic 4,295,710 3,831,106 (464,604) ‐11%

Mar Vista Gardens 4,079,729 4,269,002 189,273 5%

Nickerson Gardens 5,419,034 5,629,636 210,602 4%

Pico Gardens 2,029,457 2,193,166 163,709 8%

Pueblo del Rio 3,328,373 3,637,831 309,459 9%

Ramona/Rose Hil ls 3,904,079 4,261,818 357,739 9%

Rancho San Pedro 2,766,050 2,925,656 159,605 6%

San Fernando Gardens 3,297,418 3,494,795 197,377 6%

Will iam Mead 2,438,777 2,707,825 269,048 11%

Lankershim/87th 173,619 ‐ (173,619) ‐100%

Total 38,203,899$ 39,734,618$ 1,530,720$ 4%

Increase/(Decrease)

Table 12 ‐ PUBLIC HOUSING ‐ 2020 Tenant Rental Revenue Projection


area rents do not affect the majority of our residents. However, per HUD policy, HACLA prorates the level of subsidy for each family based on family composition when one or more of the household members is considered ineligible. As such, increases to SAFMR’s result in rent increases for these “mixed families.” As summarized above, increases to tenant revenue vary by site and are most notable in neighborhoods where the SAFMR has increased the most.

RAD Conversions Jordan Downs – In 2019, 30 units at Jordan Downs were removed from the ACC contract pursuant to the redevelopment plan; in 2020 it is projected an additional 127 units will be removed. Reductions to Operating Subsidy and Tenant Rents associated with these units results in a revenue reduction of approximately $750,000. By comparison, the HCV program will receive approximately $178,000 to administer the vouchers. Lankershim/87th – Similarly, all 57 units of the Lankershim/87th senior buildings converted to RAD in 2019 resulting in a revenue loss of $311,000 for the public housing units. However, because these units have been incorporated into HACLA’s Asset Management Portfolio, HACLA will receive both the Tenant Revenue and the HAP subsidy pursuant to the RAD voucher. The Section 8 program will receive approximately $65,000 to administer these vouchers.


PROGRAM GROUP EXPENSE SUMMARIES

SECTION 8 PROGRAM GROUP

Total expenditures are projected at $707.2 million, an increase of $33.3 million, or 5%.

Personnel costs are projected to decrease $5,200. This is the net of the following major adjustments:

1. Obligatory Changes: Baseline staffing costs will increase $1.15 million due negotiated compensation

adjustments (COLAs), step increases, pension costs, and medical plan increases.

2. Vacancy Rate: These Obligatory increases are partially offset by a higher assumed vacancy rate of 4% as

compared to 3% in the 2019 budget, which results in a savings of $240,000 This is reflective of higher than

average vacancies in the Section 8 program due to various leaves.

3. Year‐end Pension Contribution: Personnel Costs are further offset by the elimination of the discretionary

year‐end pension contribution of $1.2 million which was budgeted in 2019. Given the need for the

additional staff (described below), it is necessary to at least initially forgo budgeting for the additional

contribution. As in past years, to the extent year‐end surpluses are available in 2020, the supplemental

contribution will be considered.

4. Positions Adjustments: Eight (8) new positions are added to the Section 8 program group ($800,000),

however they are largely offset by the elimination six (6) positions ($600,000).

Administration

Assistant Director (ASD009) – This position will be responsible for helping to design the Customer

Contact Center (CCC) through a complete process improvement review currently underway, and will

then oversee its implementation and operation. This position will also focus on streamlining the

operations of two other key customer service functions: Inspections and the 2600 Wilshire lobby. The

reorganization of staff and functions pursuant to the business process review will be included in the

Midyear Budget Modification.

Administrative Analyst II (AA2005) – This position will assist in identifying and implementing all

available regulatory provisions intended to streamline program operations while maintaining required

program compliance. Moreover, this position will assist in the evaluation of current Section 8 processes

to identify system bottlenecks and opportunities for improved interaction with applicant and

participant families.

Inspections

Assistant Housing Manager (AHM007) and 3 Inspectors (HIN021,022,033) – In 2015, HACLA adopted

a biannual inspection cycle consistent with HUD efficiency efforts, and reduced the inspector roster at

that time. However, we have found that inspection volumes have not decreased: requests for

complaint‐based inspections have tripled, contracts in more distant areas, such as Palmdale, have

increased as have damage‐claim inspections. In order to meet these demands as well as reduce the

time needed to schedule initial contract inspections, which is critical for both customer service and

program success in a tight rental market, additional staffing is needed.

2018 Actual 2019

Personnel 36,030,289$ 41,266,915$ 41,261,733$ 6% (5,182)$ 0%

Non‐Personnel 22,592,886 23,915,580 22,660,154 3% (1,255,427) ‐5%

Housing Assistance Payments 563,469,111 608,805,996 643,319,836 91% 34,513,840 6%

Total 622,092,286$ 673,988,491$ 707,241,723$ 100% 33,253,232$ 5%



2020 2020 v 2019

Table 13 ‐ EXPENSE SUMMARY BY TYPE ‐ SECTION 8


Special Programs Operations and Homeless Incentive Program

Housing Support Specialists (3 – HSS006, HSS007, HSS008) – This staff will conduct owner outreach,

housing location to identify rental units, and provide housing search assistance to applicants. They will

also build and maintain relationships with property owners to strengthen partnerships and grow the

landlord base. (One position is a conversion of a Management Clerk.)

Non‐Personnel costs are projected to decrease $1.3 million, or 5%, primarily due to the elimination of operating

costs for the New Construction program ($1 million), a decrease to Supportive Services in the Continuum of Care

program ($0.8 million), partially offset by an increase to the Homeless Incentive Program ($0.2 million.)

Most of the increase is related to Housing Assistance Payments, which are projected to increase by $34.5 million or

6%. This is due an increase of $58.3 million in the HCV program due to fair market rents and per unit cost (PUC)

increases. However, this is offset by the elimination of $17 million for the New Construction program. See Table

12 for more detail.

Please see Appendix A‐9 through A‐12 – SECTION 8 PROGRAM SUMMARIES


PUBLIC HOUSING PROGRAM GROUP

Total expenditures are projected at $83.1 million, a decrease of $223,281, or 0.3%.

Personnel costs are projected to increase $0.4 million, or 1%. This is primarily reflective of negotiated compensation

adjustments, offset by the elimination of the year‐end pension contribution, as well as the following two (2) new

positions:

Application Center ‐ Quality Control Assistant (QCA011) – This position will ensure waitlist processing

integrity through quality control of waitlist ledgers and entries, provide training to other App Center staff,

and conduct ongoing analytical reviews.

Capital Grant Management ‐ Construction Project Assistant (CPA001) – Over the past several years, HACLA

has converted to a mostly in‐house construction model relying on per diem staff rather than third‐party

contractors. With higher capital grant awards which have made comprehensive infrastructure projects

possible, there is a need for additional project management support. This position will attend job walks in

preparation of scopes for contract procurement, scheduling and maintaining department project lists,

calendars and meetings (staff and vendor), creating QSPs, RFPs, and other tasks.

