Agenda packet — Palm Desert City Council, January 22, 2026 (part 3 of 3)

ADOPTED ON ________________, 20__.

EVAN TRUBEE
MAYOR
ATTEST:

ANTHONY J. MEJIA

CITY CLERK
I, Anthony J. Mejia, City Clerk of the City of Palm Desert, hereby certify that Resolution No. 2026-__ is a full, true, and correct copy, and was duly adopted at a regular meeting of the City Council of the City of Palm Desert on _______________________, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Desert, California, on ______________, 20__.

ANTHONY J. MEJIA

CITY CLERK
352
RESOLUTION 2026- ______

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EXHIBIT A
ADMINISTRATIVE POLICY NO. FIN-003A
“RESERVE POLICY”
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CITY OF PALM DESERT

ADMINISTRATIVE PROCEDURES
Subject Reserve Policy
Policy No. FIN - 003
Date Issued: September 27, 2018
Amended January 22, 2026
Approved by Resolution No. 2026- ___ authorizing a Reserve Policy
Authored by Finance Department
I. PURPOSE
To outline the policy and procedures for establishing reserves for long-term city infrastructure needs, economic uncertainties, economic development, emergency reserve, equipment replacement, productivity savings and innovation, pension and other post employmentpost-employment obligations.

This policy will also set guidelines and priorities for the distribution of excess revenue at the end of each fiscal year to assist in funding and replenishing the identified reserve categories as well as ensuring that funds for current operating needs are available. This Policy will help the City ensure stable service delivery.

II. SCOPE
The City utilizes a variety of Government funds for reporting and budgeting revenues and expenditures of the City which are separated broadly by three fund types: governmental funds, proprietary funds and fiduciary funds. This policy will pertain only to governmental funds and proprietary funds since fiduciary funds are held in trust for others.

Governmental funds include the General Fund, Special Revenue funds, Debt Service funds and Capital Project funds. Proprietary funds include Enterprise funds and Internal Service funds.

To effectively utilize and maintain adequate reserves for both known and unknown contingencies, this policy establishes reserve categories based on the hierarchy of the City’s needs and risks:

1. General Fund Operating Reserve

2. Contingency/Emergency Reserve

3. Facilities Maintenance Reserve

4. Capital Improvement Projects Reserve

5. Liability Reserve

6. Employment Benefits Reserve

7. Other Fund Stability Reserve

8. Equipment Replacement Reserve
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9. Economic Development/Land Acquisition Reserve
III. GENERAL DEFINITIONS
A. ACFR – Annual Comprehensive Financial Report – local government entity’s main yearly financial reporting document, prepared in accordance with GAAP and governmental reporting standards (typically GASB)
B. CJPIA – California Joint Powers Insurance Authority – a pooled insurance and risk management provider for California public agencies.

III.IV. RESERVE CATEGORY DEFINITIONS (in alphabetical order) a. Capital Improvement Projects Reserve – A reserve for major capital projects or improvements to the City’s infrastructure including recreational facilities, undergrounding, roadways, storm drains, parks and gardens, buildings, and rights of way.
b. Contingency/Emergency Reserve – A reserve to sustain General Fund operations, service delivery and budgetary stabilization in the event of an unexpected change in financial condition1 or public emergency. This reserve is not intended to serve as an alternative funding source for new programs. c. Economic Development/Land Acquisition Reserve -- A reserve to facilitate economic development partnerships, incentives and property acquisitions to further the City’s economic development goals.
d. Employment Benefits Reserve – A reserve for accumulated compensated leave balances, pension discount rate changes, pension obligations and other postemployment benefits (OPEB), including unfunded pension liabilities. e. Equipment Replacement Reserve -- A reserve for the replacement of equipment not identified within the Facilities Maintenance Reserve, including vehicles, office furniture, information systems, printers, scanners, communication systems, etc. f. Facilities Maintenance Reserve – A reserve to maintain existing City buildings and infrastructure including recreational facilities, parks and gardens, and hiking trails.
g. General Fund Operating Reserve – A reserve used to finance the daily operations of the City, such as public safety, streets maintenance, recreational parks, and special events.
h. Liability Reserve – A reserve for costs not covered by the City’s insurance programs including claim costs within the deductible amounts, certain types of settlements and judgments, or any claims awarded in excess of $50 million. This reserve may also be used for deductibles, to pay any amount that may be

