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HomeMy WebLinkAboutItem 11b - Community Development Block Grant Participation DATE: May 19, 2020 TO: Honorable Mayor and City Council FROM: Jason Kruckeberg, Assistant City Manager/Development Services Director By: Tim Schwehr, Senior Economic Development Analyst SUBJECT: RESOLUTION NO. 7307 APPROVING CONTINUED PARTICIPATION IN THE LOS ANGELES URBAN COUNTY COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM (“CDBG”) AND AUTHORIZING THE MAYOR TO SIGN A COOPERATION AGREEMENT WITH THE LOS ANGELES COUNTY DEVELOPMENT AUTHORITY (“LACDA”) Recommended Action: Approve SUMMARY The City currently has an active Participating City Cooperation Agreement signed with the Los Angeles County Community Development Commission (“LACDC”) to participate in the Los Angeles Urban County Community Development Block Grant (“CDBG”) Program. In 2019, following a merger with the LACDC with the Los Angeles County Housing Authority, a new joint agency called the Los Angeles County Development Authority (“LACDA”) was created. On April 17, 2020, the LACDA sent a letter to each participating city in the County CDBG program requesting approval of a City Council Resolution by no later than May 29, 2020 authorizing the Mayor to sign an updated Participating City Cooperation Agreement with the new LACDA entity for the period of July 1, 2021 through June 30, 2024. The updated Agreement approves the City’s continued participation in the Los Angeles Urban County CDBG Program beyond the 2020-21 Fiscal Year. It is recommended that the City Council adopt Resolution No. 7307 to approve the continuation of the City’s participation in the Los Angeles Urban County CDBG Program and authorize the Mayor to sign the new Cooperation Agreement with the Los Angeles County Development Authority (“LACDA”). CDBG Cooperation Agreement & FY20-21 Programs May 19, 2020 Page 2 BACKGROUND For over 30 years, the City of Arcadia has been a participant in the CDBG Program. CDBG funds are allocated by the U.S. Department of Housing and Urban Development (“HUD”) with Los Angeles County administering the Urban County CDBG Programs. The primary objective of the CDBG program is to provide assistance to low-and- moderate-income families with community development and housing assistance activities. Each year the City receives approximately $300,000 in CDBG funding. DISCUSSION By participating in the Urban County CDBG Program, the monthly and annual reporting of compliance with HUD regulations is handled by the LACDA. Given the relatively small amount of program funding received, it is considered more cost-effective to utilize the LACDA to serve in this function rather than hire additional city staff or use the City’s CDBG consultant for this purpose. The continued participation in the County Program will ensure a seamless provision of services. As such, continued participation in the Los Angeles Urban County CDBG Program through approval of an updated Cooperation Agreement with the LACDA is recommended. It should be noted that, in response to the COVID-19 pandemic, the CARES Act included changes to the HUD guidelines for how CDBG funds may be utilized. Changes included allowing CDBG funding to be utilized for small business assistance loans and grants. To date, the City of Arcadia has programmed $245,000 in CDBG funds ($180,000 in new CDBG-CV CARES Act funding and $65,000 in existing carryover CDBG funds) towards a new Small Business Grants Program. The CARES Act CDBG provisions also allow for amendments to the approved CDBG projects for the upcoming Fiscal Year 2020-21. As a reminder, at the February 4, 2020 regular meeting, the City Council approved $315,152 in CDBG projects for Fiscal Year 2020-21. A copy of the February 5, 2020 Staff Report is included as an Attachment to this report. A list of the approved programs and allocation amounts is provided below: Projects FY 2020-21 Home Improvement Program $235,836 Homeless Initiatives Program $20,000 Public Service Projects Congregate Meals for Seniors $38,768 Info. & Referral Services for Seniors $20,548 Totals $315,152 Under the CARES Act, revisions to upcoming CDBG projects and allocation amounts can be made with a 5-day public notification period and no City Council authorization resolution is required. At this point, no modifications are proposed to the programmed CDBG Cooperation Agreement & FY20-21 Programs May 19, 2020 Page 3 funds. It is anticipated that there may be more CBDG-CV CARES Act funding distributed to the City, but no additional funding has been received to date. FISCAL IMPACT As mentioned, the total amount of funding programmed for the 2020-21 Fiscal Year is $315,152. There is not a fiscal impact to the City to implement the CDBG programs as all funding comes from HUD. RECOMMENDED ACTION It is recommended that the City Council adopt Resolution No. 7307 approving continued participation in the Los Angeles Urban County Community Development Block Grant Program (“CDBG”) and authoring the Mayor to sign the new Cooperation Agreement with the Los Angeles County Development Authority (“LACDA”). Attachments: Resolution No. 7307 LACDA Cooperation Agreement February 5, 2020, Staff Report for CDBG Programs FY20-21 DATE: February 4, 2020 TO: Honorable Mayor and City Council FROM: Jason Kruckeberg, Assistant City Manager/Development Services