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HomeMy WebLinkAboutItem 3H: Approval of Funding for CDBG and HOME Programs ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Approval of 2008/09 Funding Allocations for Federal Community Development Block Grant, HOME Investment Partnerships and American Dream Downpayment Initiative Programs Meeting Date: April 14, 2008 Agenda Item Number: 3H Department: Planning and Development Staff Contact: Linda Dawson www.eugene-or.gov Contact Telephone Number: 682-5071 ISSUE STATEMENT The City Council is asked to approve the use of funds in three Federal programs funded by the U.S. Department of Housing and Urban Development (HUD). In 2008/09, Eugene will receive a $1,366,201 entitlement grant and $1,125,000 in program income from the Community Development Block Grant (CDBG) program; $983,079 through the HOME Investment Partnerships Program (HOME), and $7,691 in the American Dream Downpayment Initiative (ADDI) funds. BACKGROUND Annually in the spring, the City Council approves funding allocations for Federal HUD grant programs for the upcoming fiscal year starting on July 1. The City has received CDBG funds since 1975. HOME funding has been received by the Eugene-Springfield Consortium since 1992, with Eugene receiving 70% of the funds and serving as the lead agency. In 2003, the Eugene-Springfield Consortium began receiving funding through the ADDI Program. The annual funding allocations, called One-Year Action Plans, are prepared in the context of the five-year HUD Consolidated Plan. Fiscal Year 2008/09 will be the fourth year in the Consolidated Plan 2005. The CDBG Advisory Committee advises the Planning and Development Department on the use of CDBG funds. The Housing Policy Board (HPB) advises the City Council on the use of HOME and ADDI funds. Community Development Block Grant (CDBG) The Community Development Block Grant (CDBG) Advisory Committee conducted a public hearing on April 1, 2008, on the preliminary recommendation for use of funds. After the public hearing, the committee considered adding $25,000 to the original $34,000 proposed for improvements at the new Pearl Buck Center facility instead of funding accessible parking improvements at the Owen Rose Garden, as originally recommended. After much discussion and two tied votes, the committee members concluded that they were unable to make a recommendation on the use of those funds. Staff recommends that the $25,000 be used for improvements at the Pearl Buck Center since timing on the City’s participation with CDBG funds is critical for this project. Funding for the much needed improvements at the Owen Rose Garden can be sought in the future. The CDBG-AC and staff recommend the following use of CDBG funds for 2008/09. The allocation includes $1,366,201 in new grant funds and $1,125,000 in program income from the housing and F:\CMO\2008 Council Agendas\M080414\S0804143H.doc business loan programs. The amount of new grant dollars represents a 4% cut in CDBG funding from the previous year. New grant funds are recommended for use as follows. Landbanking for Low-Income Housing Development - $ 0. No new funds were requested since a site is not currently identified for acquisition. The City anticipates receiving program income from the sale of 20 single-family lots upon completion of the final phase of development at the Walnut Grove landbanked site. These funds may be used towards acquisition of a new site. Staff continues to seek acquisition opportunities and, if necessary, will convene the CDBG committee to discuss funding options in 2008/09, including use of this program income and possible use of other City funds to be repaid from future CDBG allocations. There are currently four sites in the landbank program for low- income housing: Willow Creek, County Farm Road, Willakenzie, and Westmoreland. Housing Rehabilitation – $0. No new grant funds will be allocated next year. Estimated carryover of $325,000 will be used in conjunction with the estimated program income amount from loan repayments of $350,000. The program offers low-interest loans through the City’s Housing Rehabilitation Loan Program for improvements to residences occupied by low-income homeowners and tenants. Emergency repair grants and loans of up to $5,000 will be provided to very low-income homeowners for minor repairs and accessibility features. Grants for accessibility improvements will be made for tenants with disabilities. Public Services