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April 12, 2022
ITEM TITLE
Proposed Federal Grant Funding: Recommendations for the 2022/2023 Annual Action Plan
Report Number: 22-0110
Location: No specific geographic location
Department: Development Services
Environmental Notice : The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act (“CEQA”) State Guidelines and Title 24 of the Federal Code of Regulations; therefore, pursuant to State Guidelines Section 15060(c)(3) and Federal Guidelines Part 58.34(a)(2) & (3) no environmental review is required. Notwithstanding the foregoing, the activity qualifies for an Exemption pursuant to Section 15061(b)(3) of CEQA and Part 58.34 (a)(2) & (3) of the National Environmental Policy Act (“NEPA”).
Recommended Action
Conduct the public hearing and accept the Federal Grand Funding report.
SUMMARY
The City of Chula Vista has received and reviewed funding applications for the U.S. Department of Housing and Urban Development ( “HUD”) grant programs including: (1) Community Development Block Grant (“CDBG”); (2) HOME Investment Partnerships Act ( “HOME”); and (3) Emergency Solutions Grant ( “ESG”) funds. This public hearing will provide the community an opportunity to provide input on the proposed 2022/2023 funding recommendations for the City’s use of these federal grant programs.
ENVIRONMENTAL REVIEW
The Director of Development Services has reviewed the proposed activity for compliance with CEQA and NEPA. The activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because the proposal consists of a reporting action, is n ot for a site-specific project(s) and will not result in a direct or indirect physical change in the environmental. Therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA. Under NEPA, the activity is exempt pursuant to Title 24, Part 58.34(a)(2)&(3) of the Code of Federal Regulations and pursuant to the U.S. Department of Housing & Urban Development Environmental Guidelines. Thus, no further environmental review is necessary at this time. Although environ mental review is not necessary at this time, once a project(s) has been approved, P a g e | 2
environmental review will be required and a CEQA/NEPA determination completed prior to initiation of any related project activity.
BOARD/COMMISSION/COMMITTEE RECOMMENDATION
Not applicable.
DISCUSSION
As an entitlement community with HUD, the City of Chula Vista receives annual funding under three entitlement block grant programs: CDBG, HOME and ESG. The grant amounts allocated to each jurisdiction are determined using a formula based on statistical and demographic data. The purpose of this funding is to provide housing, a suitable living environment, and to expand economic opportunities principally for low and moderate-income persons. As a recipient of these HUD funds, the Ci ty is required to adopt a five -year planning document, entitled the Consolidated Plan ( the “ConPlan”) which describes the City's five -year strategy for use of these funds based upon the identified goals and objectives related to its housing and community development priorities.
The City annually selects activities for funding that best meet the needs of the community as specified within the ConPlan, while also meeting the national objectives and requirements of the grant funds. The selected activities are then incorporated into a one -year planning document, known as the Annual Action Plan (the “Action Plan”) . The Action Plan constitutes the City’s formal funding application to HUD for the corresponding grant year. The 2022/2023 Action Plan represents the third year of the ConPlan period.
The City’s 2020/2024 Five-Year ConPlan identifies a total of five priorities under Housing and Community Development for funding consideration.
Table I: 2020/2024 Consolidated Plan Funding Priorities PRIORITY Goal ACTIVITY TYPE
Homelessness
Assist individuals and families to gain stable
housing after experiencing homelessness or
a housing crisis by providing appropriate
services and housing solutions on a path to
stability.
Shelter Operations
Homeless Prevention
Homeless Outreach
Homeless Supportive Services
Social Service
Programs
Invest in community social services to
promote equity and serve the most
vulnerable of the community’s population.
Public Services to Low/Moderate
Income including the following
population:
Homeless Veterans; Youth;
Seniors; Victims of Domestic
Violence; Special
Needs/Disabled
Capital
Improvement
and Public
Facilities
Support the development of vibrant,
equitable and accessible neighborhoods by
investing in public facilities and
infrastructure.
