Talks about handling increased employee health insurance premiums gave way to a discussion of anticipated cuts in federal operating funds at Tuesday night’s Vicksburg Housing Authority board meeting.

Commissioners voted to absorb the increase, which takes effect Oct. 1. It also planned discussions on streamlining operations.

VHA executive director Dannie Walker said the authority received $684,170 in operating funds from the Department of Housing and Urban Development for the present fiscal year, adding, “That was an 18 percent cut from the past two years.”

The board doesn’t know when it will receive its allocation for the upcoming fiscal year, but it will be less, he said.

The VHA pays employee premiums to Blue Cross-Blue Shield of Mississippi. Married workers pay the difference between the single and family premiums.

Blue Cross, Walker said, is increasing the rate from $368 per employee per month to about $380. He suggested increasing the deductible from $250 to $750 per employee to reduce the premiums.

VHA’s operations are funded through HUD funds and rental income, and it receives a separate amount from HUD for capital improvements to maintain and repair the buildings in its six complexes.

VHA received $681,103 in capital funding for 2011, which Walker said was 14 percent less than the $795,000 received in 2010.

“We’re going to have to look forward,” board chairman Christopher Barnett Sr. said. “We’re looking at losing about 15 percent or worse in the coming years. We need to look and see what we can do gradually.”

Walker said after the meeting that he has been working to keep VHA operations efficient.

“You’ve either got to streamline or come with more funds, and we don’t know where we can get funds,” board member Abraham Green Jr. said. “You’ve got to do something. You’ve got to be able to keep functioning.”

In a related matter, the board authorized Walker to use about $40,000 of the authority’s reserve fund to buy three new subcompact, gas-efficient cars for the VHA’s three property managers to use during work hours.

The VHA’s fleet is comprised of a pickup, van and sedan, which the managers had shared with other staff. The three new cars will be used exclusively by the managers.

The reserve fund’s total is $1.735 million, enough to operate the VHA for about 11 months, Walker said.