HomeMy WebLinkAboutItem 2D: Approval of CDBG Recovery Funds Allocation
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UGENE ITY OUNCIL
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Approval of Community Development Block Grant Recovery Funds Allocation
Meeting Date: May 26, 2009 Agenda Item Number: 2D
Department: Planning & Development Staff Contact: Stephanie Jennings
www.eugene-or.gov Contact Telephone Number: 682-5529
ISSUE STATEMENT
The City of Eugene is eligible to receive a formula allocation of Community Development Block
Grant Recovery funds in the amount of $371,021. In order to receive these funds, the City must
complete and submit an amendment to its 2008 Consolidated Plan Action Plan.
BACKGROUND
The City of Eugene is eligible to receive a formula allocation of Community Development Block
Grant Recovery (CDBG-R) funds in the amount of $371,021. The CDBG-R program was passed in to
law in February 2009, as a part of the American Reinvestment and Recovery Act (ARRA). The
purpose of CDBG-R is to carry out eligible activities on an expedited basis to stimulate the economy
and create jobs. While any CDBG use is eligible to receive funding, the specific guidance for CDBG-
R requires the City to enter into contracts for use of funds within 120 days of execution of the grant
agreement with HUD.
The City of Eugene must submit an amendment to its 2008 Consolidated Action Plan by June 5, 2009,
in order to receive CDBG-R funds. The type of amendment the City will submit is classified as a
‘Substantial Amendment’ according to HUD rules. Through the City’s amendment, the City of
Eugene must describe: 1) the proposed activities and their eligibility under CDBG; 2) the citizen
participation and approval process completed by the City for allocation of CDBG-R funds; and 3) how
the proposed uses will meet the specific requirements established for CDBG-R funds.
Staff proposes to allocate CDBG-R funds for three uses: 1) Business Development Fund; 2)
Foreclosure Counseling; and 3) Administration. A description of each proposed use is provided below.
Business Development Fund
- $318,919. The City’s Business Development Fund provides loans to
new and existing local businesses for expansion and requires the creation of jobs for low-income
persons. Loan repayments are restricted to re-lending activity within the revolving fund. 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.
Foreclosure Counseling -
$15,000. There has been a significant increase in the number of
homeowner households facing foreclosure proceedings in Eugene. Funding for foreclosure counseling
would increase the availability of services to households to obtain much needed assistance. Funds
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would be made available through a request for proposals to qualified foreclosure counseling providers
and would be selected by staff.
Administration -
$37,102. Additional staff time and other administrative costs will be incurred to
execute proposed activities and complete the necessary reporting on the use of CDBG-R funds. The
CDBG-R notice allows each jurisdiction to set aside up to ten percent of the grant amount for
administrative costs.
In accordance with the Consolidated Plan and the CDBG-R Notice, staff has: 1) reviewed the
program with the Community Development Block Grant Advisory Committee (CDBG-AC) on March
th
30; 2) completed a seven-day public comment period; and 3) held a public hearing in front of the
CDBG-AC on May 19, 2009, and 4) received a final recommendation from the CDBG-AC. The City
did not receive any written comments and no one testified at the public hearing.
RELATED CITY POLICIES
The proposed uses of CDBG-R funds support multiple City policies and programs. A summary of the
relationship between the proposed projects and each policy area is provided below:
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Eugene-Springfield Consolidated Plan 2005
- This proposal aligns with the goals and programs
established within the Consolidated Plan 2005 which guides the use of federal CDBG and HOME
funds through 2010. In order to allocate funds to specific programs or projects, HUD regulations
require a citizen participation process followed by City Council action.
COUNCIL OPTIONS
The City Council has three options:
1.Approve the proposed allocation use of CDBG-R funds and direct staff to submit a Substantial
Amendment to the Consolidated Plan 2008 Action Plan.
2.Approve the proposed allocation use of CDBG-R funds with modifications and direct staff to
submit a Substantial Amendment to the Consolidated Plan 2008 Action Plan.
3.Decline to approve the proposed allocation use of CDBG-R funds and direct staff to submit a
Substantial Amendment to the Consolidated Plan 2008 Action Plan.
CITY MANAGER’S RECOMMENDATION
The City Manager recommends that the council approve the proposed allocation use of CDBG-R funds
and direct staff to submit the proposed amendment to the Consolidated Plan 2008 Action Plan.
SUGGESTED MOTION
Move to approve the proposed allocation use of CDBG-R funds and direct staff to submit the proposed
amendment to the Consolidated Plan 2008 Action Plan.
ATTACHMENTS
None.
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FOR MORE INFORMATION
Staff Contact: Stephanie Jennings, Grants Manager
Telephone: 682-5529
Staff E-Mail: stephanie.a.jennings@ci.eugene.or.us
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