Every time I 88 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 ask for a commitment, the first statement you made was by the end of the fiscal year. MR. MacINTOSH: Right.
Now you can say you can do it quicker. Just now I said, You can do a hundred a month? You say no, we do much more than that. And when I ask about roughly how much a month, you say a few hundred. And so, a hundred a month would actually be 600 over the next two months, not 300. MR. MacINTOSH: Mm-hmm, mm-hmm. It's, uh... We do about 3,000 a year, all right. And so that's a little over about, what, 200 and --
So that would be about 500 in the next come of 89 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 months. MR. MacINTOSH: That's correct.
Mr. MacIntosh, you kept referring that you had no problem with the 1.3 million; are you telling me that you have a problem with the 2.6 million? MR. MacINTOSH: Within the original time frame, it would really have tested us.
But I discussed it with you before I transferred the money. MR. MacINTOSH: That's correct, Councilwoman.
And told me that if I did it, we would be able to complete what we had to do. MR. MacINTOSH: That I would make it happen for you. 90 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
Then why is it a problem now and it wasn't before I moved the money? MR. MacINTOSH: The problem now, Councilwoman -- and I'm going to be quite frank -- is that we're at the end of October, all right? And when we originally began our discussions back in July, I thought originally we would have the 1.3 million and we would have been working off of that. And then with the additional 1.3 million in September, that wouldn't have been an issue as far as our ability to expends those funds and expends them by December of this year.
I know that I particularly talked to you before I moved that money. MR. MacINTOSH: That's correct.
Because I said that we found out there with the residents that there was a greater demand and need than even I could 91 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 comprehend. And I remember saying to you that when I move this money, I know we can't deal with the total demand, but we can make a difference. And I told you, and I know you remember me telling you that I was worried about the seniors that didn't have heat. And I told you, I said, "They're suffering in silence, and I have a problem with this." And I said, "Whatever we have to do, tell me, because we'll do it." Do you remember me telling that you? MR. MacINTOSH: That's correct.
Let me follow up on that. You have, um, you... you have requested $1.3 million in Councilwoman Campbell's district, but you haven't asked for the additional 1.3 million. That hasn't been processed for drawdown? MS. McCOLLOCH: Who are you asking that? Are you asking me? 92 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
Somebody. Yeah, I guess you. MS. McCOLLOCH: I'm sorry. The additional 1.3 has not yet been requested for drawdown, no. 7
So that impedes his ability to move the project further; he doesn't have the approval. MS. McCOLLOCH: Of the second 1.3 that --
Right. So that's why he can't do the 2.6 million; he only has the authorization for the 1.3 million, right? MS. McCOLLOCH: Correct.
So when will the other 1.3 million come down? MS. McCOLLOCH: I don't know when it will come down. There's been some discussion that we have been engaged in with Councilwoman Campbell's staff because we don't believe that there's 1.3 available to transfer into the Basic Systems Repair Program. 93 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
I do believe -- Councilwoman Tasco, do you have the papers? I do believe it was Kevin Hanna that told me that I did have the funds and that I could use it. Now, I don't know. Unless my mind is playing games with me, I thought he was over everyone that's here today from your departments. And I would think -- I would assume that he would know what he's talking about when he makes a statement to me. What is the status of the additional $1.3 million that I transferred by resolution of City Council on September 20, 2007? MS. McCOLLOCH: Based on review of expenditures by the Redevelopment Authority on acquisitions, the -- let me just back up so everyone understands -- the additional 1.3 million that was transferred, I believe, by resolution on September 20th -- was that the date of the resolution? That 1.3 was moving an 94 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 additional 1.3 from acquisitions to the Basic Systems Repair Program for the 4th District. Upon review of expenditures by the Redevelopment Authority, where the 1.3 had rested for acquisition, there's not a full 1.3 available to be transferred because some of the funds that have been spent were obligated already.
I'd like to read a letter to you from Mr. Hanna. Who spent the money? Who moved it? MS. McCOLLOCH: I -- who spent it? It was spent by the --
You said the money had been spent. MS. McCOLLOCH: By the Redevelopment Authority as part of the acquisition process, where the money had rested as $1.3 million in acquisitions. Some funds had been spent by the 95 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 Redevelopment Authority.
