Council Splits on Restoring Funding to Haven House

Above: Council Member Aaron Stephens and Finance Director Jill Feldpausch after the conclusion of last night’s meeting.

East Lansing’s City Council passed a budget last night that cuts about a million dollars from last year’s budget in an attempt to deal with the City’s growing financial crisis. In the proposed budget, funding to local social service agencies had been cut out. But a last-minute and unexpected extra $52,395 from the U.S. Department of Housing and Urban Development (HUD) ended up being allocated, in a 3-2 vote, to provide for those agencies.

Council Members Aaron Stephens, Shanna Draheim, and Ruth Beier voted in favor of directing the unexpected funds to organizations like Haven House, which provides the region’s only emergency housing for families with children facing homelessness. Haven House (shown below) has received broad and vocal community support in the last few weeks.

Voting against that use of the funds were Mayor Mark Meadows and Mayor Pro Tem Erik Altmann. Meadows noted that, when HUD wrote to say they would be providing more than the Council had budgeted for HUD Community Block Development Grant (CBDG) funded-projects, he had been surprised by the letter. He said he assumed the HUD communication was going to instead contain news about “some other” HUD CBDG issue.

This was an apparent reference to the City having recently been ordered to repay HUD $134,000 for a CBDG grant improperly used to fix a sidewalk and retaining wall adjacent to the City Attorney’s offices. The retaining wall project was the subject of a federal fraud suit over a failure to disclose a conflict of interest involving City Attorney Tom Yeadon, a failure the City has since acknowledged, following payment of $20,000 to settle the suit.

In a memo about the unexpected $52,395 in extra funds, East Lansing Finance Director Jill Feldpausch indicated the money was “earmarked” for paying back the HUD loan to the City for the Avondale Square project. So it looked, before the 3-2 vote, like it would not go to the social service agencies.

ELi has previously reported that the Avondale Square housing project, enacted under Meadows when he was also East Lansing’s Mayor over a decade ago, has ended up costing East Lansing taxpayer millions more than originally planned. The City has had to divert funds from other uses – including infrastructure repairs and social services – to pay off that project. That has essentially put social service agencies in competition with the Avondale Square debt problem.

Written communications to Council in the last few weeks have been dominated by requests to Council to continue to provide funding to Haven House. While most people writing in support simply used a standardized letter they had been provided, East Lansing resident Crystal Barter wrote personally to say:

“One of the reasons my husband and I recently moved to East Lansing was the notion that our tax dollars would be used for the greater good. We believe in the type of City that EL strives to be (inclusive, socially-just, and progressive) and wanted our now two-year-old son being raised by a community which prioritizes the right things in life. We chose a neighborhood in EL over a McMansion in Haslett because we believe that the community in which one is raised truly shapes the human spirit and priorities in life.”

Rebecca Taylor also wrote personally, saying, “When I see a man in the rain with no roof, a mother ashamed for not providing enough, an elder alone and depressed, a child violently screaming out, it reminds me that my discomfort means nothing in comparison…. As human beings we are obliged to care for one another. If sickness or catastrophe happened to you or your family, you would want to be treated with dignity and a second chance.”

During public comments last night, Gabriel Biber, Executive Director of Haven House, came to plead with Council to restore funding to his organization. Biber said he believes the City has a moral obligation to help people facing homelessness, saying it was more important than fixing sidewalks, another possible use of CBDG funding from HUD.

Council Member Aaron Stephens formally moved, before the budget vote, to take the $53,000 “extra money we got” and, instead of using it to pay down the Avondale Square loan, putting it to social service organizations whose funding this year was eliminated in the proposed budget.

Stephens said he wanted to see the funding restored in part because the citizens’ advisory committee on CBDG funding had recommended helping social service agencies, and he wanted to honor the committee’s work. He said he saw this as a one-time move, giving the agencies more time to go find funding elsewhere in the coming year.

Below: Mark Meadows and Ruth Beier at Council last night.

Council Member Ruth Beier supported Stephen’s idea saying, “I think it is a function of a government, especially one that represents progressive people, to fund human services.” But, she said, future Councils would have to decide whether to continue that type of funding.

Council Member Shanna Draheim was the third voice of support for using the additional funds for social services, although she has said she does not intend to vote in favor of usiing City funds to support them in the future. She said she “cherishes these social service organizations” but that the City is not in a financial position to help. That said, for this year, she also wanted to honor the advisory committee’s work and give agencies more time to find alternative funding.

Below: Shanna Draheim and Mark Meadows at Council last night.

Meadows said he wanted to see funding continue to go toward lower- and moderate-income housing to keep East Lansing open to “people of lesser means” so that they could “live in this community.” He said, “I see Haven House as part of that strategic priority.” But he wanted “a different approach that accentuates that purpose.” He wanted to see the extra funds go to pay down the Avondale Square debt.

Altmann said he thought too much staff time was being spent on small grants to social service agencies, and that the State of Michigan should be dealing with funding social service agencies. “That’s where we need to look for solutions,” he said, at the state level and “not at the local level.”

Below: Erik Altmann and Shanna Draheim at Council last night.

Altmann said he thought the Council had already come to a decision to use CDBG funds as much as possible to pay off the Avondale Square debt. “We are all a little bit here holding hands and jumping off the cliff together,” he said. “I thought we had arrived at a package [deal]. And apparently we hadn’t.” He said he would not support the amendment.

The community advisory committee will now be asked to recommend use of the funds, and Council will have final approval.