Federal and city officials owe $5.3 million in overdue funding to Syracuse nonprofits running critical community and housing initiatives.
“Revisions” of the city of Syracuse’s funding application and technological issues have held up the funding from the United States Department of Housing and Urban Development, according to a HUD spokeswoman. The funding comes primarily from the HUD’s Community Development Block Grant program.
It’s unclear what those revisions or technological issues were.
The delay has forced some nonprofits to take out loans while interest rates are at their highest in about 20 years. That means programs cost more to run than HUD reimburses them.
Kerry Quaglia, the CEO of Home HeadQuarters, said the program must be administered differently at a recent public hearing. Home HeadQuarters receives more than $2 million in funding from the program, the biggest allocation to one nonprofit.
“We can’t do this again,” Quaglia said in an interview with Central Current.
The delay in funding has hurt more than just Home HeadQuarters. The HUD funding pays for programs like eviction defense through Volunteer Lawyers Project, the Greater Syracuse Tenants Network, three different city community centers and workforce training programs.
It also paid for Catholic Charities’ soon to be shuttered housing relocation program.
The $5.3 million comes from two 50-year-old HUD grant programs:
- The Community Development Block Grant, or CDBG program
- The Emergency Shelter Grant program, or ESG program
HUD disburses the money to the city who then reimburses nonprofits for the programs they run.
The city’s commissioner of Neighborhood and Business Development Michael Collins confirmed nonprofits’ accounts that the money is historically late. He said the delays did not originate on the city’s end.
“I’m expecting we will get it any day now,” Collins said.
HUD officials said the funding is likely imminent.
Collins and the nonprofits differ on how late the funding is. Executive directors of multiple nonprofits said they’re used to getting funding in September or October. That means reimbursements are now about four to five months late. Collins said HUD usually disburses funding in November or December.
Some nonprofits said the delays had no impacts on operations this year but could next year. Walt Dixie, the executive director of Jubilee Homes, said the organization used other funding to paper over the hole left by a lack of HUD funding.
But Dixie said that Jubilee Homes and other nonprofits “can’t go through something like this next year” and that the delay is “not a sustainable proposition.”
That delay has caused issues for other nonprofits. Sharon Sherman, who was at the forefront of the fight for tenants at Skyline Apartments with the Greater Syracuse Tenants Network, said she personally loaned the organization nearly $20,000 to cover payroll expenses.
Sherman doubted the tenants network could get a bank loan because the organization is small and doesn’t hold assets.
“We could not afford the interest on a loan,” Sherman said.
She has delayed buying office supplies, which have been running low. Sherman waited as long as she could before getting her mandatory audit of the organization to send to the Internal Revenue Service. Sherman told the accountant who has done her audit for 15 years that she couldn’t immediately pay the $4,000 she owes him.
Home HeadQuarters used a line of credit to cover its $2 million allocation, Quaglia said at a recent public hearing about CDBG funds.
HUD does not increase the reimbursements to cover the cost of interest when they pay nonprofits late. Organizations pay the interest out of their own pockets.
While Home HeadQuarters applied for funding in the 2024-25 CDBG cycle, Quaglia told Central Current the organization would not advance funds going forward.
“If this is going to continue,” Quaglia said at a recent public hearing about HUD funds, “we have to help find a solution with some bridge financing or something along those lines.”
Collins said HUD restrictions would prevent the city from fronting money to organizations.
Dixie argued if the city can’t front money under current HUD guidelines, the city should ask Congressional representatives to lobby for a change to HUD’s CDBG rules.
City officials have targeted the funding schedule to fix the delay in payments. Even in a best-case scenario, organizations currently wait at least four to five months to be reimbursed.
Collins said the city would look at changing its funding schedule if payments from HUD continue to come late. The city believes it could push the funding cycle back so organizations start their programs closer to when money is disbursed.
“But at the moment,” Collins said, “we haven’t had anybody saying to us that they really want us to look at that.”
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