HOUSING OPPORTUNITIES COMMISSION OF MONTGOMERY COUNTY

10400 Detrick Avenue

Kensington, Maryland 20895

(240) 773-9025

M I N U T E S

June 4, 2003

03 - 07

A regular meeting of the Housing Opportunities Commission of Montgomery County was conducted on Wednesday, June 4, 2003 at 10400 Detrick Avenue, Kensington, Maryland beginning at 7:15 p.m. Those in attendance were:

Present

Richard Y. Nelson, Jr., Chair

Y. Monroe Galloway, Chair Pro Tem

Ralph D. Bennett, Jr.

Michael J. Kator

LaKeyia L. Thompson

Absent

Norman Cohen, Vice Chair

Also Attending

Scott Minton, Executive Director Ken Tecler

Annie Alston Bill Murphy

Lillian Durham Stuart Raynor

Peter Engel Earl DeMaris

Zachary Smith Harold Kramer

Scott Ewart Patrick Mattingly

Vivian Benjamin Steve Lukaczer

Lisa Hudson Kayrine Brown

William Anderson Tom DeBrine

Gail Willison Doug Ryan

Brian Kim Jane Harrah

Lembit Jogi Bobbie DaCosta

Jim Atwell Patrick Mattingly

Andrew Oxendine Tom DeBrine

Louis Chaney Dan Sachs

Linda Mansouri

Dana Miller, Special Assistant to the Commission

Guests

none

Chair Nelson convened the meeting of the Housing Opportunities Commission at 7:15 p.m. He then called for consideration of the Consent Calendar. Upon a motion by Commissioner Bennett, seconded by Chair Pro Tem Galloway, and the affirmative votes of Commissioners Thompson, Kator, Nelson, Bennett, and Galloway, the Consent Calendar was approved. Vice-Chair Cohen was necessarily absent and did not participate in the vote.

I. CONSENT CALENDAR

A. Approval of Minutes of May 7, 2003 - The minutes were approved as written.

B. Approval of Minutes of May 16, 2003 Special Session Open Meeting - The minutes were approved as written.

D. Authorization for Executive Director to Execute Sales Agreement for 0.001 Acres (42 Sq. Ft.) of Land at Holly Hall Apartments and Related Easements - The following Resolution was adopted:

RESOLUTION: 03 – 50 RE: Authorization for Executive

Director to Execute Sales Agreement for 0.001 Acres

(42 sq. ft.) of Land at Holly Hall Apartments and Related Easements

WHEREAS, the State Highway Administration, Maryland Department of Transportation seeks to purchase approximately 0.001 acres (42 sq. ft.) of the Holly Hall Apartments property and to be granted related revertible and temporary easements for the purpose of widening New Hampshire Avenue at the entrance to the Capital Beltway; and

WHEREAS, HOC staff has no objections to the sale or the easements; and

WHEREAS, HOC’s counsel ahs reviewed the sale and easements documents;

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission that the Executive Director or his designee is hereby authorized to execute a Sales Agreement between HOC and the State Highway Administration, Maryland Department of Transportation for sale of approximately 0.001 acres (42 sq. ft.) of land owned by Holly Hall Apartments to the State for nine hundred forty-three dollars ($943.00) and to execute a related revertible easement for approximately 0.001 acres (64 sq. ft.) and a temporary easement for approximately 0.011 acres (484 sq. ft.)

E. Authorization for Executive Director to Execute Amendment to Reciprocal Easement Agreement for Strathmore Court - The following Resolution was adopted:

RESOLUTION: 03 - 51 RE: Authorization for Executive Director to Execute Amendment to Reciprocal Easement Agreement for Strathmore Court

WHEREAS, the Housing Opportunities Commission of Montgomery County (“HOC”), and Strathmore Court Associates Limited Partnership (the “Partnership) own all of the units in a condominium known as “Strathmore Court at White Flint” (the “Condominium”); and

WHEREAS, HOC is the general partner of the Partnership; and

WHEREAS, the common area owned by the Condominium is subject to a Reciprocal Easement Agreement between White Flint North Limited Liability Limited Partnership, the United States of America, and the Condominium; and

WHEREAS, the United State of America has requested an amendment to the Reciprocal Easement Agreement, terminating its rights to access to the common areas, and modifying certain maintenance obligations of the parties within the common areas; and

WHEREAS, the Commission has reviewed the amendment to the Reciprocal Easement Agreement and has determined that it is beneficial to both the Commission and the Partnership to execute it, as it reduces the burdens and responsibilities to adjacent property owners with respect to the common areas of the Condominium.

