Item 5: 2011/12 Funding Allocation for Federal CDBG and HOME Programs

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Action: 2011/12 Funding Allocations for Federal Community Development Block Grant and Investment Partnership Programs HOME Meeting Date: April 25, 2011 Agenda Item Number: 5 Department: Planning & Development Staff Contact: Stephanie Jennings www.eugene-or.gov Contact Telephone Number: 541-682-5529 ISSUE STATEMENT The City Council is asked to approve the allocation of funds received through two Federal programs administered by the U.S. Department of Housing and Urban Development (HUD). Through the Community Development Block Grant program (CDBG), Eugene may allocate an estimated $1,258,600 in entitlement grant funds as well as $1,500,000 in program income. Through the HOME Investment Partnership Program (HOME), Eugene may allocate an estimated $954,705 in entitlement grant funds and $85,000 in program income. BACKGROUND Each spring, the City Council approves funding allocations for use of CDBG and HOME funds for the next fiscal year. The proposed uses of funds are described and submitted to HUD each year in a document called the One-Year Action Plan. The Action Plan must be submitted to HUD by May 15, 2011. The proposed uses of funding must align with the local community needs and strategic plan described in the Eugene-Springfield 2010 Consolidated Plan. The CDBG Advisory Committee advises the City on the use of CDBG funds and the Housing Policy Board (HPB) advises the City on the use of HOME funds. In addition, the Action Plan must provide an update on the City’s use of the Section 108 and Brownfield Economic Development Initiative (BEDI) funds. Activities under the CDBG, HOME, and Section 108/BEDI programs are described below. Community Development Block Grant The primary purpose of CDBG is to address the needs of low- and moderate-income persons. The City is a CDBG entitlement jurisdiction and has received annual entitlement grants since 1975. Each year, the Community Development Block Grant Advisory Committee, a Departmental Advisory Committee, reviews requests for CDBG funds, holds a public hearing, and makes a final recommendation to staff for use of CDBG funds for the next fiscal year. Funds available for allocation for FY 2011/12 are described below:  New CDBG Entitlement Grant Funds ($1,258,600) – Each year, Congress appropriates funds for CDBG and HUD distributes funds according to a formula to entitlement jurisdictions. This is an estimate of funds to be allocated to the City of Eugene. The estimated entitlement allocation for FY 2011/12 is less than the previous year’s grant by $239,740.  CDBG Program Income ($1,500,000) – The City of Eugene expects to receive $1,500,000 in program income through two revolving loans that have been established with CDBG funds. The Business Development Fund will generate an estimated $1,100,000 in FY 2011/12 and the \\Cesrv500\cc support\CMO\2011 Council Agendas\M110425\S1104255 - and att's A,B and C.doc