City Council Agenda Report
March 4, 2025
TO: Honorable City Council
FROM: Jesus M. Gomez, City Manager
BY: Alex Hamilton, Interim Director of Community Development Bethani Cardenas, Housing Manager
Rosio Medina, Senior Management Analyst
SUBJECT: DIRECTION FOR THE 2025 CONSOLIDATED PLAN AND FISCAL YEAR 2025- 26 ANNUAL ACTION PLAN
Background:
The City receives Community Development Block Grant (CDBG) and HOME Investment Partnerships Program (HOME) funds from the United States Department of Housing and Urban Development (HUD). As a recipient of these funds, the City is required to submit a Consolidated Plan (ConPlan) and Analysis of Impediments to Fair Housing Choice (AI) every five years, and an Annual Action Plan (AAP) each year. The ConPlan outlines the City’s housing, infrastructure, economic development and social service needs along with the program and activities planned to address those needs. The AAP details the specific activities that will be implemented during the fiscal year, the funds allocated to each activity, and the anticipated outcomes or accomplishments.
The City’s next Five-year ConPlan covers the period of July 1, 2025 through June 30, 2029 and the AAP will cover the first Fiscal Year (FY) 2025-26. A critical part of the ConPlan process is the identification of needs through community participation. Before drafting the ConPlan, the AAP, and releasing the annual social service agency funding applications, the needs of the community, priorities, and possible initiatives are being presented to City Council for policy direction.
The purpose of this report is to give City Council an opportunity to review the proposed activities for the FY 2025-26 AAP. After the public review period ends, new activities cannot be added to the AAP without triggering another 30-day public review period and a separate public hearing.
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Direction for the 2025 Consolidated Plan Page No. 2
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Program Objectives and Use of Funds
The primary objective of the CDBG program is the development of viable urban communities by providing decent housing, a suitable living environment, and expanded economic opportunities for persons of low and moderate income. Under certain circumstances an activity may qualify if it eliminates blighted conditions or alleviates an urgent need, such as conditions caused by a natural disaster. HUD requires that CDBG and HOME funds be allocated to projects that meet the National Objectives of providing decent housing, a suitable living environment, and expanded economic opportunities.
The HOME program objective is to increase the availability and accessibility of affordable housing for low income households. 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 income limitations, such as repairing a specific home. Additionally, they can be used for public improvements to benefit areas that are located in a census tract where at least 51% of the households are deemed low to moderate income. In addition to meeting these general requirements, CDBG and HOME activities must comply with the regulations found in chapter 24, part 92 and 570 of the Code of Federal Regulations.
The 2020-2025 ConPlan outlined the following goals:
• 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
Over the past five years, the following activities have been implemented:
• Public facility/infrastructure improvements, including ADA ramps for public sidewalks and local street rehabilitation
• Residential Rehabilitation (CDBG)
• Social Service Agency Funding
• Job Training Program
• Emergency Assistance Program
• Security Deposit Assistance
• Commercial Façade Improvements
• Affordable Rental Housing (Community Housing Development Organization) • First Time Homebuyer Program
• Rental Rehabilitation Program (HOME)
• Fair Housing Program
• CDBG And HOME Program Administration
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Direction for the 2025 Consolidated Plan Page No. 3
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Programs established in the AAP should be consistent with the goals and priorities described in the City’s ConPlan. The following priorities have been identified in the City’s 2025-2030 ConPlan:
• Provide decent affordable housing
• Support special need services
• Infrastructure improvements
• Create public awareness of fair housing laws
• Job business creation and job training
• Homeless prevention programs and services
• Neighborhood preservation
Funding and Proposed Activities for the Annual Action Plan 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. HUD publishes the CDBG and HOME grantee allocations by mid-March. For FY 2024-25 the City received $977,097 in CDBG funds and $240,414 in HOME funds. The City anticipates a reduction in funding for FY 2025-
26. The City will allocate CDBG and HOME program income and carryover funds from prior years to the FY 2025-26 funding.
The ConPlan explains how the City will utilize these monies to improve community development needs, address affordable housing, and establish priorities for people experiencing homelessness. The AAP establishes strategies for the next program year and identifies specific projects and activities that will be funded with CDBG and HOME funds received from HUD. Due to funding limitations, not all of the priorities listed above can be funded in the first year of the ConPlan.
To support the priorities listed above, staff recommend funding the following activities in FY 2025-26:
PROJECTS / ACTIVITIES FUNDED BY CDBG Estimated /
Recommended Funding
Program Administration – CDBG (20% cap) $182,419
Fair Housing – CDBG (20% cap) $13,000
Emergency Services – Social Service Center (15% cap) $75,000 Social Service Agencies (TBD – 15% cap) $60,000
Economic Development Project/Activity (TBD) $100,000
Upwards Inc. – Economic Development $10,000
Capital Improvement Project (TBD) $536,678
Total $977,097
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PROJECTS / ACTIVITIES FUNDED BY HOME Estimated /
Recommended Funding
CHDO Set-Aside – HOME (15% cap of HOME funds) $36,062
Program Administration – HOME (10% cap of HOME funds) $24,041 TBRA – Security Deposit Assistance $30,000
Affordable Housing Project $150,311
Total $240,414
Public Services: Social Service Agencies
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 8, 2024, the availability of CDBG funds was announced to 51 local non-profit agencies. Nine applications for CDBG funding were received by the deadline of December 13, 2024. The Social Services Commission reviewed and discussed the applications. Based on their evaluation, the Commission and Social Services Director are making the following recommendations for City Council consideration. The recommendations are based upon an estimated allocation of $135,000.
Agency Agency Requested
Funding
Commission / Director
Recommended
Funding
Community Family Guidance Center $25,000 $20,000
Community Legal Aid $20,000 $20,000
Emergency Assistance Funds $75,000 $75,000
Fentanyl Solutions $49,500 $0
LA CADA $20,000 $20,000
Su Casa $15,000 $0
Upwards Care $48,000 $0
Women’s & Children’s Crisis Center $29,373 $0
YMCA $15,000 $0
Total $296,873 $135,000*
*amount will be adjusted based upon final HUD CDBG entitlement Timeline
The draft ConPlan and FY 2025-26 AAP will be made available for public review and comment for a period of 30-days starting March 24, 2025. After the 30-day public review period, the final ConPlan and AAP will be presented to City Council for adoption at a public hearing scheduled on or before May 6, 2025. 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 City Council March 4, 2025
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added at that time without triggering another 30-day public review period and another public hearing. The final ConPlan, AI and AAP are due to HUD by May 15, 2025.
Fiscal Impact:
The CDBG and HOME programs are funded solely by the United States Department of Housing and Urban Development.
Citizens Advised:
N/A
Strategic Plan 2023 Implementation:
N/A
Recommended Action:
Staff request guidance from City Council regarding the proposed activities for the Fiscal Year 2025-26 Annual Action Plan.
Attachments:
N/A