The Butler Redevelopment Authority voted against a proposal from City Council to reduce the administration compensation the authority receives for running the Community Development Block Grant program by 8% for the next four years.

Authority board members unanimously voted Thursday against the draft proposal that council approved at its Aug. 27 meeting.

Under the current administrative agreement between the authority and council, which expires Oct. 1, the authority receives 18% of the annual CDBG for staff salaries, planning, travel costs for carrying out CDBG projects, legal, accounting, auditing, equipment purchases and rentals, insurance, utilities, office supplies, postage, office rental and maintenance, outreach for housing programs and other expenses.

The draft agreement from council would have reduced the administrative line item in the annual CDBG budget to 10%.

In the proposed 2020 CDBG application for $308,571, the authority's 18% administrative compensation line item is $55,542. The amount would be $30,857 if the compensation is reduced to 10%.

The compensation would be $10,857 if the $20,000 allocation for planning contained in the line item is subtracted from the $30,857, according to the authority.

The agreement between the authority and council has been for a three-year term, but council's proposal reduces the term to nine months.

When the agreement expires, the authority transfers money on hand and accounts receivable attributable to the CDBG program in excess of $25,000 to the city. Council's proposal reduces that amount to $5,000.

Authority board members voted against the proposal after discussing it in executive session.

Contacted after the meeting, Mayor Ben Smith said the idea behind the proposal is to make sure the administration costs are proportionate to the amount of work performed on CDBG projects.

“We wanted to make sure the money we're paying for administration is commensurate with the amount of work being done on CDBG programs,” Smith said.

He said council will consider any further action.

The CDBG application seeks more than $223,000 for street reconstruction, $30,000 for housing rehabilitation and $55,542 for administration.

The streets listed in the application are Kaufman Drive, Donaghy Avenue, Maple Street, South Main Street and Wyoma Avenue. Part of Kaufman Drive was repaved in a previous CDBG project. The money sought in the 2020 application would pay for resurfacing the remainder of the street.

Council must approve the application before the authority can submit it to the state Department of Community and Economic Development.

In unrelated business, most of the $2 million in state Redevelopment Assistance Capital Program funding the authority arranged for the Centre City project has been distributed to unpaid vendors and investors.

The state transferred $1.95 million to the authority and an escrow agent dispersed the money to investors — Hari Hotels, Butler Area Development Corp. and Butler Hotel — and unpaid vendors. The remaining $50,000 is being retained until a close-out audit is completed in the next six to nine months.

The Centre City development includes a Marriott Springhill Suites hotel, Rite Aid and a parking garage in downtown. Hari Hotels owns the hotel.

In other business, a person who expressed interest is buying the vacant Penn Theater on Main Street is expected to look at the building Friday.

The prospective buyer contacted the authority Wednesday, said Veronica Walker, acting authority executive director. Authority staff will take the person on a tour of the building, she said.

A parapet on a six-unit apartment building owned by the authority was repaired at a cost of $4,807. The authority hired Young Masonry of Butler to repair the crumbling parapet for $4,000, but an $807 change order for flashing and sealing was added.

In addition, the Butler Art Center wants to paint murals on the exterior walls of the Penn Theater and Pepper's Flowers on West Cunningham Street, which the authority also owns. Authority board member Cheri Readie said she will ask the center to give the authority preliminary drawings for the board to approve.