Non‐Personnel costs are projected to decrease $0.5 million, or 1%, resulting mainly from the elimination of one‐

time expenses in 2019 for HVAC replacements and paving projects, as well a reduction to utility costs. These

decreases are somewhat offset by increases to management fees pursuant to HUD’s schedule, additional allocations

for maintenance materials, and additional contributions to Payments in Lieu of Taxes (PILOT).

Extra‐ordinary Maintenance costs are budgeted to remain effectively the same based on the assumption that the

significant increase to the Capital Grant in 2018 and 2019 will be repeated in 2020. The focus will continue to be the

replacement of major systems, including gas, sewer, and water lines as well as electrical systems. Please see Table

23 and Appendix B‐45 for more detail.

Please see Appendix A‐13 through A‐15 – PUBLIC HOUSING PROGRAM SUMMARIES

2018 Actual 2019

Personnel 26,729,752$ 31,948,880$ 32,334,103$ 39% 385,223$ 1%

Non‐Personnel 35,994,137 35,253,506 34,722,210 42% (531,296) ‐2%

Extra‐ordinary Maintenance 5,834,303 16,142,846 16,046,371 19% (96,475) ‐1%

Total 68,558,192$ 83,345,232$ 83,102,684$ 100% (242,547)$ ‐0.3%

$ change from Prior Year 14,787,040$ (242,547)$

% change from Prior Year 21.6% ‐0.3%

Table 14 ‐ EXPENSE SUMMARY BY TYPE ‐ PUBLIC HOUSING

2020 2020 v 2019


STRATEGIC DEVELOPMENT Total expenditures are projected at $49.4 million, an increase of $7.8 million or 19%.

Personnel costs are projected to increase $1.1 million, or 21%. This is reflective of negotiated compensation

adjustments as well as eight (8) new positions, including:

Asset Management/Redevelopment Administration

Project Delivery Manager (PDM002) – This position will focus on the oversight and monitoring of capital

projects across the Asset Management and Redevelopment portfolios. Duties will include quality assurance

of scopes of work, scope development, quality assurance of capital work including redevelopment or

construction projects, HQS/REAC/NSPIRE inspections, lender inspections, capital budget development and

planning, common area oversight, ADA compliance and conversions, compliance with all applicable building

codes and permit requirements, and ad hoc projects.

Administrative Analyst II (AA2006) – This position will provide: additional support for compliance across

different programs as that portfolio continues to grow and become more complex; rent calculations for

program conversions (requires a full understanding of all programs involved) and commercial leases

(abstracts, rent calculations including thorough cash flow analysis); analytical support for quarterly

reporting and ad hoc projects.

Community Engagement

Community Relations Specialist (CRS002) – As the redevelopment portfolio continues to grow, we are

adding a necessary support position to coordinate and lead specific resident engagement efforts. This

position will work closely with the Director of Community Relations and the Development Services team

to execute the comprehensive resident engagement strategy at the multiple redevelopment sites.

Development Services

Assistant Project Manager (APM001) and Administrative Intern II (AI2004) – These positions will provide

critical support to the Development Services team who manage an increasingly growing portfolio. There

are currently three active redevelopments, two new programs (Conduit Bonds and Acquisitions), and large‐

scale one‐time projects, such as the construction of a new WorkSource Center.

Strategic Initiatives

Workforce Development ‐ Administrative Assistant (ADA012) – The position will support back‐end office

operations for multiple Workforce Development Unit contracts, provide support with contract compliance,

vendor customer service and other contractual support duties. As the Workforce Development Unit

expands its reach, administrative support is necessary to ensure a seamless flow in operations and timely

response to Vendor and Client needs. This position will also relieve program staff from some administrative

tasks allowing them to focus more time on client support.

Strategy & Metrics: Fund Development/Grant Writer (GWR001) – This position will support the fundraising

efforts of HACLA and its affiliate organizations to garner additional support for operations and programs

related to the 25‐Year Vision Plan goals. This position is designed to raise capital amidst dwindling federal

resources.

2018 Actual 2019

Personnel 2,965,435$ 5,465,998$ 6,610,813$ 13% 1,144,815$ 21%

Non‐Personnel 27,580,066 31,348,551 35,173,817 71% 3,825,266 12%

Extra‐ordinary Maintenance 1,011,642 4,762,900 7,511,355 15% 2,748,455 58%

Total 31,557,143$ 41,577,449$ 49,295,985$ 100% 7,718,536$ 19%



Table 15 ‐ EXPENSE SUMMARY BY TYPE ‐ STRATEGIC DEVELOPMENT

2020 2020 v 2019


Program Partnerships – Administrative Programs Specialist (APS002) – This position will coordinate and

manage computer lab services to ensure robust programming in the existing Computer Learning Centers

(CLCs). In addition to linking services to Workforce Development programs, the position will support after‐

school homework tutoring programs, daytime digital literacy courses, as well as other training on an on‐

going basis. This will improve community stewardship and increase opportunities for the use of the CLCs.

Non‐Personnel costs are projected to increase $3.9 million, or 13%, resulting from various initiatives including:

An additional $0.4 million for startup and operational costs for the new Conduit Bond and Acquisitions

programs;

An additional $0.7 million for Jordan Downs redevelopment, for a total of $2.7 million, primarily for

demolition costs for Phases S3 & S3 and for a relocation office;

An additional $0.5 million for Rose Hills redevelopment, mainly related to relocation and other consulting

costs;

An additional $0.6 million for Rancho San Pedro redevelopment, primarily for an EIR and other costs related

to the execution of the DDA; and

An additional $1 million for various costs related to the Pueblo del Sol I & II re‐syndication and

predevelopment.

Extra‐Ordinary Maintenance costs are projected to increase $2.7 million or 58% mainly due to one‐time costs for

the new WorkSource Center at the Imperial Lot.

Please see Appendix A‐17 through A‐23 – STRATEGIC DEVELOPMENT PROGRAM SUMMARIES


LA LOMOD PBCA

Total expenditures are projected at $683.5 million, an increase of $89.6 million or 15%.

Operations

The most notable change for LA LOMOD is the transfer of HUD’s PBCA contracts and the New Construction program

to its portfolio. With this addition of 58 properties, HAP will increase almost $90 million, or 15%. In order to

accommodate this growth, LA LOMOD is adding three (3) new positions, as well as reclassifying a number of existing

positions. Other operating increases include the implementation of a document management system (On‐Base),

and other systems enhancements.

Related to the contract renewal, in early 2019, HUD released an initial draft of an RFP which drew significant negative

public comment. Preliminary indications were that HUD would issue a revised RFP that will better integrate public

housing authorities in the new regional framework. However, it is still not yet clear when this RFP will be released.

Pending that determination, HUD has extended PBCA contracts through December 2020.

Transfers to HACLA Programs LA LOMOD is projected to generate $13.8 million in fee proceeds, net of its own operational needs. These proceeds continue to play a critical role in the ability of HACLA to meet its program delivery and operational goals. Some of the more critical transfers for HACLA programs and initiatives include:

$1.75 million for the Community Safety Partnership: this national model for community policing will expand to San Fernando Gardens, placing LAPD CSP officers at 8 public housing developments.