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission of Montgomery County that the First Amendment to the Reciprocal Easement Agreement, as presented, is approved and the Executive Director is authorized to execute the document in substantially the same form on behalf of the Commission and on behalf of the Partnership as its general partner, as the owners of all of the units in Strathmore Court at White Flint Condominium.

E. Approval of Amendment to Personnel Policy – Chapter 1200, Section 1291 – Military Leave - The following Resolution was adopted:

RESOLUTION: 2003 - 52 RE: Approval of Amendment to

Personnel Policy – Chapter

1200, Section 1291 –

Military Leave

WHEREAS, the Housing Opportunities Commission of Montgomery County recognizes the National Guard and U.S. Armed Forces Reserves as essential to the strength of our nation and the well being of our communities; and

Whereas, the patriotic men and women of the National Guard and U.S. Armed Forces Reserves serve voluntarily in an honorable and vital profession; and

WHEREAS, employees of HOC that serve in the National Guard and U.S. Armed Forces Reserves train to respond to their community and their country in time of need; and

WHEREAS, the Attorney General for the state of Maryland has issued an opinion that concludes that state, county and political subdivisions must provide full civilian pay and benefits to members of the National Guard who are ordered to active duty; and

WHEREAS, the Housing Opportunities Commission desires to be in compliance with Maryland state law; and

WHEREAS, the Executive Director has recommended that the Personnel Policy be amended to increase the support the Commission provides to members of the National Guard and U.S. Armed Forces Reserves when ordered to active duty.

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission, Montgomery County that the Personnel Policy be amended as follows:

Chapter 1200

Delete:

1291 Military Leave

1291.1 Any Agency employee who is a member of any United States Military Reserve or National Guard Unit and is required to engage in training exercises will be granted Military Leave not to exceed two (2) weeks in any one year. Such employee shall be entitled to receive the difference between his/her regular salary and his/her military pay, if the latter is less than his/her regular pay. Such leave will not be deducted from any other leave earned by the employee.

1291.2 An employee who leaves his/her position to enter military service in time of war or any period of national emergency as declared by the President in connection with national defense or by reason of being drafted, shall be carried on the rolls in a Military Leave status without pay, and upon his/her discharge from military service, shall be entitled to be restored to his/her same position or to a position equally acceptable to him/her, for which he/she is qualified.

New Language:

1291 Military Leave

1291.1 Upon presentation of written notification of military service, a career employee who is a member of an officially-recognized reserve of the Armed Forces of the United States shall be entitled to fifteen (15) work days of paid military leave for training purposes.

1291.2 A career employee who is ordered to active duty, except Basic Training, in the following Uniformed Services: Army Reserve, Naval Reserve, Marine Corps Reserve, Air Force Reserve, Coast Guard Reserve, Army National Guard, or Air National Guard (Hereafter referred to as the Uniformed Services) shall be entitled to a leave of absence without loss of pay, time or benefits for the period of active duty plus ten (10) work days after release from active duty. He/She shall be entitled to reinstatement as provided in section 1291.4.

The employee must provide HOC a point of

contact for administration while on Military Leave.

1291.3 A career employee who is ordered to Basic Training upon entering the Uniformed Services shall be entitled to supplemental pay for the period of Basic Training.

Supplemental pay shall be equal to the difference between the employee’s regular HOC pay and the salary and allowances paid by the military. Should the salary and allowances paid by the military exceed HOC pay, the employee will not receive supplemental pay.

In lieu of supplemental pay, the employee may use accrued Annual Leave, Personal Leave or Compensatory Time Leave while on leave for Basic Training.

An employee on Military Leave for Basic Training will not accrue Annual Leave or Sick Leave unless he/she uses Annual Leave, Personal Leave or Compensatory Time Leave.

The employee will receive credit for HOC service for purposes of seniority, service awards, and Annual Leave accrual rates.

Members of the Employee’s Retirement System (ERS) will continue to receive credited service for the period of Basic Training, provided, upon return, he/she makes up any contributions missed while on leave. Credited service will be extended for the period of the absence, contingent upon receipt of all employee contributions to the ERS.

Members of the Retirement Savings Plan will continue to receive credited service during the period of Basic Training provided, upon return, he/she makes up any contributions missed while on leave.

