Wednesday, April 24, 2024
The Cambridge Housing Authority’s executive director, Gregory Russ.

The Cambridge Housing Authority’s executive director, Gregory Russ.

The Cambridge Housing Authority will avoid job losses and service cuts this year despite sharp reductions in federal aid caused by the impasse over deficit reduction in Washington. But the impact will probably be greater if automatic federal budget cuts triggered by the impasse continue in future years, Executive Director Gregory Russ said.

The authority tapped reserves and a surplus from last year to balance its fiscal year 2014 budget; the fiscal year begins April 1. Commissioners adopted the $66.8 million budget Wednesday.

The authority provides housing or housing subsidies to more than 5,000 low-income individuals or families, most of them extremely poor. Federal aid has dropped steadily over the past several years. But the automatic federal budget cuts that went into effect when Congress failed to act on the federal deficit – called “sequestration”— presented a bigger challenge. Sequestration threatened to leave the authority with a $2 million deficit.

To close the gap, the authority adjusted reserves in its public housing program as well as its budget for Section 8 rent subsidies. It also used a $426,000 surplus from fiscal year 2013, which would ordinarily go into reserves, Russ said. The surplus was higher than usual because of lower utility bills due to energy-saving improvements and delays in filling vacancies, Russ said.

The sequester cuts could continue for the next 10 years unless Congress reaches an agreement on reducing the federal deficit. If sequestration persists beyond this year, “it is doubtful we will continue” to escape serious consequences, Russ said.

This story was updated March 29, 2013, to remove references to the use of Community Development Block Grants.