HomeMy WebLinkAboutItem 1a: Approve Statement of Objectives for Use of Community Block Grant Funds & MOU with County CDC O,f ARC
Gs,11PORN,q.9,d
v~
ir
o Ji 11 t ::- t -yr
Y�torpr�ud
AoY�t,S.199)
.„,„,cY of ix. STAFF REPORT
Development Services Department
DATE: January 17, 2012
TO: Mayor and City Council
FROM: Jason Kruckeberg, Assistant City Manager/Development Services Director 7 -
By: Jim Kasama, Community Development Administrat9r
Prepared by: Amber Abeyta, Administrative Assistant
SUBJECT: STATEMENT OF OBJECTIVES AND PROJECTS FOR USE OF
COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDS FOR
FISCAL YEAR 2012-2013; AUTHORIZE THE CITY MANAGER TO
MODIFY THE PROJECT ALLOCATIONS SHOULD AMENDMENTS
BECOME NECESSARY, AND EXECUTE A MEMORANDUM OF
UNDERSTANDING WITH THE LOS ANGELES COUNTY COMMUNITY
DEVELOPMENT COMMISSION.
Recommended Action: Approve
SUMMARY
The Los Angeles County Community Development Commission (CDC) has advised that
the City of Arcadia will receive approximately $284,034 in Community Development
Block Grant (CDBG) funds for Fiscal Year (FY) 2012-13, which is a 20% reduction from
FY 11-12. Additionally, the administrative allocation of 10% of the total CDBG funding
is no longer an allowable cost. Proposed costs and project summaries must be
submitted to the County by February 1, 2012. Staff recommends that the City Council
approve the projects as set forth in this report for FY 2012-13.
The primary objective of the CDBG program is to provide assistance to low and
moderate-income families by enabling them to participate in various community
activities, and improve their property and environs. CDBG aims to also improve
accessibility for the disabled and eliminate blight or substandard conditions within the
City.
DISCUSSION
The City has been a participant in the Community Development Block Grant (CDBG)
program since 1974. CDBG funds come from the U.S. Department of Housing and
Urban Development (HUD) and are administered by the Los Angeles County
Community Development Commission (CDC) for many cities in the County, including
Arcadia. Use of funds is restricted in order to meet the objectives of assisting low and
moderate-income families and improving accessibility. Federal regulations allow a
maximum of 15% of a grantee's aggregate funds ($42,605 for FY 12-13) to be used for
Public Service programs and a minimum of 70% ($198,824) of the total funds must be
used for projects that support and benefit low and moderate-income families. In the
past, 10% of the total CDBG funds could be allocated for administrative cost; however
due to the significant reduction of FY 12-13 funding, the CDC determined that it can no
longer continue to allow that administrative allocation to the cities participating in the
Los Angeles Urban County CDBG program. However, the CDC will continue to allow
direct project administration costs to be allocated to each respective projects funding.
The substantial reduction of FY 12-13 CDBG funding is the result of a combination of
factors: new 2010 Census data; a new CDBG formula; and an increase in number of
grantees eligible for CDBG funding. The CDBG program uses two different formulas to
calculate allocation amounts for entitlement grantees: One formula measures
population, poverty, and overcrowded housing; the other formula measures poverty,
pre-1940 housing stock, and growth lag. HUD then computes the allocation amount of
every grantee using both formulas with grantees receiving their funding based on the
higher of the two formula amounts (after a pro-rata reduction to make the sum of all
allocations equal the appropriation level for the entire program). Lastly, the number of
entitlement grantees has increased by 17 for this funding period. Therefore, not only is
there less money for FY 12-13, it must be divided up among more grantees.
The following table is a summary of the funding for the current projects (FY 2011-12)
and for the projects recommended for next year (FY 2012-13):
Current Funding Recommendations
Projects FY 2011-2012 for FY 2012-2013
Housing Rehabilitation $181,562 (51.8%) $241,429 (85.0%)
Handicap Ramp/Sidewalk Imps. $90,000 (25.6%) $0 (0%)
Public Service Projects (max. 15%):
Congregate Meals $18,187 (5.2%) $18,187 (6.4%)
Sr. Citizen Social Services $21,597 (6.2%) $24,418 (8.6%)
Youth Program $12,776 (3.6%) $0 (0%)
Administration $26,280 (7.4%) $0 (0%)
Total $350,402 (100%) $284,034 (100%)
2012-13 CDBG Projects
January 17, 2012
Page 2 of 5
The following are descriptions of the projects:
Housing Rehabilitation
The current funding (FY 2011-12) for Housing Rehabilitation is $181,562 and the
recommended funding for FY 2012-13 is $241,429. Of these funds, 20% ($48,285 for
FY 12-13) is allowed to be used for administration of this project and will cover the
portion of staffs time that was previously charged under the 10% administration
allocation.
