Item 2C: Approval of CDBG and HOME Funding Allocations

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properties by for-profit and nonprofit developers, for tenant-based rental assistance and security deposit programs, for home buyer programs, for support of local Community Housing Development Organizations (CHDO), and for program administration. In addition to HOME Program funds, the American Dream Downpayment Initiative (ADDI) was signed into law in 2003. This program provides downpayment, closing costs, and rehabilitation assistance for first-time homebuyers and will be administered as part of the HOME Program. Next year, the consortium with receive $27,197, split 70/30 between Eugene and Springfield. Eugene will receive $19,037 and Springfield will receive $8,160. This represents a 50% decrease from last year. Acquisition/New Construction - $810,466 in new HOME funds and $15,000 in prior year’s funds will be used to acquire existing units identified by nonprofits, construction of new units, and rehabilitation. Projects in this category are selected through a Request for Proposals (RFP) process. The City of Eugene 2006 RFP was released in December with proposals due March 1, 2006. Funds will be awarded in conjunction with the Royal Danebo landbank parcel and for other acquisitions identified by developers in the RFP process. Recommendations from the current round will be presented the City Council on June 12, 2006. Downpayment Assistance - $59,514 in HOME funds, $19,037 in ADDI funds, and $70,000 in program income will be used with carryover funds for downpayment assistance through Eugene’s Homebuyer Assistance Program (HAP). Up to $6,000 is provided at closing to eligible households. The funds are repaid to the City upon resale of the home.The goal is to fund 40 downpayment assistance loans next program year. Interim Financing – Eugene continues to offer interim financing on affordable housing projects as funding is available. This method of financing supports the affordability of local housing projects and allows Eugene to expend HOME funds in a timely manner. Based on the results of the request for proposals process that is currently underway, there may be funding available for this interim use in 2006-07. There are no interim loans currently and no program income is expected in 2006-07. Community Housing Development Organization (CHDO) Operating Funds – The 5% of new grant funds allowed for CHDOs is allocated at the consortium level. CHDO operating funds will be split equally between the four active CHDOs: Metropolitan Affordable Housing Corporation, Neighborhood Economic Development Corporation (NEDCO), St. Vincent dePaul, and Mainstream Housing, Inc. Each CHDO will receive $18,275. Administration - $102,350 in HOME funds is used for administration, project management, and long term compliance monitoring. The Federal grant management system automatically budgets 10% of the grant amount for administrative efforts. RELATED CITY POLICIES This allocation plan is based on the Consolidated Plan 2005 which guides the use of federal CDBG, HOME, and ADDI funds through 2010. 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. L:\CMO\2006 Council Agendas\M060508\S0605082C.doc