Fremont City Council Meeting: 05/09/23 07:00 PM
3300 Capitol Avenue Div/Dept: Human Services Department Fremont, CA 94538 Category: Agreements and Contracts
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 4892) DOC ID: 4892 B
Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 1
FISCAL YEAR 2023/24 FEDERAL FUNDING RECOMMENDATIONS AND ANNUAL ACTION PLAN - Public Hearing (Published Notice) on the Use of Federal Community Development Block Grant and Emergency Solutions Grant Funds for FY 2023/24; Adopting a Resolution Approving the FY 2023/24 Annual Action Plan, and Authorizing the City Manager to Execute Agreements with the U.S.
Department of Housing and Urban Development and CDBG and ESG Grantees and Programs and Making Findings of CEQA Exemption
Contact Persons:
Name: Robert Lopez Suzanne Shenfil
Title: CDBG Administrator Director
Div/Dept: Human Services Department Human Services Department Phone: 510-574-2043 510-574-2051
E-Mail: [email protected] [email protected]
Executive Summary: The Citizens Advisory Committee (CAC) and staff completed the FY 2023-24 Community Development Block Grant (CDBG) capital project proposal process.
Approximately $1,898,812 is available for FY 2023-24. The City Council allocated $946,654 of FY 2023-24 funds in 2022, which leaves $952,158 to be allocated for FY 2023-24.
Staff and the CAC recommend allocating $796,407 of the funds and holding $155,751 for project contingencies in FY 2023-24 and emerging projects. Staff recommends that the City Council take the following actions:
1. Allocate CDBG and ESG funds for FY 2023/24 in the amounts stated herein, and contingent upon adoption of the FY 2023/24 budget by the City Council.
2. Authorize staff to:
a. Allocate additional funds to public service projects should the City receive additional program income in FY 2023/24 or a greater entitlement. b. Reserve unallocated funds to provide gap funding or fund projects that meet emerging needs.
3. Adopt a resolution:
a. Approving and authorizing the City Manager or his designee to submit the FY 2023/24 Federal Funding Program Final Statement of Community Development Objectives and Projected Use of Funds, the City’s Annual Action Plan, as recommended by staff in the amounts stated herein and finding the action exempt from CEQA, as specified.
b. Authorizing the City Manager or her designee to execute CDBG and ESG Entitlement funding agreements with HUD.
c. Authorizing the City Manager or her designee to execute agreements effective July 1, 2023, with the grantees recommended for funding by staff in the amounts set forth herein, contingent upon a finding of no significant impact in the corresponding NEPA environmental assessments and completion of the required public comment period.
Council Staff Report (ID # 4892) Meeting of May 9, 2023 Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 2
BACKGROUND:
The CDBG Program is funded through federal entitlement funds from the U.S. Department of Housing and Urban Development (HUD). The primary objectives of the CDBG program are to develop viable urban communities, principally for low- and moderate-income households, through the provision of decent housing, a suitable living environment, and economic opportunity. CDBG funds must be used for activities which:
1. Primarily benefit low- and moderate-income families. Most households receiving benefit from this program cannot earn more than 80% of the median income.
For example, an eligible family of three cannot earn more than $88,700. Most funds, however, based on current CDBG usage, serve families with even lower incomes, which are under 50% of the median income ($55,800 for a family of three);
2. Aid in the elimination of slum or blight; or
3. Other activities designed to meet urgent community needs when conditions may pose an immediate threat to the health or welfare of the community. Federal rules allow each community to tailor its program to address specific local needs.