Well, I have a letter here. Dear Mr. Hanna, I am writing to confirm my cancellation of the following acquisitions which we need to progress in the most recent reports I received from your office. Allegheny West, forgotten blocks, $394,530. RHD Carol Park, RFP, $414,640. Mt. Carmel Phase 1, $481,900. I want to receive an accounting of any and all funds expended to date on each of these acquisitions for such line items as appraisal, advertisements, et cetera. I then want to receive a report that contains the remaining balances with each acquisition post-cancellation Now, this was sent July 12th to Mr. Kevin Hanna: Dear Mr. Hanna, I am in receipt of your fax, which enclosed 96 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 your letter of June 4, 2007, with attachments. The attachments are the same that my office already had in its possession and does not meet the requirements I sent forth in my letters to you as of June 8, 2007, and June 20, 2007. 3 millions I transferred in June. I also requested an accounting of any funds that were expended on those acquisitions and the remaining balances after deducting any expenditure. Yesterday, when we spoke, you told me that some of the acquisitions may be too far down the road to cancel. Today, I personally spoke with Michael Koontz, Executive Director of the Redevelopment Authority, who told me that no funds -- no funds -- had been 97 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 expended on those acquisitions and that all he needed was permission from your office to close them out. Based upon your failure to provide the information requested over a month ago and the discussion held yesterday, I have come to the conclusion that there is a deliberate effort on your part or those affiliated with you to stall the cancellation of the acquisitions and, thereby, thwart any effort on my part to reprogram these funds to meet needs of the low-income and elderly households in the 4th Council District. I have attempted to engage in positive and constructive relationship. However, the lack of responsiveness and the conflicting information I have been provided is unacceptable and will not be tolerated. I was elected to City Council to serve the more than 150,000 residents of the 4th Council District 98 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 and especially to give voice to those residents who at least are unable to articulate their needs. I will not stand by and let them be denied this precious resource because the bureaucracy feels that they know the needs of my district better than I do. I expect a written response, including the information I requested in all of my previous correspondence to you by the close of business Monday, July 16, 2007. If not received, I will engage Council to secure the information. Carbon copy to Mayor John F. Street; Council President Anna C. Verna; Council Majority Leader Jannie L. Blackwell; Council Majority Whip Marian Tasco; Councilman Darrell Clarke; Councilman Danny Savage; Councilwoman Donna Reed-Miller; Council Minority Leader Brian J. O'Neill, Managing Director Laurie Jones; Eva Gladstein, Director of Neighborhood 99 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 Transformation; Deborah McColloch, Director of OHCD; Anthony MacIntosh, Executive Vice President, PHDC; Michael Koontz, Executive Director, RDA; Herb Wetzel, Executive Director of Housing and Community Development, City Council. Now, the money was moved June 20th by a unanimous vote in Council. Why did it take just till last week for me to learn that there was any problem when you know that we had elderly people that were in desperate need of help? And if there was a problem, you should have told me immediately. Why would you let us give these people false hope if you knew something was wrong? Although I have been verbally told everything was fine and the money would be put in a contract immediately. Then I was told it was four to six weeks.
Then Kevin Hanna called me and told me it was -- he thought both 100 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 monies were under contract. " Now, how could there be confusion about that? MS. McCOLLOCH: I can't speak to why Kevin was confused.
I just have a question. Where is Mr. Hanna? MS. McCOLLOCH: He is out of town today; that's why I'm here today. He's at a conference --
Ms. McColloch, I have a spreadsheet here that was received from OHCD on September 16th, it looks like, or 10th. And it shows that no expenditures were made, none. Now, this is September 10th. So in your department, is it a custom to send out incorrect information? 101 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 MS. McCOLLOCH: It certainly is not a custom to, and I can only apologize that that information was incorrect.
Then what you're really telling me is that it's just total incompetence over there. Because there's no way in the world, with the salaries that they pay over there, that they should send out something that's erroneous. (Applause.)
We're talking about people's lives here. We're taking about people who don't have heat, people who don't have roofs that work. This is despicable. You really, really need to look at your department and yourselves for this kind of behavior with these needy people. (Applause.)
There was one request. Ms. Gladstein has a 102 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 prescheduled meeting with the Mayor and wants to come back in 45 minutes if possible.