$2.2 million for the WorkSource Center which will more than triple the space for the Watts regional center, making it possible to expand supportive services at the new location; $800,000 is also budgeted for the conversion of the current center back to residential units at Imperial Courts.

$350,000 for Implementation of the new phone system and $338,000 for computer refresh: for many of our large systems implementations or one‐time initiatives that have agency‐wide impact, we have often relied on LA LOMOD for the one‐time costs.

$735,000 for Program Partnerships: this unit is dedicated to the provision and expansion of services to our residents through new and enhanced partnerships.

2018 Actual 2019

Personnel 3,469,351$ 4,631,320$ 5,087,300$ 1% 455,980$ 10%

Non‐Personnel 3,397,826 6,329,574 6,484,870 1% 155,297 2%

Housing Assistance Payments 554,358,793 582,970,848 672,000,000 98% 89,029,152 15%

Total 561,225,970$ 593,931,741$ 683,572,170$ 100% 89,640,429$ 15%



2020 2020 v 2019

Table 16 ‐ EXPENSE SUMMARY BY TYPE ‐ LA LOMOD


CENTRAL OFFICE PROGRAM GROUP

Total expenditures are projected at $32.8 million, an increase of $1.6 million or 5%.

Personnel costs are projected to increase $0.7 million, or 4%. This is primarily reflective of negotiated compensation

adjustments as well as:

Information Technology – two (2) new positions are added to implement critical components of the

technology roadmap.

o One position will be dedicated to Application Development and Business Intelligence using newly

acquired and/or available platforms such as ORACLE, Sharepoint, Virtual Basic, OnBase, MS Access,

and MS SQL. This position, among other duties, will lead the integration of all databases into a

platform that will produce dashboards, analytical reports, score cards, trending, notifications, and

break the silos that lead to non‐standardized reporting and assessments.

o One position will lead the expanded us of the ORACLE functionalities for financial operations and

the customization of forms or workflows to optimize ORACLE related financial processes, including

payroll, costing, grant management, etc. This position will set up the groundwork to upgrade the

application and establish a multi‐year plan to maximize benefits realized by the use of the system.

Finance – one Finance Manager position is converted to two (2) accountant positions to assist with financial

reporting and billing.

Legal‐Housing Services – one position is transferred from the Security Unit to assist with Public Housing

investigations and to support the camera system.

Agency‐wide – various shared positions have been reallocated between programs to more accurately

reflect workload, resulting in the shifting of some costs and partial positions to the Central Office.

Non‐Personnel costs are projected to increase $0.3 million, or 2%, primarily from one‐time costs for the new phone

system implementation and computer refresh.

Extra‐ordinary Maintenance in 2020 will increase $0.7 million and will include solar panels at the Torrance office,

fencing and bathroom upgrades at Van Nuys, and charging stations and HVAC work at Wilshire.

Please see Appendix A23 through A27 – CENTRAL OFFICE PROGRAM SUMMARIES

2018 Actual 2019

Personnel 14,795,444$ 18,040,787$ 18,713,369$ 57% 672,583$ 4%

Non‐Personnel 10,213,226 12,809,698 13,277,572 40% 467,874 4%

Extra‐ordinary Maintenance 36,894 362,895 1,005,000 3% 642,105 100%

Total 25,045,564$ 31,213,380$ 32,995,941$ 100% 1,782,561$ 6%



Table 17 ‐ EXPENSE SUMMARY BY TYPE ‐ CENTRAL OFFICE

2020 2020 v 2019


PERSONNEL

TOTAL PERSONNEL and POSITIONS Total Personnel expenditures in 2019 are budgeted at $104 million, a 2.6%, increase from 2019. This includes an overall increase of 17.5 Full‐Time Equivalent positions (FTEs) to a total of 851 staff.

As between the various program groups, staffing is allocated as follows:

Section 8 staffing costs are projected at $41.2 million composing 40% of total personnel costs. With the elimination of the additional contribution for pension liability, the total cost is effectively flat. Section 8 positions will increase 1.36 FTEs: this is the net of the addition of 8 new positions offset by the elimination of six (6), and the reallocation of positions between programs.

Public Housing staffing costs are projected at $31.3 million composing 31% of costs. Public Housing positions will increase 1.6 FTEs: this is the net of the addition of 2 positions offset by the reallocation of positions between programs. Strategic Development staffing costs are projected at $6.6 million composing 6% of costs. Strategic Development positions will increase 7.65 FTEs. LA LOMOD staffing costs are projected at $5.1 million, composing 5% of costs. Due to the addition of 58 properties, 3 positions are added. Central Office staffing costs are projected at $18.7 million composing 18% of costs. Total positions will increase 3.89 FTEs due to the reallocation of positions from other programs as well as the addition of 3 positions. Please see Appendix A29‐30 – Roster Personnel Summary and Schedule of New and Converted Positions

FTEs TOTAL

FY 2019 Midyear 832.39 101,353,388$

FY 2020 Proposed 850.25 103,966,836$

Increase/(Decrease) 17.9 2,613,447$

& Increase/(Decrease) 2.1% 2.6%

Table 18 ‐ Agency Total

Personnel Costs Section 8 Public Housing Strategic Dev LA LOMOD COCC TOTAL

FY 2019 Midyear 41,266,915$ 31,948,880$ 5,465,488$ 4,631,320$ 18,040,787$ 101,353,388$

FY 2020 Proposed 41,193,277$ 32,347,798$ 6,593,161$ 5,087,300$ 18,745,299$ 103,966,836$

Increase/(Decrease) (73,638)$ 398,919$ 1,127,673$ 455,980$ 704,513$ 2,613,447$

& Increase/(Decrease) 0% 1% 21% 10% 4% 3%

% of Total 40% 31% 6% 5% 18%

Positions (FTEs)

FY 2019 Midyear 354.40 276.03 42.40 48.50 111.06 832.39

FY 2020 Proposed 356.69 277.56 49.55 51.50 114.95 850.25

Increase/(Decrease) 2.29 1.53 7.15 3.00 3.89 17.86

& Increase/(Decrease) 1% 1% 17% 6% 4% 2%

% of Total 42% 33% 6% 6% 14%

Table 19 ‐ Cost and FTE by Program Group


TOTAL COSTS BY TYPE Of the $104 million in Personnel Costs, $54.9 million or 53%, are direct salary costs, and 47% are for benefit‐related costs.

Salary costs include direct salaries, overtime, and bilingual bonuses, net of leave time used. An increase of $2.2 million, or 4%, is projected primarily due to COLA and step increase adjustments, as well as additional costs for new positions. This also reflects the vacancy rate in the HCV program. o Direct Salaries: includes negotiated cost of living increases as well as step increases. This cost is net of any

accrued leaves taken by staff. o Overtime: of the total Salaries cost, approximately $350,000 is for overtime; of this 80% is budgeted in the

public housing program for emergency on‐call services and for REAC preparation. o Bilingual Bonuses: of the total Salaries cost, approximately $170,000 is for bilingual bonuses for staff, 66%

of which is for Section 8 programs. Staff are able to assist clients in over 45 languages.