Operations - $350,000 in new funds will be used to fund services as selected by the intergovernmental Human Services Commission (HSC). Public service funding is capped at 15% of new grant funds and program income from the prior fiscal year. The current allocation maintains funding consistent with prior years. Agencies to be funded include: Catholic Community Services family counseling, FOOD for Lane County dinner program and food box distribution, Relief Nursery therapeutic preschool, St. Vincent DePaul singles and family day-access centers, and White Bird medical/dental clinics and intensive case management. Public Services Non-Profit Capital Projects - $313,701 in new funds will be used to improve five facilities owned by local non-profit service providers and provide $15,000 in project related costs including environmental reviews, advertising, printing of bid documents, asbestos/lead based paint testing, and title-recording fees. Funds can be used for acquisition, new construction, rehabilitation, accessibility improvements, and weatherization efforts. Projects are selected annually through a Request for Proposals (RFP) process. Applications are reviewed and funding recommended to the full CDBG Advisory Committee by a review team comprised of three CDBG-AC members and a community member with construction expertise. The following projects are recommended: Relief Nursery The agency will use $57,000 to replace nine HVAC units in order to upgrade a failing heating system at the main facility located at 1720 West 25th Avenue. The agency’s mission is to prevent child abuse and neglect by delivering comprehensive early intervention and family preservation services to strengthen families, and promote children’s health and their physical, emotional, cognitive, and social development. The agency serves all of Lane County. Last year Relief Nursery served 663 Eugene families (52% of their client base). They offer respite, parent/child labs, parent education programs, anger management classes, ESL classes, recovery support activities, parent-teacher conferences, and family events. F:\CMO\2008 Council Agendas\M080414\S0804143H.doc Sponsors Women’s Program The agency will use $40,201 for improvements to the failing main sewer line and gutters, replacing severely deteriorated kitchen flooring, and exterior painting. Five women th transitioning from the criminal justice system and their children reside in this house at 767 West 8 Avenue. ShelterCare Garden Avenue Residence The agency will use $130,000 to re-configure the kitchen and dining areas at this residential facility which houses 12 persons with mental illness. Though the cost to re-configure a kitchen is high, this proposal substantially increases the functionality of the limited space and will provide better social interaction and meeting space. The house is located at 3692 Hickory in the Harlow neighborhood. Head Start at Ross Lane Apartments The agency will use $37,500 to add a small counseling room to their day care facility at an affordable housing complex owned by St. Vincent DePaul. The Ross Lane facility located at 2684 Ross Lane, is the smallest Head Start facility in Lane County. The addition will provide 120 additional square feet to the existing 800 square foot classroom. The facility provides full- day/full-year comprehensive services for 16 families in West Eugene. The space also accommodates five adult workers. Pearl Buck Center The agency will use $59,000 for fencing, landscaping, and lighting at their new st facility at 3690 West 1 Avenue. The production wing is complete and operational. Improvements in the independent living program and child care program areas, including the playground, surfacing and fencing are underway at this time and will make the facility operational. The agency is currently in a capital campaign and has raised nearly half of the $6 million goal. The agency provides an array of services, such as vocational training and employment, self care, community integration, and recreation to adults with developmental disabilities. The agency also provides mentoring services, case management and a pre-school for clients and their children. City Capital Projects – A total of $257,500 will be used on City capital improvements. Curb Ramps Since the implementation of Section 504 of the Rehabilitation Act of 1973 and the subsequent adoption of the Americans with Disabilities Act (ADA), the City of Eugene has had an ongoing commitment to install