Item 2: HUD Section 108/BEDI Individual Project

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the City’s general fund or any other general resources. Payments from the URA will be the pledged repayment source and primary collateral. Local governments that borrow Section 108 funds must also pledge their current and future CDBG allocations as a secondary source of repayment for the borrowing. However, the City does not anticipate utilizing future CDBG allocations as a source of repayment for this project given the financial capacity of the City’s Downtown Urban Renewal District to supplement project-specific cash flow and collateral. Next Steps There are four remaining steps in the process to access and use Section 108/BEDI funds for the West Broadway redevelopment project: 1) citizen participation; 2) compliance with other federal regulations for use of Section 108 and BEDI funds; 3) council approval to access (authority to borrow) the funds, and 4) council action related to the West Broadway Redevelopment project to use the funds. The City is currently in Step 1. Step 1 – Citizen Participation: The citizen participation component includes a comment period, CDBG Advisory Committee review, application draft review, and a public hearing. To ensure that funds would be ready to use within the current purchase option time frame, the 30-day public comment period officially began on June 20 with an advertisement in the Register-Guard. The ad explained the potential use of Section 108/BEDI funds and the process for commenting. Staff is gathering written comments and comments via phone or email through July 20. (As of July 6, no comments had been received.) The CDBG Advisory Committee is scheduled to convene on July 10 to review this project. In addition, a draft of the Section 108 individual application will be available at the reception desk of the Atrium Building starting on July 13. (An advertisement in the Register-Guard will notify the public of the availability of the application materials.) Step 2 – Federal Regulations: Other federal regulations include environmental review and acquisition/relocation procedures. The environmental review process includes documentation to show compliance with various federal laws and authorities, consultation with appropriate federal agencies, a public notification and advertising period, and a review period by HUD’s Portland office. Relocation and acquisition procedures which include appraisals and notifications are done in compliance with the Uniform Relocation Act. Staff is developing the necessary documentation, has commenced consultation with federal agencies, and expects to complete the federal processes by September. Step 3 – Council Action for Access to Funds: Prior to entering into any borrowing for an individual project, the council must approve a project bond resolution and take action on a URA bond pledging tax increment as security for the Section 108. Both actions are scheduled for July 23. Additionally, the Urban Renewal Plan amendments need to be approved prior to entering into a loan with HUD because the District’s current maximum indebtedness limit is not large enough to secure the full Section 108 loan. If the council approves the items on July 23, the City will then submit the individual project loan application for HUD review. Step 4 – Council Action for Use of Funds: The City will only have the ability to use the Section 108/BEDI funds after the council takes additional actions related to the West Broadway Redevelopment project. Specifically, the council will need to: a) review and approve the overall project, including consideration of any recommendations from the West Broadway Advisory Committee, and, b) approve a supplemental budget to authorize the use of funds. These actions are planned for September 2007. L:\CMO\2007 Council Agendas\M070716\S0707162.doc