Before you leave, along that line, this spreadsheet I have: NTI 4th City Council District Acquisition Status report, did that come from you or was that our staff report?
So we got this information, and it does have the balance that there's no acquisition that's been done and it says that the project was cancelled per Miss Campbell. You're saying this report is incorrect? MS. McCOLLOCH: I'm saying that report is incorrect, yes.
Who appropriated the funds for these three acquisitions? 103 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 MS. McCOLLOCH: They were approved previously. Through Council ordinance, they were approved previously.
What Councilmember introduced them? MS. McCOLLOCH: Councilman Nutter.
And this was when? MS. McCOLLOCH: They were a part of the acquisitions that were approved under the NTI Program previously.
Well, I have some stuff that was approved too, but we haven't moved it. So are you going to say just because we approved it in a general acquisition process that you just -- you just move it without coming to the Council to make sure that it, you know, you really want to go 104 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 through with it?
Councilwoman Tasco, it was only ordinance, only one ordinance. We're talking about three different -- three different acquisitions here.
You know, I'm not in Miss Campbell's business; that's for her to decide. I'm just asking for process in terms of how this all works. MS. McCOLLOCH: They were approved, and the Redevelopment Authority moved forward with the acquisitions of the specific properties, that there are specific properties attached to the titles of each of those.
When did they move forward with that? MS. McCOLLOCH: I'm sorry. I don't know the exact date. Let me see if Michael is here.
With your permission, I will leave and return by 105 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 12:30.
Ms. Gladstein, I don't have a copy of the resolution approved in June 20th -- June 14th before me. I'm sure you're probably familiar with it. Did the resolution take the money from some specific source or project to be allocated toward --
It took from a specific line item but not from specific projects.
So does the money exist or does it not exist? If you didn't take it from specific projects, then what difference does it make if money was spent on those 106 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 projects?
Does money still exist in that line item? And I don't care if there was an arrangement that money would be taken from specific projects. If a Council resolution took money from a line item --
Okay. At the time, on June 14th, there were adequate funds in that line item for the first transfer.
What about 107 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 September 20th?
September 20th, I rely upon reports created by the Office of Housing with information from the Redevelopment Authority, and so I've seen the same reports that the Councilwoman has seen --
I'm not talking about the report. I have the report here. I'm not talking about the report; I'm asking bow the line item.
If a Council resolution approved a transfer of money from one line item to another purpose, I'm not asking about whether the money was spent on projets that were supposed to be associated with the line item but whether the money still exists under that line item.
I'm not trying to -- the way our budget reads, the line item is not -- is in terms of remaining 108 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 funds. It's not split by Council District in the Program Statement, but there was money in the -- (Indiscernible; parties talking over each other.)
So there's still money under the line item from which it was transferred.
So Council's action on both June 14th and on September 20th transferred money from a line item to a program, 1.3 and 1.3, and the money is still available in that line item.
It transferred money from the acquisition line item to the Basic Systems Repair Program line item, and there were --
However, if there are additional expenses against 109 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 that line item, we may not have the resources to cover them. But at that point in time, there was money sitting in that line item. I can't say if there was --
I'm asking about the point at which Council approved. On both June 14th and September 20th, Council transferred money from a line item to the BSRP Program. In both cases, was the money there?
In both cases, that amount of money was available in the acquisition line item.
Just a moment, please. You know, I moved this money and relied upon the word of your departments that the money was there. And this appears to me definitely -- I'm not an attorney, but it definitely looks like (indiscernible) lines to me. Now, I want to read something 110 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 to you: For any fiscal year during which bond proceeds will be expended, the Mayor, or his appointed designee, and the RDA at least 60 days before the beginning of each fiscal year shall submit to City Council for the approval by resolution an annual Program Statement and Budget setting forth proposed form expenditures of bond proceeds for the upcoming fiscal year in substantially the form and detail attached hereto as Exhibit B. Any expenditure of bond proceeds must be in accordance with the NTI framework attached as Exhibit A to the service agreement, including the City Council oversight provisions set forth in Section 8 of the NTI framework (City Council oversight of the NTI bond program) and is in accordance with a current or previously-approved annual budget. At least 90 days before the beginning of each fiscal year, the 111 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 Mayor, or his appointed designee, shall send to each member of Council an preliminary annual program statement and budget in the same detail that will be contained in approval of Council. Such budget shall provide for a City Council development consultant appointed by the majority of City Council by resolution. The expenditure of funds from sources other than the bond proceeds set forth in the Program Statement and Budget are not subject to Council approval but shall be included for informational purposes. Such other sources of funds may include, but are not limited to, Community Development Block Grants and Federal Public Housing Funds. After it is approved, the annual Program Statement and Budget may be amended only with the approval of Council by resolution.
