Staff Report
City Council
Item No. 3.G
Meeting Date: May 13, 2026
From: John A. Corella, Director of Public Works
Title: Award Community Development Block Grant Subrecipient Agreement to Fair Housing Council of Riverside County
RECOMMENDATION:
To authorize the award of a subrecipient agreement to the Fair Housing Council of Riverside County (FHCRC) in the amount of $20,000 to provide fair housing services under Cathedral City’s FY 2026-2027 Community Development Block Grant (CDBG) program; approve a corresponding budget allocation of $20,000 from CDBG funds; and authorize the City Manager to execute all necessary contract documents, subject to the approval of the FY 2026-2027 Annual Action Plan (AAP) by the US Department of Housing and Urban Development..
BACKGROUND:
Cathedral City receives annual entitlement funding through the Community Development Block Grant (CDBG) program, administered by the U.S. Department of Housing and Urban Development (HUD). These funds support various activities that benefit low- to moderate income residents, including public infrastructure improvements, community services, and fair housing initiatives.
Each year, the city develops an Annual Action Plan (AAP) to outline the allocation of CDBG funds in accordance with the priorities set forth in the city’s Five-Year Consolidated Plan (Con Plan). On May 13, 2026, staff will present the final AAP to City Council for approval, which allocates funding across three main categories: program administration, public services, and public infrastructure improvements.
Within the program administration category, funds are designated to support fair housing initiatives that provide housing-related services to qualifying residents. Consistent with CDBG requirements, the city conducts an annual competitive procurement process to select a qualified provider to deliver these services.
On April 3, 2026, HUD announced Cathedral City’s FY 2026–2027 CDBG allocation in the amount of $482,495. This announcement initiated the required 60-day period for the city to submit its AAP to HUD, with a submission deadline of June 2, 2026. Upon submission, HUD will conduct a review period of up to 45 days for approval of the AAP and related funding activities.
In coordination with the AAP approval, the recommended subrecipient agreement for fair housing services is also on the agenda for City Council consideration at the May 13, 2026, meeting. However, execution of the subrecipient agreement will not occur until the FY 2026– 2027 AAP has been approved by HUD. This ensures compliance with federal requirements and alignment with the City’s adopted funding authorization.
DISCUSSION:
In accordance with CDBG program requirements for securing fair housing services, city staff published a Notice of Funding Availability (NOFA) for Fair Housing Services on January 23, 2026. The NOFA was published in both English and Spanish in The Desert Sun and posted on the city’s website.
The application period was open from January 23 to February 23, 2026. During this time, city staff also notified interested parties who had previously inquired about Fair Housing Service grant opportunities.
Only one (1) application was received before the NOFA application deadline. The application received was from the Fair Housing Council of Riverside County (FHCRC). The city’s Engineering Division staff, in collaboration with TAMJAC, the on-call CDBG administrative consultant, conducted a thorough review of the application.
FHCRC’s application was responsive and demonstrated strong qualifications, including a clear understanding of the tasks required to deliver fair housing services to the Cathedral City community. FHCRC also currently provides fair housing services through the city’s CDBG program since FY 2024-2025 and has consistently delivered effective, comprehensive support to residents.
This demonstrated performance is further supported by outcomes reported in the FY 2024– 2025 Consolidated Annual Performance Evaluation Report (CAPER), approved by City Council on September 11, 2025. FHCRC exceeded its program year goal by assisting 841 residents, surpassing the target of 801 and achieving approximately 105 percent of its goal.
Services included assistance with landlord-tenant issues, discrimination cases, eviction concerns, and other fair housing-related matters.
FHCRC has reported that in the first three (3) quarters of FY 2025–2026, it has assisted 221 residents. FHCRC has indicated that similar reductions in service requests are being experienced by fair housing providers nationwide. While the number of residents assisted during FY 2025–2026 has declined compared to the prior program year, FHCRC has continued to provide quality fair housing services and remains available to assist residents in need. City staff will continue collaborative efforts with FHCRC to enhance public outreach and awareness of available fair housing resources and services within the community.
City staff recommend that the City Council authorize the award of a subrecipient agreement to FHCRC in the amount of $20,000 to provide fair housing services under Cathedral City’s FY 2026–2027 CDBG program; approve a corresponding budget allocation of $20,000 from CDBG funds; and authorize the City Manager to execute all necessary contract documents, subject to HUD approval of the FY 2026–2027 AAP.
FISCAL IMPACT:
FHCRC initially requested $25,000 in its application. However, the city’s FY 2026–2027 CDBG allocation of $482,495, announced by HUD, was lower than both anticipated and the prior year’s allocation of $511,608. To maintain the funding distribution previously approved by the City Council across all program categories, staff recommend a reduced award amount of $20,000, which FHCRC has accepted.
The recommended funding level is also consistent with the amount awarded in FY 2025– 2026 and the prior two (2) fiscal cycles. Additionally, current program utilization has decreased during FY 2025–2026 compared to the prior program year, further supporting the recommended funding level.
This amount will be funded through Cathedral City’s FY 2026–2027 CDBG allocation. All expenditures under the CDBG program are reimbursable and subject to federal requirements, including HUD approval of the AAP and execution of the federal grant agreement. The subrecipient agreement will not be executed until the FY 2026–2027 AAP has been approved by HUD.
Pursuant to HUD guidance issued in a memorandum on pre-award costs dated April 1, 2026, for FY 2026-2027, jurisdictions may incur eligible costs prior to execution of the federal grant agreement to ensure continuity of services, provided such costs are necessary for timely program implementation, eligible under applicable regulations, and included in an Annual Action Plan approved by HUD. This program meets these requirements.
The following table summarizes the budget allocations for fair housing services.
FISCAL YEAR DESCRIPTION
GENERAL
LEDGER
ACCOUNT
CODES
PROJECT
CODE AMOUNT ONE TIME or
ONGOING
2026-2027
CDBG Fair
Housing
Services
251-100-150-
156-8600-8601
CDBG- PROF
SVCS $20,000.00 One Time
2026-2027 Total $20,000.00
FIVE-YEAR STRATEGIC PLAN:
Goal F: Embracing, Inclusive Community
Objective: Cathedral City is valued and respected as a community that welcomes and embraces diversity, has an abundance of high quality and affordable housing options, and vibrant businesses. Our neighborhoods are attractive and well-maintained and issues surrounding homelessness have been compassionately addressed with thoughtful, coordinated, and collaborative programs.
ATTACHMENTS:
1. FHCRC Subrecipient Agreement
2. FHCRC Public Service Grant Application for Fair Housing Providers