Title
Public Hearing to Consider Adoption of the Community Development Block Grant (CDBG)/HOME Partnership Investment Program (HOME) Five-Year Strategic Plan for Fiscal Year (FY) 2025-29 and the FY 2025-26 CDBG/HOME Action Plan; and Authorize the City Manager to Negotiate and Execute Related Documents, Agreements, and Modifications at Funding Levels Approved by Congress. (City Manager, 203 and 204)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
The City of Alameda (City) is an entitlement recipient of Community Development Block Grant (CDBG) funds from the U.S. Department of Housing and Urban Development (HUD). Fiscal Year (FY) 2025-26 represents the first year of the new five-year Consolidated Plan, which is a planning document required by HUD to be submitted by all jurisdictions that directly receive HUD formula funds. In FY 2025-26, the City expects to receive approximately $1.1 million in CDBG entitlement funds. This amount will be allocated to the following four priority areas such as non-housing public services, non-housing public improvements, residential rehabilitation, and administration. As a member of the Alameda County HOME Partnership Investment Program (HOME) Consortium, the City expects to receive $200,000 in FY 2025-26 HOME Program funds. This public hearing is an opportunity for the community to provide input on:
1) The proposed programs and projects that will be funded with CDBG and HOME funds in the upcoming FY 2025-26; and
2) The Five-Year Strategic Plan for FYs 2025-2029.
BACKGROUND
The City is an entitlement recipient of CDBG funds from HUD. CDBG funds support programs and activities that benefit very low-, low- and moderate-income people and households as well as supporting overall community health. Each year, entitlement cities must follow a process to receive public input, establish community goals and prepare a budget for the coming year. As a condition of funding, the City is required to submit to HUD a Five-Year Strategic Plan (Strategic Plan) and an Annual Action Plan (collectively known as the Consolidated Plan) that details the projects, programs, activities and resources that will be used to address the housing and community development priority needs and goals (Exhibit 1). The new five-year cycle begins July 1, 2025.
The Strategic Plan for FYs 2025-29 sets forth broad policy goals and identifies the City’s plan for addressing the priority needs, primarily through the use of CDBG and HOME funds. The priority need categories are defined by HUD. Specific objectives for the coming year are addressed in the FY 2025-26 Action Plan (Action Plan) covering the period of July 1, 2025 through June 30, 2026.
In preparing the Strategic Plan, the City consulted with community-based service providers, residents, City departments and the Social Service Human Relations Board (SSHRB). The community stakeholders helped establish priority needs and objectives and proposed strategies in the form of projects and activities to further those objectives. On October 24, 2024, SSHRB discussed priority needs and made a recommendation to the City Council regarding public service needs for the upcoming FY 2025-26. On December 3, 2024, City Council held a public hearing and adopted the Needs Statement as recommended by SSHRB.
As part of the annual CDBG planning process, on January 16, 2025, the City released the CDBG FY 2025 and 2026 Notice of Funding Availability (NOFA) and Request for Proposals (RFP) on January 16, 2025. On March 27, 2025, SSHRB reviewed and made a recommendation for the CDBG social services funding allocation, as further described in the section of this report titled Public Services.
CDBG funding for the upcoming fiscal year is derived from two sources: 1) CDBG entitlement funds that are allocated by HUD and 2) program income that is generated from CDBG loan repayments. In May 2025, HUD will announce award amounts. Based on previous allocations, the City anticipates receiving approximately $1.1 million in CDBG entitlement funding for FY 2025-26. The FY 2024-25 revenue from the CDBG loan repayments for residential rehabilitation projects will continue to be received through June 30, 2025, so the actual amount of program income has yet to be finalized but is estimated to be $60,000. The total FY 2025-26 CDBG program budget is $2,521,504 which includes:
• Approximately $1.1 million in CDBG entitlement funds
• $1,408,846 of carried forward funds for open projects
• Approximately $60,000 of program income from loan repayments projected to be received in FY 24-25
All citizen participation requirements have been met for the public hearing, with publication of the notice in the April 4, 2025, Alameda Journal newspaper, as well as in Chinese, Spanish, Tagalog, and Vietnamese-language newspapers. While staff has not identified local Arabic or Korean language media, the public notice is also posted on the City web site and can be translated into all six languages. Accommodations are available for non-English speaking residents and persons with disabilities to participate in the public comment process.