1 An unexpected change in financial condition could include things such as the economic crisis in 2008, a loss or delay of a ma jor revenue source, a natural disaster, liabilities not covered by insurance, or change in the pension discount rate for the City’s unfunded pension liability.
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considered a liability to the City consistent with this category, or to pay any contribution or premium to the pool on behalf of the City. i. Other Fund Stability Reserve – A reserve for transfers to funds from the General Fund to cover expenses.

IV.V. ACCOUNTING GUIDANCE
The Government Finance Officers Association (GFOA) suggests that as a best practice, cities should consider their own unique circumstances in order to determine adequate reserves. This includes assessing the needs of the City as well as the uncertainties that could impact the City’s revenues and fund balance
Government Accounting Standards Board Statement (GASB) No. 54 defines five specific classifications of fund balance. The five classifications are intended to identify whether the specific components of fund balance are available for appropriation (or available to reserve) and are therefore “Spendable.” The classifications are also intended to identify the extent to which fund balance is constrained by special restrictions. The five classifications2 of fund balance for governmental funds are as follows:

CLASSIFICATIONS NATURE OF RESTRICTION
Non-spendable Cannot be readily converted to cash
Restricted Externally imposed restrictions
Committed City Council imposed commitment
Assigned City Manager assigned purpose/intent
Unassigned Residual balance not otherwise restricted

2 Nonspendable Fund Balance (inherently nonspendable) – Assets that cannot be converted to cash (i.e., prepaid items and inventories of supplies) and assets that will not be converted to cash soon enough to affect the current period. Examples of nonspendable fund balance are reserves for long term receivables and advances, prepaid assets, City’s financial assets which are not due to be received for an extended period, so are not available for appropriation during the budget year.

Restricted Fund Balance (externally enforceable limitations on use) – Limitations imposed by creditors, grantors, contributors, or laws and regulations of other governments and limitations imposed by law through constitutional provisions or enabling legislation.

Examples of restricted fund balance are reserves for debt service, developer impact fee, capital bonds and grants.

Committed Fund Balance (self-imposed limitations on use set in place prior to the end of the fiscal year) – Limitation imposed at the highest level of decision making that requires formal action at the same level to remove (City Council). Examples of committed fund balance are the aquatic center, energy loan programs and the housing authority capital asset replacement.

Assigned Fund Balance (limitation resulting from intended use) – Intended use is established by highest level of decision making, then may be implemented by an official designated for that purpose (delegated by the City Council to the City Manager). Examples of assigned fund balance are the library fund, building maintenance fund, capital project reserve fund, and economic development fund.

Unassigned Fund Balance (residual net resources) – Excess of nonspendable, restricted, committed, and assigned total fund balance. Unassigned Fund Balance reserves are residual positive net resources in excess of what can properly be classified in one of the other four components. Unassigned General Fund Balance (unobligated general fund reserves) and can be used for any lawful purpose.
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This Policy is focused only on the reserve designations that will be Committed, Assigned or identified in Unassigned. Non-spendable and Restricted classifications will be excluded because they are subject to requirements outside the City’s control. The City will, however, consider restricted fund balance as spent first when both restricted and unrestricted fund balances are available.
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V. RESERVE FUNDING POLICIES
The primary goal of the Policy is to identify and reserve, adequate resources for operational liquidity, future needs and any uncertainties that might affect the City’s fund balance. The Policy includes broad reserve categories that are meant to be as inclusive as possible, yet flexible enough to address needs or risks as they arise. Each reserve category may include multiple funds some of which may have a restricted fund balance component. At the discretion of the City Manager, monies held in reserve may be used in any year when the General Fund is not balanced in order to offset operating costs consistent with these reserve categories.

