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--- Issued April 3, 2013

Erie Housing Authority Executive Director John E. Horan and four other top administrative employees volunteered to take a pay freeze in order to help solve federal funding cuts affecting the Authority – cuts that, among other things, are forcing reductions in the Authority's Section 8 Program.

On March 25th the Board of the Authority approved the pay freeze as part of their 2013 budgets for two major housing programs. These budgets reflect the impact of the recent sequester of funds from the federal government, reducing the 2013 allocation to the Housing Authority by $588,500.

The Authority will have to absorb the reductions in federal funding over the next 12 months. The following cuts have been made to the Authority’s operating budgets, that started on April 1 and run through March 31, 2014.

1.    Pay freeze for the top five Housing Authority administrative employees ($14,611)

2.    Increase in clerical employees’ share of hospitalization and medical costs ($8,070)

3.    Freeze in filling vacant administrative positions ($19,284)

4.    Reduction, through attrition, of 87 families who are eligible to receive affordable housing assistance through the Section 8 Housing Choice Voucher program ($186,912)

5.    Reduction by 20% in the Authority’s summer internship program for college bound public housing youth ($16,148)

6.    Reduction in planned capital improvements ($232,786)

7.    Elimination of the Congregate evening meals at Schmid Towers, Friendship, and Ostrow Apartments, effective June 1, 2013 ($48,000)

8.    Elimination of the code enforcement contract with the City of Erie for neighborhoods surrounding public housing sites, effective May 1, 2013 ($62,689)

According to Horan, “The cuts have been forced by the steady reduction in funding over the last three federal fiscal years. In the first two years, we were required to use our reserves to cover the reductions. Those reserves have now been depleted. The sequester of approximately 9% across the board effective March 1, 2013 was part of the most recent cut in federal funds. The essential services to our residents have been saved for the time being.

"However, we will not be able to help any of the 526 eligible families, who are still on our Section 8 waiting list until the current program is reduced, through attrition, by 87 families. This will take approximately 11 months.”

Horan made it clear that despite the cutbacks, the Authority will still continue, as always,  its PILOT (Payment in Lieu of Taxes). Each year, since 1941, the Authority has provided voluntary PILOT payments to the City of Erie, Erie County, and the Erie School District. Counting the 2012 contribution of $301,278 the Authority has paid a total of $7,285,383 in lieu of real estate taxes.

The Housing Authority is, by state law, exempt from real estate taxes. “However, we make these payments to the taxing bodies for the services they provide to public housing residents, Horan said. "Providing financial support to our local governing bodies is the right thing to do even though we are tax exempt and despite sequestration cuts.”

The Housing Authority provides affordable housing to nearly 3,100 families through its various programs. Over 950 of these families are assisted through the Voucher Program, which pumps $3.8 million annually into Erie’s private rental market economy.

For additional information or interview, contact John E. Horan at 814-452-2425, or