Paid Leaves, including general, vacation, and sick leave accruals, total $11.5 million, or 11% of total costs. Federal and state Taxes total $5 million, or 5% of costs. The increases for both are tied to salary increases.

Medical costs, including post‐employment healthcare, total $13 million or 12% of costs, with an overall increase of 11%. This is due to: o Medical: per the new medical plan adopted in 2017, HACLA pays the full cost of the Kaiser plan for staff and

their families. In 2020, those premiums will increase 7%. o OPEB: of the $13 million total, $2.5 million is for medical coverage for retired employees. Due to the success

of the OPEB trust, we were able to reduce our required contributions from $4 million to $2.5 million several years ago, and then even further to $1.7 million in 2019. However, in order to mitigate HACLA’s unfunded liability, we are restoring the contributions to $2.5 million.

Pension costs total $19.5 million, a decrease of $1.4 million or 7%. This reduction reflects the elimination of the year‐end additional contribution to the pension plan of $3 million. Excluding that, pension costs have otherwise increased $1.6 million. HACLA continues to monitor the pension liability closely, and will continue to consider additional payments and other measures to continue to mitigate that liability.

Personnel Costs Salaries Leaves Taxes Medical/OPEB Pension TOTAL

FY 2019 Midyear 52,746,346$ 11,110,000$ 4,823,081$ 11,737,713$ 20,936,249$ 101,353,388$

FY 2020 Proposed 54,914,695$ 11,494,336$ 5,021,998$ 12,992,656$ 19,543,151$ 103,966,836$

Increase/(Decrease) 2,168,349$ 384,336$ 198,918$ 1,254,943$ (1,393,098)$ 2,613,447$

& Increase/(Decrease) 4% 3% 4% 11% ‐7% 3%

% of Total 53% 11% 5% 12% 19%

Table 20 ‐ Cost by Type


PROPERTY MAINTENANCE & CAPITAL PROJECTS

WORKSOURCE CENTER

HACLA’s Workforce Development Unit runs the Watts/Los Angeles JCC WorkSource Center (“Center”), serving over 3,000 clients annually including youth and adults with multiple barriers to employment entry. The Center has grown from its WorkSource‐only model and has garnered additional contracts in recent years. The WorkSource Centers are currently operating in approximately 4,500 square feet of space between two locations: a headquarters at Imperial Courts and a satellite office at Jordan Downs. HACLA has identified approximately 20,000 square feet of the Imperial lot, a portion of which is leased to the City of Los Angeles for a bridge housing facility, to be available for a new WorkSource Center, which will be located on the westernmost portion of the Imperial Site. The approximately 8,640 square foot semi‐permanent modular building will provide various small classrooms, conference rooms, offices, a large multi‐purpose space, a dedicated business center and ADA accessible restrooms, in addition to 26 dedicated onsite parking spaces. At the October 31, 2019 Board of Commissioners meeting, the Board approved the purchase of the modular structure; included in the 2020 Budget are the related construction costs, including necessary infrastructure, such as utility connections, foundation/pad construction, and paving, for a total cost of $2.2 million. (Please see Appendix B‐81 for budget detail.)

With this move, 4 residential units at Imperial Courts can be restored.

PUBLIC HOUSING

1. CAPITAL PROJECTS From a high in 2005 of $19 million, the Capital Grant award declined dramatically, reaching a historic low of $12 million in 2013. The grant grew incrementally to a consistent award of $14.5 million. Fortunately, beginning in 2018, Congress appropriated a significant increase to the grant resulting in an annual award of $21 million. This infusion of funds has been directed for major systems improvements. Given that both the House and Senate bills propose even higher appropriations, we consider the consecutive‐year increases as likely to be continued and have budgeted at this level for 2020.


From the projected grant of $21 million, there are a number of annual and recurring costs, which total $8.6 million of the annual award. This includes the transfer of $2.9 million to the Public Housing program for regular maintenance, $1.1 million for accessibility compliance, among other costs. In addition, approximately $2 million is identified as Demo/Dispo transition funds, which are designated for redevelopment costs. This leaves approximately $10.6 million for major capital projects. For the past several years, the Public Housing program has initiated utility infrastructure systems upgrades. Given the safety concerns regarding gas lines, all those systems were prioritized to be replaced first, followed by sewer and water lines at Estrada Courts and Mar Vista. With the infusion of additional funds, electrical systems replacements have been added at most sites.

To accomplish these and other projects that are currently underway, 87 Per Diem tradespeople are retained, including:

17 Plumbers

8 Apprentice Plumbers

14 Laborers

5 Apprentice Laborers

15 Carpenters

5 Apprentice Carpenters

4 Electricians

3 Apprentice Electricians

3 Spray Painters

2 Painter

2 Cement Masons

2 Apprentice Cement Masons

4 Ceramic Tiles Setters

3 Resilient Tile Layers

Gas Lines Sewer Lines Water Lines Electrical Roofs Total

Avalon Gardens 1,394,750$ 1,505,614$ 2,900,364$

Estrada Courts 827,850 428,186 680,598 811,060 2,747,694

Gonzaque Village 1,476,505 498,640 1,975,145

Imperial Courts 667,686 1,724,170 2,000,000 4,391,856

Mar Vista Gardens 551,123 1,204,491 1,582,424 525,707 3,863,745

Nickerson Gardens 1,036,804 4,727,670 5,764,474

Pico Gardens 91,760 91,760

Pueblo del Rio 526,839 1,699,560 2,000,000 4,226,399

William Mead 366,564 1,834,164 2,200,728

Total 6,848,121$ 1,632,677$ 5,492,806$ 10,188,561$ 4,000,000$ 28,162,165$

Personnel 6,163,309$ 1,387,775$ 4,668,885$ 9,169,705$ NA 21,389,674$

Non‐Personnel 684,812$ 244,902$ 823,921$ 1,018,856$ NA 2,772,491$

Table 21 ‐ Capital Grant Infrastructure Projects


2. REGULAR MAINTENANCE Summarized below are the general maintenance categories for regular maintenance at the 14 public housing sites. Given limited resources, funds have been prioritized for the items where Residents have expressed the greatest need, including $1 million for Unit Repairs (such as cabinets and painting), $800,000 for Grounds & Landscape (such as site cleanliness and tree trimming), and $880,000 for Plumbing. The reduction of total costs for HVAC and Grounds reflect large one‐time expenses for HVAC system replacements and paving projects.

3. IMPERIAL UNIT CONVERSIONS With the move of the WorkSource Center to the new facility, the building the Center currently occupies will be converted back to four (4) residential units, which will provide much needed additional housing. Because the conversions will require extensive renovation, including compliance with ADA requirements, $800,000 in LA LOMOD funding is earmarked for this work.

RENT SUBSIDY CAPITAL PROJECTS Pending the completion of the Physical Needs Assessment, which will be the basis for an updated 5‐Year Capital Improvement plan, site improvements totaling $4.5 million are planned.

Specific projects include:

Air Conditioning & Ventilation upgrades ‐ $314,000 is earmarked for the scattered sites that compose the LA Groups 1 and 2. The overall reduction reflects significant HVAC work budgeted for 2019.

