Title
Public Hearing to Consider Adoption of the Community Development Block Grant(CDBG)/HOME Partnership Investment Program (HOME) Five-Year Strategic Plan for FY 2020-25 and the FY 2020-21 CDBG/HOME Action Plan; and Authorize the City Manager to Negotiate and Execute Related Documents, Agreements, and Modifications. (Community Development 236/235)
Body
To: Honorable Mayor and Members of the City Council
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) 2020-21 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 2020-21, the City will receive $1,161,287 in CDBG Entitlement funds. As a member of the Alameda County HOME Partnership Investment Program (HOME) Consortium, the City expects to receive $266,050 in FY 2020-21 HOME Program funds. This public hearing is an opportunity for the community to weigh in on: 1) the proposed programs and projects that will be funded with CDBG and HOME monies in the upcoming FY and 2) the Five-Year Strategic Plan for FYs 2020-2025.
BACKGROUND
The City is an entitlement recipient of CDBG funds from HUD. CDBG funds support programs and activities that benefit low- and moderate-income persons and households and which help prevent or eliminate slums and blight. 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 programs, activities and resources that will be used to address the housing and community development priority needs and goals (Exhibit 1). A new five-year cycle will begin July 1, 2020.
The Strategic Plan for FYs 2020-25 sets forth broad policy goals and the City’s plan for addressing the identified 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 2020-21 Action Plan (Action Plan) covering the period of July 1, 2020 through June 30, 2021.
In preparing the Strategic Plan, the City consulted with community-based service providers, residents, and City departments and boards. The community stakeholders helped to establish priority needs and objectives and proposed strategies in the form of projects and activities to further those objectives. On November 21, 2019, the Social Service Human Relations Board (SSHRB) discussed priority needs and made a recommendation to the City Council regarding public service needs for the upcoming FY. A public hearing regarding public service needs was held at the City Council’s January 7, 2020 meeting. No written comments were received and the City Council adopted the needs statement as recommended by the SSHRB.
On February 14, 2020, HUD announced CDBG allocations for the FY 2020-21 Action Plan period. The City will receive $1,161,287 in CDBG Entitlement funds and projects $120,000 in program income from CDBG loan repayments in FY 2020-21. In addition, as a member of the Alameda County HOME Partnership Investment Program (HOME) Consortium, the City expects to receive $266,050 in FY 2020-21 HOME Program funds.
On March 27, 2020, the President of the United States signed the Coronavirus Aid, Relief, and Economic Security (CARES) Act into law. Through the CARES Act, HUD has been authorized to loosen some of its regulations for CDBG funding for FY 2019-20 and FY 2020-21, including:
• Extending the deadline for submission of Consolidated Plans
• Suspending the 15% cap on public services
• Authorizing a five-day public comment period (instead of the required 30-day comment period)
• Eliminating in-person public hearings, allowing grantees to hold virtual hearings
• Allowing HUD to further waive program requirements (except for requirements related to fair housing, non-discrimination, labor standards, and the environment)
HUD has acknowledged the City’s requests for the waivers listed above. Consequently, the Five-Year Consolidated Plan (is due on July 3, 2020. The Citizen Participation Plan was revised to incorporate shortened public comment periods, acknowledge the use of virtual hearings and recognize that information may be disseminated through electronic media. The updated Citizen Participation Plan was presented at the June 2, 2020 City Council meeting and is attached as Exhibit 2.
All citizen participation requirements have been met for the public hearing, with publication of the notice in the June 5, 2020 Alameda Journal newspaper, as well as in Chinese, Spanish, Tagalog, and Vietnamese-language newspapers. Accommodations are available for non-English speaking residents and persons with disabilities to participate in the public comment process.
DISCUSSION
The City of Alameda 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.
CDBG Funding Allocation
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, the SSHRB seeks input from the community and articulates needs that are specific to Alameda with a particular focus on 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 five areas of priority needs and 14 objectives that will be used to address the identified priority needs attached as Exhibit 3.
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 Active Transportation Plan Community Open House <https://www.activealameda.org/Events-listing/Open-House> held November 7, 2019
• City of Alameda Community Needs Assessment 2017
• City of Alameda Homelessness Report 2018
• Consultation with community-based organizations
• SSHRB meeting on public services needs
• City Council Annual Public Needs Hearing
In addition to recommending a needs statement to the City Council, SSHRB reviews and makes recommendations regarding funding for public services based on the adopted needs statement. At SSHRB’s March 26, 2020 meeting, the Board approved recommendations for CDBG public service funding. The letter from SSHRB is included as Exhibit 4. On May 28, 2020, staff presented to SSHRB three newly proposed public service programs to specifically address impacts on Alamedans’ physical, mental and financial health as a result of COVID-19. Those activities were presented to City Council on June 2, 2020.
While HUD regulations cap Public Services funding at 15% of the current year’s grant allocation plus program income received in the previous fiscal year, the CARES Act suspended the cap for expenditures in FY 2020-21. Consequently, in addition to the services proposed prior to the passage of the CARES Act, additional public services funding has been allocated for Emergency Rent Relief as the need is anticipated to exceed the funds available through the CDBG CARES Act funding approved on June 2, 2020. Staff is also recommending public service funding be used to provide augmented case management services to those unsheltered individuals at the day center and to those living in the FEMA trailers . Agreements for these services will be for one year, while all other public service agreements will be for two years.
