Salt Lake City Mayor Jackie Biskupski issues her first budget veto in a fight with the City Council over how to spend on affordable housing

(Trent Nelson | Tribune file photo) Salt Lake City Mayor Jackie Biskupski at her State of the City address, Jan. 17, 2019. The mayor, who is not seeking reelection, issued her first budget veto on Tuesday in a dispute with the City Council over spending on affordable housing.

Salt Lake City Mayor Jackie Biskupski has issued the first vetoes of her tenure in office, crossing out several of the City Council’s newly passed budget proposals for nearly $4 million in spending on affordable housing.

With a series of line-item vetoes announced Tuesday, Biskupski sought to undo the council’s decision to shift nearly $2.59 million held in the city’s Housing Trust Fund away from the administration-controlled Housing and Neighborhood Development Division and put it under the purview of another arm of city government over which the council feels it has greater control, the Redevelopment Agency, or RDA.

The mayor, who is not seeking reelection to a second term, also vetoed a council hold on another $1.9 million in spending on homeless-services related programs that had been sidetracked while council members awaited more information.

“It is important to note that while we may disagree on how we should move forward over the next year to address the housing crisis, we do not disagree that we must,” Biskupski wrote in her veto message. City residents, she wrote, “have been clear that they consider this to be a top funding priority and ... we have heeded their call.”

In a joint statement on Tuesday, members of the City Council said they had expected the mayor’s vetoes and would meet Friday at noon to consider an override. Reversing the line-item vetoes would require backing from at least five of the council’s seven members, referred to a super majority.

The mayor has said the council’s changes threaten to slow down the city’s attempts to address a shortage of thousands of affordable houses and rentals in Utah’s capital. She urged the council and her administration on Tuesday to “come together” to discuss this “significant shift in City policy” and to get input from those affected by the moves.

Members of the council have cast their changes to the original budget $331 million Biskupski proposed in May as fulfilling their role as financial stewards for the city, especially in light of new tax money available for housing through a “Funding Our Future”-related 0.5-percent sales-tax hike approved in May 2018.

Council Chairman Charlie Luke and Councilwoman Amy Fowler, who chairs the RDA board, said in their statement the council had worked to streamline how city funds get spent on affordable housing and to make the lending process more transparent.

Notably, the City Council’s June 11 votes to approve the 2019-2020 budgets for the city and the RDA were both unanimous.

“This budget does not slow down the process, and we have confidence the RDA staff and other City agencies can move forward on the accelerated timeline we have for affordable housing,” Luke and Fowler said in their statement.

They added that the mayor’s veto statement contained several inaccuracies they hoped to address in detail at a later date, without elaborating.

The veto comes when relations between the administrative and legislative branches at City Hall are at something of a low since Biskupski took office in 2016. The mayor recently said she was “ashamed” over the City Council’s policy stances on the controversial Inland Port and called for “better council members.”

That led Councilwoman Erin Mendenhall, one of eight candidates currently running for mayor, to publicly call Biskupski “a failed mayor.”

As part of its budget deliberations earlier this month, the council moved the housing trust fund on a yearlong trial basis from HAND to the RDA, which is governed by council members as members of the RDA board and has its own internal system for lending and financial incentives to developers.

Housing trust fund loans are considered a crucial tool in so-called gap funding, helping developers with other funding sources to make affordable projects pencil financially. The council said it ultimately intended to split the trust fund in two, with the RDA in charge of lending for housing development and HAND controlling spending on housing programs.

But Biskupski said the city’s existing housing trust fund model was already “transparent and effective,” with every loan reviewed by a citizens advisory board and then OK’d by the City Council. Creating a new process for lending through the RDA, she said, threatened to delay vital loans to developers hoping to build affordable-housing projects.

More than $11 million has been loaned from the fund in the last three years, the mayor noted, helping to build or preserve 1,295 affordable dwellings in Salt Lake City.

And delaying the $1.9 million in funding for several homeless pilot programs already underway, the mayor said, would disrupt case management and housing aid, in some cases, for children, residents coping with mental illness and those who don’t qualify for other assistance.

In their lengthy budget hearings, council members said they supported many of the homeless-services spending items the mayor had proposed, which included allocations for aid through The Road Home, Volunteers of America, Utah Community Action and other service agencies.

But during budget talks, council members said an exchange of information with HAND on key program goals had broken down. So, the spending items were instead temporarily placed in holding accounts, with the option of freeing up some or all of that $1.9 million once the council could craft specific rules to guide how the money was to be spent.

Biskupski on Tuesday portrayed the situation with some of those programs as more urgent, particularly one run by The Road Home called New House 20 and supported by the city since 2015, for the heaviest users of emergency homeless services.

“These are programs that reputable organizations are already running,” Biskupski spokesman Matthew Rojas said. “We don’t want them to run out of money.”