Cabinetry ‐ $730,000 will be dedicated for cabinet and countertop replacements throughout the portfolio, including $115,000 at Union Tower, $60,000 at Owensmouth, $82,000 at Clemson Market, and $60,000 at St. Andrews.

Painting (Exterior/Interior) ‐ $745,000 will be dedicated for painting at various properties, including $153,000 at Gibraltar Apartments, $120,000 at Barbara Ann, and $102,000 at Laveta Terrace.

Flooring ‐ $837,000 will be used for flooring and carpet replacements at sites throughout the portfolio, including $170,000 at Parkview East and West, $90,000 at Owensmouth, and $61,000 at Yosemite.

2019 2020

Appliances & HVAC 524,851 290,230 (234,621) ‐45%

Electrical 233,809 297,100 63,291 27%

Equipment & Maintenance 541,464 561,600 20,136 4%

Extermination 327,860 334,950 7,090 2%

Grounds & Landscape 1,089,570 806,439 (283,131) ‐26%

Locks & Security 356,325 293,525 (62,800) ‐18%

Other 69,242 66,250 (2,992) ‐4%

Plumbing 790,070 879,600 89,530 11%

Unit Repair 1,028,430 1,056,250 27,820 3%

Windows, Doors, Shades 207,711 219,900 12,189 6%

Total 5,169,332$ 4,805,844$ (363,488)$ ‐7%

Table 22 ‐ PUBLIC HOUSING ‐ Regular Maintenance

Increase/(Decrease)


2019 2020

ADA ‐ 24,150 24,150

Air Conditioning & Ventilation 895,300 314,670 (580,630) ‐65%

Cabinetry/Countertops 761,500 730,410 (31,090) ‐4%

Decking/Stairs/Patios 61,000 118,220 57,220 94%

Elevator 50,000 51,000 1,000 2%

Energy Upgrades/Telecom 33,300 47,640 14,340 43%

Fences/Gates/Security 112,000 129,240 17,240 15%

Furnishing & Accessories 42,300 41,720 (580) ‐1%

Interior 156,500 119,850 (36,650) ‐23%

Landscaping/Gardening 23,000 45,460 22,460 98%

Membrane Roofing 320,000 295,800 (24,200) ‐8%

Painting and Wall Coverings 708,000 745,460 37,460 5%

Paving and Surfacing 182,000 185,640 3,640 2%

Plumbing Fixtures 130,500 108,630 (21,870) ‐17%

Resilent Flooring and Carpet 676,500 837,150 160,650 24%

Wood and Plastic Doors/Screens 611,000 756,960 145,960 24%

Total 4,762,900$ 4,552,000$ (210,900)$ ‐4%

Table 23 ‐ RENT SUBSIDY ‐ Extra‐Ordinary Maintenance

Increase/(Decrease)


PROGRAM BUDGET SUMMARIES Summarized below are the Summary Budgets for individual programs within the major program groups.

SECTION 8 PROGRAM SUMMARIES

Housing Choice Voucher (HCV)/VASH Total Units 44,100 Net Revenue This includes both new Budget Authority as well as the use of HUD‐held HAP. Personnel Projected to decrease $0.3 million primarily due to the elimination of the additional pension

contribution. Non‐Personnel Essentially flat, due to various adjustments, including a reduction of outside legal fees, an

increase to insurance costs, a reduction to port‐out voucher fees, and an increase for the allowance of uncollectible debt.

Housing Assistance Increase of $58.3 million due to cost per unit increases.

Homeless Incentive Program (HIP) Population Homeless individuals and families; landlords Key Issues In partnership with the County of Los Angeles, HACLA administers various incentives to assist

homeless voucher‐holders secure housing. This includes:

$3 million Move‐in Assistance – including security deposits, utilities, and household supplies

$1.8 million Holding fees – up to one‐month rent payment

$20,000 Credit checks and rental application fees

$20,000 Damage claims – upon move‐out, up to $2,000 for damage in excess of security deposit

Continuum of Care Total Units 4,400 units available; 3,668 projected to be leased Population Homeless individuals; supportive services provided

2019 2020

Net Revenue $ 584,137,464 $ 642,069,709 57,932,245$ 10%

Expenses

Personnel 33,785,677 33,500,554 (285,124) ‐1%

Non‐Personnel 17,051,445 16,997,414 (54,030) 0%

Housing Assistance 533,300,343 591,571,741 58,271,398 11%

Total Expenses 584,137,464$ 642,069,709$ 57,932,245$ 10%

Table 24 ‐ SECTION 8 ‐ HCV/VASH

Inc/(Dec)

2019 2020

Net Revenue $ 5,093,589 $ 5,389,088 295,500$ 6%

Expenses

Personnel 450,801 515,902 65,101 14%

Non‐Personnel 16,988 17,186 198 1%

Incentives 4,625,800 4,856,000 230,200 5%

Total Expenses 5,093,589$ 5,389,088$ 295,500$ 6%

Table 25 ‐ SECTION 8 ‐ Homeless Incentive Program

Inc/(Dec)


Net Revenue Decrease is due to change in budget methodology, which is tied to projected actual lease up, rather than full‐utilization.

Personnel Increase is due to negotiated compensation adjustments. Non‐Personnel Decrease is due to the shift of supportive services funding for sponsors to rental assistance. Housing Assistance Based on projected utilization.

Family Self‐Sufficiency Households 675 Population Families assisted through HCV are able to increase earned income without jeopardizing rental

assistance if steps toward self‐sufficiency are maintained. Key Issues Escrow deposit payments are funded from HCV HAP revenue. Overall non‐HAP increases are

reflective of obligatory personnel and contract increases.

Housing Opportunities for Persons with AIDS (HOPWA) Total Units 410 certificates available Population Persons with HIV or AIDS Key Issues HOPWA program revenue will increase 4% next year due to additional grant funding for units;

however, due to an increase to the average per unit cost, only 324 of 410 available certificates can be issued. One of the key program features is the conversion of program participants to the HCV program after eighteen (18) months; however, this is contingent on participant readiness. To ensure HOPWA vouchers are available for those in need, HACLA will continue to work with participants and sponsors to facilitate this transition.

2019 2020

Net Revenue $ 50,462,263 $ 43,175,880 (7,286,383)$ ‐14%

Expenses

Personnel 4,243,221 4,497,504 254,282 6%

Non‐Personnel 724,685 328,003 (396,682) ‐55%

Housing Assistance 45,494,357 38,350,374 (7,143,983) ‐16%

Total Expenses 50,462,263$ 43,175,880$ (7,286,383)$ ‐14%

Table 26 ‐ SECTION 8 ‐ Continuum of Care

Inc/(Dec)

2019 2020

Net Revenue $ 1,718,845 $ 1,822,308 103,464$ 6%

Expenses

Personnel 806,371 836,804 30,433 4%

Non‐Personnel 32,376 35,504 3,128 10%

Housing Assistance 880,097 950,000 69,903 8%

Total Expenses 1,718,845$ 1,822,308$ 103,464$ 6%

Table 27 ‐ SECTION 8 ‐ Family Self‐Sufficiency

Inc/(Dec)

2019 2020

Net Revenue $ 4,253,089 $ 4,303,799 50,710$ 1%

Expenses

Personnel 843,320 745,563 (97,757) ‐12%

Non‐Personnel 46,259 49,109 2,850 6%

Housing Assistance 3,363,510 3,509,127 145,617 4%

Total Expenses 4,253,089$ 4,303,799$ 50,710$ 1%

Table 28 ‐ SECTION 8 ‐ HOPWA

Inc/(Dec)


Moderate Rehabilitation/Single Room Occupancy Total Units 1,115 Population Homeless individuals and families Key Issues Program increases are due to permissible rent increases.

