07-05-2011 - FY 2011/2012 Community Development Block Grant (CD - Item 10 (2).doc
TO: Andrew G. Pasmant, City Manager Andrew G. Pasmant, City Manager
and City Council
FROM: Michele L. McNeill,
Community Services Director
SUBJECT: FY 2011-2012 COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) PUBLIC SERVICE PROJECT FUNDING
RECOMMENDATION:
Staff recommends that the City Council allocate $192,296 in CDBG funds to the Public Service Projects as outlined in Attachment #1, Column H (Staff Recommendation) and authorize the
necessary appropriations.
DISCUSSION:
The City of West Covina receives an annual allocation of CDBG funds from the U.S. Department of Housing and Urban Development (HUD). The FY 2011-2012 CDBG allocation is $1,077,643,
which represents a decrease of $213,960 or 16.6% from the FY 2010-2011 allocation.
In its approved FY 2011-2012 CDBG Action Plan, the City indicated that it would fund public services to the maximum allowable level. By regulation 15% of the grant total, plus program
income generated in the prior year, can be used to fund public services.
For West Covina, program income is derived from repayments of CDBG-funded loans to the City’s Home Improvement Loan Program, which are due at the time of title transfer of the home.
Staff estimates the City will receive $204,355 in FY 2010-2011, significantly more than anticipated.
The sum of the grant amount ($1,077,643) and the program income ($204,330) is $1,281,973. Fifteen (15) percent of this total is $192,296, which represents the total amount available
for public services in FY 2011-2012. Relative to FY 2010-2011, this amount is a decrease of $5,944. The impact of the reduced grant amount was slightly mitigated by the increase in
the amount of program income received.
The City published a Notice of Funding Availability in February 2011 and received 14 funding requests totaling $279,824 ($87,528 more than is estimated to be available from CDBG funds)
for public service providers serving West Covina residents. Funding recommendations are shown in Attachment #1. Descriptions of the applicants are included in Attachment #2. Past
and proposed performance is summarized on Attachment #3.
Two of the proposals were not recommended for funding. First, after a consultation with HUD, the specific activity proposed by Love INC., was determined to be ineligible. The organization,
which provides several services, was given the opportunity to present another proposal. They did not, but will apply next year. The second proposal was from the Center for Aging Resources
(CAPS), which the City has funded for the past several years. The organization provides an adult day care. During the presentation on May 26, the program representative indicated
that their Board of Directors recently voted to discontinue the program, citing financial concerns. The program manager was attempting to secure funding commitments and implement a
cost reduction plan that would be presented to the Board in July such that their prior action might be reconsidered.
While the balance of applicants provide a worthy and CDBG-eligible service, the staff recommendation seeks to maintain status quo funding for City projects and offset City-program expenses
that would otherwise be supported by the City's General Fund. (All City projects are designated with an (*) asterisk). A decrease in CDBG funding to these programs would result in
an increased burden on the General Fund in order to maintain current service levels.
Staff also recommends status quo funding for the Housing Rights Center. Fair housing is a high priority since the City, as a CDBG recipient, is required to certify to HUD that it affirmatively
furthers fair housing. In order to accomplish this, the City uses CDBG to fund the Housing Rights Center, which provides fair housing services to the City. Fair housing is a unique
activity in that HUD allows it to be funded as either a public service or administrative activity, which are capped at 15% and 20% respectively. In recent years, the City has funded
fair housing as an administrative activity in order to free up as much funding as possible under the public service cap for other activities. As a result of the reduced grant from
HUD, staff is recommending that fair housing be funded as a public service to free up funds under the administrative cap and mitigate impact to the General Fund.
Lastly, the staff recommendation is meant to fund service areas (outside of City programs) that help to address the comprehensive needs of a senior, a crime victim, or a homeless person.
The intention was to focus on those services that would complete a continuum of care for individuals in need, while complimenting the services provided by the City of West Covina.
In sum, staff recommends status quo funding for City-administered projects and for the Housing Rights Center. Attempting to fund the balance of proposals in as equitable a manner as
possible, a percentage was determined, which compared the remaining funds ($68,153) to the sum of last year’s approved amounts ($79,110). The staff recommendation represents funding
for each activity, up to this percentage (86.15%) of the amount approved in FY 2010-2011.
Opportunities may exist to amend funding for these providers during the program year, based on a mid-year evaluation of expenditures or increased receipts of program income. Staff will
bring these opportunities forward as they arise.
ALTERNATIVES:
Alternatives are:
Allocate $192,296 in CDBG funds to the Public Service Projects as outlined in Attachment #1, Column H (Staff Recommendation) and authorize the necessary appropriations.
Allocate $192,296 in CDBG funds to the Public Service Projects as outlined in Attachment #1, Column F (Community Services Commission Recommendation) and authorize the necessary appropriations.
Allocate $192,296 in CDBG funds to the Public Service Projects as outlined in Attachment #1, Column G (Senior Citizens Commission Recommendation) and authorize the necessary appropriations.
Reconsider recommendations and adjust funding amounts for some or all of the projects.
FISCAL IMPACT:
The proposed $192,296 represents 15% of the City’s $1,077,643 entitlement from HUD for FY 2011-2012, plus an additional 15% of $204,330 in program income, which staff estimates to be
generated at the close of FY 2010-2011.
COMMISSION DISCUSSION AND RECOMMENDATION:
Public Service Project applicants made presentations to the CDBG Ad Hoc Committees of the Community Services and Senior Citizens Commissions, which met jointly on May 26, 2011. The
CDBG Ad Hoc Committees then met separately to develop allocation recommendations. In a Special Meeting on June 14, the Community Services Commission approved to forward recommendations
to the City Council for consideration, as shown on Attachment #1, Column F. During its regularly scheduled meeting on June 23, the Senior Citizens Commission approved to forward recommendations
to the City Council for consideration, as shown on Attachment #1, Column G.
_____________________________ ______________________________________
Prepared by: Kelly McDonald Reviewed/Approved by: Michele L. McNeill
Management Analyst II Community Services Director
Reviewed /Approved by: __________
Finance
Attachments:
Attachment #1: FY 2011-2012 CDBG Public Service Project Applicants and
Funding Recommendations
Attachment #2: FY 2011-2012 CDBG Public Service Project Applicants
Attachment #3: FY 2011-2012 CDBG Public Service Project Applicants –
Summary of Past and Proposed Performance