ADA improvements
New streets and sidewalks
Public facility improvements
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Economic
Development
Enhance the City’s economic stability by
investing in inclusive economic growth
initiatives that develop and strengthen small
businesses, employment and workforce
development programs and improving
access to jobs.
Business Financial Assistance
Programs
Business Technical Assistance
Job Training and Placement
Affordable
Housing
Increase affordable rental and owner-
occupied housing to improve housing
opportunities that reflect the community’s
needs.
New Construction
Acquisition
Rehabilitation
First-Time Homebuyer
Assistance
Tenant-Based Rental Assistance
2022/2023 ANNUAL ACTION PLAN
Resources
As of the date of this report, HUD has not provided the City’s allocation amounts for 2022/23 since Congress has not yet completed the appropriations process. HUD has instructed cities to continue their normal annual planning process and to submit the Action Plan once the 2022/23 allocations have been announced.
For the purposes of this report and in preparation of the Action Plan, staff will be assuming a slight reduction from prior year funding for the CDBG, HOME and ESG grant programs for planning purposes. In the event that the City receives a higher allocation, staff has identified two projects within the grant programs for increased funding. These projects are identified in the respective program sections below.
In addition to its annual entitlement amount, the City will also allocate prior year unencumbered ESG funds.
These funds typically become available as projects are completed under budget, loans are repaid or other program income is generated.
Table II: 2022/2023 Anticipated Grant Funding
PROGRAM ENTITLEMENT
AMOUNT
PRIOR YEAR
(UNENCUMBERED)
TOTAL AVAILABLE
FOR 2022/2023
Community Development Block Grant $2,700,000 $0 $2,700,000 Home Investment Partnerships Act $ 900,000 $0 $900,000 Emergency Solutions Grant $ 200,000 $1,205,045 $ 1,405,045 Total $3,800,000 $1,205,045 $5,005,045
Funding Requests
As part of the annual Action Plan process, the City releases a Notice of Funding Availability (“NOFA”) for the three grant programs. The NOFA was released in February 2022, with an original submittal deadline of March 7th. This deadline was extended to March 9th due to technical difficulties with the application submittal system. Housing staff has reviewed all proposals to ensure compliance with the prescribed regulations and consistency with the City’s goals and objectives.
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An executive summary was prepared for each request which summarizes the requested funding level, proposed use of funds, and benefit to the community in Attachment 1 . T he federal grant funding recommendations for CDBG, HOME and ESG are presented below.
Community Development Block Grant (CDBG)
For fiscal year 2022/2023, the City will utilize an estimated total of $2,700,000 of CDBG funds. All projects considered for funding must address at least one of the three CDBG National Objectives: (1) benefit primarily low/moderate income families; (2) aid in the prevention or elimination of slums or blight; or (3) meet community needs due to a major emergency such as a natural disaster.
Projects are then classified into three distinct categories:
1. Administration and Planning
2. Public Services
3. Capital Improvement Projects (“CIPs”) and Community Development
Below is a summary of the funding recommendations under each respective category.
1. Administration/Planning Recommendations
Funds under this category cover all city staff costs associated with the management and administration of the City of Chula Vista's CDBG program including regulatory compliance, contract administration, subrecipient monitoring and fiscal management. This also includes preparation of the required planning documents, such as the Annual Action Plan, the Consolidated Plan, and the Analysis of Impediments to Fair Housing Choice. Federal regulations governing the CDBG program limit the amount that the City spends on administration/planning activities to 20 percent (20%) of the entitlement amount for the program year (estimated cap of $540,000 in 2022/23).
