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HomeMy WebLinkAboutItem 08b - Community Development Block Grant Funds STAFF REPORT DEVELOPMENT SERVICES DEPARTMENT DATE: December 16, 2025 TO: Honorable Mayor and City Council FROM: Jason Kruckeberg, Assistant City Manager/Development Services Director By: Jeramie Brogan, Senior Management Analyst SUBJECT: RESOLUTION NO. 7666 AUTHORIZING THE ALLOCATION OF COMMUNITY DEVELOPMENT BLOCK GRANT (“CDBG”) FUNDS FOR FISCAL YEAR 2026-27, AND APPROVING A STATEMENT OF OBJECTIVES AND PROJECTS FOR USE OF CDBG FUNDS CEQA: Not a Project Recommendation: Adopt and Approve SUMMARY Each year, the City is required to hold a public hearing and approve a Statement of Objectives and Projects for use of Community Development Block Grant (“CDBG”) funds for the next fiscal year. Following City Council approval, the project summaries and budgets are submitted to the Los Angeles County Development Authority (“LACDA”) for their final review and coordination with the U.S. Department of Housing and Urban Development (“HUD”), for disbursement of funds. For Fiscal Year 2026-27, LACDA has advised that the City will have an estimated allocation of $261,209 in CDBG funds available for use. It is recommended that the City Council adopt Resolution No. 7666, authorizing the allocation of CDBG funds for Fiscal Year 2026-27 and approving the projects set forth in this report for Fiscal Year 2026-27, which include continuation of the Home Improvement Program and Information and Referral Services for Senior Citizens. While the City’s Congregate Meals for Seniors Program will continue, it will no longer be funded by CDBG funds. Resolution No. 7666 - Community Development Block Grant ("CDBG") Funds December 16, 2025 Page 2 of 6 BACKGROUND Since 1974, the City has been a participant in the Los Angeles Urban County’s Community Development Block Grant Program. 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. The City’s use of these funds is restricted to meet the objectives of assisting Low and Moderate Income families and individuals or improving disability access. Federal regulations allow grantees to use up to 15% of their anticipated annual allocation for public service programs. The balance of the annual funds must be directed toward projects that directly support and benefit Low and Moderate Income families and individuals, or disabled community members. DISCUSSION For Fiscal Year 2026-27, the City will receive an estimated allocation of $261,209 in new CDBG funding. The following table is a summary of the projects and final funding amounts approved for Fiscal Year 2025-26, and the recommended projects and funding amounts for Fiscal Year 2026-27: PROPOSED ACTIVITIES FY 2025-26 BUDGET PROPOSED FY 2026-27 BUDGET Home Improvement Program $243,738 $222,028 Public Service Projects Congregate Meals for Seniors $23,000 $0 Information & Referral Services for Seniors $20,000 $39,181 Totals $286,738 $261,209 More details on each CDBG project activity proposed for Fiscal Year 2026-27 are provided below. Home Improvement Program Since 1974, the Home Improvement Program (“HIP”) has been the largest of the City’s CDBG programs, having assisted more than 500 Low and Moderate Income Resolution No. 7666 - Community Development Block Grant ("CDBG") Funds December 16, 2025 Page 3 of 6 homeowners in Arcadia. The current maximum grant amount is $25,000 for single- family homes and $20,000 for condominiums. Grants benefit income-qualified homeowners by providing needed home improvements and repairs, including painting, roofing, new windows, plumbing and HVAC improvements, energy- efficiency upgrades, and disabled accessibility modifications. The recommended level of funding for the Home Improvement Program for Fiscal Year 2026-27 is $222,028. Of these funds, 20% ($44,405) is allowed to be used for administration of this program and will cover the cost of a consultant. It is anticipated that the City will assist approximately 7 to 8 income-qualified homeowners during Fiscal Year 2026-27. To participate in the Home Improvement Program, a property owner is required to have owned and resided in their home for a minimum of five years prior to receiving a grant. The combined household income of all residents at the property may not exceed 80% of the Area Median Income for Los Angeles County, which is calculated as combined annual earned income and assets. The current program income limits for Fiscal Year 2025-26 are listed below (the limits for FY2026-27 have not been released yet). FY2025-26 HOME IMPROVEMENT PROGRAM INCOME LIMITS HOUSEHOLD SIZE MAXIMUM INCOME* 1 $84,850 2 $96,950 3 $109,050 4 $121,150 5 $130,850 6 $140,550 7 $150,250 8 $159,950 *80% Median Household Income for L.A. County As a condition of the program, homeowners authorize a Grant Memorandum of Agreement, which is recorded on their property deed and requires full reimbursement of the grant if the property is sold, or if the title is transferred within Resolution No. 7666 - Community Development Block Grant ("CDBG") Funds December 16, 2025 Page 4 of 6 five years of their HIP project’s completion. Additional information on program eligibility requirements and processes can be found in the HIP Guidelines and Procedures, included as Attachment “B” to this report. Information and Referral Services for Senior Citizens (Public Service Project) The Information and Referral Services program provides seniors with information that is essential for maintaining independent and healthy lifestyles. Offerings include essential services and referrals such as Medicare/Medi-Cal assistance, legal assistance, health services, transportation, social security, housing assistance, and taxes. With a proposed budget of $39,181, the program is expected to serve approximately 800 clients during Fiscal Year 2026-27. Program offerings will also expand in Fiscal Year 2026-27 as a result of reprogramming the Congregate Meals for Seniors funding to the Information and Referral Services program. Additional details on the Information and Referral Services Program can be found in Attachment “C”. Other Considerations Due to new federal requirements under Executive Order 14218 (Information on the Executive Order can be found in Attachment “D”), the City will no longer use CDBG funds to implement the Congregate Meals for Seniors Program. The Executive Order mandates that any CDBG-funded program providing direct benefits to individuals or households, including housing rehabilitation, public services, and job-creation activities, must verify the Citizenship/Legal Status of all participants, except when services are delivered by eligible nonprofit subrecipients. Given the structure of the Congregate Meals Program and the complexity this verification process would impose on participants, it is no longer advisable to partially fund the program using CDBG funds. This important program will continue to be offered using different funding sources. The City will comply with the Executive Order for the Home Improvement Program and the Referral programs, since these programs require extensive documentation and record-keeping already. In addition to the new Fiscal Year 2026-27 CDBG funding, the City of Arcadia has a total balance of $322,585 in unallocated, carry-over CDBG funds for Fiscal Year 2025- 26, which is available to be allocated to an Americans with Disabilities Act (“ADA”) Resolution No. 7666 - Community Development Block Grant ("CDBG") Funds December 16, 2025 Page 5 of 6 curb ramp project, or another eligible project. Any future projects involving unallocated funds will be brought forward as a separate City Council action. This item was noticed to the public on November 25, 2025, and no public comments have been received. ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”), under Section 15061(b)(3), as it can be seen with certainty that it will have no impact on the environment. FISCAL IMPACT A total of $261,209 is proposed to be expended during Fiscal Year 2026-27. All CDBG funding comes from HUD; however, CDBG project appropriations are included in the City’s operating budget and are subject to City Council approval. Failure to program and expend the allocated funds will result in the funds being “taken back” by the County and reallocated. Due to the complexity of new federal requirements related to the verification of program participants’ citizenship/legal status, CDBG funds will no longer be used to support the Congregate Meals for Seniors program. To continue program operations at the existing service level, it is recommended that General Funds be used in lieu of CDBG funds. The proposed Congregate Meals for Seniors Program budget will be included for consideration as part of the City’s Fiscal Year 2026-27 operating budget. RECOMMENDATION It is recommended the City Council determine that this action does not constitute a project under the California Environmental Quality Act (“CEQA”); adopt Resolution No. 7666 authorizing the allocation of Community Development Block Grant (“CDBG”) funds for Fiscal Year 2026-27, and approving a Statement of Objectives and Projects for use of CDBG funds; 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”). Resolution No. 7666 - Community Development Block Grant ("CDBG") Funds December 16, 2025 Page 6 of 6 Attachment “A”: Resolution No. 7666 Attachment “B”: HIP Guidelines & Procedures for Fiscal Year 2025-26 Attachment “C”: Information and Referral Services for Seniors Program Summary Attachment “D”: CDD Bulletin No. 25-0020 Citizenship/Immigration Status Declaration 1 RESOLUTION NO. 7666 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, AUTHORIZING THE ALLOCATION OF COMMUNITY DEVELOPMENT BLOCK GRANT ("CDBG") FUNDS FOR FISCAL YEAR 2026- 2027 WHEREAS, the Community Development Block Grant ("CDBG") Program has operated since 1974 to provide local governments the resources to meet the needs of persons of low-and moderate-income; and WHEREAS, the City of Arcadia contracts with the Los Angeles County Development Authority ("LACDA") for the disbursement of Community Development Block Grant Funds, through the Small Cities Program; and WHEREAS, the City of will receive an estimated total of $261,209 in Fiscal Year 2026-2027 in Community Development Block Grant Funds; and WHEREAS, the City Council has conducted a public hearing, with the required prior noticing to provide the public and opportunity to comment on the programs. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA, CALIFORNIA, DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS: SECTION 1. The City Council approves the Community Development Block Grant ("CDBG") Program Budget for Fiscal Year 2026-2027 and instructs staff to submit the necessary document and a copy of this Declaration to the Los Angeles County Development Authority ("LACDA"). Attachment "A" 2 SECTION 2. The City Council authorizes the City Manager to adjust the Program budget as necessary throughout the Fiscal Year. This includes, but is not limited to, allocating amounts on a per project basis, adjusting project budgets, implementing new or cancelling existing activities, to allow for the timely expenditure of CDBG- funds. SECTION 3. The City Clerk shall certify to the adoption of this Resolution. Passed, approved and adopted this 16th day of December, 2025. _____________________________ Mayor of the City of Arcadia ATTEST: City Clerk APPROVED AS TO FORM: Michael J. Maurer City Attorney City of Arcadia HOME IMPROVEMENT PROGRAM Guidelines and Procedures FISCAL YEAR 2025-26 EFFECTIVE 07/01/2025 City of Arcadia Development Services Department 240 West Huntington Drive Arcadia, CA 91007 (626)294-4844 www.ArcadiaCA.gov Attachment "B" FY25-26 HIP Guidelines Page 2 Home Improvement Program Guidelines I. OBJECTIVE The purpose of Arcadia’s Home Improvement Program (HIP) is to assist low to moderate income homeowners with home improvements to their primary residence. The homes must be located within residential zones and owner-occupied. An income eligibility table is included as Attachment A. II. TYPE OF ASSISTANCE The City of Arcadia operates a Home Improvement Program (HIP) utilizing Community Development Block Grant Funds (CDBG) though the Los Angeles County Community Development Authority (LACDA) to provide eligible households with grants. The Program provides maximum grants of $25,000 per single family home and $20,000 per condominium or townhouse. This amount may be increased on a case-by-case basis, subject to approval by the City Manager and/or their designee. III. ELIGIBILITY CRITERIA A. Homeowner Eligibility Requirements 1. Household Income Adjusted Gross annual household income may not exceed 80% of the Los Angeles County Median income adjusted for family size as provided by the U.S. Department of Housing and Urban Development (HUD). The City will require documentation of both household size and household income information to determine application eligibility. 2. Definition of Household: For households applying for the City of Arcadia’s Home Improvement Program, all persons on title are considered household members and all persons in residence are considered household members for the purpose of determining income eligibility. 3. Definition of Annual Household Income: For the purpose of determining Program eligibility, annual income includes but is not limited to (see table below): FY25-26 HIP Guidelines Page 3 1. Income from wages, salaries, tips etc. The full amount, before any payroll deductions, of wages and salaries, overtime pay, commissions, fees, tips and bonuses, and other compensation for personal services. 