Yes, that's a 112 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 correct reading, and we did submit a proposed Program Statement and Budget in April. And then we -- and we shared it with members of City Council. And then we submitted another one in May, which was introduced into City Council; that's a Program Statement and Budget, which was then amended by Council during the Council discussions and then approved by 070405-A, as amended, on June 14th. That's correct.
But also, do you see the section 15 (indiscernible). Bear with me on this. There is a section that says pretty much that anything can be changed by a resolution passed by City Council; is that correct?
So long as it is consistent with the ordinance and the framework that's cited in the statement you just made.
Point of information. 113 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
Thank you, Mr. Chair. Ms. Gladstein, I understand you have to leave. You would not have approved the drawdown on September 13th, and you would not have approved the drawdown on October 3rd if the money wasn't still there in the line item.
So the money was there when you approved it on September 13th and when you approved it on October 3rd.
In addition, there's been a subsequent appropriation of an additional 1.3 million, which was approved by City Council on September 20th.
You approved the drawdown on October 3rd after City 114 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 Council approved another 1.3. When you approved the drawdown, did you not then look at how much money was left per the September 20th resolution as well?
You approved the first 1.3 -- (Indiscernible; parties talking over each other.)
-- on October 3rd, after Council approved the second 1.3.
So when you approved the first 1.3, did you look to see how much money was left there, knowing that Council approved the second 1.3?
I did look to see, and I saw that there was 115 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 approximately -- it was between 1.3 and 1.4.
So when you approved the first drawdown of 1.3 on October 3rd, the second 1.3 connected to Council's second authorization on September 20th was there.
Yes. I was unaware as to the fact that some funds had already been spent on some of these projects.
But the money was still there when you approved the first 1.3.
Would you show us some documentation that shows us where the funds were expended?
I would have to 116 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 ask the Office of Housing. (Witness comes forward.)
Councilwoman Campbell, my name is Michael Koontz, Executive Director of the Redevelopment Authority. I can show you the documentation for the approximate $180,000 that was expended in part. I believe the Allegheny West properties and the three or four properties that were acquired RHD.
But, Mr. Koontz, you and I have talked repeatedly, and you were the one that assured me that there were no 20 expenditures. I even spoke to you as late as about a week and a half to two weeks ago, and you never told me that there was a problem; you told me that there definitely were no fund expended.
And until last 117 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 Thursday night, I didn't know that the Allegheny West properties or the RHD properties had been acquired; I did not know that.
You're the executive director and you didn't know that they had been acquired?
We acquire 2 or 3,000 properties per year. I did not know that these properties had been acquired.
The board approved -- I believe there were two declarations of takings that were 118 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 approved. One was approved in 2006, the spring of 2006; and one was approved earlier this spring, March or April.
But you told me you checked, Mr. Koontz, because I particularly relied upon the --
I looked at the list, the same list that was forwarded to OHCD, and I saw zero. I believe that none had been acquired, and so I told you that none had been acquired.
Well, Mr. Koontz, I don't believe that my needy residents should suffer because of either incompetence or ignorance; I don't think that's fair at all. It's not their fault that we were given erroneous information. (No response.)
I just find this very hard to believe because I know I spoke to you on numerous occasions about this, 'cause I do not believe in giving people false hope. 119 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 And I kept asking you and I kept asking Kevin Hanna, and I was told that there were no funds expended, and then all of a sudden -- and then when did they decide that they were going to tell me? I didn't learn about any of this until after I put the resolution 9 in for this body to meet to have an investigation. No one had come to me about any of this. Only after the resolution was passed by Council to have this investigation did someone tell me something.
Until I checked each and every property in all of your projects Thursday night myself, I did not know until then.