Table III: 2022/2023 CDBG Administration Funding
Applicant Program Recommended
1 DSD – Housing Division CDBG Administration/Planning $450,000 2 CSA San Diego County Fair Housing and Tenant/Landlord Services $60,000 Total $510,000
2. Public Services Program Recommendation
Funds for Public Services activities are awarded to local agencies and community organizations to implement projects and programs that improve the lives of low-income residents, including the elderly, disabled, at-risk, and homeless. The amount of funds the City may allocate to public services is limited to fifteen percent (15%) of the annual entitlement (estimated cap of $405,000 in 2022/23). Staff’s funding recommendations for public service activities are based on funding priorities established in the ConPlan, along with an established ranking criterion which categorizes the programs by community need (Tier I- III, with Tier I being the highest).
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Public Services Community Need Ranking
Tier I
(highest) Tier II Tier III
Emergency Needs:
Programs that address basic,
fundamental needs
including shelter, food, and
other commodities.
Special Needs/Disabled:
Programs that provide services to
persons with disabilities, special
needs, and are at high-risk.
Other General Services:
All other services which do n ot
fall within Tier I or II and provide
general public services to
low/moderate income persons.
A total of fourteen public service applications were received. With the exception of applicant number 14 (Women Initiating Success Envisioned Inc.), all requests are previous grant recipients and are in good standing with the City of Chula Vista and HUD. Women Initiating Success Envisioned Inc. is a newly formed organization with limited experience in receiving and administering federal funding. Staff recommends funding of Women Initiating Success Envisioned Inc. for its first year with staff providing the necessary technical assistance for compliance and the successful delivery of the proposed program.
Summarized below are the list of applicants, program name and amount of recommended funding by staff.
Table IV: 2022/2023 CDBG Public Services
Applicant Program Recommended
3 Alpha Project for the
Homeless*
Take Back the Streets* $99,000*
4 Chula Vista Elementary
School District
Family Resource Center Emergency & Basic
Services
$35,000
5 City of Chula Vista Parks and
Rec
Norman Park Senior Center $30,000
6 City of Chula Vista Parks and
Rec
Therapeutic Recreation Programs for Adults
with Severe Disabilities
$20,000
7 Family Health Centers of San
Diego
Family Health Centers of San Diego Mobile
Medical Services
$30,000
8 Jacobs & Cushman San Diego
Food Bank
Food for Kids Backpack Program $15,000
9 Meals-on-Wheels Greater
San Diego
Senior Meal Delivery & Accompanying
Services
$25,000
10 SBCS Corporation** Family Violence Support Services** $0** 11 SBCS Corporation Homeless Services $40,000
12 SBCS Corporation South Bay Food Program $11,000
13 Voices for Children Court Appointed Special Advocate (CASA) Program
$15,000
14 Women Initiating Success
Envisioned Inc. (WISE)
Women Initiating Success Envisioned Inc. $15,000
15 McAlister Institute Work For Hope $60,000
16 Chula Vista Housing Division Hotel/Motel Voucher Program $10,000 Total $405,000
*Should the City receive a greater CDBG entitlement amount than that anticipated, additional funding will be allocated to this project.
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**Application received for grant funding totaling $240,000. Staff will request approval to reprogram ARPA funds for this purpose at a future City Council meeting, rather than funding using CDBG.
3. CIPs and Community Development
After the Public Services and Administration activities are funded, a total of $1, 785,000 remains for eligible capital improvement projects, public facility improvements, and other housing/community development related activities. The City has earmarked $657,214 for the annual Castle park Infrastructure Section 108 debt service payment, with seven years remaining on the 20-year loan term.
This leaves a balance of $1,127,786 for new projects.
To be considered eligible for funding within the CIP category, the project must be located in a primarily residential area designated as low/moderate income by the U.S. Census and cannot be regional in nature (serving the entire City or county region). Priority is given to those projects with the most effectiveness and the greatest feasibility by demonstrating leveraging of additional funding sources, benefit and impact to the community, and relevance to the City of Chula Vista’s Critical Needs List and/or Pedestrian Master Plan.