Staff has prepared an Action Plan Summary of Activities (Exhibit 5). The summary lists activities recommended for funding in FY 2020-21. Funding sources include FY 2020-21 entitlement funds, program income, and carry-forward funds. The carry-forward funds (i.e., appropriated but unexpended funds) from the prior year are encumbered within the same grant year until a project is completed or a project is identified and funds are reprogrammed to the new project. This Action Plan includes approximately $1,399,100 of carry-forward funds, based on the balance as of April 30, 2020. This includes funds for projects that have been previously approved, but not yet completed (e.g., Alameda Food Bank relocation and tenant improvement project).
The proposed activities for FY 2020-21 are intended to address both the current urgent needs that arose from the coronavirus and subsequent shelter-in-place orders while also preparing the City and its most vulnerable residents for recovery. There are four new public improvement projects proposed:
1. Teen Technology Lab for the Alameda Boys and Girls Club.
2. Health, safety and energy efficiency improvements at Midway Shelter, including replacing dilapidated and unsafe decking that provides access to each of the trailers.
3. Health and safety improvements, including fencing and striping as well as construction of shower and kitchen facilities on the premises of the new Safe Parking/day center location.
4. Park improvements, including rubberized surfacing to improve ADA accessibility and safety and energy efficient upgrades at Woodstock Park
Lastly, the City will carry forward funds for two projects - Alameda Food Bank tenant improvements and clearance. Due to the increased demand and the social distancing requirements that arose from the COVID-19 health pandemic, the Alameda Food Bank has begun operating out of its warehouse and using it as the primary distribution facility. By operating out of the warehouse instead of its normal location, the Food Bank clients can safely drive through and receive prepackaged bags of food. The Food Bank has proposed to use the funds for tenant improvements that will make its existing warehouse more useable:
• New roll-up loading dock door (w/electrical work required)
• New double sink with sprayer faucet
• Rolling chain link gate
• Widen a doorway/reframe to accommodate forklift
Clearance funds had been set aside in anticipation of work starting at any one of several nonprofit affordable housing developments. Demolition work at Rosefield Village as well as at the North Alameda Housing site is slated to begin in the first half of the upcoming fiscal year.
HOME Funding Allocation and Activities
As a member of the Alameda County HOME Consortium, the City expects to receive $266,050 in FY 2020-21 HOME funds of which $15,099 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. Staff received two applications for HOME funds. Staff proposes that $125,000 be allocated to the Rosefield Village project and the remaining $125,951, plus any program income, be allocated to the 1245 McKay Avenue project.
ALTERNATIVES
• Staff recommends that City Council hold a public hearing to consider adoption of: 1) the CDBG/HOME Program Five-Year Strategic Plan for FY 2020-25 and 2) the FY 2020-21 CDBG/HOME Action Plan. Staff further recommends that City Council authorize the City Manager to negotiate and execute related documents, agreements, and modifications to implement the programs described above.
• While CDBG regulations require that a public hearing be held to adopt the Five-Year Strategic Plan and the annual Action Plan, City Council could direct staff to consider other new programs for funding as long as those programs are consistent with HUD guidelines (e.g., assistance is limited to low-income residents, funding caps are followed, etc.).
• Council may modify the recommendations prior to acceptance. Such modifications could include making changes to the programs to be funded or revising the proposed funding allocation among the proposed projects.
• City Council could decline to move forward with adopting the proposed Five-Year Strategic Plan and the FY 2020-21 Action Plan at this time, which would result in the loss of CDBG and HOME funding for up to five years.
FINANCIAL IMPACT
There is no impact to the General Fund to approve the FY 2020-21 CDBG/HOME Action Plan. CDBG/HOME funds received will be budgeted in the CDBG Fund 236 and HOME Fund 235. This Action Plan will appropriate an estimated $1,161,287 in CDBG Entitlement funds. Other CDBG funds noted in the Action Plan include an estimated $120,000 in program income from loan repayments in FY 2020-21 from the Substantial Rehab and Residential Rehab programs. The Action Plan will appropriate approximately $266,050 of HOME funds for affordable housing administration, construction, and rehabilitation projects. In addition, approximately $1,399,100 will be appropriated and carried forward from prior years’ allocations.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The proposed Action Plan is consistent with the City’s CDBG Five-Year Strategic Plan and citizen participation requirements. Preparation of the FY 20-25 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.
CLIMATE IMPACTS
This action has no climate impacts.
RECOMMENDATION
Conduct a public hearing and:
1. Adopt the Five-Year Strategic Plan for FYs 2020-2025;
2. Adopt the FY 2020-21 CDBG/HOME Action Plan; and
3. Authorize the City Manager to negotiate and execute grant agreements, grant modifications, and other related documents at funding levels approved by Congress.
CITY MANAGER RECOMMENDATION
The City Manager recommends adoption of the five-year strategic plan and adoption of the CDBG/HOME Action Plan.
Respectfully submitted,
Debbie Potter, Community Development Director
By,
Lisa Fitts, CDBG Management Analyst
Financial impact section reviewed,
Nancy Bronstein, Human Resources Director and Interim Finance Director
Exhibits:
1. Draft Consolidated Plan
2. Citizen Participation Plan
3. Priority Needs and Objectives
4. Public Services Support Letter
5. Summary of Activities
cc: Eric Levitt, City Manager