2. Business Income The net income from the operation of a business or profession. Expenditures for business expansion or amortization of capital indebtedness shall not be used as deductions in determining net income. An allowance for depreciation of assets used in a business or profession may be deducted, based on straight-line depreciation, as provided in Internal Revenue Service regulations. Any withdrawal of cash or assets from the operation of a business or profession will be included in income, except to the extent the w ithdrawal is reimbursement of cash or assets invested in the operation by the family. 3. Interest & Dividend Income Interest, dividends, and other net income of any kind from real or personal property. Expenditures for amortization of capital indebtedness shall not be used as deductions in determining net income. An allowance for depreciation is permitted only as authorized in number 2 (above). Any withdrawal of cash or assets from an investment will be included in income, except to the extent the withdrawal is reimbursement of cash or assets invested by the family. Where the family has net family assets in excess of $5,000, annual income shall include the greater of the actual income derived from all net family assets or a percentage of the value of such assets based on the current passbook savings rate, as determined by HUD. 4. Retirement & Insurance Income The full amount of periodic amounts received from Social Security, annuities, insurance policies, retirement funds, pensions, disability or death benefits, and other similar types of periodic receipts, including a lump-sum amount or prospective monthly amounts for the delayed start of a periodic payment (except for certain exclusions, listed in Income Exclusions, number 14). 5. Unemployment & Disability Income Payments in lieu of earnings, such as unemployment and disability compensation, worker's compensation and severance pay (except for certain exclusions, listed in Income Exclusions, number 3). 6. Welfare Assistance Welfare Assistance. Welfare assistance payments made under the Temporary Assistance for Needy Families (TANF) program are included in annual income: • Qualify as assistance under the TANF program definition at 45 CFR 260.31; and • Are otherwise excluded from the calculation of annual income per 24 CFR 5.609(c). If the welfare assistance payment includes an amount specifically designated for shelter and utilities that is subject to adjustment by the welfare assistance agency in accordance with the actual cost of shelter and utilities, the amount of welfare assistance income to be included as income shall consist of: • the amount of the allowance or grant exclusive of the amount specifically designated for shelter or utilities; plus: the maximum amount that the welfare assistance agency could in fact allow the family for shelter and utilities. If the family welfare assistance is reduced from the standard of need by applying a percentage, the amount calculated under 24 CFR 5.609 shall be the amount resulting from one application of the percentage. 7. Alimony, Child Support, & Gift Income Periodic and determinable allowances, such as alimony and child support payments, and regular contributions or gifts received from organizations or from persons not residing in the dwelling. 8. Armed Forces Income All regular pay, special pay, and allowances of a member of the Armed Forces (except as provided in number 8 of Income Exclusions). FY25-26 HIP Guidelines Page 4 4. Annual Income does not include: 1. Income of Children Income from employment of children (including foster children) under the age of 18 years. 2. Foster Care Payments Payments received for the care of foster children or foster adults (usually persons with disabilities, unrelated to the tenant family, who are unable to live alone. 3. Inheritance and Insurance Income Lump-sum additions to family assets, such as inheritances, insurance payments (including payments under health and accident insurance and worker’s compensation), capital gains, and settlement for personal or property losses (except for certain exclusions, listed in Income Inclusions, number 5). 4. Medical Expense Reimbursements Amounts received by the family that are specifically for, or in reimbursement of, the cost of medical expenses for any family member. 5. Income of Live-in Aides Income of a live-in aide (as defined in 24 CFR5.403). 6. Income from a Disabled Member Certain increase in income of a disabled member of qualified families residing in HOME-assisted housing or receiving HOME tenant-based rental assistance (24 CFR 5.671 (a)). 7. Student Financial Aid The full amount of student financial assistance paid directly to the student or to the educational institution. 8. “Hostile Fire” Pay The special pay to a family member serving in the Armed Forces who is exposed to hostile fire. 9. Self-Sufficiency Program Income a. Amounts received under training programs funded by HUD. b. Amounts received by a person with a disability that are disregarded for a limited time for purposes of Supplemental Security Income eligibility and benefits because they are set side for use under a Plan to Attain Self-Sufficiency (PASS). c. Amounts received by a participant in other publicly assisted programs that are specifically for, or in reimbursement of, out-of- pocket expenses incurred (special equipment, clothing, transportation, childcare, etc.) and which are made solely to allow participation in a specific program. d. Amounts received under a resident service stipend. A resident service stipend is a modest amount (not to exceed $200 per month) received by a resident for performing a service for the PHA or owner, on a part-time basis, that enhances the quality of life in the development. Such services may include, but are not limited to, fire patrol, hall monitoring, lawn maintenance, resident initiatives coordination, and serving as a member of the PHA’s governing board. No resident may receive more than one such stipend during the same period of time. e. Incremental earnings and benefits resulting to any family member from participation in qualifying state or local employment training programs (including training not affiliated with a local government) and training of a family member as resident management staff. Amounts excluded by this provision must be received under employment training programs with clearly defined goals and objectives, and are excluded only for the period during which the family member participates in the employment-training program. 10. Gifts Temporary, nonrecurring, or sporadic income (including gifts). 11. Reparation Payments Reparation payments paid by a foreign government pursuant to claims filed under the laws of that government by persons who were persecuted during the Nazi era. FY25-26 HIP Guidelines Page 5 12. Income from Full- time Students Earnings in excess of $480 for each full-time student 18 years old or older (excluding the head of household or spouse). 13. Adoption Assistance Payments Adoption assistance payments in excess of $480 per adopted child. 