A total of four applications are presented under this category: the City’s Section 108 Loan payment and three CIPs (Rienstra Park ADA Accessibility Improvements, Lauderbach, and D Street).
Table V: 2022/2023 CDBG Community Development Projects Applicant Program Recommended
17 City of Chula Vista Parks
and Rec*
Rienstra Park ADA Accessibility Improvements* $635,786* 18 SBCS Corporation CIP - Lauderbach $392,000
19 Chula Vista Housing
Division
Section 108 Loan $657,214
20 Chula Vista Engineering
Division
D Street CIP
$100,000
TOTAL $1,785,000
*Should the City receive a greater CDBG entitlement amount than that anticipated, additional funding will be allocated to this project.
Per CDBG regulations, CIP projects must serve an area where at least 51% of residents are low and moderate income. Provided with a description of the projects are maps illustrating each location and HUD-designated Low/Moderate Income Census Tract (shaded in Yellow)
The Rienstra Park CIP will provide for ADA access to all park baseball fields by providing accessible pathways to and between each field, including redesigning the lower portion of the park to eliminate two (2) unused fields and rebuild the remaining two (2) fields with ADA access creating a total of six (6) accessible fields and new paved access to East Orange Avenue. The parking lot will be resurfaced/restriped and will include accessible routes to the field locations and converting an asphalt drainage inlet to a planted bioretention basin.
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Rienstra Park
The Lauderbach CIP will add a commercial kitchen to the Lauderbach Community Center to be utilized in conjunction with SBCS' food and nutrition programs to educate the community on healthy eating and active living. The kitchen will also be available for use as a way for community members to begin their own businesses (making and selling food items for income) as a way to increase their self-sufficiency. In addition to adding the kitchen, SBCS will enhance the security of the building.
Lauderbach Community Center
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The D Street CIP is an existing project, which will pr ovide missing pedestrian pathway and street improvements along the north side of D Street along the entire frontage of a mobile home park. Addressing this gap will provide the only continuous ADA accessible pedestrian pathway on this transit corridor block between Broadway and Industrial Boulevard. Prior year allocations for this project total $425,000. With the current year proposed allocation, the CDBG funds applied to this project will total $525,000.
D Street Capital Improvement Project
Home Investment Partnerships Act (HOME)
HOME funds may be used to provide affordable rental housing and home ownership opportunities through:
1. New construction
2. Acquisition
3. Rehabilitation
4. First time homebuyer assistance
5. Tenant-based rental assistance
For 2022/23, the City of Chula Vista will utilize the HOME entitlement to address the City’s housing priorities of the 2020/2024 ConPlan (approximately $ 900,000). Per the HOME regulations fifteen percent (15%) of the annual allocation must be set aside to assist Community Housing Development Corporations (“CHDOs”) for the creation of affordable housing units (estimated minimum of $135,000 in 2022/23) . Should these funds not be utilized in a timely manner for this specific purpose, these funds would be recaptured by HUD and would be unavailable to the City.
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Table VI: 2022/2023 HOME Projects
Applicant Program Recommended
26 DSD – Housing Division HOME Planning and Administration $90,000 27 SBCS Corporation Tenant Based Rental Assistance $500,000 28 DSD – Housing Division* Production of Affordable Housing* $310,000* TOTAL $900,000
*CHDO funding set-aside.
The City received one application eligible for HOME funds from SBCS to provide tenant based rental assistance for general low- and moderate-income residents. The remainder of funds will be utilized for future affordable housing development proposals and administration expenses.
Emergency Solutions Grant (ESG)
Chula Vista estimates that it will receive approximately $200,000 in ESG entitlement funds for FY 2022/23 and unencumbered prior year funds of $1,205,045. ESG funds may be used to provide homeless services through:
1. Homeless Prevention
2. Rapid Re-Housing (rental assistance)
3. Street Outreach
4. Emergency Shelter
5. Homeless Management Information Systems (“HMIS”)
The City received four proposals for ESG, including one proposal from the Interfaith Shelter Network of San Diego and three applications from SBCS Corporation. All requests are previous grant recipients and are in good standing with the City of Chula Vista and HUD. The remaining funds will be earmarked for Planning and Administration Costs (7.5% of the entitlement , or $15,000 in 2022/23 ), Homeless Prevention and Rapid ReHousing Services, and the HUD mandated Homeless Management Information System. These programs will be administered by DSD Housing staff.