The identified reserve funding policies are as follows:

1. General Fund Operating Reserve – On June 30, the Finance Director shall set aside twenty fiveten percent (2510%) of the projected annual General Fund expenditures. Withdrawals are permitted following an economic contraction, defined as two consecutive quarters of declining “real Gross Domestic Product/GDP” (GDP adjusted for inflation). This reserve will be adjusted at the end of each fiscal year to the recommended level based on the next year’s projected expenditures. This reserve will be classified in fund balance as ASSIGNED.

2. Contingency/Emergency Reserve – At the beginning of each fiscal year, the Finance Director shall reserve an amount equal to twenty fifteen percent (2015%)3 of the projected annual General Fund revenues. Withdrawals are permitted if a severe emergency, such as a natural disaster accompanied by significant, unanticipated revenue loss or expenditure needs occur. Withdrawals would need to commence within 12 months of the triggering event and could continue until tax revenues exceed pre-contraction levels, if that is the case. This reserve will be adjusted at the beginning of each fiscal year to the recommended level based on that year’s projected revenues. This reserve will be classified in fund balance as COMMITTED.

3. Facilities Maintenance Reserve – Upon the approval of this policy, the Finance Director is directed to commit the amount identified in the Capital Replacement Reserve Study, as the initial deposit, less amounts available from other funding sources to this reserve. The policy designated goal for funding this reserve, will be between sixty and one hundredseventy percent (60-1070%) of the ‘Fully Funded’annual calculated replacement value amount in the Capital Replacement Reserve Study. The annual recommended funding amount identified in the Capital Replacement Reserve Study will be considered as part of the annual budget. The

3 After the financial crisis in 2008 the fluctuation in the City’s revenue was approximately twenty percent (20%) of the 2007-08 budget or $11 million dollars. While the City also reduced its budget at that time to offset the reduction in revenues to the extent possible, the core services were still rising. It took approximately eight years to reestablish the revenue base to pre-2008 levels. Based on these actual events staff believes that 20% of the annual operating revenue would be prudent as a reserve, with a consideration to review from time to time as information becomes available to the City that might suggest the amount to be increased. 359
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replacement value will be determined each by the total balance of facilities in the General Fixed Assets Fund 980. The minimum reserve will be calculated at 30%, with the maximum cumulative reserve balance not to exceed 110% of the annual calculated replacement value. Residual balances each year may be carried over up to the 110% ceiling. This reserve will be classified in fund balance as COMMITTED.

4. Capital Improvement Projects Reserve – At the financial closing of each fiscal year, the Finance Director shall set aside twenty percent (20%) of the total Capital Improvement Program projects for the next five years. The Finance Director will adjust this amount annually to the policy designated level plus any additional amounts so directed by the City Council under Section VI of this policy. This reserve will be classified in fund balance as both RESTRICTED and COMMITTED depending on the project funding. Unless otherwise specified, at such time as a project or any portion thereof has been awarded the amount will be allocated (committed) to the project and will not be available for other projects.

5. Liability Reserve -- The Finance Director shall commit at least the pooled retention requirement for both Liability and Workers’ Compensation, which is currently $4 million ($2 million each). This amount may be adjusted annually in accordance with the minimum threshold requirements in CJPIA’s Memorandum of Coverage. This reserve will be classified in fund balance as COMMITTED.

6. Employment Benefits Reserve – Internal Service Funds have been established for the purpose of reserving monies for compensated balances and Other PostEmployment Benefits (OPEB). On June 30 of each year, the Finance Director shall set aside one hundred percent (100%) of the compensable accrued unused vacation, sick leave, and compensatory time and the current year’s OPEB requirements to the appropriate internal service funds. This amount will be COMMITTED. The Finance Director shall also set aside fifty percent (50%) of a one percent (1%) difference in the Public Employees Retirement System (PERS) discount rate. This amount will be COMMITTED in the General Fund.

