CC - Item 5A - CDBG and Home Programs FY 2013-14 Annual Action PlanROSEMEAD CITY COUNCIL
STAFF REPORT
TO: THE HONORABLE MAYOR AND CITY COUNCIL
FROM: JEFF ALLRED, CITY MANAGER j
DATE: MARCH 26, 2013
SUBJECT: CDBG AND HOME PROGRAMS FY 2013 -14 ANNUAL ACTION PLAN
SUMMARY
On February 12, 2013, the City Council conducted a public hearing to receive input on
the development of the City's Annual Action Plan for the period of July 1, 2012 -June 30,
2013. Four (4) social service organizations (Family Counseling Services, Family
Promises, People for People, and Southern California Housing Rights Center) and one
(1) Community Housing Development Organization — CHDO (Rio Hondo Community
Development Corporation) made presentations at the public hearing. Under federal
regulations, no more than 15% of the Community Development Block Grant (CDBG)
allocation can be used for social service activities. In addition, under the HOME
Investment Partnership (HOME) program, at least 15% must be set aside for a CHDO.
The Federal government is currently working on allocating CDBG and HOME funding
awards and has not yet announced the final amounts to each participating community;
however, it is estimated that the City of Rosemead will sustain a 5.1 % funding reduction
to both allocations due to the 2013 Sequestration. Based on this estimated reduction, a
summary of staff - endorsed projects has been prepared according to the funding
requests and ongoing CDBG and HOME funded activities.
Staff Recommendation
It is recommended that the City Council review and finalize the CDBG and HOME
funding recommendations under the City's FY 2013 -14 Annual Action Plan.
BACKGROUND
The City of Rosemead is a Federal entitlement grant recipient of CCDB and HOME
funds from the U.S. Department of Housing and Urban Development (HUD). As part of
the process to receive funding, the City must undertake development of a Consolidated
Plan and Annual Action Plan. It is called a Consolidated Plan because it consolidates
the application process for HUD's four (4) entitlement grants into one consolidated plan
and application. The four grants are: CDBG, HOME, Housing Opportunities for Persons
with AIDS (HOPWA), and Emergency Shelter Grant (ESG). All four (4) grants are
driven by an entitlement formula process set by the federal government. The City is
eligible to participate in two (2) of these programs: CDBG and HOME.
ITEM NO. LL�
City Council Report
March 26, 2013
Page 2 of 4
As part of the requirements of the federal Consolidated Plan process, the City is
required to hold a public hearing regarding the projected use of funds prior to adoption
of its Consolidated Plan and Annual Action Plan. In order to receive the FY 2013 -14
allocations, the City must comply with the following requirements of the Consolidated
Plan final rule regarding pre- submission requirements:
➢ Fulfill citizen participation requirements by conducting a public hearing to
receive citizen input regarding annual funding needs;
➢ Publish a draft Plan and Annual Action Plan for a 30 -day comment period in
order to receive citizen input regarding the final document; and
➢ Conduct a public hearing adopting the final Plan and the Annual Action Plan.
The Annual Action Plan is a part of the Consolidated Plan, which takes all HUD
requirements regarding planning, needs analysis, reporting, budgeting, citizen
participation, and certifications and incorporates them into one process. The full
Consolidated Plan must be completed once every five (5) years and the Annual Action
Plan must be completed annually.
ANALYSIS
The Federal government is currently working on allocating CDBG and HOME funding
awards and has not yet announced the final amounts to each participating community.
While the City has not yet been notified of the final amounts that will be available to
meet identified needs within Rosemead for the FY 2013 -14, HUD has warned that it is
estimated that Rosemead will receive a 5.1% decrease to both its current $682,256
allocation of CDBG funds and $228,955 allocation of HOME funds based on the 2013
Sequestration. When these estimated figures are combined with anticipated program
income, and projected carryover funds, the City anticipates having a total of
approximately $914,564 ($647,490 FY 2013 -14 allocation, $11,185 anticipated program
income, and $255,919 FY 2012 -13 carryover funds) in CDBG funds available and
$596,122 ($217,278 FY 2013 -14 allocation and $378,844 FY 2012 -13 carryover funds)
in HOME funds available for in the FY 2013 -14.
