CA Review __RK__
Meeting Date: April 18, 2023
To: Mayor and City Council
From: Scott Chadwick, City Manager
Staff Contact: Mandy Mills, Director of Housing & Homeless Services [email protected], 442-339-2907
Subject: Budget Amendment and Funding Transfer for Repairs at the Tyler Court Senior Apartment Complex
District: 1
Recommended Action
Adopt a resolution authorizing a budget amendment for necessary repairs at the Tyler Court Senior Apartments and a transfer of $500,000 in funds from the Community Development Block Grant Special Revenue Fund to the Tyler Court Apartment Fund.
Executive Summary
The City of Carlsbad owns the Tyler Court Senior Apartment complex, which provides affordable housing for very low-income senior households. Ongoing repairs and maintenance are paid for out of an established reserve fund held by the City of Carlsbad.
In January 2023, the City Council authorized additional funding from Community Development Block Grant (CDBG) funds for the City Affordable Housing Fund, which will allow some needed repairs at Tyler Court to be completed earlier than anticipated rather than relying on operating revenue.
To move forward on the identified repairs with CDBG funds, an operating transfer needs to be approved from the Community Development Block Grant Fund to the Tyler Court Apartment Fund. The City Council is required to approve transfers between funds.
Explanation & Analysis
In 1999, the Redevelopment Agency of the City of Carlsbad purchased the Tyler Court Senior Apartment complex for the purpose of providing permanent affordable housing for very low- income senior residents. The day-to-day management is provided by a contract with a private property management company, WSH Management Inc. (WSH) which oversees ongoing maintenance, repairs and capital improvements using reserve funds out of the Tyler Court Apartment Fund held by the city.
The management company has identified a number of deferred maintenance items that the 38- year-old building needs. Based on the limited rental revenue, not all repair and maintenance April 18, 2023 Item #5 Page 1 of 4
projects can be done when identified. Each year city staff work with the company to estimate for the cost of repairs and capital needs and then funds are appropriated in the budget for the following fiscal year.
In January 2023, the City Council authorized a mid-year reallocation of unanticipated Community Development Block Grant funds to a number of eligible projects on which the funds could be expended quickly to meet federal expenditure limits. This included funds for city affordable housing projects.
City staff worked with WSH to identify the most needed and shovel-ready repairs at Tyler Court that were eligible for and could be funded with CDBG funding as opposed to including them within the limited operating budget over the next few years. The projects identified for this fiscal year include water heater replacement, parking lot repair and exterior painting. Based on estimates, these projects will cost approximately $200,000.
Projects anticipated to be completed in the next fiscal year using CDBG funds include state required balcony inspections and related repairs, canopy replacement monument sign replacement and front landscaping improvement. These projects are estimated to cost approximately $300,000.
The Carlsbad Housing and Redevelopment Commission previously authorized the use of the Tyler Court Reserve Fund for operations and/or repairs, renovations, capital improvements. To use CDBG funds for these necessary capital projects out of the Tyler Court deserve Fund, the City Council needs to authorize an increase in the current fiscal year’s expenditure budget for Tyler Court Apartments and transfer $500,000 in Community Development Block Grant funds to the Tyler Court Apartment Fund.
Fiscal Analysis
There is no impact to the City’s General Fund. The transfer from the Community Development Block Grant Fund to the Tyler Court Apartment Fund is simply a movement of cash and will not result in a net impact. The budget authority requested in the Tyler Court Fund will be offset by Community Development Block Grant revenue, which is received on a reimbursement basis from the federal government.
Next Steps
City staff will amend the Tyler Court expenditure budget and transfer funds from the CDBG Fund to the Tyler Court Apartment Fund. WSH will oversee the repair work at the Tyler Court Senior Apartments in accordance with local, state and federal requirements.
Environmental Evaluation
This action does not require environmental review because it does not constitute a project within the meaning of the California Environmental Quality Act under Public Resources Code section 21065 in that it has no potential to cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.
Exhibits
1.City Council resolution
April 18, 2023 Item #5 Page 2 of 4
RESOLUTION NO. 2023-113
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, AUTHORIZING A BUDGET AMENDMENT FOR NECESSARY
REPAIRS AT THE TYLER COURT SENIOR APARTMENTS AND A TRANSFER OF $500,000 IN FUNDS FROM THE COMMUNITY DEVELOPMENT BLOCK GRANT
SPECIAL REVENUE FUND TO THE TYLER COURT APARTMENT FUND
WHEREAS, on September 30, 1999, the Redevelopment Agency of the City of Carlsbad purchased the Tyler Court Senior Apartment Complex for the purpose of providing permanent affordable housing for very low-income senior citizens in Carlsbad; and WHEREAS, the Housing and Redevelopment Commission established a Tyler Court Senior Apartments reserve fund for the operations and/or repairs, renovations, capital improvements or other related activities for Tyler Court Senior Apartments s as deemed appropriate by the Agency's Executive Director and/or designee; and
WHEREAS, the Housing and Redevelopment Commission previously authorized that it is appropriate and necessary to contract for outside professional services for exclusive day-to-day management of the Tyler Court Senior Apartments, which includes ongoing maintenance, repairs and capital improvements; and
WHEREAS, in 2012, ownership of the property was transferred from the Carlsbad Redevelopment Agency to the City of Carlsbad as a result of the dissolution of the Redevelopment Agency per State law; and
WHEREAS, the City of Carlsbad is committed to continuing to provide a suitable living environment and to expand economic opportunities for the city's low-income residents as is outlined in the Community Development Block Grant Action Plan; and WHEREAS, on Jan. 10, 2023, the City Council approved Resolution No. 2023-005, which contained an expenditure plan of additional Community Development Block Grant revenue to include the City's Affordable Housing Fund; and
WHEREAS, the Tyler Court Senior Apartments is in need of several critical capital repairs, which costs exceed the available operating budget.
Exhibit 1
April 18, 2023 Item #5 Page 3 of 4
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows:
1.That the above recitations are true and correct.
2.That the City Council is authorizing a budget amendment to the Tyler Court Apartment Reserve Fund's FY 2022-23 operating budget for necessary repairs at the Tyler Court Apartment Complex.
3.That the Deputy City Manager, Administrative Services, is authorized to transfer $500,000 from the Community Development Block Grant Special Revenue Fund to the Tyler Court Apartment Fund.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of Carlsbad on the 18th day of April, 2023, by the following vote, to wit:
AYES:
NAYS:
ABSTAIN:
ABSENT:
Blackburn, Bhat-Patel, Acosta, Burkholder, Luna.
None.
None.
None. \
KEITH BLACKBURN, Mayor
SHERRY FREISINGER, City Clerk
(SEAL)
April 18, 2023 Item #5 Page 4 of 4