New Construction Key Issues This program is being transitioned to administration by LA LOMOD as part of its PBCA

portfolio.

Mainstream Housing Total Units 164 available; 105 projected Population Elderly and persons with disabilities Key Issues Minor reductions reflect anticipated units leased, which continue to be a challenge in a tight

housing market.

Please see Appendix B‐1 through B‐30 – SECTION 8 PROGRAMS – DETAILED SCHEDULES

2019 2020

Net Revenue $ 8,885,052 $ 9,143,458 258,406$ 3%

Expenses

Personnel 1,095,362 1,119,054 23,692 2%

Non‐Personnel 371,814 374,370 2,556 1%

Housing Assistance 7,417,876 7,650,034 232,158 3%

Total Expenses 8,885,052$ 9,143,458$ 258,406$ 3%

Table 29 ‐ SECTION 8 ‐ SRO/Mod Rehab

Inc/(Dec)

2019 2020

Net Revenue $ 18,094,577 $ ‐ (18,094,577)$ ‐100%

Expenses

Personnel ‐ ‐ ‐

Non‐Personnel 1,038,512 ‐ (1,038,512) ‐100%

Housing Assistance 17,056,065 ‐ (17,056,065) ‐100%

Total Expenses 18,094,577$ ‐$ (18,094,577)$ ‐100%

Table 30 ‐ SECTION 8 ‐ New Construction

Inc/(Dec)

2019 2020

Net Revenue $ 1,343,612 $ 1,337,480 (6,132)$ 0%

Expenses

Personnel 42,163 46,353 4,190 10%

Non‐Personnel 7,702 2,568 (5,134) ‐67%

Housing Assistance 1,293,748 1,288,560 (5,188) 0%

Total Expenses 1,343,612$ 1,337,480$ (6,132)$ 0%

Inc/(Dec)

Table 31 ‐ SECTION 8 ‐ Mainstream Housing


PUBLIC HOUSING PROGRAM SUMMARIES

Public Housing Total Units 14 major sites Revenue Total revenue is projected to decrease $0.5 million primarily due to the elimination of revenue

associated with converted units at Jordan Downs. Personnel Projected to increase $0.2 million, or 1%, due to obligatory increases tied to labor agreements,

less the year‐end pension contribution. Non‐Personnel Projected to decrease $0.7 million due the elimination of one‐time HVAC and paving projects

in 2019.

At 41%, Maintenance costs, including dedicated staff, materials, and contracts, comprise the largest portion of the operating budget. Administration, including site office staff, office expenses, systems and other administrative costs are 19% of the budget, followed by Utilities at 14%.

Capital Grant and Resident Liaisons Revenue Revenue is projected at 2018 and 2019 levels. Total is net of the 20% operating transfer to

Public Housing. Personnel The increase is due to the addition of a Construction Project Assistant. Non‐Personnel The increase is due to the increase to administrative fees. Extra‐Ordinary As noted above, the majority of funds available for capital projects will be reserved for major

system upgrades.

2019 2020

Net Revenue $ 62,886,903 $ 62,350,684 (536,218)$ ‐1%

Expenses

Personnel 30,973,609 31,170,583 196,974 1%

Non‐Personnel 31,913,294 31,180,101 (733,192) ‐2%

Total Expenses 62,886,903$ 62,350,684$ (536,218)$ ‐1%

Table 32 ‐ PUBLIC HOUSING

Inc/(Dec)

Category Total %

Maintenance 25,678,050$ 41%

Administration 12,001,416 19%

Utilities 8,512,504 14%

Management Fees 8,039,602 13%

Insurance 2,985,005 5%

Payment in lieu of taxes 3,122,211 5%

Legal 1,305,537 2%

Other 706,359 1%

Total 62,350,684$

Table 33 ‐ Public Housing Expense Summary


Community Safety Partnership Revenue This includes the expansion of the program to San Fernando Gardens, and the elimination of

costs for a one‐time study in 2019. CSP Officers Dedicated Officers are stationed at Ramona Gardens, Pueblo del Rio, Avalon/Gonzaque,

Nickerson Gardens, Jordan Downs, Imperial Courts, and San Fernando Gardens. Tenant Services Enhanced services are offered in the areas of Cultural Events, Sports Activities, Supportive

Services, and Resident Stipends. Other Admin Internal HACLA support includes 75% of a Community Relations Assistant, office expenses, and

other miscellaneous costs; the reduction is due to the elimination of a one‐time study in 2019.

Please see Appendix B‐31 through B‐49 – HOUSING SERVICES – DETAILED SCHEDULES

2019 2020

Net Revenue $ 18,128,738 $ 18,100,000 (28,738)$ 0%

Expenses

Personnel 903,568 1,094,064 190,496 21%

Non‐Personnel 1,082,324 1,241,828 159,504 15%

Extra‐Ordinary Maint. 16,142,846 15,764,108 (378,738) ‐2%

Total Expenses 18,128,738$ 18,100,000$ (28,738)$ 0%

Table 34 ‐ PUBLIC HOUSING ‐ Capital Grant

Inc/(Dec)

2019 2020

Net Revenue $ 1,601,343 $ 1,750,000 148,657$ 9%

Expenses

CSP Officers 1,215,000 1,417,500 202,500 17%

Tenant Services 195,401 248,616 53,214 27%

Other Administrative 190,942 83,884 (107,057) ‐56%

Total Expenses 1,601,343$ 1,750,000$ 148,657$ 9%

Table 35 ‐ Community Safety Partnership

Inc/(Dec)


STRATEGIC DEVELOPMENT PROGRAM SUMMARIES

Rent Subsidy Portfolio Revenue Total revenue is projected to increase 10% due to increases to contract rent subsidies. Notable Changes

Third‐party management: Fees paid to third‐party managers and HACLA tied to revenue, which will increase.

Transfers to HACLA for Initiatives: will increase to $7.77 million primarily to fund redevelopment activity, including Jordan Downs ($2.3M), Rancho San Pedro ($0.7M), Development Services Operations ($1M), Bonds & Acquisitions ($0.6M), and Community Engagement ($.08M).

Asset Management Key Initiatives Personnel costs reflect the addition of Project Delivery Manager and Administrative Analyst II,

who will focus on the construction and financial oversight of the asset management and redevelopment portfolio.

Multi‐Family Service Coordinator Purpose: The MFSC Grant offers enhanced resident supportive services at four of the Rent Subsidy

sites, including Ownensmouth Gardens, Reseda East, Las Palmas Gardens, and Union Towers.

