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HomeMy WebLinkAboutCDBG FY 19-20 Application Process-Action PlanSTAFF REPORT CITY OF PALM DESERT FINANCE DEPARTMENT MEETING DATE: January 10, 2019 PREPARED BY: Christopher Gerry, Management Analyst REQUEST: Request to commence the Fiscal Year (FY) 2019/20 Community Development Block Grant Program application process and develop the FY 2019/20 Annual Action Plan. Recommendation By Minute Motion: 1. Open the public hearing and receive public comment relative to the Fiscal Year (FY) 2019/20 Community Development Block Grant (CDBG) Program cycle and develop the FY 2019/20 Annual Action Plan, and; 2. Open the FY 2019/20 CDBG application process. Strategic Plan Obiective Not applicable. Background The Community Development Block Grant (CDBG) Program is designed to assist jurisdictions in addressing the needs of the very low to low-income population (e.g., homeless, seniors, at -risk youth, individuals, and families) through funding nonprofit organizations that provide direct services to qualifying clientele. CDBG funds may be used for public facility improvements for a building/property owned by a nonprofit agency providing services for the homeless, severely handicapped, or at -risk youth. Funds may also be used to support public service programs providing food, clothing, counseling, medical, transportation services and/or shelter, or to undertake City programs or projects designed to provide a benefit to very low to low-income individuals. On May 24, 2018, the City Council adopted a resolution and approved a cooperative agreement with the County of Riverside to participate in its Urban County CDBG Program. As previously presented, there are various benefits to joining the Urban County CDBG Program under the designation of a "Metro City." For example, the City would still maintain local control of selecting activities to fund and have much less of an administrative burden. Please see the attached staff report for more information. However, the U.S. Department of Housing and Urban Development (HUD) has since determined the City must wait to join the Urban County CDBG Program until FY 2021/22 due to federal regulations, which only allow cities to join an Urban County CDBG Program as a January 10, 2019 - Staff Report CDBG Program Page 2 of 2 Metro City during a specific window of time every three years. As a result, City staff will bring forward a new resolution and cooperative agreement for City Council consideration in the future. In the meantime, City staff will continue to coordinate our CDBG Program as a Direct Entitlement Jurisdiction (17th year). In order to accept applications for the upcoming year and develop the Annual Action Plan, the City Council conducts a public hearing to receive comments from the public. This process officially opens the FY 2019/20 (45th year) cycle of the CDBG Program, which will conclude with recommendations for grant awards by the Outside Agency Funding Committee to City Council, as well as approval of the Annual Action Plan. The City of Palm Desert's CDBG allocation is unknown until approval of the federal budget. Furthermore, HUD recommends that jurisdictions move forward with the annual process and base their funding on the previous year's allocation, regardless of whether or not the Federal budget has been approved. As a result, staff estimates the FY 2019/20 CDBG funding level based on the previous year's allocation of $354,119. If the City is not notified of its allocation prior to grant award recommendations to City Council in April 2019, awards will be modified as outlined by the Outside Agency Funding Committee, if necessary. Staff maintains a mailing list for community nonprofit and social service agencies who have expressed interest in the CDBG Program. Notifications were recently distributed to approximately 90 separate organizations. Also, these potential subrecipients received a copy of the items, as follows: 1) notice of public hearing for January 10, 2019; 2) needs assessment form to submit written comments; 3) notice that the CDBG application is available on the City's website or by contacting the City for a hardcopy; and 4) community meeting notice scheduled for January 23, 2019. Those present at the City Council meeting and community meeting will be able to provide input on activities that address community needs, and on the development of the Annual Action Plan. All CDBG applications will be accepted and reviewed by the Outside Agency Funding Committee with recommendations submitted to the City Council for final review and approval. The deadline for application submittal is February 15, 2019. Fiscal Analvsis There is no fiscal impact associated with this request. LEGAL REVIEW DEPT. RE, IEW FINANCIA EVIEW CITY MANAGER Approved as to form r /N/A �� f� Robert W. Hargreaves Jane oore Jan t . Moore auri Aylaian City Attorney Dire for of Finance Dir, ct r of Finance City Manager ATTACHMENTS: 1. Staff report (May 24, 2018) 2. Notice of public hearing 3. Mailing list CONTRACT NO. C37080 STAFF REPORT CITY OF PALM DESERT FINANCE DEPARTMENT MEETING DATE: May 24, 2018 PREPARED BY: Niamh Ortega, Administrative Secretary REQUEST: Adopt Resolution No. 2018- 31 