City Council Agenda Report
March 19, 2024
TO: Honorable City Council
FROM: Jesus M. Gomez, City Manager
BY: John P. Ramirez, AICP, Director of Community Development Bethani Cardenas, Housing Manager
Rosio Medina, Senior Management Analyst
SUBJECT: PUBLIC HEARING - PROPOSED ACTIVITIES FOR FISCAL YEAR 2024/25
ANNUAL ACTION PLAN FOR THE COMMUNITY DEVELOPMENT BLOCK
GRANT AND HOME INVESTMENT PARTNERSHIPS PROGRAM
Background:
The Community Development Block Grant (CDBG) and HOME Investment Partnerships Program (HOME) are funded by the United States Department of Housing and Urban Development (HUD), and submittal of an Annual Action Plan (Plan) is required as part of the annual application process for funding. The Plan lists the specific activities that the City will undertake with the CDBG and HOME funds. The types of activities that the City may conduct are subject to federal rules and regulations, such as funding caps on program administration and social services, requirements for public-private partnerships, and compliance with National Objectives.
The purpose of this report is to give City Council an opportunity to review the proposed activities for the Fiscal Year (FY) 2024/25 Plan. After the public review period ends, new activities cannot be added to the Plan without triggering another 30-day public review period and a separate public hearing.
Use of Funds
HUD requires that CDBG and HOME funds be allocated to projects that meet the National Objectives of decent housing, a suitable living environment, and expanded economic opportunities. While HOME funds may only be used for housing related activities, CDBG funds may be used for a variety of community development activities, such as rehabilitation of housing and commercial buildings, infrastructure improvements, and certain services, such as counseling and job training. Funds may be used to directly benefit a household that meets the
City Council March 19, 2024
Proposed FY 2024/25 Annual Action Plan Page No. 2
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9 income limitations, such as repair of a specific home, or used for an area benefit, where the improvement is located in a census tract with at least 51% of the households being considered low to moderate income. In addition to meeting these general requirements, activities must comply with the regulations found in Chapter 24, Parts 92 and 570 of the Code of Federal Regulations.
Programs established in the Annual Action Plan should be consistent with the goals and priorities described in the City’s Five-Year Consolidated Plan. The following priorities were identified in the City’s 2020-2025 Consolidated Plan (Consolidated Plan):
Provide decent affordable housing
Maintain and promote neighborhood preservation
Support special needs programs and services
Construct or upgrade public facilities and infrastructure Attract and retain job generating businesses
At this time, the City does not know the final funding amounts for CDBG and HOME. The figures shown below and in the draft Annual Action Plan reflect HUD's current allocation. The figure for "Expected Amount Available for Remainder of Con Plan" anticipates level funding using the current year allocations and projecting those allocations over the remaining years covered by the Consolidated Plan. If there are further cuts to the City's allocation over the coming years, the City will adjust this figure accordingly and prepare the Annual Action Plans reflective of the funding reality. Therefore, the amounts shown in the tables below are estimates based on the City’s 2023 funding allocation and estimated program income. The proposed activities are consistent with the priorities identified in the Consolidated Plan.
Funding and Proposed Activities for the Annual Action Plan The City anticipates receiving approximately $1,622,410 in CDBG funds, which includes entitlement, program income, and carryover funds from prior years. The City anticipates receiving approximately $541,694 in HOME funds, which include entitlement, program income, and carryover funds for Fiscal Year 2023/24. The Consolidated Plan explains how the City will utilize these monies to improve community development needs, address affordable housing, and priorities for people experiencing homelessness. The Plan establishes strategies for the next program year and identifies specific projects and activities that will be undertaken with CDBG, and HOME funds received from HUD.
City Council March 19, 2024
Proposed FY 2024/25 Annual Action Plan Page No. 3
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9 The following table lists the proposed activities and expenditures for FY 2024/25:
PROJECTS/ACTIVITIES FUNDED BY CDBG CDBG
Program Administration – CDBG (20% cap) $195,482
Fair Housing – CDBG (20% cap) $13,000
Emergency Services – Social Services Center* $75,000
Social Services Agencies (TBD) $81,331
Economic Development Activities $480,000
Capital Improvement Project $777,597
Total $1,622,410
*CDBG funding for public service programs (15% cap of CDBG funds)
PROJECTS/ACTIVITIES FUNDED BY HOME HOME
CHDO Set-Aside – HOME (15% cap of HOME funds) $93,932
Program Administration – HOME (10% cap of HOME funds) $31,311 TBRA – Security Deposit Assistance $30,000
Affordable Housing Project $386,451
Total $541,694
Public Services/Social Services Agencies Fund Recommendations The City is allowed to allocate a maximum of 15% of its CDBG entitlement for public services related to activities, such as health services, substance abuse services, homeless services, employment services, crime prevention and other public services.
Public services funding has been distributed to various Social Service Agencies and the Emergency Assistance Program administered by the Social Services Department in previous years.