14. Social Security & SSI Income Deferred periodic amounts from supplemental security income and social security benefits that are received in a lump sum amount or in prospective monthly amounts. 15. Property Tax Refunds Amounts received by the family in the form of refunds or rebates under state or local law for property taxes paid on the dwelling unit. 16. Home Care Assistance Amounts paid by a state agency to a family with a member who has developmental disability and is living at home to offset the cost of services and equipment needed to keep this developmentally disabled family member at home. 17. Other Federal Exclusions Amounts specifically excluded by any other Federal statute from consideration as income for purposes of determining eligibility or benefits under a category of assistance programs that include assistance under any program to which the exclusions set forth in 24 CFR 5.609(c) apply. A notice will be published in the Federal Register and distributed to housing owners identifying the benefits that qualify for this exclusion. Updates will be published and distributed when necessary. The following is a list of income sources that qualify for that exclusion: ➢ The first $2,000 of per capita shares received from judgment funds awarded by the Indian Claims Commission or the U.S. Claims Court and the interests of individual Indians in trust or restricted lands, including the first $2,000 per year of income received by individual Indians from funds derived from interests held in such trust or restricted lands; ➢ Amounts of scholarships funded under Title IV of the Higher Education Act of 1965, including awards under the Federal work-study program or under the Bureau of Indian Affairs student assistance programs; ➢ Payments received from programs funded under Title V of the Older Americans Act of 1985 (Green Thumb, Senior Aides, Older American Community Service Employment Program); ➢ Payments received on or after January 1, 1989, from the Agent Orange Settlement Fund or any other fund established pursuant to the settlement in the In Re Agent Orange product liability litigation, M.D.L. No. 381 (E.D.N.Y.); ➢ Earned income tax credit refund payments received on or after January 1, 1991, including advanced earned income credit payments; ➢ The value of any child care provided or arranged (or any amount received as payment for such care or reimbursement for costs incurred for such care) under the Child Care and Development Block Grant Act of 1990; ➢ Payments received under programs funded in whole or in part under the Job Training Partnership Act (employment and training programs for Native Americans and migrant and seasonal farm workers, Job Corps, veterans employment programs, state job training programs and career intern programs, AmeriCorps). ➢ Payments by the Indians Claims Commission to the Confederated Tribes and Bands of Yakima Indian Nation or the Apache Tribe of Mescalero Reservation; ➢ Allowances, earnings, and payments to AmeriCorps participants under the National and Community Services Act of 1990; ➢ Any allowance paid under the provisions of 38 U.S.C. 1805 to a child suffering from spina bifida who is the child of a Vietnam veteran; ➢ Any amount of crime victim compensation (under the Victims of Crime Act) received through crime victim assistance (or payment or reimbursement of the cost of such assistance) as determined under FY25-26 HIP Guidelines Page 6 B. Property Eligibility Requirements Following determination of homeowner eligibility, the owner must demonstrate property eligibility. To be eligible to receive Program assistance, real property will be evaluated and must meet each of the requirements set forth below: 1. Location and Type of Property The property must be a single-family home, condominium, or townhouse to be eligible for the Program. The Property must be owner-occupied and located within the city boundaries of Arcadia. Participating properties must be the primary residence of the participating property owner. Owners of condominiums and townhomes will need to provide pre - approval from their HOA of the approved improvements before work begins. (Repairs are limited to the interior of each qualified unit. No common areas or exterior repairs are eligible under the Home Improvement Program). 2. Condition The single family units must be in need of exterior repairs to (i) correct existing nonconforming development standards, (ii) correct existing nonconforming local and/or state code requirements, (iii) correct existing local and/or state code violations, (iv) protect the structural integrity of the property, (v) refurbish exterior and/or eligible interior improvements (necessary for health and safety), or (vi) aid the mobility of the physically disabled and/or elderly. All eligible improvements must be pre-approved by the City of Arcadia. Submission of receipts, invoices and/or bills for work completed prior to City approval/ inspection will be considered ineligible for reimbursement. 3. Ownership and Owner-Occupancy Requirements The income eligible homeowner(s) must hold record fee simple title to the property and must occupy the property as a primary residence. The city will not approve homeowners listing their home for sale. 4. Residency Requirement the Victims of Crime Act because of the commission of a crime against the applicant under the Victims of Crime Act; and ➢ Allowances, earnings, and payments to individuals participating in programs under the Workforce Investment Act of 1998. FY25-26 HIP Guidelines Page 7 Property owners applying for the Home Improvement Program are required to have owned and occupied the residence for a minimum of five (5) years prior to applying for the Home Improvement Program. 5. Mortgage Status Homeowner(s) cannot be delinquent on their mortgage or in foreclosure as it pertains to the primary residence. Documentation listed in Section IV.8 must be submitted for determining eligibility. 