Federal budget cuts strike Albany coffers

ALBANY -- With a Fiscal Year 2011 federal budget now in place, local government officials have received the first reports of the fallout from the bitter battle between Republicans and Democrats in their newly declared war on spending.

First in the cross hairs is the city's Community Development Block Grant funding, which comes from the U.S. Department of Housing and Urban Development.

According to Marion Turner, the city's federal government lobbyist, funding for CDBG grants was cut for communities nationwide by 16.2 percent, or $647 million.

The HOME Investments Partnerships Program -- which provides funding for housing rehabilitation and repairs for low-income residents -- was cut 12 percent.

Latoya Cutts, the city's director of Community and Economic Development, said Monday that she expects the double-digit cuts to slice through the various strata of government down to the municipal level.

"We've been told that if the programs were cut by 16 percent and 12 percent at the national level, to plan for at least that deep of cuts at our level," Cutts said.

Cutts said that while the cuts are significant, her department had planned for a variety of different defunding scenarios, with a 16 percent reduction at the lower-end of the spectrum.

Cutts said that a 16 percent cut would translate roughly into a $200,000 cut from the city's HUD allocation, leaving it $1 million.

City Manager James Taylor said that given Albany's entitlement status, it will likely be spared the largest of the cuts, but that "cuts may be robust enough to impact staffing levels and personnel."

Cutts' office is fully funded by federal money, which she said means that cuts to the city's DCED would mean reductions in funding for its various programs and likely a reduction in personnel.

CDBG money helps fund a variety of different community programs, including funds for local non-profits, such as LilyPad and Open Arms, and housing assistance programs.

The commission is set to discuss the matter at its meeting this morning at the Government Center.