The employee may continue their coverage under the same benefit elections (medical, dental, vision, life insurance and long term disability) in effect prior to his/her leave for Basic Training. The employee will be responsible for his/her share of benefit costs during the period of Basic Training. Missed allocations will be made up from future pay checks upon return to active employment status.

1291.4 Reinstatement Rights: Under the Uniform Services Employment and Reemployment Rights Act (USERRA) and Maryland Law, an employee returning from Military Service shall be entitled to reinstatement under the following conditions:

The employee provided proper notice prior to leaving for military service.

The employee’s position was not a “term” position with an expiration date prior to the employee’s release from the military.

The employee was discharged under honorable conditions. If he/she is discharged from military service under less than honorable conditions, the Commission reserves the right to review the reason for discharge prior to making a determination for reinstatement.

The total length of the employee’s periods of active duty does not exceed five (5) years during his/her entire HOC employment. Periods of active duty for training or during which an employee is ordered to active duty during war, emergency or in support of a critical mission are not included in the calculation of the five (5) year period.

1291.5 Upon reinstatement, an employee is entitled to the following:

Reinstatement to his/her previous position, or a position of like status and pay for which the employee is qualified.

Training or retraining to make the employee able or qualified to do the job if the job requirements have changed during the period of Military Service.

Employment in a position of lesser status, for which qualified and with full seniority and pay, should he/she be unable to become qualified to perform the previous job.

Accrued seniority for period(s) of Military Service for determination of Annual Leave accrual rate, HOC service awards and service increments.

Reinstatement of his/her unused Sick Leave, Annual Leave and Personal Leave balances.

Reinstatement of group insurance coverage.

Credit toward vesting under the employee’s retirement plan for the period of Military Service.

Credited service toward retirement provided the employee makes up any required employee contributions to his/her retirement plan.

1291.6 Term employees shall be eligible for Military Leave benefits and Reinstatement Rights consistent with the position to which appointed. Military Leave benefits will cease and Reinstatement Rights will end on the end date for the position.

II. INFORMATION EXCHANGE

A. Executive Director's Report - Mr. Minton added the following items to his written report.

1) Mr. Minton informed the Commission that HOC is undergoing a Rent Integrity Monitoring Review by HUD. A team of six reviewers are examining the income verification process and the rent calculations. Mr. Minton explained that the review is a General Accounting Office (GAO) mandate to HUD to determine the level of fraud in payments being made by HUD. GAO estimates that HUD could save $2 billion per year by improving their rent validation efforts. HOC is among the 500 largest Public Housing Authorities in the country to be undergoing this review.

2) Zachary Smith, Director of Public Affairs is preparing a letter for County Executive Doug Duncan and County Council President Steve Silverman to sign. The letter is in opposition to the Housing Assistance for Needy Families (HANF) proposal.

3) Mr. Minton informed the Commission that the Econo Lodge development agreement has been signed by the Department of Housing and Community Affairs. Mr. Minton noted that a higher fee was negotiated for HOC in its capacity as the developer on the project.

4) David Reeves, Director of HUD’s Washington, DC Field Office, visited HOC this week. Mr. Minton explained that the meeting was for Mr. Reeves to get acquainted with staff at the agencies within his jurisdiction. There was a brief discussion of Mr. Reeves’ background.

5) Mr. Minton met with Alice Cooper, Director of the Frederick County Department of Housing and Community Development and Jim Upchurch from the Western Maryland Interfaith Housing Coalition. Frederick County has adopted an MPDU law and is seeking guidance in administering the program. HOC will assist them in their efforts. Mr. Minton stated that he would keep the Commission informed.

B. COMMISSIONER EXCHANGE

Chair Pro Tem Galloway stated that the Food For Thought academic achievement program took place at the County Council building on last Thursday. She explained that the Chicken Out Rotisserie provides gift certificates to academic scholars who are also HOC residents. Chair Pro Tem Galloway stated that over 85 students received certificates and awards. She stated that Patricia O'Neil, President of the Montgomery County Board of Education, and County Council President Mike Subin attended and participated in the event. Several principals of Chicken Out Rotisseries gave remarks to the students and their families.

Chair Pro Tem Galloway stated that one student, John Hart, an 11th grader at Gaithersburg High School who has a 4.0 grade point average, gave an excellent speech. She noted that Mr. Hart aspires to be a cardiac surgeon. Commissioner Galloway then commended Lillian Durham, Director of Resident Services, Gail Gunod-Green, Volunteer Coordinator and Susan Yancy of Public Affairs for their work in putting together a good event which was well-attended. She noted that Council President Subin was very impressed with the scholarship of HOC's resident youth.