The City is one of eight jurisdictional members of the Alameda County HOME Consortium (HOME Consortium) through which participating jurisdictions may receive HOME funding from HUD. Because the City is a member of the HOME Consortium, both the Five-Year Strategic Plan and Annual Action Plan for CDBG and HOME funds are coordinated through the HOME Consortium. Each member of the HOME Consortium must prepare an individual Consolidated Plan and Annual Action Plan. As a member of the Alameda County HOME Partnership Investment Program (HOME) Consortium, the City expects to receive an additional $200,000 in both FY 2025-26 and FY 2026-27 HOME Program funds.
DISCUSSION
Five-Year Strategic Plan
As required by HUD, the HOME Consortium must identify priority needs and develop broad policy objectives for the use of CDBG, HOME, and any other federal funds that may be awarded. The policy objectives are addressed in the Strategic Plan. In addition to the priority needs identified by the HOME Consortium, SSHRB sought input from the community and focused on needs that are specific to Alameda, particularly public services.
The Strategic Plan addresses needs in the areas of housing, homelessness, non-housing community development such as public services, public facilities/infrastructure and economic development. The Strategic Plan incorporates community input and outlines six areas of priority needs and twelve objectives that will be used to address the identified priority needs. These priority needs and objectives include:
• Public Services
o Support programs for very low- and low-income residents, preserving safety net services, and providing support and coordination for families and individuals who are vulnerable or “in crisis.”
o Improve access to food and reduce food insecurity.
o Support services that provide mental health care or support services for those residents experiencing mental health challenges.
• Address Homelessness
o Fund and support overnight shelter, crisis housing and public services for homeless families and individuals.
o Fund supportive services, including case management and outreach, at agencies that serve homeless families and individuals.
• Economic Development and Microenterprise Assistance
o Fund economic development initiatives and support services that help job seekers to receive additional training or enter the job market, including microenterprise assistance.
• Promote Affordable Housing
o Create new affordable housing throughout the City.
o Offer financing for residential rehabilitation projects.
• Non-Housing Public Improvements
o Clean-up and securing of unsafe structures and sites that pose a health and safety threat.
o Make improvements, including those for ADA accessibility, to public facilities, such as curbs and sidewalks, neighborhood parks and recreational improvements, tree planting, homeless facilities, and other public improvement activities.
• Fair Housing and Administration
o Improve the administration of funding and coordination among project providers.
o Support fair housing efforts in the community, including providing assistance to individuals facing challenges with acquiring housing.
Annual Action Plan
The City prepares an annual Action Plan that identifies specific objectives and the proposed uses of CDBG funds. The Action Plan funding recommendations are based on needs identified through a number of community meetings and reports, including:
• Alameda County report on Analysis of Impediments to Fair Housing
• Alameda County EveryOne Home reports
• City of Alameda Community Needs Assessment 2023
• City of Alameda 2024 Annual Report on The Road Home
• Consultation with community-based organizations
• SSHRB meeting on public services needs
• City Council Annual Public Needs Hearing
During the CDBG NOFA process, staff review and evaluate all submitted CDBG proposals. Eligible applications are evaluated on specific threshold criteria as described in the NOFA. Once staff completes the preliminary review, SSHRB reviews and makes recommendations regarding funding for public services based on the City Council adopted Needs Statement. Then, staff compiles the recommendations to prepare for final approval from City Council. The letter from SSHRB is included as Exhibit 3.
Public Services
HUD requires that public services funding be capped at 15 percent of the current year’s grant allocation plus program income received in the previous fiscal year.
