Item 5: 2012/13 Funding Allocations for CDBG and HOME

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The CDBG Advisory Committee held a public hearing and adopted a final recommendation for use of CDBG funds on April 10, 2012. The recommended allocation of new entitlement funds includes funding for public services which includes operating funds for eight social service programs, two nonprofit capital facility expansions, microenterprise training, and program administration. The package of recommended uses will address critical community needs for social services, and employment opportunities. Program income from the Business Development Fund and Housing Rehabilitation Fund will be allocated for new business and housing rehabilitation activities. Attachment A provides a table showing the sources, recommended uses, and a brief description for each use of CDBG funds. HOME Investment Partnerships Program The primary purpose of HOME is to expand the supply of housing affordable to low-income persons. The City is the lead entity in the Eugene-Springfield HOME Consortium, which has received annual entitlement grants since 1992. The Eugene-Springfield Consortium will receive an estimated $983,051 in HOME funds in FY 2012/13. This entitlement allocation is $364,059 (27 percent) less than the amount received in the previous year. Eugene will receive 70 percent of entitlement grant funds ($688,136) and Springfield will receive 30 percent ($294,915). The expected program income will come from repayments received through the Homebuyer Assistance Program (HAP) and from other housing development loans. The HPB met on April 2, held a public hearing, and made a recommendation for allocation of HOME funds to both jurisdictions. HPB recommends that Eugene’s portion of HOME funds be divided among two program areas: 1) Housing Development Programs; and 2) Community Housing Development Organization (CHDO) Operating Support. The proposed allocation differs from previous allocations of HOME funds with the exclusion of funding the HAP Program. HPB recommends no funds be allocated to either the Security Deposit Assistance Program or Eugene’s HAP Program. While there is a community need for security deposit, initial lease, and first time homebuyer assistance to help low- and very-low income persons attain housing, funding available to support staff time necessary to implement the programs is not available. The proposed allocation maintains support for a mix of housing development and organizational support. In addition to these programs, Eugene staff anticipates up to $1,000,000 will be available for HOME interim financing. Through HOME interim financing, the City makes short-term loans for HOME eligible uses with funds dedicated but not yet disbursed for specific projects. The amount of funds available for HOME interim financing is dependent on project timing. If the City’s actual allocation is greater or lesser than estimated, adjustments will be shared equally across the program areas and administration. Attachment B includes a table which shows the sources, recommended uses, and a brief description for each use of HOME funds. RELATED CITY POLICIES The Action Plan must be developed in accordance with the Eugene-Springfield 2010 Consolidated Plan, which assesses local needs and establishes a five-year strategic plan. In order to allocate funds to specific programs or projects, HUD regulations require a citizen participation process, including advertising and conducting a public hearing, followed by City Council action. S:\CMO\2012 Council Agendas\M120423\S1204235.doc