The Emergency Solutions Grant (ESG) Program’s primary objectives are to address the needs of homeless people in emergency or transitional shelters to assist people to quickly regain stability in permanent housing after experiencing a housing crisis and/or homelessness. ESG funds must be used for activities which primarily benefit individuals and families that meets HUD’s “homeless” and “at-risk of homelessness” definitions in accordance with 24 CFR 576. The ESG program has five program components that the City may select from:
1. Street Outreach: Engage homeless individuals and families living on the street;
2. Emergency Shelter: Improve the number and quality of emergency shelters for homeless individuals and families, help operate these shelters, and provide essential services to shelter residents;
3. Rapid Re-housing Assistance: Rapidly re-house homeless individuals and families;
4. Homelessness Prevention: Prevent families and individuals from becoming homeless; and
5. Homeless Management Information System: Support the operation of the local information technology system used to collect client-level data County-wide.
On October 4, 2022, the City Council authorized the City Manager to execute an agreement with HUD for the new ESG funds. On May 2, 2023, staff recommended that the City Council authorize a Memorandum of Understanding with the Fremont Family Resource Center to provide housing stability services with the goal of preventing homelessness with ESG funds.
The City Council’s funding decisions are submitted to HUD as part of the City’s annu al application (annual Action Plan) for CDBG and ESG funds, which includes a final Statement of Community Development Objectives and Projected Use of Funds (see Exhibit 2), as well as an Action Plan.
The City allocates CDBG and ESG funds in two-year funding cycles. This allows agencies to better budget their resources and reduces the amount of paperwork they need to complete Council Staff Report (ID # 4892) Meeting of May 9, 2023 Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 3
each year. The City commits a portion of its estimated funding sources in the first year and holds the remaining funds for unforeseen project contingencies and emerging projects in the second year. This funding recommendation is for FY 2023/24.
On June 21, 2022, the City Council allocated $946,654 of FY 2022-23 funding based on an estimated FY 2023-24 CDBG budget.
DISCUSSION/ANALYSIS:
Community Development Block Grant Program
Table 1 shows the funding sources for the FY 2023-24 CDBG Entitlement Program.
Table 1: FY 2023/24 – CDBG Entitlement Funding Sources
FY 2023/24
1. CDBG Entitlement $1,740,174
2. Estimated Program Income $20,000
3. Reprogrammed Funds and Project Reserve $138,638
Total FY 2023/24 CDBG Funding: $1,898,812
CDBG RFP Process: The availability of CDBG funds was advertised through the newspaper, the City’s web page, the City’s cable channel, and an extensive mailing to social services agencies. The RFP process was conducted as follows:
1. RFP materials were made available to the public on February 2, 2023.
2. On February 2, 2023 staff conducted a publicly noticed grant proposal workshop for prospective CDBG applicants. The workshop gave new agencies the opportunity to understand the proposal process, including proposal criteria and the CAC’s role in the process. The CAC is committee which is advisory to City staff in the review of CDBG funding requests. Five (5) prospective applicants attended the workshop.
3. Proposals for CDBG funding were submitted by the deadline of March 8, 2023.
4. On March 15, 2023, staff and the CAC held a public meeting to develop supplemental questions for applicants to answer. In reviewing the projects, the CAC and staff evaluated each proposal based on the following criteria:
a. Benefit to low- and moderate-income households;
b. Ability of the project to address the most critical local needs of lower income residents;
c. Feasibility of the project to succeed;
d. Cost effectiveness;
e. Impact of funding on the outcome of the proposed activity; f. Management and performance capacity of the project sponsor; and g. Completeness of the proposal.
5. On March 24, 2023, the CAC and staff conducted a public hearing to interview agencies regarding their proposals.
6. And finally, on April 13, 2023, the CAC and staff developed funding recommendations for the City Council.
Council Staff Report (ID # 4892) Meeting of May 9, 2023 Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 4
As a member of the Alameda County HOME Consortium, the City also participates in the Consortium’s citizen participation process. The Consortium will hold a pre-draft public hearing at HCD’s Housing and Community Development Advisory Committee Meeting and will consist of an overview of the Action Plan and request for input on housing and community development needs.
Capital Projects Funding Recommendations: Staff estimated that there was approximately $895,751 in funding available for capital projects in FY 2023 -24.