6. Previous Program Participation Property owners can only participate in this program once every five years and receive a maximum of two grants. First-time participants are given priority over previous participants. Exceptions to these participation limitations may be considered for properties with emergency building and safety issues and/or code compliance violations on a case-by-case basis, but only to fund improvements that address the specific outstanding issue or violation IV. APPLICATION PROCEDURES Application materials for participation in the HIP program can be obtained from and returned to the Development Services Department at City Hall, located at 240 West Huntington Dr., Arcadia, CA 91007 or on the City’s website. The application must be completed in its entirety and submitted to the location indicated in the guidelines. When funding becomes available, staff will contact homeowners who have submitted an HIP application and schedule interviews to determine program qualification. At the interview appointment, the following documentation must be provided for consideration: 1. Verification of personal income and assets which will include, but is not limited to the applicant’s two most recent pay stubs, award letters from social security/pension and recent federal income tax returns (if self-employed, up to 2 years of returns and profit and loss statements for the past 2 years) 2. Proof of ownership (Grant Deed, Trust and/or current Property Tax Bill) 3. Proof of residency (utility bills, car registration) 4. Bank/Financial statements for the past 3 months 5. Proof of current property insurance 6. Copy of current mortgage statement for subject property 7. Sign notification/acknowledgement of Lead Based Paint and Asbestos FY25-26 HIP Guidelines Page 8 8. Completed Real Estate Form indicating no additional investment properties 9. Approve Program Guidelines Application approval is subject to funding availability, income eligibility and past participation in the Program. V. SELECTION OF HOMEOWNER(S)/SCREENING PROCESS A. Applications will only be accepted from low to moderate income property owners located within the City of Arcadia. Properties located within the unincorporated Los Angeles County area are ineligible for this program. Those out of the city limits will be referred to the Los Angeles County’s Program. B. Eligible participants will be selected on a first-come, first-served basis, and the availability of CDBG funds. C. Pre-qualification - Each application filed with the City shall be date stamped and will be processed in the order received. Staff will review applications for completeness and will verify property and income eligibility. Incomplete applications will not be processed until all requested information is submitted by a specified time. Staff will notify in writing all ineligible households. The City requires all households participating in the Home Improvement Program to meet specific income limits as determined by Housing Urban Development (HUD), based upon household size. For reference, HUD published income limits, according to household size, for Los Angeles County is attached (Attachment A). D. Annual income is the gross amount of income that is anticipated to be received by all members of the household during the twelve months following the effective date of determination, as well as reviewing the income from the preceding year. E. An applicant is considered ineligible, if: 1. The property is not located within the city boundaries and in the designated residential zones. 2. The property is found to be non-conforming. 3. The household income exceeds the income limit established by HUD. 4. The property is not the owner’s primary residence. (Rental properties are ineligible). 5. The information on the application is found to be inaccurate or insufficient to determine the household income for program eligibility. FY25-26 HIP Guidelines Page 9 VI. METHOD OF CALCULATING ASSISTANCE The amount of HIP Program funds provided to an eligible project shall be established through the property inspection work write-up, cost estimate, and bidding results as described below and shall not exceed $25,000 per participating household/property for single-family dwellings, and $20,000 for townhomes and condos. This amount may be increased on a case-by-case basis, subject to approval by the City Manager and/or their designee. A. Property Inspection Procedures The City will conduct the initial, interim, and final property inspection for code compliance, with the homeowner(s), or the owner's representative. The inspection will include: 1. Interview with the homeowner(s), or owner's representative to identify specific housing issues. 2. Walk through of property with a checklist, accomplished by the property owner(s) identifying recommended and necessary improvements. 3. A summary list of repairs complied and approved by City staff with recommendations from the homeowner(s). B. Preparation of Work Write-up and Cost Estimate 1. The City will be responsible to inspect property to identify violations of health, safety, and building codes. 2. The City will prepare a detailed work write-up (specifications) that addresses all violations of health, safety, and building codes, and provides (for properties constructed before 1978) for testing and abatement/removal of lead-based paint, limited asbestos testing (if applicable) and identifies any other rehabilitation efforts to be conducted. 3. The City will file the completed deficiency list, work write-up and cost estimate that notes dates of inspection, (and if needed) persons in attendance at walk through and any special circumstances. 4. The City will obtain architectural design approval from Planning Services for all exterior rehabilitation work prior to the contractor selection process. 5. If the property is not suitable for rehabilitation and/or if the homeowner discontinues the process, a termination/denial letter will be mailed to the homeowner. FY25-26 HIP Guidelines Page 10 C. Contractor Selection Procedures 1. Upon approval by the City, the homeowner is highly encouraged to obtain at least three (3) bids, but no fewer than two (2) bids, from qualified, licensed contractors who are not listed on the HUD debarment list and who are in good standing with the California State Contractors Licensing Board. 2. The homeowner’s selected bid from a qualified contractor will be examined by the City and must be the lowest responsible bidder to be awarded the contract. 3. Contractors are responsible for obtaining and/or verifying architectural design approval from Planning Services for all exterior rehabilitation work (paint color, window material, mechanical equipment enclosures, etc.). 4. The lowest responsible contractor must have a valid city business license, current Unique Entity Identifier (UEI) from SAM.gov, valid general liability insurance, workmen’s compensation insurance (if applicable), and a current State of California contractor’s license prior to receiving award of the contract. The Contractor will be responsible for obtaining the necessary building permit(s) and ensuring that permit(s) is/are finalized. VII. CALCULATION OF SUBSIDY/COST REASONABLE REVIEW The City will determine reasonable rehabilitation cost for work to be performed based upon the scope of work. This cost shall be established by utilizing market data and published construction cost guidelines. The city will review bids to determine cost reasonableness and will ensure compliance with the Scope of Work. VIII. ELIGIBLE COSTS A. Eligible Hard Costs - Program funds are available for rehabilitation costs to properties that either correct substandard conditions, correct violations of local housing codes or address health and safety issues and are physically attached to the property and permanent in nature. General repairs not corrective in nature shall be given lower priority. Eligible repairs include, but are not limited to the following: 1. Repairs that remedy existing nonconforming uses such as garage conversions, additions, etc. 2. Exterior work to help preserve or protect structures such as painting, roofing, repair/replacement of screens/windows, doors, and door locks, structural and/or foundation damage, repair of sidewalks and driveways, fencing. FY25-26 HIP Guidelines Page 11 3. Interior work to make a structure more livable and repair/replace/ restore important parts such as cabinets, counters, plumbing, damaged flooring, faulty or inadequate heating, damaged ceilings, water heaters, electrical wiring and service, painting. 