On November 20, 2023, the availability of CDBG funds was announced to 45 local non-profit agencies. Five (5) applications for CDBG funding were received by the deadline of December 18, 2023. On January 4, 2024 and February 8, 2024, the Social Services Commission reviewed and discussed the applications. After discussion and review, the Commission and Social Services staff are making the following recommendations for City Council consideration. The recommendations in the following table are based upon an estimated allocation of $156,331.
City Council March 19, 2024
Proposed FY 2024/25 Annual Action Plan Page No. 4
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9 Agency 23/24 Funding
Amount
Social Services
Commission
Recommendation
for FY 24/25
Est. $68,000
Social Services
Director/Staff
Recommendation
for FY 24/25
Est. $81,331*
LA CADA $18,276 $18,000 $20,000*
Jovenes $18,276 $14,000 $20,000*
Legal Aid $30,000 $22,000 $21,331*
Norwalk La Mirada Adult
School
$18,000 $14,000 $20,000*
Emergency Assistance
Program – Social
Services
$75,000 $75,000
The Whole Child $10,000
(General Fund)
$0 $0
Citizen Participation Plan
The Citizen Participation Plan outlines the City’s policies and procedures to encourage resident participation in the development of the City’s Consolidated Plan, Annual Action Plan, and Annual Reports. Staff proposes that the City Participation Plan be revised to allow the City to increase or decrease funding for any specific activity by no more than 20% of the activity funding without triggering a public hearing; City Council will conduct two (2) public hearing on the Consolidated Plan/Action Plan(s); the Social Services Commission and Staff will review and provide funding recommendations for public service agency funding, City Council will review recommendations from the Social Services Commission and/or provide final funding recommendations; and to publish the public notices on the Consolidated Plan/Action Plan(s) in Spanish.
Policy for funding changes
HUD requires that the City establish a methodology to adjust funding for activities and allocate excess program income and carry-over funds after the exact amounts are known. The above entitlement, program income, and carry-over amounts are estimates. As the final amounts are known, HOME and CDBG activity funding amounts will be adjusted in the following manner:
HOME program administration will be adjusted up or down to equal 10% of the final entitlement amount plus 10% of estimated program income; FY 2023/24 HOME carry over will be committed to an Affordable Housing Project; HOME program income received in FY 2023/24 will be allocated to administration (up to 10%) and to an Affordable Housing Project;
CHDO program will be reduced or increased according to the amount of funds remaining to be added or deducted from the overall HOME budget;
City Council March 19, 2024
Proposed FY 2024/25 Annual Action Plan Page No. 5
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9 CDBG Program Administration will be adjusted up or down to equal 20% of the actual entitlement amount plus 20% of program income;
The CDBG carryover amount will be revised at year-end to match the actual uncommitted balance remaining in the CDBG program;
CDBG program income received during FY 2023/24 will be allocated to program administration (up to 20%). Remaining program income will be allocated to a Capital Improvement Project or Economic Development Activity.
Timeline
The draft FY 2024/25 CDBG and HOME Annual Action Plan will be made available for public review and comment for a period of 30-days starting March 25, 2024. After the 30 day public review period, the final Plan will be presented to City Council for adoption at a public hearing scheduled on or before May 7, 2024. At the public hearing, City Council may increase, reduce, or eliminate the funding allocated to any of the proposed activities listed above, but new activities cannot be added at that time without triggering another 30-day public review period and another public hearing. The final plan is due to HUD by May 15, 2024.
Fiscal Impact:
The CDBG and HOME programs are funded solely by the United States Department of Housing and Urban Development. Normally, there is no impact to the general fund.
Citizens Advised:
Notice of the Public Hearing was posted at the City’s official posting sites on March 1, 2024, and published in The Norwalk Patriot in accordance with State law on February 29, 2024.
The 2024/25 Annual Action Plan and Citizen Participation Plan will be made available at City Hall (Community Development Department), the Social Services Center and the Norwalk Regional Library from March 25, 2024 to April 25, 2024 for citizens to review and make comments.
Strategic Plan 2023 Implementation:
The recommended actions will further the City’s Strategic Plan Goal 2: Objective 1 Re-invest in existing and aging infrastructure and Objective 3: Improve living conditions for residents in greatest need; Goal 3: Objective 1 Create dynamic neighborhoods, Objective 2 Diversify and grow the economy, and Objective 3 build great public destinations.
Recommended Action:
Staff recommends City Council and the public provide input of the proposed Community Development Block Grant (CDBG) and HOME Investment Partnerships Program (HOME) funding activities for Fiscal Year 2024/25 Annual Action Plan.
City Council March 19, 2024
Proposed FY 2024/25 Annual Action Plan Page No. 6
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9 Attachments:
1. Draft FY 2024/25 CDBG and HOME Annual Action Plan
https://filedrop.norwalkca.gov/s/eLejKAt2xTC9J8a
2. CDBG Census Tract Map
3. Citizen Participation Plan