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Other Background Information School Site Acquisition During the past year, School District 4-J identified Westmoreland as one among a number of surplus school sites to be offered for sale. This site is an attractive housing landbank site, given the difficulty of locating suitable land in the current market. This site offers an opportunity to secure a large, viable site for future low-income housing development. In July 2003, the HPB approved a subcommittee recommendation to acquire approximately three acres at a number of surplus school sites. They placed a high priority of the acquisition of the Westmoreland site. The City is coordinating with the school district on the purchase of approximately three acres at the Westmoreland site. The appraised value for 3.55 acres of the Westmoreland property is $480,000. For purposes of timeliness in expending funds, the City would like to purchase this site in April 2004. After the purchase of the West 8th Avenue site last month, a balance of only $389,400 remains in available CDBG funds. The CDBG Advisory Committee is recommending that the shortfall of approximately $100,000 be reprogrammed from housing rehabilitation program funds. Although this would reduce the estimated carry-forward in the housing rehabilitation program in 2004-05, there would still be adequate funds for projected loan activity. The CDBG Advisory Committee conducted a public hearing on March 3, 2004, on the reprogramming of the $100,000 needed to complete the transaction and recommended the action. At noon on March 8, 2004, the HPB will conduct a public hearing on the use of CDBG funds for the acquisition and is expected to reconfirm its earlier recommendation to purchase the site. Reprogramming Funds for Business Development Loans On September 22, 2003, the City Council approved five non-profit capital projects to receive CDBG funding in 2003-04. An allocation of $170,000 to improve the Heeran Center on Coburg Road was one of the projects. The approval of this allocation was a key piece in an application submitted by Lane County for federal funding to operate a federally-qualified health center. Lane County was successful in obtaining the grant but has informed the City that it has signed a lease for a facility in Springfield and will not be occupying the Heeran Center as proposed. The $170,000 previously allocated to this project is available for reprogramming. The Business Development Fund (BDF) makes loans to emerging and expanding small businesses in the community that create jobs for low-income individuals. The BDF manages a current loan portfolio of $3 million and has placed $1.74 million in the last eighteen months. For purposes of"timeliness," it would be best to fully expend the $170,000 in previously allocated funds by April 2004. The Business Development Fund is structured to be able to spend funds in a short time frame. Currently, all available loan funds have been committed and there are several applications pending. The CDBG Advisory Committee reviewed this option in February 2004, conducted a public hearing on March 3, 2004, and recommends the reprogramming action. Timing It is important to allocate funds in areas most likely to spend in a timely manner. These expenditures along with other ongoing programs and projects will facilitate the City in meeting the HUD "timeliness" test conducted on May 1. L:\CMO\2004 Council Agendas\M040308\S0403082D.doc