Director By: Patricia Auriemmo, Senior Administrative Assistant SUBJECT: STATEMENT OF OBJECTIVES AND PROJECTS FOR USE OF COMMUNITY DEVELOPMENT BLOCK GRANT (“CDBG”) FUNDS FOR FISCAL YEAR 2020-21 Recommendation: Approve SUMMARY The overall goal of the Community Development Block Grant (“CDBG”) program is to provide assistance to low- and moderate-income families and individuals by enabling them to participate in various local community activities and to eliminate blighted or substandard housing conditions. The Los Angeles County Development Authority (“LACDA”) has advised that the City of Arcadia will receive an estimated amount of $296,580 in CDBG funds for Fiscal Year 2020-21. Following City Council approval, the proposed project summaries and budgets must be submitted to the LACDA. It is recommended that the City Council approve the projects set forth in this report for FY 2020-21, which include the Home Improvement Program, Congregate Meals for Seniors, the Information and Referral Services for older adults, and participation in the County’s Homeless Initiatives Program. A placeholder has also been added to potentially allocate funding as part of the San Gabriel Valley Regional Housing Trust, but this has not yet been authorized. BACKGROUND For over 40 years, the City has been a participant in the Los Angeles Urban County’s Community Development Block Grant Program. The CDBG funds come from the U.S. Department of Housing and Urban Development (“HUD”) and are administered by the Los Angeles County Development Authority (“LACDA”) for participating cities in the County, including Arcadia. Use of these funds is restricted in order to meet the objectives of assisting low- and moderate-income families, and improving disabled accessibility. Federal regulations allow for a 20% (increased from 15% for previous years) maximum of a grantee’s anticipated annual allocation ($59,316 for FY 2020-21) to be used for Public Service programs. The balance of the annual funds ($237,264) Community Development Block Grant (“CDBG”) Funds February 4, 2020 Page 2 of 5 must be directed towards projects that support and benefit low- and moderate-income families and individuals or the homeless. DISCUSSION The total estimated allocation for FY 2020-21 is $296,580. Additionally, there is an existing unspent balance of approximately $88,689 from previous fiscal years of which $18,572 is proposed to be utilized in FY 2020-21 for a total budget amount of $315,152. The use of these previously unallocated funds is to account for the increase in Public Service program funds, and to keep the remaining programs at their current, effective levels. It should be noted that the City has an existing project funded with unallocated funds to improve bus stops and transit infrastructure citywide. The following table is a summary of the funding for the current FY 2019-20 projects, and for the recommended projects and funding for FY 2020-21: Projects Current FY 2019-20 Recommended FY 2020-21 Home Improvement Program $235,836 $235,836 Homeless Initiatives Program $40,000 $20,000 Public Service Projects Congregate Meals for Seniors $28,604 $38,768 Info. & Referral Services for Seniors $19,566 $20,548 Totals $324,006 $315,152 The proposed FY 2020-21 CDBG budget will fund the following program activities: Home Improvement Program Since 1974, the Home Improvement Program (“HIP”) has been comparatively the largest of the City’s CDBG programs; having provided assistance to more than 500 low- and moderate-income homeowners. Currently, the HIP provides a maximum grant of $20,000 ($15,000 for condominiums) to benefit income-qualified homeowners by providing needed home improvements and repairs such as painting, roofing, specific modifications for property owners with special needs, and energy-efficiency improvements. The HIP has proven to be a positive and successful program in improving and maintaining aging building stock throughout the City. On average, approximately 12 income-qualified homeowners in Arcadia receive grants each year through this program. For the current fiscal year, the City is on pace to issue a total of 15 home improvement grants consisting of 12 grants of $15,000 to $20,000 for single-family homes and three grants of $10,000 to $15,000 for owner-occupied condominiums. The recommended level of funding for the Home Improvement Program for FY 2020-21 is $235,836. Of these funds, 20% ($47,167) is allowed to be used for administration of this program and will cover the cost of a consultant and staff time. It is Community Development Block Grant (“CDBG”) Funds February 4, 2020 Page 3 of 5 anticipated that this funding will allow the City to assist between 12 and 15 income- qualified homeowners during the next fiscal year. Los Angeles County Homeless Initiatives In Fiscal Year 2017-18, Los Angeles County offered participation in new programs designed to address the needs of the County’s homeless population. The use of CDBG funds by participating cities had previously been approved for two programs: Rapid Re-Housing Match and the Shelter Partnership. In Fiscal Year 2019-2020, a total of $40,000 was approved for these programs, divided evenly. The City was recently informed that the $20,000 programmed for the Rapid Re-Housing Match was not funded in Fiscal Year 2019-20, as this program no longer exists. Therefore, LACDA applied it to