approving the Community Development Block Grant Joint Recipient Cooperative Agreement for Fiscal Years 2019-2020 and 2020-2021 Recommendation By Minute Motion, that the City Council: Waive further reading and adopt Resolution No. 2018- 31 authorizing participation in the County of Riverside's Urban County Program for Fiscal Years 2019-2020 and 2020-2021; 2. Authorize the City Attorney to finalize the Joint Recipient Cooperation Agreement with the County of Riverside; and 3. Authorize the City Manager to execute the Joint Recipient Cooperation Agreement with the County of Riverside allowing the City to participate in the Urban County Consolidated Planning Program, and take any other actions necessary to effectuate the actions taken herewith. Strategic Plan Obiective N/A Background Analvsis The Community Development Block Grant (CDBG) is a Federally funded program created by Congress in 1974 that awards grants to local governments to develop viable communities by providing decent housing, suitable living environments, programs, and expanding economic opportunities, principally for persons of low- and moderate - income. Every year, CDBG funds are allocated by the U.S. Department of Housing and Urban Development (HUD) to state and local governments to carry out a wide range of community development activities directed toward revitalizing neighborhoods, economic development, and providing improved community facilities and services. May 24, 2018 — Staff Report Resolution No. 2018- 31 authorizing participation in Urban County Program Page 2 of 4 The City of Palm Desert has been a recipient of CDBG funds for over 35 years. The earliest awards facilitated projects such as the College of the Desert Childcare Training Center, Joslyn Senior Center, Desert Arc (formerly known as the Foundation for the Retarded) expansion, and San Pablo park which is now a part of the Civic Center campus. The City originally received funding as a Metropolitan City in a joint agreement with the County. Over the years, the City has alternated between retaining its status under the County program and being a direct CDBG recipient known as an Entitlement City. For the last 16 years, Palm Desert has been designated as an Entitlement City. In April 2018, the County of Riverside Economic Development Agency (EDA) issued its annual notification to the City Manager that the City could elect to rejoin the County as a Metropolitan City/Joint Recipient in the Urban County Community Development Block Grant program or alternatively could elect to continue its non -participation and remain an Entitlement City. Staff has weighed the pros and cons of each option, and determined that it is in the best interest of the City to elect to participate through a Joint Recipient Cooperative Agreement (Metropolitan City Agreement) with the EDA. The Agreement covers a three-year period; Fiscal Years 2018-2019, 2019-2020, and 2020- 2021. The City is obligated to complete the current cycle as an Entitlement City and is eligible to participate in FY2019-2020 for the last two years of the current agreement period. Should the City elect to participate, it may choose its status as a Metro City or Cooperating City. A comprehensive comparison of a Metro City vs Cooperating City is attached as Exhibit A. With either option, the City retains full oversight of the solicitation and selection of projects and activities. The County has confirmed that the City would remain responsible for the public hearing and application process. Staff considers the Metro City status to be the most beneficial to the City as it retains its entire entitlement allocation, can allocate its full 15% public service cap, and retains a percentage of the administrative expense allocation in order to carry out the administrative tasks associated with the grant. As a Cooperating City, the City receives an adjusted allocation of 60-70% of the total amount, has a lower public service cap, and is not entitled to any of the administrative funding. In the years that the City has operated as an Entitlement City, it has received funds that range from $419,000 in FY 2003-2004 to $269,514 in FY 2015-2016, as shown in Exhibit B. Currently, there is a 20% cap on administrative costs, which covers Fair Housing obligations (approximately 53% of cap) and City staff administrative expenses. Using the most recent allocation of $354,119, the 20% administration cap translates to $70,723, with $37,100 issued to Fair Housing Council and $33,723 retained for City administrative expenses. It is estimated that the City's staff costs range from $175,000 to $250,000 to administer the CDBG program as an Entitlement City but varies each year depending on the cycle year. In the past, the General Fund has paid for most of the City's costs including staff time for the administration of this program. As a Metro City, the City would be able to G:%inance'Janet Moore%F1NANCF.ISR - Auth City to participate in Urban County program 052418 Jm doc May 24, 2018 — Staff Report Resolution No. 2018-31 authorizing participation in Urban County Program Page 3 of 4 use the portion of the administration allocation toward these costs. Additionally, participation in the Urban County program would