2019 2020

Revenue $ 39,685,481 $ 43,457,711 3,772,230$ 10%

Expenses

Administrative/Other $ 5,808,253 $ 6,276,402 468,150$ 8%

3rd Party Management 6,826,498 7,396,351 569,853 8%

Util ities 3,198,136 3,418,524 220,387 7%

Ordinary Maintenance 5,344,280 5,722,611 378,331 7%

Protective Services 860,174 869,846 9,672 1%

Insurance 891,473 959,423 67,950 8%

Bad Debt 9,707 108,052 98,345 1013%

Mortgage and Interest 5,611,663 5,608,686 (2,977) 0%

Extra‐Ordinary Maintenance 4,762,900 4,552,000 (210,900) ‐4%

Total Expenses 33,313,084$ 34,911,895$ 1,598,811$ 5%

Transfers

HACLA for initiatives 4,993,162$ 7,772,788$ 2,779,627$ 56%

Transfers to Reserves 1,379,235$ 773,027$ (606,208)$ ‐44%

Table 36 ‐ RENT SUBSIDY PORTFOLIO

Inc/(Dec)

2019 2020

Net Revenue $ 2,304,405 $ 2,564,401 259,995$ 11%

Expenses

Personnel 1,876,295 2,076,211 199,916 11%

Non‐Personnel 428,110 488,189 60,080 14%

Total Expenses 2,304,405$ 2,564,401$ 259,995$ 11%

Table 37 ‐ ASSET MANAGEMENT

Inc/(Dec)


Redevelopment Administration Purpose This unit conducts asset management functions for redevelopment sites, including financial

oversight and reporting. Other redevelopment activity, once completed, will be handed off to this unit for oversight. This unit is funded through La Cienega LOMOD, the instrumentality which is typically a part of the partnership structure.

Mixed Finance Properties Purpose This budget reflects three mixed‐finance sites which include ACC (public housing) units,

including Pueblo del Sol I/II, Dana I/II, and Del Rey. This only includes the Operating Subsidy received, which is reduced due to increases to tenant rents.

Development Services Purpose Development Services is responsible for all aspects of active and potential redevelopment of

public housing sites and other HACLA‐owned properties. Personnel In 2020, Development Services will continue to increase the department’s capacity to meet

the growing demand, including and Assistant Project Manager and Administrative Intern II. Non‐Personnel Development Services will continue to rely on outside counsel and consultants with

transactional advice and assistance.

2019 2020

Net Revenue $ 446,513 $ 469,677 23,165$ 5%

Expenses

Personnel 418,021 440,789 22,768 5%

Non‐Personnel 28,492 28,888 396 1%

Total Expenses 446,513$ 469,677$ 23,165$ 5%

Table 38 ‐ MULTI‐FAMILY SERVICE COORDINATOR GRANT

Inc/(Dec)

2019 2020

Net Revenue $ 425,170 $ 392,396 (32,774)$ ‐8%

Expenses

Personnel 250,080 292,196 42,116 17%

Non‐Personnel 175,090 100,200 (74,890) ‐43%

Total Expenses 425,170$ 392,396$ (32,774)$ ‐8%

Table 39 ‐ REDEVELOPMENT ADMINISTRATION

Inc/(Dec)

2019 2020

Net Revenue $ 862,872 $ 763,658 (99,214)$ ‐11%

Expenses

Management Fee 32,775 32,850 75 0%

Other Fees 4,000 1,600 (2,400) ‐60%

Transfers to Property Ops 826,097 729,208 (96,889) ‐12%

Total Expenses 862,872$ 763,658$ (99,214)$ ‐11%

Table 40 ‐ MIXED FINANCE PROPERTIES

Inc/(Dec)

2019 2020

Operating Transfers $ 1,465,613 $ 1,811,185 345,572$ 24%

Expenses

Personnel 1,191,050 1,530,416 339,366 28%

Non‐Personnel 180,063 171,269 (8,793) ‐5%

Business Consulting 94,500 109,500 15,000 16%

Total Expenses 1,465,613$ 1,811,185$ 345,572$ 24%

Table 41 ‐ DEVELOPMENT SERVICES

Inc/(Dec)


Conduit Bonds and Acquisitions Purpose These two new units will continue to develop the capacity, tools, and network to launch bonds

for active our redevelopments and to pursue acquisitions to increase affordable housing units.

Community Engagement Purpose This unit works in parallel with the Development Services team to ensure that residents are

engaged and kept informed of key redevelopment activity. Personnel In 2020, a Community Relations Assistant is added to support these efforts. Non‐Personnel Tenant‐related expenses are captured in the respective redevelopment budgets.

Program Partnerships Purpose This unit builds partnerships for enhanced services for all HACLA program participants. In

addition to the WorkSource Center and the Recreation Centers, interagency collaborations, such as with USC, LAUSD, and others, are pursued.

Personnel In 2020, staffing will be realigned with other units, and one Administrative Assistant is added to support compliance and reporting for the Workforce Development Unit.

PILOT (Payment in Lieu of Taxes) and Computer Learning Centers On June 1, 2018, the Mayor and City Council of the City of Los Angeles approved the three‐year request for the use of PILOT funds as follows: $1 million per year for Summer Youth Employment; $2.25 million over three years for the replacement of security cameras at various public housing sites; $300,000 per year for the operation of HACLA’s computer labs; $1.35 million over three years for the provision of enhanced recreation center services by non‐profit partners such as the Boys & Girls Club.

2019 2020

Operating Transfers $ 194,946 $ 559,773 364,827$ 187%

Expenses

Personnel 194,946 251,968 57,022 29%

Legal and Other Adm ‐ 134,155 134,155 100%

Business Consulting ‐ 173,650 173,650 100%

Total Expenses 194,946$ 559,773$ 364,827$ 187%

Table 42 ‐ BOND & ACQUISITIONS

Inc/(Dec)

2019 2020


Expenses

Personnel 395,583 558,112 162,529 41%

Non‐Personnel 121,179 102,100 (19,079) ‐16%

Tenant Services 70,000 ‐ (70,000) 100%

Total Expenses 586,763$ 660,212$ 73,449$ 13%

Table 43 ‐ COMMUNITY ENGAGEMENT

Inc/(Dec)

2019 2020

Operating Transfers $ 749,737 $ 737,207 (12,530)$ ‐2%

Expenses

Personnel 595,068 568,337 (26,731) ‐4%

Non‐Personnel 154,669 168,870 14,201 100%

Total Expenses 749,737$ 737,207$ (12,530)$ ‐2%

Table 44 ‐ PROGRAM PARTNERSHIPS

Inc/(Dec)


In 2020, the Program Partnerships Unit will make more strategic use of the annual $300,000 allocation for the Computer Learning Centers (CLCs) by activating more robust and integrated programming. An Administrative Programs Specialist will be added to both manage the staffing of the CLC’s through interns as well as work with other unit members to enhance available services at the CLCs, particularly in support of the Workforce Development grants.

Strategy & Metrics / Agency Plan Purpose This unit holds primary responsibility for initiating the internal and external promotion of Build

HOPE’s objectives and values. Personnel In 2020, staffing will be enhanced to garner additional support for operations and programs

related to the Vision Plan goals, specifically to raise capital amidst dwindling federal resources. This includes a new Fund Development/Grant Writer and the transfer of a Grant Administrator from the Program Partnerships Unit.