the Shelter Partnership funding, for a total grant of $40,000. The Shelter Partnership is an agency that provides goods to over 240 shelters throughout Los Angeles County. The funds from the local jurisdictions are provided to nearby facilities. (See attached letter describing services and previous funding.) Because there is only the one homeless initiative program now eligible to be funded through CDBG, it is recommended that $20,000 be allocated to the Shelter Partnership for Fiscal Year 2020-21. The City has recently received a grant for a local case worker to assist with homeless issues, and funding utilized through this channel will be more directly focused on local Arcadia needs. Congregate Meals for Senior Citizens – (Public Service Project) This Program is one of two public service projects funded for the current Fiscal Year, which cumulatively cannot exceed a total of 20% of the total annual CDBG allocation. This is an ongoing program that provides senior citizens with a nutrition program featuring mid-day hot meals, Monday through Friday, at the Community Center. It is anticipated that approximately 20,500 meals will be served during the next Fiscal Year. The recommended funding is $38,768, which is an increase of $10,164 from the current year, and includes the majority of the increased funding now permitted to be used for public service projects (increased from 15% to 20% for the 2020-21 Fiscal Year). The proposed funding level is approximately 13.1% of the total annual allocation for this important program. Approximately 20,500 Meals @ $4.25 each = $87,125/FY FY 2019-20 CDBG Funding $28,604 FY 2019-20 General Fund Appropriation $58,521 FY 2020-21 Proposed CDBG Funding $38,768 FY 2020-21 Proposed General Fund Appropriation $48,357 Community Development Block Grant (“CDBG”) Funds February 4, 2020 Page 4 of 5 The General Fund allocation will by mostly offset by revenues collected by participating seniors, who pay between $2 and $4 per meal, depending on their age. Information and Referral Services for Senior Citizens – (Public Service Project) The Information and Referral Services program provides senior citizens with information that is essential for maintaining 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. With a proposed budget of $20,548 the current level of service can be maintained, which will serve approximately 700 clients during FY 2020- 21. The proposed funding level is very similar to last year, and is 6.9% of the total annual allocation. Planning summaries and budgets are due to the LACDA by February 3, 2020. In order to meet this deadline, the summaries were originally scheduled for the January 21, 2020, City Council meeting, However, due to a noticing error, the item had to be re- scheduled to February 4. The City advised the LACDA of the delay in submitting the projects and supporting documents, and has been informed there are no issues with this and that the City will not receive a delinquency notice from CDBG due to this slight delay. Finally, although it is not shown in the table, the Development Services Department is working with the San Gabriel Valley Council of Governments (COG) in a new initiative called the San Gabriel Valley Regional Housing Trust Joint Powers Authority. An item to consider participation in this JPA is on the February 4, 2020, City Council Agenda. The JPA is designed to provide a coordinated regional entity dedicated to seeking funding and pursuing projects to locate and build housing in the San Gabriel Valley. Membership in this JPA is estimated to cost $15,000 annually. Currently, the COG is working with CDBG to determine whether participation in this regional effort could be funded with CDBG dollars. As these funds have not yet been authorized, they have not been included in the summary table above. However, should CDBG approve the uses of funds for this purpose, the Development Services Department would bring a modification of the summary table, and/or a request to use unallocated funds, back to the City Council for review. ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”), and it can be seen with certainty that it will have no impact on the environment. Thus, this matter is exempt under CEQA. Community Development Block Grant (“CDBG”) Funds February 4, 2020 Page 5 of 5 FISCAL IMPACT All CDBG funding comes from HUD. However, CDBG project appropriations are included in the operating budget, and are subject to City Council approval prior to the expenditures. As shown in the table above, with the increase in CDBG funding for Public Service Projects from 15% to 20%, the additional funding allows the service levels for Congregate Meals to increase by $10,164 thereby decreasing General Fund expenditures accordingly in Fiscal Year 2020-21. RECOMMENDATION It is recommended the City Council determines that this action does not constitute a project and is therefore exempt under the California Environmental Quality Act (“CEQA”); approve the Statement of Objectives and Projects for use of Community Development Block Grant (“CDBG”) Funds for Fiscal Year 2020-21; and authorize and direct the City Manager to modify the project allocations should amendments become necessary, and execute a Memorandum of Understanding with the Los Angeles County Development Authority (“LACDA”). Attachment: Letter from the Shelter Partnership on funding