4. Fumigation and treatment of termites and pest control. 5. Testing/abatement of lead-based paint and asbestos hazards. 6. Weatherization and energy conservation items such as insulation, caulking, weather stripping and new energy efficient windows and HVAC system. 7. Modifications which aid the mobility of the elderly and physically disabled such as shower units with seats, lever hardware, retrofitting toilets to achieve adequate height, moving power points and light switches, ramping reconstructing doorways, lowering sinks in kitchens and bathroom. 8. Energy audits, if applicable. 9. Approved emergency repairs, such as plumbing, roofing and electrical. 10. Lead-based painting testing and clearance inspections 11. Asbestos testing and clearance inspections. IX. INELIGIBLE COSTS 1. Repair, purchase, or installation of appliances/or structures that are designed and manufactured to be freestanding and window air conditioning units. 2. Recreational items such as barbecues, hot tubs/jacuzzi, swimming pools, saunas, tennis courts. 3. Non-essential items such as security alarms and protection bars, decorative items, window coverings, awnings, patios, decks, and storage sheds/workshops, driveways, and landscaping. Repairs to garage structures only are not allowed (must be linked with repairs to the home). 4. Other proposed improvements as determined ineligible by the City of Arcadia and/or the LACDA. 5. Regarding condos and townhomes, common areas such as windows, walkways, certain electrical and plumbing repairs, exterior painting, HVAC units and insulation. FY25-26 HIP Guidelines Page 12 X. GRANT DOCUMENT PREPARATION A. Once the bid is awarded and the grant amount has been approved, the participating Homeowner will be required to sign a Grant Memorandum Agreement (Attachment B). The Development Services Director, or designee, will then approve and sign the Agreement. B. The original signed document will then be forwarded to the Los Angeles County’s Recorder’s Office for recording. XI. CONSTRUCTION PROCESS A. Upon contractor selection and full execution of the Grant Agreement by the affected homeowner(s) (which shall list work as described in the bid specifications), homeowner(s) must sign the Construction Contract. Once signed by the homeowner(s) and the awarded contractor, a Notice to Proceed will be issued by the City. At that time, the Contractor will carry out the required work under the supervision of staff. Work shall commence no later than thirty (30) days from the date the last agreement is executed by the affected homeowner(s) and be completed no more than ninety (90) days after the start date. B. A building permit will be required for all projects that require a permit. A “Final Inspection” will be required for these projects, prior to any payments being made. C. All awarded Contractors working with the Home Improvement Program will be required to meet the requirements listed in this guideline (Section VI, Part C). D. Rehabilitation projects will be closed subsequent to the Arcadia Building Division staff approval of the rehab work performed, and data entered the LACDA rehab panel. XII. CONSTRUCTION/PROJECT MANAGEMENT A. The City will be responsible for conducting initial, interim, and final inspections for participating properties. These inspections shall be performed to ensure code compliance, adherence to work write-ups, and progress inspections. The City will also assume responsibility for determining cost reasonableness based upon market data and published construction cost guidelines. FY25-26 HIP Guidelines Page 13 B. The City must determine initial areas where health, safety, building, city, and other codes must be addressed and will monitor progress in correcting these deficiencies. C. The City must identify all rehabilitation activities to be conducted and shall create a work-write up which addresses all code requirements and rehabilitation activities, lead-based paint testing and removal/abatement, if necessary, while excluding all ineligible activities. D. The City will conduct all progress inspections to ensure the continued quality of all construction, including adherence to the scope of work and all building codes. E. During the approval and construction management process, staff will input all required documentation regarding household income and property description onto Los Angeles County Development Authority’s (LACDA) website – rehabilitation panel. XIII. CONSTRUCTION PAYMENTS Upon the completion of the rehabilitation project, the following documents must be submitted to the Development Services Department for the processing of payments: • A Contractor Payment Request form must be completed and signed by the contractor as well as the homeowner. The Contractor must provide his/her City of Arcadia business license information and the Tax ID number to process the requested payment. • The “Waiver and Release” form must be completed and signed by the Contractor. • An original invoice must be submitted by the Contractor. • If applicable, a copy of the permit finalized by the City’s Building Division must be submitted by the contractor or homeowner(s). Any costs for improvements that exceed the maximum amount of grant funds awarded shall be borne by the applicant (homeowner). This amount will be provided as a cashier’s check to the City and will be held for payment to the contractor when all work is satisfactorily completed. Upon processing the final payment, payment and final inspection information will be entered into the County’s rehab panel for final submission. XIV. GRANT PROVISION AND MONITORING COMPLIANCE Home Improvement Program participants must sign an agreement indicating that they will remain in the home a minimum of five (5) years following completion of the grant- funded improvements. If the home is sold or the title is transferred within five (5) years, the property owner is required to reimburse the City for the entire grant amount. FY25-26 HIP Guidelines Page 14 EXCEPTION: If the home is sold or the title is transferred due to a legitimate hardship as determined by the Development Services Director, or designee, the grant recipient may be exempt from part or the total reimbursement amount. For the purposes of this program, “sale or transfer of title” shall mean any sale or