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C~A,RMAN:FRANC~SMURDOCK CENTRALINA COUNCIL OF GOVERNMENTS <br />WC~CHAIRMAN: RALPH AUSTIN <br />SECRETARWDAVID WARD POST OFFICE BOX 35008 ONE CHARLOTFETOWN CENTER <br />TREASURER:ROBERTALLISON CHARLOTTE, N.C. 28235 1300 BAXTER ST. 704/372-2416 <br />~op~u~ MAR O 1 1989 <br /> <br /> ~o~ COG ~oard of Delegates <br /> County Commission Chairpersons <br /> County Managers <br /> P~OM: Sue B. Archer, Aging Program Administrator ~/~ <br /> DATE: February 28, 1989 <br /> RE: Reduction of Funds for Aging Services <br /> The North Carolina Division of Aging has informed the eighteen <br /> Regional Council Area Agencies on Aging staff that as of July 1, <br /> 1989 there will be a $3.4 million reduction in Federal funds. This <br /> shortfall of Federal dollars will result in a reduction of services <br /> to older adults in North Carolina. As we understand it, the <br /> following sequence of events led to the shortfall. <br /> * 1973 - early 1980's: Unspent Federal funds (Title III of the <br /> Older Americans Act) were held in rese~;e by the State. <br /> * Early 1980's - 1989: In an attempt to exhaust tke Federal <br /> reserve funds, the State allocated Federal funds in excess of <br /> the annual Federal allocation. This over allocation of <br /> Federal money allowed services to be provided at approximately <br /> 125% of the annual Federal allocation. <br /> * July i, 1988: The last allocation of Federal reserve funds <br /> was awarded by the State. <br /> * July 1, 1989: The impact of the $3.4 million shortfall ~:hich <br /> was created by the use of Federal Reserve Funds is realize~. <br /> The bulk of this shortfall will be experienced during the July <br /> 1 to September 30 quarter. The problem stems from the fact <br /> that the State fiscal year begins July 1 and the Federal <br /> fiscal year begins October 1. Therefore~ the July 1 - <br /> September 30 q~arter creates a fiscal situation in which there <br /> are only $1.8 million Federal dollars available to cover $5.2 <br /> million dollars in normal service cost; thus, the $3.4 million <br /> dollar shortfall. It is anticipated that the amount of <br /> Federal funds will be somewhat reduced during the next several <br /> years because of the above events. <br /> <br /> <br />