Therefore, staff proposes the following funding allocations:
|
Funding Type |
Estimated Amount |
15% of Amount for Public Services |
|
City of Alameda Entitlement (estimated) |
$1,112,658 |
$166,899 |
|
FY 2025-26 Program Income (estimated) |
$60,000 |
$9,000 |
|
Total Estimated Funds Available |
$1,172,658 |
$175,899 |
The City received seven public service applications for FY 2025-27. All public service applications were evaluated and scored on specific threshold criteria described in the NOFA. This consists of application completeness, eligibility under CDBG regulations, project description, measurable outcomes, timeline, budget, and capacity. Of the seven applications, the Alameda Boys & Girls Club did not submit one of the supporting documents by the NOFA deadline and while that issue was later resolved, the Alameda Boys & Girls Club was removed from consideration because the proposal lacked clear measurable program outcomes and did not have a detailed program timeline.
Below is a summary of the public services applications received, the average score from SSHRB, the FY 2025-26 funding request, and staff recommendation for FY 2025-26 funding levels. Most of the current providers have applied for the upcoming funding cycle in anticipation of receiving CDBG funding for the next two years. Although staff recommends funding public service providers for two consecutive years to provide funding certainty for the providers, City Council approval is required annually before funds are granted and agreements are executed each year.
|
Applicant Listed in order of Score |
Average Score |
CDBG Funding Requested |
CDBG Recommended Funding |
|
Spectrum Community |
97.75 |
$21,750 |
$19,575 |
|
Eden Council for Hope and Opportunity (ECHO) |
95.75 |
$24,978 |
$19,421 |
|
Family Violence Law Center (FVLC) |
95.25 |
$30,000 |
$23,325 |
|
Alameda Food Bank |
94.75 |
$30,000 |
$23,325 |
|
Building Futures for Women and Children |
93.75 |
$105,505 |
$69,172 |
|
Alameda Boys & Girls Club (ABGC) |
88.50 |
$86,000 |
$0 |
|
Alameda Family Services (AFS) |
82.50* |
$205,000 |
$21,081 |
|
Table A: List of Applicants by Highest Score |
|
$503,233 |
$175,899 |
Staff reviewed the public service funding requests and the estimated amount of CDBG funds available for public services. Based on the average score and highest priority need, staff initially recommended funding the top five ranked applicants for FY 2025-27. At the March 27 SSHRB meeting, staff presented the public service funding recommendations, provided a timeline overview, and noted that the funding requests were well in excess of the estimated funding available. SSHRB discussed the funding recommendations and determined that AFS youth mental health services should be funded in FY 2025-26 due to the high community need and the potential loss of an existing program. The final SSHRB recommendation included evenly distributing the funding reduction from all applicants in order to fund AFS for student based mental health services at Alameda and Encinal high schools. To address the recommendation to provide youth mental health funding while leaving enough meaningful funding for all agencies, staff identified separate funding to augment the AFS services. There is $45,000 of Permanent Local Housing Allocation (PLHA) funding that can be used to offset $45,000 of General Funds that are currently budgeted to support AFS mental health services at Dignity Village. This makes the $45,000 available, in addition to the recommended CDBG funding for a total of $67,755 for AFS to continue student based mental health services at the high schools. Funding this project for an additional year will provide time for AFS to identify other funding sources should CDBG not be a viable option moving forward. SSHRB also recommended prorating any additional funds received by HUD in excess of the estimated $175,899. CDBG funds received toward public services in excess of the expected $175,899 will be used to proportionally fulfill the requests of the top five scored applicants.
The attached FY 2025-26 Action Plan Summary of Activities Recommended for Funding (Exhibit 4) reflects the staff recommendation that supplements SSHRB’s recommendation. Staff informed AFS that this additional funding source is not available in future fiscal years and all organizations were made aware of the limitations of these funds and encouraged to continue raising funds to leverage CDBG funding.
Economic Development
Alameda Point Collaborative (APC) and Upwards, Inc. submitted applications for FY 2025-27 economic development funds. APC requested $150,000 to renovate a company RV to provide mobile support services to the APC residents who have limited accessibility and in need of essential resources. Upwards, Inc. requested $120,000 to administer a program that supports and enhances the sustainability of local child care providers in the City. The APC application did not meet the threshold criteria outlined in the City’s NOFA because it is not an eligible activity under CDBG regulations and APC did not submit required supportive documentation by the NOFA deadline. The Upwards, Inc. application also did not meet the minimum threshold requirements outlined in the City’s NOFA. This includes having a program or project that meets a priority need as seen in the Needs Statement and intentionally excluding required supportive documentation to maintain confidentiality. Due to the reasons above, staff recommends not funding Alameda Point Collaborative and Upwards, Inc. for the upcoming funding cycle. This would result in not funding any economic development activities in FY 2025-26. Opportunities for funding under this category will be available for eligible applicants in FY 2026-27.