No. I told you that... no properties had been acquired on these three projects. I didn't tell you I had checked; I told you --
If I 120 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 don't have anything else, I have a very good memory. I remember distinctly calling you, and you told me, "Let me get back to you." And you did get back to me within a couple of days, and you told me that I could go ahead because there were no funds.
Right. And I looked at the records. When I first told you I didn't think any had been acquired, I hadn't looked at the records; that was in your office. Later on that evening or the next day -- I'm not exactly sure when -- I went back and checked our records, and our records did indicate at that time that none were acquired. In fact, our records indicated, until I changed them last Thursday night, when I looked up each individual property, that none had been acquired.
Well, tell me this. You know, I get updates 121 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 on the properties that are owned by Redevelopment in my district, and I've never seen any of these addresses on the latest one that I got as late as a week ago. Now, why aren't they on the list?
I asked for an update for all properties that were owned by the Redevelopment Authority in the 4th Councilmatic District, and the last time I asked was about a week and a half ago. And when we got the list, I didn't see any of these properties, because I know some of the properties that are allegedly involved, and I didn't see them on the list.
I -- I only remember giving out a list of Party A owned properties for the 4th District many, many months ago.
No, I got one from John Coates a week and a 122 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 half ago. I even called him to talk to him about a couple places on there.
I would just like to follow up a question. Ms. McColloch, you said that these acquisitions were approved by Councilman Nutter in 2006?
Right. One of them was a Council ordinance; that was the Mt. Carmel project. Inside the ordinance itself, along with the approval to acquire the properties, are 123 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 words to the effect that Council also approves the expenditure of NTI dollars for those properties.
For the Mt. Carmel properties. The other two projects -- the Allegheny West and the Mt. Carmel -- those were taken by administrative process and did not come to Council, commonly referred to as Act 94. Typically on those, we send a resolution to Council before we go to our board requesting permission to acquire those properties. It's my understanding that we did that for both the Allegheny West and the few for RHD. I don't have it with me, but I can certainly find it. And if we didn't do it, you know, I'll so inform you, but it's my understanding that we did.
Would 124 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 you please give us copies of the resolutions.
Just for a frame of reference: During period of time when the properties were acquired by the RDA, who was the Councilman in the 4th District?
Um, Councilwoman Campbell would have been the Councilperson for the majority of them, the ones that were this spring. And I'm not exactly sure at what point in 2006 --
No, I'm talking about the three that she's concerned about. I assume that there's three that you're -- Councilwoman Campbell, there's three that --
There are only two that have been acquired, properties in 125 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 Mt. Carmel and prop -- I mean properties in the RHD Carol Park project and some properties in the Allegheny West project.
This summer, I had to sit -- in fact, it was the spring, I had to speak to Mr. Koontz about the Mt. Carmel project because they had not at that time acquired anything according to Reverend Campbell. And I called Mr. Koontz because there were some things I really didn't understand because they had told me from this group that they were being forced to work with some properties that they didn't want, and they were told that they would have to do these properties before they could get the properties that they really wanted. And then when I started questioning about it, I had Mr. Koontz 126 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 on the phone, I was told that they didn't feel that Councilman Nutter at the time wanted to expend that large amount of money for what Mt. Carmel really wanted to do. Now, this is according to the group that came before me -- they had to do these houses that they really didn't want to do. Now, Mr. Koontz, do you remember me talking to you about ha?
I remember that the discussion was why we didn't take all of the -- or we didn't include all of -- first of all, none of the Mt. Carmel properties have been taken. As far as the discussions we had, my memory of that discussion is that I said that the project budget, originally when it was first sent to the City, was larger. It included occupied properties and vacant properties. And that the occupied properties, both because of the dollar-amount and the fact that there 127 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 was -- the number of them were taken out of the development, it was decided that maybe they would be acquired later or maybe not at all. But we were just asked to proceed with the vacant properties at that time.
But when Mt. Carmel came to meet with me, I called you while they were there. And at that time, I was told that nothing done, because I was rather surprised. I called you while they were sitting there.
And I've said before that those properties -- I did not know about that until last Thursday night, and I apologize for that.
I just want to get my question answered, which was: If Mt. Carmel didn't get acquired but 128 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 the other two project properties were acquired to facilitate those projects, who was the Councilperson at the time?