Redevelopment Projects In 2020, redevelopment activity will continue at Jordan Downs, Rose Hills, and Rancho San Pedro, and will begin at Pueblo del Sol. Reflected below are the administrative expenses associated with that activity; requests for financing will be presented to the Board separately. In general, the costs are related to:

Resident Engagement including community planning events and meetings, translation, and in the case of Jordan Downs, support of the recreation center. Note: Resident engagement funds for Rancho are included in the CNI grant.

Development Costs primarily include predevelopment cost sharing at Pueblo del Sol approved by the Board on October, 31, 2019.

Legal Fees for the development and negotiation of various documents, including Master Development Agreements, Development & Disposition Agreements, and other critical financing documents.

Consulting/Relocation for environmental related studies and reports, underwriting review and other transactional assistance as well as relocation services at Rose Hills.

Site Improvements include demolition and the creation of a relocation office at Jordan Downs.

Other Costs include security and interest/mortgage payments.

Program 2018 2019 2020 3‐Yr Total

Summer Youth Employment 1,000,000$ 1,000,000$ 1,000,000$ 3,000,000$

Safety Infrastructure (Cameras) 800,000 700,000 750,000 2,250,000

Computer Learning Centers 300,000 300,000 300,000 900,000

Recreation Centers 400,000 500,000 450,000 1,350,000

Total 2,500,000$ 2,500,000$ 2,500,000$ 7,500,000$

Table 45 ‐ PILOT Program

2019 2020


Expenses

Personnel 278,980 611,098 332,117 119%

Non‐Personnel 242,554 219,123 (23,431) ‐10%

Total Expenses 521,535$ 830,221$ 308,686$ 59%

Table 46 ‐ STRATEGY & METRICS / AGENCY PLAN

Inc/(Dec)


Redevelopment Grants To support the redevelopment of Jordan Downs and Rancho San Pedro, HACLA was awarded two highly competitive grants, Transformative Climate Communities (TCC) for Jordan, and Choice Neighborhoods Planning (CNI) for Rancho San Pedro. In order to ensure success of each grant, HACLA will be contributing cash match for various components.

Please see Appendix B‐51 through B‐90 – STRATEGIC DEVELOPMENT – DETAILED SCHEDULES

Jordan Downs Rose Hills Rancho Pueblo del Sol Total

Operating Transfers $ 2,615,464 $ 499,500 741,000$ 1,115,925$ 3,855,964$

Expenses

Resident Services/Engage 409,375 ‐ ‐ ‐ 409,375

Development Costs 30,000 ‐ ‐ 830,925 30,000

Legal Services 250,000 70,000 175,000 80,000 495,000

Consulting/Relocation 361,000 425,000 562,000 185,000 1,348,000

Site Improv (Demo/Relo Office) 850,000 ‐ ‐ ‐ 850,000

Other 715,089 4,500 4,000 20,000 723,589

Total Expenses 2,615,464$ 499,500$ 741,000$ 1,115,925$ 3,855,964

Table 47 ‐ 2020 REDEVELOPMENT

TCC CNI Total

HACLA Match $ 403,027 $ 220,455 623,482$

Expenses

Resident Engagement 160,413 95,455 255,868

Partnership Support 43,980 7,000 50,980

Systems/Data/Design 146,500 ‐ 146,500

Redevelopment Studies ‐ 68,000 68,000

Other 52,134 50,000 102,134

Total Expenses 403,027$ 220,455$ 623,482$

Table 48 ‐ 2020 REDEVELOPMENT GRANTS


CENTRAL OFFICE PROGRAM SUMMARIES

TOTAL COCC DEPARTMENTS Revenue Total revenue is projected to increase by 6% due to HUD‐scheduled increases for management

fees, Fee for Service increases for public housing legal services, and the use of sale proceeds for capital improvements at the commercial buildings.

Personnel The 4% increase is due to negotiated compensation adjustments as well as the addition of two (2) positions in Information Technology.

Non‐Personnel The increase is due to one‐time costs for phone system implementation, computer replacements, and site improvements at the commercial buildings.

Personnel Costs by Department With the exceptions noted below, increases are due to negotiated compensation adjustments.

Information Technology: Costs reflect the addition of two new positions, which will be focused on systems integration and optimization. Security/Support Services: Cost reductions reflect the transfer of one position to Facilities and one position to Legal Services.

Non‐Personnel Costs by Department Notable variances include: Information Technology: Increase reflects one‐time costs for the phone system implementation, agency‐wide computer refresh, and additional funds for cyber‐security. Facilities: Increase reflects additional site improvements, including solar panels at the Torrance office.

2019 2020

Net Revenue $ 31,213,380 $ 32,995,941 1,782,561$ 6%

Expenses

Personnel 18,040,787 18,713,369 672,583 4%

Non‐Personnel 13,172,594 14,282,572 1,109,978 8%

Total Expenses 31,213,380$ 32,995,941$ 1,782,561$ 6%

Table 49 ‐ CENTRAL OFFICE ‐ All Departments

Inc/(Dec)

2019 2020

BOC/Executive 1,761,880$ 1,853,637$ 91,757$ 5%

Intergov't/Pub Rel 840,100 838,313 (1,788) 0%

Human Resources 2,204,653 2,329,561 124,908 6%

Information Technology 1,010,250 1,522,670 512,420 51%

Finance 5,505,548 4,968,828 (536,720) ‐10%

Contracts/Compliance 1,545,270 1,660,400 115,130 7%

Legal ‐ General 1,152,893 1,356,751 203,858 18%

Legal ‐ Housing Services 1,120,222 1,190,841 70,619 6%

Security/Support Srvs 620,541 504,593 (115,948) ‐19%

Housing Service Admin 1,864,519 1,907,684 43,165 2%

Facilities 414,911 580,091 165,180 40%

Total Expenses 18,040,787$ 18,713,369$ 672,583$ 4%

Table 50 ‐ CENTRAL OFFICE ‐ Personnel

Inc/(Dec)


2019 2020

BOC/Executive 446,389$ 439,551$ (6,838)$ ‐2%

Intergov't/Pub Rel 202,448 210,782 8,335 4%

Human Resources 1,489,220 1,519,493 30,273 2%

Information Technology 4,186,781 4,965,647 778,867 19%

Finance 696,552 579,097 (117,456) ‐17%

Contracts/Sec3/Labor 115,346 145,726 30,380 26%

Legal ‐ General 385,454 295,549 (89,905) ‐23%

Legal ‐ Housing Services 97,046 114,697 17,651 18%

Security/Support Srvs 347,492 279,511 (67,981) ‐20%

Housing Service Admin 241,879 183,894 (57,984) ‐24%

Facil ities 4,963,988 5,548,624 584,636 12%

Total Expenses 13,172,594$ 14,282,572$ 1,109,978$ 8%

Table 51 ‐ CENTRAL OFFICE ‐ Non‐Personnel

Inc/(Dec)

Documents

VI - HACLA