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Home My WebLink AboutFY 2026 (Housing Agency) KAUA‘I COUNTY HOUSING AGENCY FY 2026 BUDGET AND OPERATIONS SYNOPSIS Adam Roversi Director 1 Department: HOUSING AGENCY Fund: GENERAL FUND 1. FY 2025 to FY 2026 BUDGET COMPARSION FY 2025 FY 2026 $ + / - % + / - Salary and Wages 967,519 945,932 -21,587 -2.2% Benefits 603,916 628,455 24,539 4.1% Utilities 0 0 0 0.0% Vehicle/Equip, Lease 48,001 2 -47,999 -100.0% Operations 603,813 596,266 -7,547 -1.2% 2,223,249 2,170,655 -52,594 -2.4% 2 2. MAJOR CHANGES AND/OR VARIANCES IN OPERATIONS BUDGET For FY26 we are projecting a small decrease in salaries and wages as a result of a minor shift to using non-county grant funds for some salaries. However, we are requesting an increase to Benefits in the amount of $24,539 or 4.2%. To ensure we are adequately positioned to meet future obligations, we have made a strategic decision to increase the allocation of our Other Post- Employment Benefits account across the board. This will provide for flexibility in addressing any potential increases. Overall, the decrease in salaries offset by the cost of benefits results in a nominal $2,952 net increase in personnel costs. Non-personnel-related operating costs have been reduced by $7,547 from FY25. When paired with a vehicle acquisition in FY25, this results in an overall reduction of $55,546 in the total operating budget. Historically, a general fund contribution to the Housing Development Revolving Fund has also been included in the Housing Agency’s budget request. In FY25, the General Fund contribution to this account was $20,093,525. Beginning in FY26, however, the Administration will be transferring the Housing Development Fund to the CIP Budget. Current funds in the Development Revolving funds will be rolled over to the CIP account, and our FY26 request will be submitted as a CIP Budget item. 3. OPERATIONAL CHALLENGES Our two primary operational challenges are the administration of increasingly complex and layered sources of funding necessary to successfully complete numerous large scale development projects simultaneously, and the successful administration of the federal Housing Choice Voucher (HCV) program. Historically, the Housing Agency focused its development efforts on one relatively small development project each couple of years targeting project sites that required little in the way of complex infrastructure. With the Lima Ola Workforce Housing Project, the Housing Agency shifted into the business of organizing and implementing significantly more complex development projects requiring large scale infrastructure development. As we continue into Phase II of Lima Ola, and begin similar large scale master planned developments in both Waimea and Kīlauea, we have been required to manage increasingly complex workflows and diverse funding sources. Regarding the HCV program, in FY25 we continued to serve a high number of around 850 participants, a dramatic program increase realized beginning in 2022 after previously serving an annual average of around 650 clients in prior years. The increased number of participants, though a benefit to our community and a program success, has met numerous obstacles with the limited number of units available to participants. The challenge of recruiting landlords to participate in the program has been made even more difficult with the recent implementation of more rigorous federal housing inspection standards. It is also disconcerting that 75% of the federal staff overseeing the statewide HCV Program have been fired by the current federal administration. 3 4. OPERATIONAL HIGHLIGHTS FROM FY25 Operational Highlights in FY25 include completion of three multi-family projects in Phase I of the Lima Ola Subdivision. These projects include a 32-unit Supportive Housing Project for Homeless Families, a 45-unit Workforce Rental Project, and a 40-unit Senior Housing Rental Project. Additionally, we are on track to complete 24 of the 38 single-family homes in Phase I with the remaining single-family homes on their way. Beyond the Housing Agency’s direct developments, three private development partner projects made possible by County assistance continued work on a collective 235 new affordable rental units. The 75-unit Kai Olina project in Port Allen, despite having 25 nearly completed units destroyed by fire last year and a second smaller suspected arson incident this year, is continuing to progress and is a bit more than 50% complete. The 94-unit Uahi Ridge Phase I project in Līhu‘e has received all required approvals and will break ground in March of this year, and the 66-Unit Rice Street Apartment project has similarly secured all required approvals and should break ground before May of 2025. Paving the way for future large scale County affordable housing development, we are nearing completion of the Community Planning work for both the Kīlauea Town Expansion Project and the Waimea 400 Workforce Housing Project. In FY26 we will be working to complete all necessary pre-development work on these projects to secure land use entitlements clearing the way for future development of around 600 new affordable homes.