transfer that will cause the assisted property to be reassessed by the Los Angeles County Assessor’s Office pursuant to Article XIII A of the California Constitution (commonly referred to as Proposition 13). To verify compliance, staff may also conduct site visits or consult Los Angeles County records for homeowners who has participated within the past five years to confirm continued occupancy of the property as their primary residence. XV. EQUAL OPPORTUNITY Program participants will be selected on a first-come, first-served basis and based upon previous participation. No person shall be excluded from participation in, be denied the benefits of or be subjected to discrimination under any program or activity funded in whole or in part with Home Improvement funds. In addition, Home Improvement funds must be made available in accordance with all federal laws and regulations. XVI. AFFIRMATIVE MARKETING PROCEDURES Program information is available to the Arcadia community through various sources. The application and brochure explaining the Program are available at the Development Services Department, City of Arcadia, and 240 West Huntington Drive, Arcadia, California, 91007. The Home Improvement Program is advertised periodically in the City’s e-newsletter and/or Arcadia Hot Sheet publication. Additionally, the program is published on the City’s website and can be viewed periodically on the local cable station to reach the City’s diverse population. XVII. FAIR HOUSING This policy will be implemented consistent with the City’s commitment to fair housing practices. No person shall be excluded from participation in, denied the benefit of, or be subject to discrimination on the basis of his or her religion or religious affi liation, age, race, ancestry, national origin, gender, marital status, familial status (children), physical or mental disability, sexual orientation, or any other arbitrary causes. XVIII. LEAD-BASED PAINT AND ASBESTOS Properties constructed prior to 1978 will require that a Lead Based Paint Notice be given to all property owners. As required by the County, all participating homeowners are provided a copy of the brochure entitled, “The Lead-Safe Certified Guide to Renovate FY25-26 HIP Guidelines Page 15 Right” and sign a notice indicating receipt of this brochure issued by the EPA. The City of Arcadia is required to follow the federal LBP hazard regulations when implementing the home improvement program. When a grant application is approved, the city will provide the homeowner with information about potential lead hazards and the abatement and safety requirements of participating in the program. As part of the grant program, the city will test Home Improvement assisted units constructed before 1978 for the presence of lead-based paint utilizing a licensed third-party vendor. Any lead-based found as a result of these tests shall be removed and/or abated as a priority item for rehabilitation. In accordance with CDC requirements, all participating homeowners are provided a copy of the brochure entitled, “A Consumer Guide to Asbestos” and sign a notice indicating receipt of this brochure. Depending on the type of repairs, the property may require asbestos testing. The testing must be completed by a qualified third-party vendor and if necessary, the asbestos shall be removed and/or abated during the rehabilitation work. XIX. DEBARMENT AND SUSPENSION As required, the city and participating homeowner(s) will comply with all contractor debarment and suspension certifications. XX. REPORTING In accordance with federal requirements, Quarterly Performance Reports must be submitted to the Los Angeles County Development Authority (LACDA). The report is to identify the number of applicants, number of projects in progress, total number of projects completed, income range of clients, ethnicity, sex, and any disability of the head of household. In accordance with federal requirements, the annual Contract/Subcontract Activity Report must be submitted to the Los Angeles County Development Authority (LACDA). HUD requires all contracts and subcontracts of $10,000 or more executed during the specific period must be reported. XXI. CONFLICT OF INTEREST No member of the governing body of the City and or other official, employee or agent of the City government who exercises policy or decision-making authority in connection with the planning or implementation of the Home Improvement Program shall directly or indirectly be eligible for this Program. XXII. PHOTO PERMISSION USAGE All participating property owners must allow the City of Arcadia to photograph before and after pictures of the interior and exterior of the house, garage and other structures FY25-26 HIP Guidelines Page 16 present at the subject property. The participating property owners understand that these photographs will be used to document the conditions and justify the assistance under the Home Improvement Program. The participating property owners also agree for t he City of Arcadia to place these photographs in local newspaper articles and/or the City’s newsletters as a method to promote and advertise the Home Improvement Program at any time. All participating property owners will be required to complete and sign a Photography Permission Form (Attachment C) agreeing to the requirements stated in Section XXII of these guidelines. A signed form must be present in the project file prior to approval of the application and before any photos are taken and/or published by the City of Arcadia. XXIII. AMENDMENTS Amendments to these Guidelines may be made by the City whenever appropriate to improve the program effectiveness and to resolve program issues. As part of the amended adoption process, the City will review updated federal regulations issued by LACDA in their bulletins to participating cities, to ensure continued compliance with CDBG regulations. FY25-26 HIP Guidelines Page 17 ATTACHMENT A CITY OF ARCADIA HOME IMPROVEMENT PROGRAM LACDA PUBLISHED INCOME LIMITS (Effective May 2025) Number of Persons in Household Annual Income Limit 1 $84,850 2 $96,950 3 $109,050 4 $121,150 5 $130,850 6 $140,550 7 $150,250 8 $159,950 Income limits are subject to change by the Los Angeles County Development Authority (LACDA) FY25-26 HIP Guidelines Page 18 ATTACHMENT B CITY OF ARCADIA Development Services Dept. 240 W. Huntington Drive Arcadia, CA 91066-6021 FREE RECORDING GOVERNMENT CODE SECTION 6103 SPACE ABOVE THIS LINE FOR RECORDING USE GRANT MEMORANDUM OF AGREEMENT This Memorandum of Agreement (“Memorandum”) is made and entered into this ____day of ____, 202 5 by and between _______ and the CITY OF ARCADIA, a municipal corporation (“City”). Homeowner and City hereby agree as follows: 1. As a participant in the 2025-2026 Home Improvement Grant Program (“Program”), Homeowner is receiving from City a Community Development Block Grant funded Home Improvement Grant in the amount of _________ Dollars and 00/00 Cents ($00,000.00) (the “Grant”) for rehabilitation of property described in Exhibit A, which is attached hereto and incorporated herein, (the Property”), and has a street address of _________ in the CITY OF ARCADIA. 