Table VII: 2022/2023 ESG Programs
Applicant Program Recommended
21 DSD – Housing Division ESG Planning and Administration $15,000 22 SBCS Corporation ESG - Casa Nueva Vida $70,155 23 SBCS Corporation Homeless Prevention Program $100,000 24 SBCS Corporation CIP - Shelter Rehab $1,204,890 25 Interfaith Shelter Network of San Diego Rotational Shelter Program $15,000 TOTAL $1,405,045
Conclusion
While the ESG and the HOME programs were designed to meet very specific objectives, the CDBG program allows flexibility in the type of activities it funds. This allows the City to leverage its CDBG funds with ESG and HOME funds to maximize the impact of the grant funding to meet the housing needs of the lower income community. Since the end of redevelopment in California in 2012, the City of Chula has lost $21 million that would have otherwise been generated from redevelopment for affordable housing related activities. As the P a g e | 10
cost of housing has increased year after year, far outpacing income growth, housing has become increasingly unaffordable to more members of the community.
Staff recommends that the City Council conduct the public hearing to solicit input from the community on the 2022/23 funding recommendations presented. The 2022/2023 Annual Action Plan was released for the required 30-day review and comment period on April 8, 2022 and will close May 9, 2022.
Staff will incorporate all public comments into the final Annual Action Plan, to be brought forward for City Council consideration in May 2022.
DECISION-MAKER CONFLICT
Staff has reviewed the property holdings of the City Council members and has found no property holdings within 1,000 feet of the boundaries of the Lauderbach, Rienstra Park Improvement, and D Street CIPs which are the subject of this action. Consequently, this item does not present a disqualifying real property-related financial conflict of interest under California Code of Regulations Title 2, section 18702.2(a)(7) or (8), for purposes of the Political Reform Act (Cal. Gov’t Code §87100, et seq.). Staff is not independently aware and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter.
CURRENT-YEAR FISCAL IMPACT
There are no current year fiscal impacts to the General Fund as a result of this action. At this time, Council is reviewing the funding allocation requests for CDBG, HOME, and ESG funds. Appropriations for the proposed CDBG, HOME and ESG programs will be requested once the final allocations are received from HUD.
In the remote event that HUD should withdr aw the City's CDBG, HOME , and ESG funding, the Agreements/Memorandum of Understandings provide that the city is not obligated to compensate subrecipients or City Departments for program expenditures. Recommended funding allocations are summarized below.
Community Development Block Grant (CDBG)
Public Services $405,000
CDBG Administration and Planning $510,000
Section 108 Loan Payment $657,214
Capital Improvement and Housing $1,127,786
Subtotal $ 2,700,000
Home Investment Partnerships Act (HOME)
HOME Planning and Administration $90,000
Affordable Housing Projects/Programs $810,000
Subtotal $900,000
Emergency Solutions Grant (ESG)
ESG Administration and Planning $,15,000
Shelter Services $1,290,045
Homeless Prevention and Rapid ReHousing $100,000
Subtotal $1,405,045
TOTAL CDBG, HOME and ESG $5,005,045
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ONGOING FISCAL IMPACT
There is no ongoing fiscal impact to the City's General Fund as a result of this action. All costs associated with the administration of the CDBG, HOME and ESG programs are covered by the respective grants.
ATTACHMENTS
1. 2022/2023 Federal Grant Funding Recommendations
Staff Contact: Angelica Davis, Senior Management Analyst Tiffany Allen, Director of Development Services