and reconstruct accessible curb ramps throughout the City. This program has traditionally been funded at a level of $50,000 to $75,000 annually. The Six-Year Capital Improvement Program (CIP), presented to the Budget Committee, assumed that $60,000 in CDBG funding would continue over the next several years. The $60,000 in CDBG funds will be used to install curb ramps at city-wide locations. Accessible Pedestrian Signals (APS) provide audible and tactile cues to assist pedestrians in making safe decisions when crossing at intersection crosswalks. This safety concern is paramount to people who are visually impaired. In 2006-07, the Budget Committee recommended the implementation of an annual program at the $65,000 level for the system-wide retrofit of Audible Pedestrian Signals, similar to the ADA curb cut program. The cost for the retrofit of a typical four-legged intersection is estimated at $6,500 for materials. The committee suggested that possible sources of funding for the $65,000 would include, but not be limited to, CDBG, STP-U, General Capital Projects, and Road Funds. After evaluating the possible funding sources for 2008/09, CDBG was determined to be the only viable source. Possible sources will continue to be evaluated each year. $65,000 will be used to install F:\CMO\2008 Council Agendas\M080414\S0804143H.doc accessible pedestrian signals at locations prioritized by the Human Rights Commission Accessibility Committee. Kaufman Senior Center Wheelchair Lift The Kaufman Senior Center has two 20-year-old wheelchair lifts. Both lifts are outdated and do not comply with current elevator codes. The lifts have proven to be unreliable and repair parts are no longer available. One lift travels from the ground level to the main floor of the center. The other lift travels from the ground level to the basement level. A ramp was recently installed to provide wheelchair access to the main floor, but a reliable wheelchair lift is still needed to access the basement. The funding will be used to replace the lift that travels to the basement level. Parts from the removed lift will be salvaged and used to repair the lift to the main floor if and when the upper lift breaks down. $37,500 in CDBG funds will be used to replace the lower lift. Soreng Theater Wheelchair Lift The stage of the Soreng Theater is only accessible to a person in a wheelchair by way of a freight elevator. A wheelchair lift will be installed at the Hult Center’s Soreng Theater to provide performers and the public access to the stage. The Soreng Theater is used by many community groups both for performances, presentations, and recognition events. Some of the regular community users who will benefit from this improvement include LILA (Lane Independent Living Alliance), ACT-SO, (a year-long enrichment program for African-American high school students), Emerald Awards (a Eugene Chamber of Commerce event where audience members are recognized for contributions to the community), Mobility International,ACE Awards(A Champion in Education) and regular school tours and public tours of the Hult Center. CDBG funds totaling $70,000 will be used to install a new lift. Economic Development - $775,000 in program income will be used for loans to businesses creating jobs for low-income persons through the Business Development Fund (BDF) and the Emerging Business Loan Pool. The BDF is a CDBG revolving loan fund for new and expanding local businesses that promotes job creation for low and moderate income individuals. The program funds projects unable to access 100% of financing through conventional lending sources. Matching funds in the form of private bank loans and/or owner equity is required for BDF eligibility. BDF loans typically cover 25 – 50% of project financing. To maximize program goals, interest rates are below-market and terms are based on project needs. Although the program is mainly focused on job creation, commercial revitalization projects that eliminate conditions of slums and blight are also eligible. The Loan Advisory Committee, a six-member citizen advisory committee, reviews all loan proposals prior to approval. Loan repayments are restricted to re-lending activity within the revolving fund. To date, the BDF has loaned over $13.8 million to over 200 businesses, leveraged private investments exceeding $35 million, and created over 1,040 jobs. The Emerging Business Loan Pool (EBLP) was established in the late 1980’s as a spin-off program within the BDF to