7. Other Fund Stability Reserve - Upon the approval of this policy, the Finance Director shall be directed to commit $3.3 million to this reserve. At the end of each fiscal year, the Finance Director shall adjust the amount to be the projected annual transfers to other funds. These funds may either be committed and transferred at the beginning of the Fiscal Year (and trued up at year-end) or is a reserve will be classified in fund balance as COMMITTED.

8. Equipment Replacement Reserve – An Internal Service Fund has been established for the purpose of equipment replacement. At the financial closing of each fiscal year, the Finance Director shall adjust this reserve to be at least 100% of the total historical cost of equipment assets as noted in the CACFR and may Formatted: Font: Bold, Italic
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include amounts set aside in excess of 100% for any approved one-time expenditures. This reserve will be classified in fund balance as COMMITTED.

9. Economic Development/Land AcquisitionCommunity Investment Reserve -- Upon approval of this Policy, the Director of Finance shall deposit an additional $4,000,000 as a reserve for land/property acquisitions. In addition, w To ensure reinvestment in the community, a dedicated Economic/Community Investment Reserve will be created in an annual amount of $5,000,000 supported by a structured, measurable allocation of limited fund balance. Any project utilizing these reserved funds would need to demonstrate a minimum expected ROI within five years that meets or exceeds the benchmark currently used for City investments, the Five-Year Treasury Bill rate to be viable investments paid from this reserve. Unused annual reserve amounts may accumulate for four years and then must be returned to fund balance as UNASSIGNED. As the City builds out, this amount may be adjusted and funds reallocated where needed with City Council approval. Additionally, within a reasonable amount of time from when the City receives its share of the proceeds of the former redevelopment agency’s land sales, from the County of Riverside, the Finance Director shall commit the City’s share to this reserve. This reserve will be classified in fund balance as COMMITTED.

9.10. Productivity Savings/Innovation Reserve
This reserve concept is a modern, incentive-based approach to support innovation and operational efficiency across City departments. The reserve encourages continuous improvement and high performance by allowing General Fund managers to retain and reinvest productivity-related savings in long-term service enhancements. Eligible productivity savings would be separately tracked by the department or division that generated them. Requests for use of accumulated savings could be submitted to the City Manager at any point during the second half of the fiscal year. Any savings not utilized or requested would roll back into the General Fund balance at year-end. This reserve will be classified in fund balance as ASSIGNED.
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VI. CITY COUNCIL DESIGNATION OF RESERVES AND MINIMUM THRESHOLD The City Council will take action to COMMIT fund balance and unless otherwise specified in this Policy, hereby designates the City Manager or his/her designee to ASSIGN fund balance when appropriate. The City Council may designate portions of General Fund unassigned or unobligated fund balance for any other municipal purpose that the City Council deems prudent or necessary. At no time will the City’s cumulative Reserve Balance dip below 35% of annual revenue. This measure meets both bond rating requirements for Aaa rating and the suggested minimum of 16.7% of revenue, as suggested by GFOA’s best practices without unanimous City Council approval.

VII. ANNUAL DISTRIBUTION OF EXCESS REVENUE
The distribution of excess revenue at the end of each fiscal year will be according to the following guidelines and priorities. Excess revenue, for purposes of this Policy, is the difference between revenues and expenses in the General Fund at the end of a fiscal year after all required transfers are made to other funds.

The priority for distributing or reserving excess revenue at year end is as follows:

1. All excess revenue shall first be used to replenish the General Fund Operating Reserve until it reaches the Policy designated level.

2. The amount necessary to reserve for continuing appropriations and encumbrances that are not funded by other methods, if any.

3. The amount necessary to fund an adequate reserve for potential liabilities, compensated absences, and other post-employment benefits to be paid during the next fiscal year that are not funded by other methods, if any.