Commissioner Bennett stated that Fairfax County recently passed an MPDU law for hi-rise buildings. He urged staff to find out more about the law and the possibility of Montgomery County having a similar law. He stated that it is important for the high-density areas of the County.

C. COMMUNITY FORUM - no comments made.

III. COMMITTEE REPORTS

Budget Finance and Audit – Gail Willison, Budget Officer, gave a brief presentation of the FY04 budget. She provided printed copies of slides which she reviewed in her presentation. She noted that the overall budget for the Agency is $177, 775, 510. She also pointed out that the Public Housing deficit has decreased from $613,000 to $329,920 due to increased subsidy dollars the Agency will receive in 2004. Additionally, she explained that approximately 68% of the revenue is used for non-operating costs and Housing Assistance Payments. She further explained that of the total budget, approximately 94% of the revenue is restricted through bond requirements or internal requirements to cover the costs of operating and maintaining properties. With regard to the personnel complement, Ms. Willison explained that the total work years for the Agency in 2004 is 345.8, which represents a net decrease of 6.15 work years from the FY03 budget.

Chair Nelson commended the staff for a well-managed and well-developed budget. He stated that he is impressed with the staff’s ability to keep the Agency running and providing to the number of people that it serves, especially in a period of shrinking resources. He expressed his appreciation for the dedication to those efforts. Commissioner Bennett concurred with Chair Nelson’s remarks.

In response to a question from Commissioner Bennett, Ms. Willison stated that although State funds have decreased, Federal funds have increased as a result of several grants obtained by the Resident Services division.

There was brief discussion about decreased projections of rental increases in HOC’s properties and the format of the budget document.

Mr. DeMaris pointed out that, in the last four or five years, HOC has become much more dependent on its own discretionary income. He explained that interest income has decreased and the Agency is increasingly more dependent on the property income to fund its mission.

Ms. Willison stated that the largest increases in expenses have been in personnel costs and property insurance.

Chair Nelson made several observations about educating the public about HOC’s budget. He noted the increase in benefits which has escalated personnel costs. Ms. Willison pointed out that the Agency will be adding over 500 new units in FY 2004.

Commissioner Kator moved to adopt the resolution. Commissioner Bennett seconded the motion. Affirmative votes were cast by Commissioners Thompson, Nelson, Galloway, Kator and Bennett. Vice Chair Cohen was necessarily absent and did not participate in the vote.

RESOLUTION: 03-53a Re: Adoption of the FY’04 Budgets, Bond Draw Downs and Transfers

WHEREAS, the Commission needs to adopt a budget based on the current chart of accounts in use before July 1, 2003; and

WHEREAS, the Commission needs to approve the transfer of equity between Agency funds.

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission of Montgomery County that it hereby adopts a total Operating Budget of $177.8 million for FY’04 by fund as attached:

BE IT ALSO RESOLVED that the Housing Opportunities Commission of Montgomery County approves the draw down of bond funds for the Operating Budget as follows:

$ 634,810 from the Multifamily Bond Fund (1984 Open Indenture)

$ 111,110 from the Magruder’s Bond as permitted by trust indenture

$ 1,574,800 from the Single Family Bond Fund

BE IT ALSO RESOLVED that the Housing Opportunities Commission of Montgomery County approves the following transfers between funds in order to balance the Operating Budget:

Up to $1,505,850 from the net cash flow from the Opportunity Housing properties in the Opportunity Housing Fund to the General Fund.

Sufficient funding from the Public Housing operating reserves to cover the actual deficit in the Public Housing Rental Program (approximately $329,920).

BE IT ALSO RESOLVED that the Housing Opportunities Commission of Montgomery County hereby adopts a Capital Budget for FY’04 of $35.8 million as attached.

(attachments are on file in the Commission Office)

Commissioner Bennett moved to adopt the resolution. Chair Pro Tem Galloway seconded the motion. Affirmative votes were cast by Commissioners Thompson, Nelson, Kator, Galloway and Bennett. Vice Chair Cohen was necessarily absent and did not participate in the vote.

RESOLUTION: 03-53b Re: Adoption of the FY’04 Personnel Complement

WHEREAS, in accordance with Section 220 of the Housing Opportunities Commission’s Personnel Policy, the Commission approves, establishes, modifies, or abolishes all positions or classes of positions in the act of adopting the annual budget; and

WHEREAS, the FY’04 Budget supports the positions as listed in the FY’04 Personnel Complement (attached to this resolution).

