How notice of non-compliance from HUD is treated by the City of New Rochelle

In December 2022, then City Manager Chuck Strome received two letters from the federal government’s Department of Housing and Urban Development (HUD), both of which advised him that there were issues of non-compliance with HUD-funded programs in New Rochelle.   Infamously, in response to one letter regarding alleged mismanagement at the New Rochelle Municipal Housing Authority (NRMHA), the City Manager, in an unprecedented move, removed four appointed volunteer members  of the NRMHA board without warning or due process. 

The second letter notified the City that it had failed to adequately disburse HUD funds from the Community Development Block Grant (CDBG) program for two years in a row.

In other jurisdictions in Westchester County, the CDBG program provides much needed funds for, among other things, nonprofits and municipal programs for seniors, teens and the disabled.   

The Westchester County Consortium, representing small towns and villages, solicits annual proposals for use of CDBG funds from its members, then informs the general public about these requests and the County Development Department’s recommendations and rankings–which programs have been approved, which are being held up, and which applications have been rejected and why.

 In New Rochelle, an annual plan is published and a public hearing is held, but public input on the priorities is not sought.  

In its 2021 publication, CDBG Best Practices Report (pages 7-12), HUD provides several ways in which outreach and community engagement can be made so that a community can prioritize the greatest need.  It also stresses the importance of sharing the goals and performance of grant recipients as well as how the CDBG activities meet the priorities and needs of the community. 

While facilities such as the  Mascaro Boys & Girls Club and the NRMHA were in dire need of infrastructure improvements, New Rochelle failed to disburse over $1 million in CDBG funds in 2021 and 2022.  The city has offered no explanation for this, providing only a plan to bring itself into compliance.  The plan, issued March 14, does not suggest that the priority needs of the community are at the center of its efforts to be in compliance–rather, they focus on the easiest lift for over $1 million in funding. 

The City developed a Workout Plan to ensure that the City meets timeliness requirements by the next test in November 2023. The City has prioritized shovel ready projects such as new ADA accessible sidewalks and sidewalk replacement in CDBG eligible areas to improve public safety.

The City will also reinvest into the City’s Senior Citizen Center, recreational spaces, youth programs and park picnic areas. To move CDBG funds for these projects, the City recognizes that a Substantial Amendment to our Annual Action Plan(s) is required.

Issue:

The Department of Development would like to reprogram approximately $1.4M of unexpended prior year CDBG funds, originally allocated to Administration, Public Services, reestablished Public Facilities and previously closed projects, to help fund shovel ready projects that will provide meaningful impact to the people who live and work in New Rochelle.”

It should be noted that neither the Mayor, the City Council, nor the City Manager seems to have criticized or imposed consequences on any person or department for the failure to disburse these desperately needed funds in a timely fashion.  That kid-glove treatment stands in sharp contrast to the summary dismissal of the four NRMHA Commissioners.