4. The amount necessary to fund the Contingency/Emergency Reserve to maintain General Fund operations, service delivery and budgetary stabilization in the event of an unexpected change in financial condition4 or public emergency. Or, if there is insufficient amounts available to fully fund the Contingency/Emergency Reserve, an amount necessary to temporarily reserve for any known and/or anticipated economic downturns during the next fiscal year that are expected to be more than three percent (3%) of the previous year’s General Fund revenues.

5. Other considerations for the allocation of excess revenues will be at the discretion

4 An unexpected change in financial condition could include things such as the economic crisis in 2008, a loss or delay of a ma jor revenue source, a natural disaster, liabilities not covered by insurance, or change in the pension discount rate for the City’s unfunded pension liability.
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of the City Manager after review of the City’s outstanding obligations, approved goals, or level of reserves within each category.
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VIII. REPLENISHMENT OF RESERVES
After consideration of the use of excess revenue in Section VI., the City Manager will annually review the level of each approved reserve category, and after determining what is reasonably necessary and appropriate for the City’s needs, may direct replenishment of critical reserves (General Fund Operating Reserve and Contingency/Emergency Reserve) from other reserves or may assign any remaining excess revenues accordingly.

If a transfer is required from one reserve to another, the City Manager shall notify the City Council at the next regularly scheduled City Council meeting of such transfer.

When reserves are used for any intended purpose, or as allowed under this policy, and a replenishment source is not identified at the time of use, the City Manager will advise the City Council during the annual budget process as to the status of reserves including any recommendations for replenishment.

IX. COMPREHENSIVE ANNUAL COMPREHENSIVE FINANCIAL REPORT In accordance with generally accepted accounting principles and practices, all classifications of General Fund fund balance will appear in the Notes to Financial Statements of the CACFR and be classified in accordance with GASB 54. 364

CITY OF RA CH,O MIRAGE
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STAFF REPORT
TO: City Council DATE: March 10, 2015
FROM: Isaiah Hagerman, Finance Director
SUBJECT: General Fund Reserve Balances
SPECIFIC REQUEST OR RECOMMENDATION:

Consideration of Resolution No. 2015- , approving commitment of certain reserves for specified purposes consistent with the fund balance policy JUSTIFICATION OR INFORMATION:

Annually the Budget Subcommittee, which consists of Mayor Pro Tem Hobart and Councilman Kite, and staff performs a review of the General Fund reserves, in accordance with the City' s Fund Balance Policy and professional standards set by the Governmental Accounting Standards Board ( GASB). Funds may be committed by City Council. Funds may also be uncommitted by either fulfilling the commitment or by resolution approved by City Council. Each commitment of fund balance must meet a specific level of specificity to be classified as committed fund balance. Currently, City Council has established seven reserves for the General Fund: Prudent Reserve, Disaster Recovery Reserve, Capital Projects Reserve, Economic Development Reserve, Ritz Spa Suite Reserve, Section 19 Water Reserve, and the Rancho Mirage Public Library Reserve.

Based on the review, a reduction of $ 4, 000, 000 in the Disaster Recovery Reserve and a reduction of $ 3, 600, 000 in the Economic Development Reserve are being requested. All other reserves will stay at their current amounts.

The reductions in the Disaster Recovery and Economic Development reserves will free up fund balance to ensure the City has sufficient unassigned fund balance. Unassigned fund balance is used to account for any remaining fund balance that isn' t reserved for a specific purpose.

Unassigned fund balance was significantly reduced to make the General Fund' s share of the Ca1PERS pension payment. In addition, the City Council will be considering the use of unassigned fund balance to retire the 2005A Lease Revenue Bonds. The table below summarizes the recent history of our reserves.

City Council Action:

Approved as Requested.

Approved as Amended.

Denied.