reach businesses that face extraordinary credit barriers, defined as impediments to small business formation and expansion that stem from high risk and socio-economic factors, such as low-income status and cultural differences. The EBLP can provide up to 100% financing for a project. The CDBG program has targeted 25% of its business lending to occur in the EBLP. During the last five years, $1,355,000 (43% of BDF disbursements) has been loaned through the EBLP and has helped create 55 jobs (37% of the total jobs created). Lane MicroBusiness will receive $25,000 to provide micro-enterprise business development services such as training, education, and workshops for Eugene low-income micro-business entrepreneurs. F:\CMO\2008 Council Agendas\M080414\S0804143H.doc Administration - $420,000 in new funds will be used for project implementation, fair housing activities, the City’s Central Services allocation, the annual audit, and general program administration. This is the same amount as the last three annual allocations. Section 108 Loan Guarantee Program In July 2006, HUD approved the City’s Section 108 application for funding to create a $9,895,000 loan pool, together with Brownfield Economic Development Initiative (BEDI) grant funds, for redevelopment projects within the Downtown and Riverfront urban renewal districts. On February 26, 2007, the City Council approved an ordinance authorizing the use of the HUD Section 108 loan as a financing tool. The non-emergency ordinance established the City’s general ability to borrow for Section 108 projects with the stipulation that individual projects be approved by council resolution. The City received approval for its first individual Section 108 project for the acquisition of downtown property from the Portland field office in August of 2007. Due to unanticipated changes in the development financing and plan for the West Broadway redevelopment area, the individual project application was revised in March 2008. The revised application proposes to utilize a combination of federal and local funds to support the redevelopment of properties at the heart of downtown, along Broadway and Willamette Street. Specifically, the City seeks to acquire two properties (four tax lots) with $3.91 million in Federal Section 108 Loan Guarantee Program funds and $0.99 million in BEDI grant funds (the Properties). The City will work with Beam Development to remake the important intersection of Willamette and Broadway into a vital area with restaurants, a mix of national and local retailers, and office space. The scale of the buildings will entail new construction of a five-story building and historic rehabilitation of the existing five-story and two-story buildings known as the Centre Court and Washburne buildings, respectively. The national objective for this first individual Section 108 project is the elimination of slums and blight. The City anticipates participation in the Beam project with the use of Section 108/BEDI funds in two phases. In the first phase (Section 108 Loan #1), the City will acquire the properties. In the second phase (Section 108 Loan #2), the City anticipates providing a second layer of construction financing to Beam through a loan of Section 108/BEDI funds. HOME Investment Partnerships Program/American Dream Downpayment Initiatitve The Eugene-Springfield Consortium will receive $1,404,399 in Federal HOME Investment Partnerships Program (HOME) funding in fiscal year 2008/09. These funds will continue to be split 70/30 between the two jurisdictions; Eugene will receive $983,079 and Springfield will receive $421,320. HOME funds can be used for acquisition and development of housing affordable to low- and moderate-income households, rehabilitation, homebuyer programs, rental assistance, support of local Community Housing Development Organizations (CHDO) and HOME program administration. In addition to HOME Program funds, the Consortium will receive funding through the American Dream Downpayment Initiative (ADDI), which was signed into law on December 16, 2003. This program provides down payment, closing costs, and rehabilitation assistance for first-time homebuyers and will be administered as part of the HOME Program. In fiscal year 2008/09, the consortium will receive $10,989, split 70/30 between Eugene and Springfield. This amount is a reduction of $16,208 from last year’s allocation. Eugene will receive $7,692 and Springfield will receive $3,297. Staff proposes that HOME