The City received four (4) new proposals for CDBG-funded capital projects, requesting $740,000 over the next fiscal year. At their April 13th meeting, the CAC recommended that CDBG funds be allocated to all four projects as shown below in Table 2. A staff analysis, with project summary and funding recommendation for each proposed project is enclosed (Exhibit 3). All the capital projects recommended for funding are designed to address the needs of low- and moderate-income households with incomes under 80% of the area median income and are consistent with the City’s FY 2020-2024 Strategic Plan.
Table 2: Capital Project Recommendations
Proposed Capital Projects Amount
Requested
Recommended
Allocation
Tri-City Volunteers, Inc. – Food Bank
Flooring Replacement Project
$272,000 $272,000
Mid-Pen Housing Corporation – Oroysom
Village Roof Replacement Project
$350,000 $350,000
Age Well Center at Lake Elizabeth – Floor
Replacement and Bathroom Renovation
Project
$85,000 $85,000
Fremont Family Resource Center – Core
Team Space Expansion Project
$33,000 $33,000
Capital Projects Subtotal: $740,000 $740,000
Public Services and Administration Funding Recommendations: On June 21, 2022, the City Council allocated $556,654 of FY 2023-24 public services and administration funding based on an estimated FY 2023-24 CDBG budget. Staff is recommending an additional allocation of $22,460 for public service projects, and $33,947 for administration for a total of $56,407 as stated in Table 3. These calculations are based on actual FY 2022 - 23 program income the City received, anticipated FY 2023-24 program income, and the FY 2023-24 CDBG entitlement. Public service projects and administration allocations will be proportionally increased or decreased from the estimated funding levels to match actual allocation amounts.
Council Staff Report (ID # 4892) Meeting of May 9, 2023 Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 5
Table 3: Public Service and Administration Recommendations Amount
Previously
Allocated
Recommended
Additional
Allocation
Total
FY 23/24
Allocation
Public Service Projects: The total allocation
for public services projects may be up to 15% of
the City’s entitlement and actual FY 2022/22
program income
$238,566 $22,460 $261,026
Administration: This total covers staff salary,
overhead and project management costs, and is
consistent with HUD’s administrative cap,
calculated at 20% of the City’s entitlement,
anticipated program income.
$318,088 $33,947 $352,035
Public Service & Administration Subtotal: $556,654 $56,407 $613,061
Table 4 below outlines the total additional allocation recommendations for FY 2023 -24.
Table 4: FY 2023/24 Total Additional Allocation Recommendations Additional Allocation Recommendation
Capital Projects $740,000
Public Service and Administration $56,407
Total $796,407
CDBG Contingency Reserve:
After taking into consideration the additional allocation recommendations found in Table 4, there is a total of $155,751 in remaining funds.
To ensure that entitlement jurisdictions fulfill their citizen participation obligation in a timely manner, HUD advised that jurisdictions include “contingency provisions” language in their action plans, which explains how the jurisdictions will adjust their proposed plan to match their actual CDBG entitlement allocation amounts. At the funding recommendations meeting, the CAC and staff agreed on the following contingency plan: if additional CDBG funds are available, the funds will be kept in reserve to be used for gap funding for current capital projects and for emerging needs projects.
Emergency Solutions Grant Program
Table 5 shows the funding sources for the FY 2023-24 ESG Entitlement Program.
Table 5: FY 2023/24 ESG Entitlement Funding Sources
FY 2023/24
1. ESG Entitlement $153,361
2. Estimated Program Income $0
3. Reprogrammed Funds and Project Reserve $0
Total FY 2023/24 ESG Funding: $153,361
Council Staff Report (ID # 4892) Meeting of May 9, 2023 Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 6
Table 6 below outlines the total allocation recommendation for FY 2023/24.