Public Improvements
The City received three public improvement project applications for FY 2025-26. There will be approximately $360,000 in funding available for non-housing public improvement projects. The public improvement project proposals received are as follows:
|
Proposed Public Improvement Projects |
Funding Requested |
CDBG Capital Recommended Funding |
|
Building Futures with Women and Children - Bessie Coleman Court Sewer Lateral Replacement & Renovations |
$350,000 |
$175,000 |
|
Alameda Food Bank Public Improvements |
$250,000 |
$100,000 |
|
Alameda Boys and Girls Club Security Enhancements |
$192,000 |
$85,000 |
Building Futures with Women and Children requested $350,000 for FY 2025-26 funding. In FY 2024-25, they were awarded $188,020 in CDBG entitlement funds for sewer lateral replacement and renovations at Bessie Coleman Court. Previous year’s award went towards capital improvements for one of the three buildings and this year’s funding request is for a different building on the same property. Building Futures with Women and Children is expected to leverage additional funds to fully fund the project to improve habitability. Alameda Food Bank requested $250,000 in funding to improve Americans with Disabilities Act (ADA) accessibility by upgrading the newly acquired facility and bringing the building up to compliance. Alameda Boys and Girls Club requested $192,000 to improve the safety and security of the facility by installing fencing and a keyless entry/access system. For the past three years, the City allocated $273,000 or more to public improvement projects. Availability of funds, eligibility with CDBG regulations, and project readiness are major factors in determining which projects should be funded. Based on funding availability and eligibility, staff recommends funding all three projects totaling $360,000. Should a project not move forward, funds will be reallocated to other awardees or reallocated through a new RFP process.
Residential Rehabilitation
The City will allocate approximately $345,758 to fund residential and substantial rehabilitation activities. Funds for substantial rehabilitation continue to be allocated as required per the 1990 Guyton Judgment and Settlement Agreement (Guyton Agreement). This agreement requires the City to undertake certain activities to further affordable housing production. Additionally, the Guyton Agreement requires that 15.3 percent of the City’s CDBG entitlement be allocated to the Substantial Rehabilitation Program. Funds for substantial rehabilitation will continue to be allocated as required.
In December 2024, the City entered into an agreement with Rebuilding Together East Bay Network (RTEBN) to administer the residential rehabilitation program. The program expectations are to ensure improved housing conditions for low-income, elderly, and disabled residents. As the program administrator, RTEBN is responsible for updating program guidelines and priorities, marketing the program, fielding inquiries, developing a scope of work, preparing loan documents, and construction management. RTEBN will administer one housing rehabilitation loan of up to $15,000 and four minor home modification grants of $5,000 each. As the program progresses, the second year will include an expansion to increase the number of households served. The second year of funding will be dependent on performance and compliance with City requirements.
Administrative Funds
Administrative funds have been included as permitted by HUD guidelines. Funds from this category are capped at 20% of the entitlement award. As was done in FY 2024-25, staff recommends funding Eden Information & Referral services with CDBG administrative funds in the amount of $26,000, which reduces the number of providers paid from the limited public service funds. SSHRB reviewers were not asked to score Eden I & R as it provides a needed service and is the sole provider of 211 information and referral services in Alameda County as well as serves as the City of Alameda Homeless Hotline. The City will allocate approximately $231,000 in total for general administration.
Carry-Forward Funds
Carry-forward funds are for projects in progress that were approved and appropriated the prior year but are not fully expended. Per HUD requirements, carry-forward funds are encumbered within the same grant year until a project is completed or a replacement project is identified and funds are reprogrammed to the new project. This Action Plan includes approximately $1,408,846 of carry-forward funds, based on the balance as of March 31, 2025. This includes funds for projects such as Bessie Coleman Court Sewer Lateral Replacement, Public Works ADA Transition Plan, and other eligible projects that are not fully completed.