After much deliberation and thought, it is being proposed that the following activities be
funded under the CDBG and HOME programs and included in the City's Annual Action
Plan for the FY 2013 -14. In reviewing the CDBG recommendations it would be
appropriate for the City Council to remember that only three broad funding categories
are considered eligible under CDBG - regulations. A project must either provide benefits
to low or moderate - income persons, eliminate slum or blighted conditions, or satisfies
an urgent need. In addition, of the CDBG funds received, no more than 15% ($97,119)
of the annual grant amount plus anticipated program income can be used for social
service activities, no more than 20% ($129,492) of the grant amount plus anticipated
program income can be used for Planning and Administrative services, and, at least,
70% of all funds must be used for low -to- moderate income activities.
City Council Report
March 26, 2013
Page 3 of 4
There were no new public service funding requests submitted for the FY 2012 -13. Out
of the three (3) existing social service organizations already receiving funding, all have
requested the same level of funding as approved in the current fiscal year. With the
exception of People for People, it would be appropriate to continue to support Family
Counseling Services and Family Promises at their current level of funding. In regards to
People for People, it is recommended to fund them at a slightly higher amount than
requested. They had requested $9,328, but due to anticipated program income from
the Senior Nutrition Program, it is recommended to round People for People's funding to
an even $10,000. A detail list of funding request versus funding recommendation can
be found in Attachment "A ".
In reviewing the HOME funds recommendations, it would be appropriate for the City
Council to remember that no more than 10% ($21,728) can be used for administrative
and program delivery activities. At least 15% ($32,592) must be set aside for
Community Housing Development Organizations (CHDO), as constituted under the
regulations. In addition, up to 5% ($10,864) can be used by a CHDO for operating
expenses. The balance of funds can only be used for housing activities.
City Administration
General Administration
$111,492
General Administration — Program Income
$ 2,237
Fair Housing Contract
$ 18,000
Subtotal
$131,729
Rehabilitation
Administration
$233,495
Emergency Grants
$ 10,000
Grants
$100,000
Rebates
$ 15,000
Lead /Asbestos Testing
$ 11,000
Lead /Asbestos Remediation
$ 60,000
Subtotal
$429,495
Public Safet
Code Enforcement
$247,273
Subtotal
$247,273
Social Services
Family Counseling Services
$ 5,000
Family Promises
$ 5,000
People for People
$ 10,000
Senior Nutrition Services
$ 77,119
Senior Nutrition Services — Program Income
$ 8,948
Subtotal
$106,067
Total CDBG Allocation
$914,564
In reviewing the HOME funds recommendations, it would be appropriate for the City
Council to remember that no more than 10% ($21,728) can be used for administrative
and program delivery activities. At least 15% ($32,592) must be set aside for
Community Housing Development Organizations (CHDO), as constituted under the
regulations. In addition, up to 5% ($10,864) can be used by a CHDO for operating
expenses. The balance of funds can only be used for housing activities.
City Council Report
March 26, 2013
Page 4 of 4
2013- 2014 =HQIIAE'Allocatorl,
City Administration
General Administration
$
21,728
General Administration - Car over
$
9,574
Subtotal
$
31,302
Rehabilitation
Owner - Occupied Rehabilitation Loans
$
317,882
Down Payment Assistance Program
$
210,000
Subtotal
$
527,882
Community Housing Development Organization
CHDO
Rio Hondo CDC (Operating)
$
4,346
Rio Hondo CDC (Affordable Housing Program)
$
32,592
Subtotal
$
36,938
Total HOME Allocation
$
596,122
It should be noted that all the proposed projects meet the CDBG and HOME eligibility
requirements.
PUBLIC NOTICE PROCESS
This item has been noticed through the regular agenda notification process.
I Pre / Ip'ared, by: '
Michelle G. Ramirez
Community Development Director
Attachment A - Social Service Funding
FY 2012 -13 Approved Budget vs. FY 2013 -14 Proposed Budget
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