The Housing Rehabilitation program is the largest of the City's CDBG programs, and
has been an ongoing project for many years. The program provides a maximum grant
of $15,000 to benefit low/moderate-income homeowners by providing needed home
improvements and repairs such as painting, roofing, electrical upgrades, handicap
accessibility, removal of overgrown landscaping, energy-efficiency improvements, and
correction of code deficiencies.
It is anticipated that the City will assist a total of 13 homeowners during the current FY
(2011-12), 9 from the funding for FY 2011-12, and 4 from funds carried over from FY
2010-11.
At least 11 homeowners can be assisted with the recommended funding of $241,429 for
FY 2012-13.
Handicap Ramps/Sidewalk Improvements
Due to the relative economic health of this community, Arcadia does not have any
neighborhoods that meet the low and moderate-income standards to qualify for many
CDBG funded projects, such as street improvements. Disabled access improvements,
however; are eligible, such as the current Colorado Street Sidewalk Accessibility
project. Given the amount of project administration required to complete the extensive
reporting required by the CDC for these types of projects, and given the elimination of
the 10% general administrative allocation, staff does not find that a disabled access
improvement project would be cost efficient, and is not proposing a project for FY 12-13.
Congregate Meals for Senior Citizens— (Public Service Project)
The current FY funding is $18,187 (5.2%) and the recommended funding for FY 2012-
13 is the same.
This program is one of three (3) public service projects funded for the current FY (2011-
12) which cumulatively cannot exceed a total of 15% ($42,605). It is an ongoing
program that provides senior citizens with a nutrition program that features hot noon-
time meals, Monday through Friday at the Community Center. For the current fiscal
year, it is anticipated that almost 13,000 meals will be provided, and the goal is to
maintain this level of service for the next fiscal year.
2012-13 CDBG Projects
January 17, 2012
Page 3 of 5
Senior Citizen Social Services Information and Referrals — (Public Service Project)
The current funding (FY 2011-12) is $21,597 (6.2%) and the recommended funding for
FY 2012-13 is $24,418.
This program provides senior citizens with information that is essential for them to
maintain independent and healthy lifestyles. Services include assistance with
government benefits (e.g., Medicare/Medi-Cal and Social Security) housing assistance,
transportation, legal assistance, in-home services, health services, and educational
opportunities. For the current fiscal year, 391 senior citizens have been assisted as of
the end of December 2011, and the goal is to maintain a similar level of service for the
next fiscal year.
Youth Services Program — (Public Service Project)
The current FY 2011-12 funding is $12,776 (3.6%) and this program serves
approximately 55 children during the summer months for various recreation camps,
activities and programs. Given the significant reduction of FY 12-13 CDBG funding, staff
does not recommend funding this project for FY 12-13. These services are not viewed
as essential functions like some of the other services currently being provided with our
other CDBG Senior funding. In addition, similar programs are being offered to the
community by the Arcadia Coordinating Council. We hope that in the future funding will
become available to cover this potential loss of service, but the limit of 15% to Public
Service projects severely limits our funding opportunities. Unfortunately, this option is
not a simple one. There would be the potential loss of one part-time staff member that
oversees the disbursement of funds for these programs.
FISCAL IMPACT
The overall decrease in CDBG funding and the loss of Administration Funds could have
an impact on the General Fund. Approximately $25,151 projected as general
administration expenditures now must be either reallocated to other CDBG
administration accounts or the General Fund. This is comprised of portions of the
Community Development Administrator and Administrative Assistant positions within the
Development Services Department. It is reasonable that the Community Development
Administrator could be funded by the Home Improvement Program portion of CDBG
funds since this accounts for all this position's oversight within the program. It is
possible that the remaining $10,906 attributable to the Administrative Assistant position
could also be allotted to the Home Improvement Program or other programs, but staff is
still exploring this possibility. Thus a total of $10,906 could potentially need to be funded
through the General Fund. In addition, if the Council chose to fund the Youth Services
program through the General Fund, this would account for another $12,776 in the 2012-
2013 budget.
2012-13 CDBG Projects
January 17, 2012
Page 4 of 5