Other:

Referred to:

For:

Cont. to Agenda of:

Hearing Set:

AGENDA ITEM #
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DATE: March 10, 2015 Page 2 of 3
JUSTIFICATION OR INFORMATION CONTINUED:

Reserve Name
Prudent Reserve
Disaster Recovery
Capital Projects
Economic Development
Ritz Spa Suite Purchase
Section 19 Water
Library
Original
Reserve Amount
May 2013)
25, 000, 000
15, 000, 000
10, 000, 000
5, 000, 000
5, 000, 000
5, 125, 000
5, 000, 000
Current
Amount
25, 000, 000
15, 000, 000
7, 513, 333
5, 000, 000
5, 000, 000
5, 125, 000
3, 789, 805
The detail of each reserve is presented below.

Prudent Reserve:

Requested
Change
N/ A
11, 000, 000
N/ A
1, 400, 000
N/ A
N/ A
N/ A
The Prudent Reserve commitment is set aside for future revenue shortfalls that meet or exceed the following. If the state reduces future revenue streams or if economic conditions lead to a decline in total general fund revenues of 9% or more from the prior year total general fund revenue amount in any
utilize the Prudent Reserve funds to
City and its residents.

Disaster Recovery:
given fiscal year. The City may
maintain levels of service to the
The Disaster Recovery commitment covers the costs and losses as a result of a major earthquake and disasters that require the activation of the City' s Emergency Operation Center ( EOC) in accordance with California Emergency Services Act.

Capital Projects:

The Capital Project commitment set aside is for land, equipment replacement, information technology equipment and software, facility and infrastructure renovation, upgrade and acquisitions. This set aside can also be used for solar and other " green" projects.

Economic Development:

Due to the passage of
funding for economic
lost some funding for
AB X1 26 and the loss of the redevelopment agency
development projects and programs, the City has
its economic development programs but the Economic
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DATE: March 10, 2015 Page 3 of 3
JUSTIFICATION OR INFORMATION CONTINUED:

Development commitment will be used to continue economic development efforts such as the Highway 111 Facade improvement and property upgrade program, as well as for incentive and acquisitions programs to encourage retail and hotel growth within the City.

Ritz Spa Suite Purchase:

The Ritz Spa Suite reserve will be committed for the purchase of the Spa Suite' s according to Operating Covenant and amendments.

Section 19 Water:

The Section 19 Water reserve will be committed for deposit into an escrow account relating to costs of bringing water to section 19 for development purposes. In the event the actual amount required for deposit into the escrow account is less than the $ 5. 125 million commitment, the remaining amount will cease to be committed and revert back to unassigned fund balance.

City of Rancho Mirage Public Library:

It is anticipated the General Fund will eventually have to supplement the operating and capital costs of the Library Fund. The Library Fund commitment will be reserved for these costs.

RECOMMENDATION:

Approval of Resolution No. 2015-, approving commitment of certain reserves for specified purposes consistent with the fund balance policy ATTACHMENT:

Resolution No. 2015- , approving commitment of certain reserves for specified purposes consistent with the fund balance policy AGENDA ITEM #
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RESOLUTION NO. 2015-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

