HONOLULU (HawaiiNewsNow) - Federal Authorities are taking the city to task for delays in spending $8 million in federal housing money.
In a Dec. 13 report, the U.S. Department of Housing and Urban Development said the city may have to repay the money if it's unable to spend the money this year.
"If the city were to lose $8 million -- if it failed to meet timeliness again -- of course it's significant," said City Council Chair Ernie Martin.
"Even $800,000 or $80,000 would be significant."
Residents at city housing projects said the city is hoarding the money at the expense of services.
"We're in a housing crisis. We desperately need affordable housing for all income levels and this would better spent financing low-income housing someplace else," said Steve Lohse, who lives at Chinatown Gateway Plaza.
HUD said it may also place Honolulu on a list of high-risk cities and that could cause delays and run up costs for future projects.
"The scary part is losing the money. We used to get $20 million, then it was $16 million, then $12 million," said City Councilwoman Ann Kobayashi.
The spending backlog has been a problem at the city for years and pre-dates the Caldwell Administration. But this is the first time that HUD has taken the city to task in its annual review of the city's housing programs.
Pam Witty-Oakland, director of the Department of Community Services, said its already working out a plan with HUD to fix the problem and that the city ultimately will not have to back the money.
The reason for the delays is that the process to issue housing grants to affordable housing developers and other groups is cumbersome. It says it's working on streamlining that process.
"We've made great strides toward making a difference," said Witty-Oakland.
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