For the Allegheny West, the eight that were acquired, Councilwoman Campbell was --
Was Councilman Nutter in office then? 129 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
Mr. Chairman, what I find very strange about this is: June the 8th, I wrote and requested detailed information about this very situation. And I was assured when I followed with the phone call that nothing had happened. I sent the letter June 8th and asked for a detailed written report.
Okay. So who -- I guess on the second set of properties, who would have communicated the information from the 4th District if it weren't -- if Councilman Nutter was running for mayor and Councilwoman Campbell wasn't in office yet? Would there have been some conversation with the 4th District office?
There weren't any, okay. Thank you. Councilwoman Tasco? 130 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
Let me just -- Ms. Gladstein is not here, but let me just get some facts. When she submitted the '07-'08 NTI Program and Budget, which we passed June 14th, in the -- she stated, I believe, before she left that the money was in that program that we passed, the 1.3 million was there. So where did the breakdown come? And not from '06 to June '07. Where did the breakdown come in terms of what was real and what wasn't real? And can we rely on the process being correct, anyway? I mean, we were -- Councilwoman Campbell believed, and she stated, that in the program that there was $1.3 million. And so, therefore, she transferred the money. She did the first 1.3 and then she did the other 1.3. But why didn't these dollars that were appropriated or spent to acquire these properties not deleted 131 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 from the acquisition budget? Where does that breakdown come? MS. McCOLLOCH: If I understand the question correctly, I believe the breakdown is that the RDA expends funds and then they are drawn down. So in this case, an --
Well, wouldn't you have had an approval, just like you took to November, to give the approval on the $1.3 million of NTI dollars? So we know that they're not there, so next year, we won't get another NTI budget, so we know it's not there. But if there is -- if you encumber the funds, you know that we have taken so much money out of NTI for various projects, so when the budget comes through, it's less all that -- all those projects. So what happened to the appropriation or the encumbrance of these dollars in the '07-'08 budget, 132 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 and why did it appear in those budgets that there existed additional money for acquisition? MS. McCOLLOCH: The first -- if I can characterize it, the first 1.3, the 1.3 million from June, everyone has agreed those -- which in the case of the 4th District came 900,000 from the acquisition line and 500,000 from the vacant property stabilization line. Everyone has agreed that there were no 13 ties on that money, if that's the correct term, that there were no 15 commitments against those funds. So that 1.3 was moved by resolution. That's the 1.3 that's in the document that you have.
Mm-hmm. MS. McCOLLOCH: That I signed on September 13th and Eva signed on October 3rd. So that 1.3, the funds have been moved and are now moved out of acquisition and vacant property 133 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 stabilization and into 4th District BSRP. The second 1.3, the 1.3 of September 20th, is the one that is at question because when -- at the time -- and I was one of the people that was raising it. I said, Are we sure that we haven't spent some of this money? because I think that we have had expenditures because this process has been going on for sometime in terms of when you initiate the process to acquire properties. And my other question was: Have we already had made commitments or authorizations that we can't pull back from? Are we already committed to acquire certain properties? Even if we haven't spent the money, have we taken actions that --
Point of information. MS. McCOLLOCH: -- lead us to having to spend the money because 134 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 they've been spent? And that's when there was additional research --
Point of information. MS. McCOLLOCH: -- and this is what Michael --
Ms. McColloch, I think I heard you say a couple of minutes ago that the Redevelopment Authority can spend money without a drawdown. Did you actually say that? MS. McCOLLOCH: The Redevelopment Authority has capital that it spends, and then it would spend the money and then it would be drawn down from the NTI.
And then if you choose so, you can go back and charge it back to that; is what you're saying? MS. McCOLLOCH: It would be 135 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 charged back to the account to which it should be, yes.
So you're saying that in the case of Redevelopment Authority or OHCD, you can just spend money without an NTI drawdown and then charge it back to the NTI drawdown later on; is that what you're saying? MS. McCOLLOCH: Based on an authorization, yes.
Based -- MS. McCOLLOCH: In other words, it's a cash issue.
But how can you go back and charge it back to NTI funds if there's no NTI drawdown? MS. McCOLLOCH: You couldn't charge it back to NTI funds until there is an NTI drawdown.