HOME Funding Allocation
As a member of the Alameda County HOME Consortium, the City expects to receive approximately $200,000 in FY 2025-26 HOME funds of which five percent (5%) may be used for administrative purposes. It is recommended that the City use its remaining HOME allocation for the construction and/or rehabilitation of affordable housing.
The City received one application for HOME funding. Island City Development (ICD), a non-profit affiliate of the Alameda Housing Authority, requested $1,000,000 to build forty-six units of permanent supportive housing for formerly homeless individuals or households at North Housing PSH II, known as Estuary II. Staff proposes that the available estimated $200,000 be allocated to the Estuary Park II (North Housing PSH II) project. This is in addition to the $89,506 that was committed to this project in FY 2024-25 for a total estimated $289,506.
ALTERNATIVES
• Authorize the City Manager to adopt the CDBG/HOME FY 2025-26 Action Plan; and authorize the City Manager to negotiate and execute related documents, agreements, and modifications to implement the programs and projects for the upcoming fiscal year.
• Provide direction to staff for a modified service program funding allocation or capital project allocation, as long as those changes are consistent with HUD guidelines.
• Decline to move forward with adopting the proposed CDBG/HOME FY 2025-26 Action Plan at this time, which would result in the loss of CDBG and HOME funding for the upcoming fiscal year.
FINANCIAL IMPACT
To approve the FY 2025-26 CDBG/HOME Action Plan, $46,674 of the General Fund will monies already approved in the Housing and Human Services budget will be used to supplement CDBG funding for AFS program operations and will be offset by the use of PLHA funds for the AFS contract at Dignity Village. CDBG/HOME funds received will be budgeted in the CDBG Fund 203 and HOME Fund 204. This Action Plan will appropriate approximately $1.1 million in CDBG Entitlement funds. Other CDBG funds noted in the Action Plan include an estimated $60,000 in program income from loan repayments in FY 2024-25 from the Substantial Rehabilitation and Residential Rehabilitation programs. The Action Plan will appropriate approximately $200,000 of HOME funds for affordable housing administration, construction, and rehabilitation projects. In addition, approximately $1,408,846 will be appropriated and carried forward from prior years’ allocations.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action supports the City’s Strategic Plan priority to House All Alamedans and End Homelessness, specifically Project HH1 to address housing and human services functions and develop recommendations; Project HH2 to implement the Homelessness Strategic Plan; and Project HH3 to further the preservation, rehabilitation, or construction of affordable housing in Alameda.
In addition, the preparation of the FY 25-29 Strategic Plan is in accordance with HUD and County HOME Consortium requirements.
ENVIRONMENTAL REVIEW
The execution of related agreements and final funding commitments are subject to the requirements of the National Environmental Policy Act (NEPA) and satisfactory environmental clearance pursuant to 24 CFR Part 58. The City has satisfied all such NEPA requirements applicable to the actions recommended herein. Additionally, these actions does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
CLIMATE IMPACT
There are no identifiable climate impacts or climate action opportunities associated with the subject of this report.
RECOMMENDATION
Hold a public hearing consider adoption of the CDBG/HOME Partnership Investment Program Five-Year Strategic Plan for Fiscal Year (FY) 2025-29 and the FY 2025-26 CDBG/HOME Action Plan; and authorize the City Manager to negotiate and execute related documents, agreements, and modifications at funding levels approved by Congress.
Respectfully submitted,
Amy Wooldridge, Assistant City Manager
By,
C’Mone Falls, Housing & Human Services Manager
Yasamin Obaidy, Administrative Specialist
Andre Fairley, Management Analyst
Financial Impact section reviewed,
Ross McCarthy, Acting Finance Director
Exhibits:
1. Draft Five-Year Consolidated Plan
2. Citizen Participation Plan
3. SSHRB Needs Statement
4. Draft Summary of Activities
cc: Social Service Human Relations Board