funds be divided among three program areas: 1) Housing Development Programs; 2) Homebuyer Assistance Program (HAP); and 3) CHDO Operating Support. This proposal F:\CMO\2008 Council Agendas\M080414\S0804143H.doc is similar to the allocation of funds in the last fiscal year. In addition to these programs, Eugene staff anticipates up to $1,000,000 will be available for HOME interim financing. This amount may change depending upon project timing and overall availability of funds. Housing Development – $700,000 in new and carryover funds. Housing Development includes funding for acquisitions, new development construction, rehabilitation, and project-related soft costs incurred by the jurisdictions. Funds can be used for rental or home ownership developments. Eugene awards funds in this category through an annual RFP processes. Eugene’s 2008 Housing RFP was released in November and proposals were due in February 2008. The Allocations Committee reviewed the proposals and recommended projects for consideration at a public hearing to be conducted by the thth Housing Policy Board on May 5. The item will come to the council on June 5. Homebuyer Assistance Program (HAP) – $150,000 in new funds and up to an additional $100,000 based on how much program income is received. Eugene offers up to $10,000 in downpayment assistance at closing to eligible households seeking to purchase homes. The funds are repaid upon resale . of the homeDue to increasing home sale prices, Eugene saw a decline in demand for down payment assistance in 2006/07 with only 12 loans closing that year. In 2007/08, however, 23 loans were made, in great part due to the conversion of Westmoreland units to condominiums. Staff continues to actively seek out opportunities to partner with developers to create more affordable homeownership options. In these cases, staff recommends increasing the loan amount up to $20,000 when appropriate. Community Development Housing Organization (CHDO) Operating Funds – The Consortium may award up to 5% of new HOME funds for CHDO general operating grants. The total budgeted amount for this item is $70,000. Eugene’s contribution is $49,000 and Springfield’s contribution is $21,000. Consortium CHDO operating funds will be split equally between the four active CHDOs: Mainstream Housing, Inc, Metropolitan Affordable Housing Corporation (Metro), Neighborhood Economic Development Corporation (NEDCO), and St. Vincent DePaul Society of Lane County, Inc. Each CHDO will receive $17,500. All CHDO’s must be certified or recertified each year in order to receive CHDO Operating Funds. Administration - $98,308 – The Federal grant management system automatically budgets 10% of new HOME funds for administration. Eugene will receive 70% of the amount awarded to the Consortium. 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. COUNCIL OPTIONS The City Council can approve, not approve, or modify the One-Year Action Plan for use of Federal CDBG, HOME, and ADDI funds for 2008/09. F:\CMO\2008 Council Agendas\M080414\S0804143H.doc CITY MANAGER’S RECOMMENDATION The City Manager recommends approval of the One-Year Action Plan for use of Federal CDBG, HOME, and ADDI funds in 2008/09. SUGGESTED MOTION Move to approve the One-Year Action Plan for use of Federal CDBG, HOME, and ADDI funds in 2008/09. ATTACHMENTS A. CDBG-Five Year Summary of One-Year Action Plans B. Summary of HOME/ADDI Allocations C. CDBG Advisory Committee, CDBG Non-profit Capital Project Review Team, and Housing Policy Board Members Lists D. History of CDBG Non-Profit Capital Funding FOR MORE INFORMATION Staff Contact: Linda Dawson Telephone: 682-5071 Staff E-Mail: linda.l.dawson@ci.eugene.or.us F:\CMO\2008 Council Agendas\M080414\S0804143H.doc ATTACHMENT A City of Eugene CDBG Allocations Summary Consolidated Plan 2000 Consolidated Plan 2005 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 HOUSING Housing Rehabilitation 173,000 195,000 0 0 0 0 250,000 215,784 Program Income 363,380 395,000 446,000 510,000 450,000 425,000 400,000 450,000 Housing Development 300,000 300,000 100,000 385,400 400,000 0 0 0 Program Income 255,000 200,000 PUBLIC SERVICES Operations 392,000 395,000 370,000 389,350 389,350 390,000 350,000 350,000 Non-profit Capital Projects 90,000 110,000 250,000 240,000 165,000 246,773 277,978 150,500 Program Income 76,708 CITY CAPITAL PROJECTS Facilities Access Improvements 125,000 130,000 178,000 159,000 130,530 297,379 50,000 Curb Ramps 50,000 50,000 75,000 60,000 