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission of Montgomery County, that it hereby approves the FY’04 Personnel Complement with a total of 345.8 work years.

Chair Pro Tem Galloway moved to adopt the resolution. Commissioner Bennett seconded the motion. Affirmative votes were cast by Commissioners Thompson, Nelson, Kator, Galloway and Bennett. Vice Chair Cohen was necessarily absent and did not participate in the vote.

RESOLUTION: 03-53c Re: Adoption of the FY’04

Compensation Package for the Non-represented Staff

WHEREAS, the Commission wishes to determine and award a compensation package for non-represented employees that is fair and equitable.

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission that it hereby awards a compensation package for the non-represented staff of:

· 2.75% COLA effective July 1, 2003,

· 2% Increment effective the first pay period of September 2003,

· Mileage reimbursement as follows:

o 1-1,000 $.365 cents per mile

o 1,001-7,500 $.50 cents per mile

o 7,500 and above $.60 cents per mile

(Note: if IRS reimbursement rate increases during the year, then the Tier 1 of the above reimbursement schedule of $.365 will be adjusted accordingly.)

· Automobile insurance reimbursement for employees who use their vehicle for HOC business and claim work mileage on their personal insurance up to $325 per year.

· Meal Allowance of $12.50 per meal.

· Tuition Assistance up to $1,000 not to exceed the total available Agency Budget of $15,000

· Emergency Maintenance on-call rate as follows:

o $20.00 per day – Monday through Friday

o $30.00 per day – Saturday, Sunday and holidays

· Pay for Performance will not be funded in FY’04.

BE IT FURTHER RESOLVED that if the non-represented employee has reached the maximum of the pay grade, the increment and wage increase will be paid in a one-time lump sum payment that will not be added to the base salary.

Commissioner Bennett moved to adopt the resolution. Commissioner Thompson seconded the motion. Affirmative votes were cast by Commissioners Nelson, Kator, Galloway, Bennett and Thompson. Vice Chair Cohen was necessarily absent and did not participate in the vote.

RESOLUTION: 03-53d Re: Adoption of the FY’04

General Salary Schedule

WHEREAS, the Housing Opportunities Commission of Montgomery County publishes an annual general salary schedule for both non-represented and represented staff.

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission of Montgomery County that it hereby adopts the attached General Salary Schedules.

(attachments are on file in the Commission Office)

The Commission then moved to consideration of the Third Quarter Budget to Actual Statements. Ms. Willison informed the Commission that the Agency ended the third quarter with a net cash surplus of $480,908.

Ms. Willison explained that a savings in the General Fund has offset the Opportunity Housing Fund. She stated that she does not expect that a budget amendment will be needed. She stated that enough savings in other areas of the budget should offset the deficit.

Ms. Willison stated that the Public Fund is performing better in both the Public Housing and the Housing Choice Voucher Program. She explained that the amount of reserves required to fund the Public Housing deficit will likely be less than projected. With regard to the Housing Choice Voucher Program, the Lease-Up Initiative has been very effective and has resulted in higher occupancy. Because of this, she stated that it may be possible to re-pay some funds to the Opportunity Housing Reserve Fund (OHRF).

Ms. Willison stated that the capital budgets are on target. She noted that a large fourth quarter expense will be incurred for the Yardi software conversion.

Ms. Willison commented briefly on the Opportunity Housing Fund, noting that it is on target with the exception of being over budget at Alexander House. She explained that the overage occurred because the FY 2002 Capital budgets were not rolled forward.

Commissioner Bennett moved to adopt the resolution. Commissioner Kator seconded the motion. Affirmative votes were cast by Commissioners Thompson, Galloway, Nelson, Kator and Bennett. Vice Chair Cohen was necessarily absent and did not participate in the vote.

RESOLUTION: 03-54 Re: Acceptance of Third Quarter FY’03 Budget to Actual Statements

WHEREAS, the budget policy for the Housing Opportunities Commission of Montgomery County states that quarterly Budget to Actual Statements will be reviewed by the Budget, Finance and Audit Committee; and

WHEREAS, the Budget, Finance and Audit Committee reviewed the Third Quarter FY’03 Budget to Actual Statements during its May 27^th meeting.

NOW, THEREFORE, BE IT RESOLVED by the Housing Opportunities Commission of Montgomery County that it hereby accepts the Third Quarter FY’03 Budget to Actual S