result in significant savings to staff time and resources while incurring a similar level of benefit to the City and local agencies through CDBG funds. Of the twenty percent (20%) permissible for administration, the County is requiring seventy percent (70% or approximately $49,576) for administration of the Urban County program. On behalf of the City, the EDA's duties include, but are not limited to the following: • Review of all funding applications for HUD eligibility. • Carries out all administration work between HUD, applicants, and City for approved projects. • Updates and informs cities of all HUD rules and regulations. • Drafts and submits all required one-year and five-year reporting to HUD. • Handles and administers the Integrated Disbursement and Information System (IDIS) that HUD requires and utilizes. • Administers all fair housing activities. Under the Urban County program, the County is responsible for all grant -related administrative activities, thereby relieving staff of the majority of the reporting required throughout the specialized CDBG/HUD process. This process alone currently includes four departments' review of the plans and reports as well as the implementation requirements (including compliance and compatibility with the City's zoning, housing restrictions, and the City's municipal code). The City would not be eligible for a limited number of federal grants and loans under the metro city designation, namely the HOME, Emergency Services Grant (ESG) and Micro -Enterprise Loan programs. However, the City may change its participation for the next cycle beginning FY 2021-2022, opting to become a cooperating city or revert to its entitlement status if deemed appropriate. Currently the City does not participate in these programs. The Continuum of Care's ESG funds come from the State Department of Housing and Community Development (HCD) allocation of ESG, and even though the City would not be eligible to avail of the County's ESG funds, it is free to continue participation in the Continuum of Care program or seek its own ESG funds from the State's HCD. Fiscal Analvsis Although the funding levels that will be awarded by HUD for FY 2019-2020 and FY 2020-2021 are unknown at this time, execution of this agreement guarantees that the City will be entitled to CDBG Program resources allocated by HUD and administered by the EDA as a Joint Recipient Cooperation Agreement (Metropolitan City). G:Tinance'Janct MooreTINANCCIBR - Auth City to participate in Urban County program 052418 jm.doc May 24, 2018 — Staff Report Resolution No. 2018- 31 authorizing participation in Urban County Program Page 4 of 4 Participation in the Metropolitan City agreement with the EDA allows the City to enjoy the benefits of an Entitlement City without having to contend with the cumbersome requirements imposed by HUD. LEGAL REVIEW DEPT. REVIEW FINANCIAL REVIEW CITY MANAGER ,N% Robert Hargreaves Oiredo��offinance Met Moore `-Lauri A laian 9 Y Legal Counsel Director of Finance Executive Director ATTACHMENTS: 1. Exhibit A - Riverside County Urban County Program: Joint Metro City vs Cooperating City 2. Exhibit B - History of CDBG Awards FY 2003-2004 through FY 2018-2019 3. Resolution No. 2018- authorizing participation in the County of Riverside's Urban County Program for FY 2019-2020 and 2020-2021 4. Joint Recipient Cooperation Agreement for the Community Development Block Grant for FY 2019-2020 and 2020-2021 5. Urban County Qualification — Notice of Participation Status G-TmanceJanct MooreTINANCE'SR - Auth City to participate in Urban County program 052418 pn.doc CITY OF PALM DESERT NOTICE OF COMMUNITY MEETING TO RECEIVE PUBLIC COMMENT AND CITIZEN PARTICIPATION IN THE COMMUNITY DEVELOPMENT BLOCK GRANT ANNUAL ACTION PLAN (FY 2019/2020) NOTICE IS HEREBY GIVEN THAT the City of Palm Desert will hold a Community Meeting and inviting the agencies, groups, and general public to attend the Community Meeting and receive public input and recommendations pursuant to the Housing and Community Development Act of 1974 as amended regarding the proposed development process relative to the Community Development Block Grant (CDBG) Program Annual Action Plan (FY 2019/2020) to be adopted by the City Council in or around May 2019. The Community Meeting has been scheduled for Wednesday, January 23, 2019, at 9:00 a.m., located at City of Palm Desert Civic Center, 73-510 Fred Waring Dr., Palm Desert, CA 92260 in the North Wing Conference Room. Interested parties should attend to provide input in regards to CDBG programs/projects, expenditure of funds, and the development process relative to the above Plan. The CDBG Needs Assessment is available via the City's website at www.citvofpalmdesert.orq. A copy may also be requested from the City of Palm Desert, address provided below. All interested agencies, groups, and persons wishing to comment on the Needs Assessment are invited to do so by appearing at the above set Community Meeting and/or submitting written comments at the address below prior to the meeting. NIAMH ORTEGA, MANAGEMENT SPECIALIST II CITY OF PALM DESERT 73-510 FRED WARING DRIVE PALM DESERT, CA 92260 (760) 346-0611 Rachelle D. 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