Table 6: FY 2023/24 ESG Allocation Recommendations
Additional Allocation Recommendation
Administration $11,502
Housing Stability – Homelessness Prevention
(Fremont Family Resource Center)
$141,859
Total $153,361
The FY 2023-24 Action Plan, Proposed Final Statement of Community Development Objectives and Projected Use of Funds: Under the 1990 National Affordable Housing Act, localities eligible to receive federal funding for housing and community development programs (CDBG, ESG, HOME, etc.) administered by HUD are required to prepare an annual Action Plan to report on the programs and activities that address community development information on federal, state and local funding sources for community development and affordable housing activities, a description of activities to be undertaken using federal funding sources, a description of other actions the City will be taking to reduce barriers to affordable housing, lead-based paint hazards, and poverty, as well as a description of efforts to improve institutional structure, public/ private coordination, and public housing resident initiatives. The City’s Draft FY 2023-24 Action Plan is enclosed (Exhibit 2). The City is also required to submit a Proposed Final Statement of Community Development Obje ctives and Projected Use of Funds (Exhibit 3).
FISCAL IMPACT: There is no match requirement for this funding. The appropriation of the funds will be included in the proposed FY 2023/24 operating budget and contingent upon adoption by the City Council in June 2023.
ENVIRONMENTAL REVIEW: All CDBG-funded projects listed in this staff report are subject to evaluation under the environmental review procedures pursuant to the California Environmental Quality Act (CEQA) and the National Environmental Policy Act (NEPA).
Consistent with NEPA regulations, funding will not be distributed to a project until appropriate NEPA review and clearance is completed for that project.
All of the projects being recommended are exempt from review under the California Environmental Quality Act (CEQA) pursuant to, without limitation CEQA Guidelines Section 15301 and/or 15302 as the repair, maintenance or minor alteration of existing facilities involving negligible or no expansion of use pursuant to CEQA Guidelines Section 15301, and/or as replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site and have substantially the same purpose and capacity as the replaced structure pursuant to CEQA Guidelines Section 15302. In addition, the action is exempt pursuant to CEQA Guidelines Section 15378(b)(2), (4) and/or (5), as continuing maintenance, fiscal and/or administrative activities that have no possibility to cause a significant effect on the environment. Each of the foregoing provides a separate and independent basis for CEQA exemption.
ATTACHMENTS:
• Exhibit 1 - Fremont - DRAFT 2023-2024 Annual Action Plan Council Staff Report (ID # 4892) Meeting of May 9, 2023 Updated: 5/5/2023 9:35 AM by Susan Gauthier B Page 7
• Exhibit 2 - FY23-24 CDBG Staff Analysis
• Exhibit 3 - FY 2023-24 Proposed Final Statement Final • Draft Resolution FY 23-24 CDBG Funding Recommendations
RECOMMENDATION: Staff recommends that the City Council:
1. Hold a public hearing on the proposed FY 2023/24 Federal Funding Program Final Statement of Community Development Objectives and projected Use of Funds.
2. Allocate CDBG and ESG funds for FY 2023/24 in the amounts stated herein, and contingent upon adoption of the FY 2023/24 budget by the City Council.
3. Authorize staff to:
a. Allocate additional funds to public service projects should the City receive additional program income in FY 2023/24 or a greater entitlement. b. Reserve unallocated funds to provide gap funding or fund projects that meet emerging needs.
4. Adopt a resolution:
a. Approving and authorizing the City Manager or his designee to submit the FY 2023/24 Federal Funding Program Final Statement of Community Development Objectives and Projected Use of Funds, the City’s Annual Action Plan, as recommended by staff in the amounts stated herein and finding the action exempt from CEQA, as specified.
b. Authorizing the City Manager or her designee to execute CDBG and ESG Entitlement funding agreements with HUD.
c. Authorizing the City Manager or her designee to execute agreements effective July 1, 2023, with the grantees recommended for funding by staff in the amounts set forth herein, contingent upon a finding of no significant impact in the corresponding NEPA environmental assessments and completion of the required public comment period.