2. Pursuant to the Program, among other things, the Homeowner agrees to retain ownership of the Property for no less than five (5) full calendar years after the completion of all rehabilitation work. 3. As soon as reasonably practicable following the completion of the rehabilitation work on the Property, Homeowner shall submit a written Notice of Completion to the City evidencing the date of completion of the rehabilitation work. 4. The required five-year period of ownership of the Property by Homeowner ends on ____ when the Grant is forgiven. 5. If the Homeowner chooses to transfer any interest of the Property before the date set forth in paragraph 4 of this Memorandum, then the Homeowner must reimburse the City the full amount of the Grant. 6. If the Homeowner transfers any interest in the Property before the date set forth in the Notice of Completion, then the City must receive written notice addressed to the following: CITY OF ARCADIA HOME IMPROVEMENT PROGRAM 240 W. HUNTINGTON DRIVE ARCADIA, CA 91007 7. Reference is hereby made to the “Three-Party Agreement/Disclaimer” executed between the Parties on ___, and all documents related to the Grant, in their entirety, for any and all purposes. True copies of this Memorandum and those documents are on file in the offices of City at 240 W. Huntington Dr., Arcadia, CA 91007. CITY OF ARCADIA Date: By: Jason Kruckeberg, Assistant City Manager/ Development Services Director HOMEOWNER Date: By: FY25-26 HIP Guidelines Page 19 ATTACHMENT C CITY OF ARCADIA DEVELOPMENT SERVICES DEPARTMENT HOME IMPROVEMENT PROGRAM PHOTOGRAPHY PERMISSION FORM I, the undersigned, hereby grant permission to the City of Arcadia and its officials, officers, employees, representatives, and agents (collectively the “City”), and also the Development Authority of the County of Los Angeles, the Housing Authority of the County of Los Angeles, the County of Los Angeles and their officers, employees and agents (collectively the “County”), to use and/or publish for the City and County purposes, the photographs of the persons, properties and facilities described herein. I, the undersigned, hereby hold harmless and specifically waive and release the City and County from any and all claims, now or in the future that may arise out of the City and County’s use and/or publication of the photographs described herein. Date of Photograph and/or Name of Person(s) Photographed Name of Property and Facility Photographed Name of Person(s) Granting Permission (“Permittor”) Address and Telephone Number of Person(s) Granting Permission (“Permittor”) Relationship of Permittor to the Person(s) and Facility Photographed Signature(s) of Permittor Date City of Arcadia CDBG Information and Referral Program Policy Mission The mission of the City of Arcadia Information and Referral Program is to assist people in need of social services and information on a variety of topics. The program is open to the public, regardless of age, race, gender, sexual orientation, or physical ability. Clients who are 55 years of age and older qualify for subsidized assistance through the Community Development Grant Program (CDBG). Services Provided The City of Arcadia Information and Referral Program provides the public with essential information to navigate the world around them. For the seniors, it allows them to maintain independent living and healthy lifestyles. Information is compiled and distributed for the following topics: government benefits, income taxes, notary public, housing, and Medicare/Medi-Cal assistance. Tracking When a client 55 years of age and older or who meet CDBG eligibility inquires in person about information and referral services, they will be given a Client Intake Form that is to be completed and returned back to staff. Staff will then ask for verification of age by State/Federal Issued ID and residency verifcation. All Client Intake Forms will be entered into CDBG website as soon as possible. Completed Client Intake Forms are filed and stored in Recreation Supervisor's Office. Implementation When an individual is requesting information, staff and volunteers will first look through the complied Information and Referral cabinet for relevant handouts on the topic inquiry. If the cabinet does not hold the desired information or more assistance is required, the participant will be referred to the Recreation Coordinator supervising the Information and Referral Program. At that point, the Recreation Coordinator will research more resources and/ or refer the individual to the appropriate social service agency. Reporting In accordance with Federal requirements for CDBG , staff will document the number of clients 55 years of age and older or who meet CDBG eligibility receiving information and referrals. Staff will also submit a CDBG Quarterly Performance Reports. Attachment "C" IN N ILIMB 1ER; 25-0020 SUl!UEC'r: CITIZENSHIP/ IMMIGRATION STATUS DECLARATION OA,TE:: 10/20/2025 EIFFecnve- OATf;:JUL Y 1, 2025 TO: PARTICIPATING CITIES COMMUNITY-BASED ORGANIZATIONS OTHER PUBLIC AGENCIES COUNTY DEPARTMENTS LAHSA LACDA DIVISIONS PAGE 1 OF 1 Under Executive Order 14218, including the Personal Responsibility and Work Opportunity Act of 1996 (PRWORA), verification for direct benefit Housing and Urban Development (HUD) projects must demonstrate eligibility for assistance by: ►Submitting evidence of citizenship or eligible immigration status for each member of the household regardless of age, to qualify for assistance under HUD programs to your agency; and ►Declaring and attesting to U.S. citizenship or eligible immigration status. For U.S. citizens, sign a declaration of citizenship and for noncitizens, sign a declaration of eligible immigration status, along with proof of age or other documentation. CDBG and HOME funded activities that provide direct benefit to households and individuals, including but not limited to housing rehabilitation, public services, or job creation activities, require operating agencies, except eligible nonprofit organizations as program subrecipients, to verify the legal status of those receiving the service. Please implement the Citizenship Declaration Form (Attachment I) and keep it in your participant files. The Declaration Form and supporting evidence must be available upon request. This guidance may be superseded with future directives provided by HUD or County Counsel. If you have any questions, please contact your assigned Management Analyst. Sincerely, LINDA JENKINS, Director Community Development Division Attachment LJ:MC;JED:ab:CMT _Bulletin 25-0018_ CITIZENSHIP-IMMIGRATION STATUS DECLARATION_ 10072025.docx Community Development Division -(COD) Putting Dollar$ into Action Attachment "D"