Okay. Well, at the point at which Eva Gladstein signed a drawdown for the first 1.3 on October 3rd -- MS. McCOLLOCH: Mm-hmm. 136 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890
-- she just testified before she left that the second 1.3 was there. That's what she said. MS. McCOLLOCH: (Nods head.)
So if it was there and she's the director of NTI and the money was there, the fact that someone else spent money before the NTI -- before an NTI drawdown was actually authorized goes against procedure unless you create your own procedure. MS. McCOLLOCH: No, we don't create our own procedures.
Well, the point at which the director of NTI authorized the first 1.3, she said the second 1.3 was there because when she authorized the first 1.3, it was after we approved the second 1.3. And that's very clear. MS. McCOLLOCH: The Redevelopment Authority may have had expenses based on the previous 137 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 resolution that committed the 1.3 to acquisition, that it has expended funds -- an example is the advertising costs or the appraisals or what have you. In this case, it's actually some actual acquisition costs, if I understand Michael as testimony correctly that had not yet been drawn down against the NTI funds, although the RDA, if you will, advanced the funds to -- for those expenditures based on the previous approvals of those three acquisition packages.
So, Ms. McColloch, what you're saying is that the RDA incurs any expenses based upon past resolutions that City Council has authorized that they can spend money however they want and then just charge it back to a future NTI drawdown, and that could actually affect not only the program in the 4th District but in the 7th District or in the 9th District.
Right, 138 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 'cause they're going to take my money, the $1.1 million, take out those seven houses, which I don't even know if they're in my district, and then charge it against the one million when these people were already on the list and should have been in the original Basic Systems Repair Program, 'cause they just haven't -- they just got this money, right? MS. McCOLLOCH: I'm sorry. I'm trying to follow two different questions.
It's the same question, whether you can spend money however you want and then charge it back to NTI drawdown. MS. McCOLLOCH: If it's been authorized. The 1.3 of acquisition expenses had been previously authorized, and so the Redevelopment Authority was moving forward with those acquisitions. 139 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 And in the moving forward with those acquisitions, it incurred some expenses.
What expenses were they charged to the 1.3? You mean the 1.3 that Councilwoman Campbell put in in June? She asked for a 1.3 million authorization for a Basic Systems Repair Program, and then the Redevelopment Authority used the resolution to use to spend on some other project and then you're going to put it back and all that stuff? MS. McCOLLOCH: No. 17
I think what she's saying, or what she's trying to say, is that the Redevelopment Authority does things like, before there's a Council hearing or a Council ordinance, we have to advertise for three consecutive weeks, for example; that's probably like or $30,000. We have to advertise the 25 bills. And we order title reports and 140 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 appraisals before there's actual approvals to acquire the properties. I think those are the types of charges she was speaking of.
At what point does that get documented as money that has been spent or incurred or encumbered? (No response.)
I mean, the point at which Eva Gladstein is authorizing the first 1.3. And obviously, if you're authorizing 1.3, you want to see if 1.3 is there. And obviously, if you authorize the 1.3, at a point where you know that another 1.3 has already been authorized by City Council, you're actually checking to see how much money is there total.
We actually -- when the NTI Program was first approved, there was an allocation to the Redevelopment Authority, or approval was granted for the Redevelopment Authority 141 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 to draw down X-amounts of dollars, and those dollars, I believe, were to be used for things like advertising, title reports, appraisals, prior to actually getting the approvals.
Mr. Koontz, do you know whether or not the 1.3 that Council authorized in June and the 1.3 that Council authorized in September were taken from a line item that you're supposed to be charging against?
Mr. Koontz and Ms. McColloch, could you please tell me -- I sent a letter where I stipulated that I wanted no funds expended. Would you tell me whether or not any of these acquisitions were done after my letter was received?
None of the acquisitions were done after your letter was received. None of the acquisitions 142 10/29/07 LEGISLATIVE OVERSIGHT/RES. 070882, 890 were done after you and I spoke originally.
I would like to see the resolutions too because my understanding was two of the properties were under Act 94; they were not ordinance. Only one was ordinance.
That's true. As a matter of fact, for the properties that were in the ordinance, none of them have been acquired. There have been properties acquired in the Act 94, the two Act 94 projects -- Allegheny West and RHD Carol Park. They were acquired around March of this year, I believe, and I believe a couple were acquired last year.