More than $100,000 in unspent federal Community Development Block Grant funds from 2010 is the result of poor planning and lack of follow-through on projects awarded the funds, Niles city officials say.

The city council learned Monday it must spend at least $50,000 of its unused CDBG funding by May 2 or risk losing it. The city of Niles qualifies for CDBG funding as an “entitlement community,” based on its aging housing stock and high level of poverty.

Facing a tight deadline to unload the cash, City Administrator Ric Huff recommended the council reallocate the funding to a $100,000 sidewalk project that will make 13 four-corner intersections handicap accessible and bring them into compliance with the Americans with Disabilities Act.

“We got behind the eight ball a little bit in spending the funds,” Huff said Wednesday. “So we needed a capital project to spend that kind of money.”

Project ready to go

Huff said the sidewalk intersection project has been on the city’s radar for several years and, with much of the research on it already done, it was “shovel ready.”

All $408,500 of the fiscal year 2010 CDBG funds were budgeted, but $105,700 of it has yet to be spent.

A downtown beautification project was awarded $13,000 but never was completed. Juan Ganum, Niles community development director, said it was going to be used for ornamental fencing downtown. But because no organization or agency was responsible to execute the project, it never got done.

“No one was charged with spending it,” he said. “Unless there is an agency responsible, there’s no accountability.”

Another $20,000 was allocated for a “homeless intervention program” but none of that money was spent either. Ganum said the city had planned on forwarding the money to the Housing Resource Network of Berrien County but changed its mind when it learned that much of HRN’s efforts are focused on north county.

The city also budgeted for a $15,000 building improvement project for the historic Ferry Street Resource Center, which never got off the ground due to lack of communication with the state Historic Preservation Office.

Accountability needed

“What we’re all learning is that first of all you need to direct the money to an agency with the capacity to use the funds. Someone or some group has to be a point person,” Ganum said.

Joe Ray, the city’s Department of Public Works Director, said he found out about the sidewalk project Monday afternoon and had to be ready to solicit bids by today.

Ray said he and his department were busy preparing specifications for the project and determining locations for the new intersections. Ray said typically he would need at least a week to prepare for such a project.

The city is banking on finding a contractor that can complete the project by April 30 in order to have the CDBG funds spent by May 2. The price for the project is likely to be elevated since the contractor will be on a tight deadline, Ray said.

The city is accepting public comments on the proposed sidewalk project and reallocation of CDBG funds through March 30. Approval of the project, taking into consideration public comment, will be on the agenda of a special meeting of the city council April 2.

Ganum said this situation is unlikely to happen again, since the CDBG action plan process will now begin earlier.

“We want to get the city council involved early on,” he said. “We need to know what the city council thinks is a priority, the values for the city. Once we decide what our priorities are, it will be much easier to allocate the limited funds we receive.”

Mayor Mike McCauslin said the city now understands “the work you have to go through to get the money spent.”

He said it is likely in the future that spending deadlines will be imposed on organizations and agencies receiving CDBG dollars to avoid a similar situation in the future.

Niles residents wishing to make comment on the reallocation of CDBG funds can contact Ganum at (269) 683-4700 ext. 233 or at jganum@nilesmi.org.