60,000 60,000 60,000 Neighborhood Projects 50,000 42,250 70,000 Neighborhood Matching Grants 21,000 10,000 Neighborhood Parks 10,000 61,000 35,000 140,000 92,000 Accessible Pedestrian Signals 13,000 59,990 65,000 ECONOMIC DEVELOPMENT Business Loan Program 0 0 200,000 0 0 0 0 215,500 Program Income 584,286 610,000 575,000 518,000 710,000 650,000 625,000 785,000 Micro-enterprise Training 25,000 30,000 35,000 25,000 0 25,000 0 30,000 ADMINISTRATION Planning & Implementation 370,000 370,000 400,000 412,000 416,120 420,000 420,000 420,000 Total Annual Grant Allocation $1,546,000 $1,603,000 $1,584,000 $1,713,000 $1,666,000 $1,579,152 $1,417,968 $1,415,794 Total Estimated Program Income $947,666 $1,005,000 $1,021,000 $1,028,000 $1,160,000 $1,075,000 $1,356,708 $1,435,000 Prior Years’ Funding $0 $0 $75,000 $15,000 $0 $40,000 $0 $233,000 GRAND TOTAL $2,493,666 $2,608,000 $2,680,000 $2,756,000 $2,826,000 $2,694,152 $2,774,676 $3,083,794 Neighborhood Improvements include: West University Pedestrian Lighting, Bethel Path Neighborhood Parks Improvements include: Scobert, Monroe, Trainsong, and Acorn Parks F:\CMO\2008 Council Agendas\M080414\S0804143H.doc ATTACHMENT B City of Eugene HOME and ADDI Allocations Summary HOMEProgram New Construction/ CHDO Operating* Administration Downpayment Assistance Total Acquisition HOME ADDI 2000-01 $812,750 $50,715 $101,430 $50,000 $1,014,300 2001-02 $959,140 $56,420 $112,840 $0 $1,128,400 2002-03 $862,115 $56,595 $113,190 $100,000 $1,131,900 2003-04 $872,915 $57,230 $114,461 $100,000 $56,702 $1,201,308 2004-05 $972,548 $57,209 $114,417 $0 $66,910 $1,211,084 2005-06 $782,795 $54,288 $108,576 $125,000 $38,154 $1,108,813 2006-07 $810,466 $51,170 $102,350 $59,514• $19,037 $1,042,537 2007-08 $655,983• $50,806 $101,619 $207,805• $19,037 $1,035,253 2008-09P $693,462• $49,000 $ 98,308 $142,309• $ 7,692 $ 990,770 ROPOSED •Supplemented by program income (earned by loan payments) and prior year carryover funds. * CHDO=Community Housing Development Organization F:\CMO\2008 Council Agendas\M080414\S0804143H.doc ATTACHMENTC Committee Membership CDBG Advisory Committee Members: Victoria Bosch Drix John Fisher Joel Iboa Hugh Massengill, Chairperson Jericho Schwab Tim Shearer Rita Svanks Janet Yood CDBG Non-profit Capital Project Review Team Members: Hugh Massengill Tim Shearer, Chairperson Terry Webster Janet Yood Housing Policy Board Members: Lane County, Bobby Green At Large: City of Eugene, Jennifer Solomon Norton Cabell, Chairperson City of Springfield, Dave Ralston Brita Fischer Susannah Meininger Virginia Thompson John Wagner John VanLandingham ATTACHMENTD History of CDBG Non-profit Capital Funding 10/9/2007 NON-PROFIT AGENCIES FY 86/87 FY95/96 – FY99/00 – FY03/04- FY05/06 FY06/07 FY07/08 TOTAL – FY94/95 FY98/99 FY02/03 FY04/05 RECEIVED Alvord-Taylor House 26,500 0 0 0 0 0 0 26,500 American Red Cross 31,500 0 40,000 0 0 0 0 71,500 Birth to Three 0 122,000 0 0 0 0 0 122,000 Catholic Community Services 27,500 0 0 0 91,880 0 0 119,380 Centro LatinoAmericano 131,500 34,000 73,000 0 0 0 0 238,500 Child Advocacy Center 0 0 100,000 0 0 0 0 0 Child Care, Inc. 0 90,000 0 0 0 0 0 90,000 Community Center for the 22,500 0 0 0 0 0 0 22,500 Performing Arts Easter Seals 18,550 0 15,000 0 0 0 0 33,550 FOOD for Lane County 189,150 0 170,000 0 0 0 0 359,150 Goodwill Industries 0 0 15,000 0 0 0 0 15,000 HACSA/Heeran Center 0 0 0 170,329 0 0 0 0 HeadStart of Lane County 0 0 0 0 0 53,000 0 53,000 HIV Alliance 135,200 5,200 0 53,000 0 69,700 0 193,400 (includes HOPWA grant) Independent Environments 0 0 0 45,000 0 0 0 45,000 Laurel Hill Center 30,500 0 0 0 0 0 0 30,500 Law & Advocacy Center (Legal Aid) 55,350 0 0 20,681 0 0 0 76,031 Looking Glass 49,200 56,000 24,000 78,840 0 134,308 0 342,348 NEDCO 0 12,000 0 0 0 0 0 12,000 Pearl Buck Center 56,200 25,000 7,500 0 0 0 0 88,700 Relief Nursery 114,500 0 35,500 0 0 0 25,000 175,000 Sexual Assault Support Services 0 30,000 0 0 0 0 0 30,000 Sharehouse 0 20,000 0 0 0 0 0 20,000 ShelterCare 28,450 0 55,000 36,700 124,702 0 0 244,852 Sponsors 19,000 0 10,000 16,966 0 0 0 45,966 St Vincent dePaul 10,000 0 0 200,000 0 0 123,000 333,000 White Bird 230,740 0 30,000 0 0 0 0 230,740 Willamette Family Services, Inc. 164,050 18,000 0 65,456 30,191 97,678 0 375,375 Womenspace 45,000 22,000 0 40,000 40,000 0 0 107,000 YMCA 41,000 0 0 0 0 0 0 41,000 Total Funds Allocated 3,541,992 Note: Cancelled project amounts are highlighted in grey above; funds were reprogrammed to other non-profit projects.