RANCHO MIRAGE APPROVING COMMMITMENT OF CERTAIN

RESERVES FOR SPECIFIED PURPOSES CONSISTENT WITH THE

FUND BALANCE POLICY
WHEREAS, the Governmental Accounting Standards Board
GASB") is the authoritative body that sets accounting
principles for governmental agencies, including the City of Rancho Mirage; and
WHEREAS, GASB pronouncements comprise the majority of
generally accepted accounting principles for governmental agencies; and
WHEREAS, GASB has issued Government Accounting Standards Board No. 54 Fund Balance Reporting and Governmental Fund Type Definitions (" Statement 54") which requires that governmental agencies change the categories and terminology used to describe the components of fund balance; and
WHEREAS, Statement 54 is designed to improve the reporting of fund balance
classifications
governments are
the funds; and
and to establish a hierarchy
based primarily on the
bound by constraints
of fund balance
extent to which
on resources reported in
WHEREAS, the City Council approved the " Fund Balance
Policy" with Resolution No. 2013- 22 on May 16th, 2013 that is attached hereto as Exhibit " A" and incorporated herein by this reference, which policy comports with the requirements of Statement 54; and
WHEREAS, the Fund Balance Policy establishes the procedures for reporting, within the annual financial statements,
unrestricted fund balance within the City' s governmental funds; and
WHEREAS, the City
23, a copy of which is
by this reference as
reserves for specific
Balance Policy; and
Council later approved Resolution 2013 -
attached hereto and incorporated herein
Exhibit " B," which committed certain
purposes in accordance with the Fund
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368
WHEREAS, staff
Reserve be reduced
Economic Development
1, 400, 000, keeping
Resolution 2013- 23.
now proposes that the Disaster Recovery
from $ 15, 000, 000 to $ 11, 000, 000 and the
Reserve be reduced from $ 5, 000, 000 to
in place all other reserves approved by

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO

MIRAGE DOES HEREBY RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1. Recitals.

That the Recitals set forth above are true and correct.

Section 2. Approval of Commitment of Certain Reserves
for Specified Purposes Consistent with the
Fund Balance Policy.

That the City Council hereby approve reductions in the
Disaster Recovery> Reserve from $ 15, 000, 000 to $ 11, 000, 000 and in the Economic Development Reserve from $ 5, 000, 000 to $ 1, 400, 000.

Section 3. Severability.

That should any provision, section, paragraph, sentence or word of this Resolution be rendered or declared invalid by any final court action in a court of competent jurisdiction or by reason of any preemptive legislation, the remaining provisions, sections, paragraphs, sentences or words of this Resolution as hereby adopted shall remain in full force and effect.

Section 4. Repeal of Conflicting Provisions.

That all the provisions heretofore adopted by the City
Council that are in conflict with the provisions of this Resolution are hereby repealed.

Section 5. Effective Date.

That this Resolution shall take effect upon its adoption.

Section 6. Certification.

That the City Clerk shall certify to the passage and
adoption of this Resolution and enter it into the book of original resolutions.
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PASSED, APPROVED AND ADOPTED on this 10th day of March, 2015.

Iris M. Smotrich, Mayor
ATTEST:

Cynthia Scott, City Clerk
APPROVED AS TO FORM:

Steven B. Quintanilla,
City Attorney
N:\ RNCH\ 0001- 10 General Matters \ DOC\ 814 - Resolution General Fund Reserve Balances ( 03. 02. 15). doc 5- 6
370
EXHIBIT " A"
FUND BALANCE POLICY RESOLUTION 2013- 22

SEE ATTACHED
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RESOLUTION NO. 2013- 22

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO MIRAGE ADOPTING THE FUND BALANCE POLICY.

WHEREAS, the Governmental Accounting Standards Board
GASB") is the authoritative body that sets accounting
principles for governmental agencies, including the City of Rancho Mirage; and
WHEREAS, GASB pronouncements comprise the majority of
generally accepted accounting principles for governmental agencies; and
WHEREAS, GASB has issued Government Accounting Standards Board No. 54 Fund Balance Reporting and Governmental Fund Type Definitions (" Statement 54") which requires that governmental agencies change the categories and terminology used to describe the components of fund balance; and
WHEREAS, Statement 54 is designed to improve the reporting of fund balance and to establish a hierarchy of fund balance classifications based primarily on the extent to which
governments are bound by constraints on resources reported in the funds; and
WHEREAS, the City Council has reviewed the Fund Balance Policy that is attached hereto as Exhibit " A" and incorporated herein by this reference, which policy comports with the requirements of Statement 54; and
WHEREAS, the Fund Balance Policy will establish the
procedures for reporting, within the annual financial
statements, unrestricted fund balance within the City' s governmental funds.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO

MIRAGE DOES HEREBY RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1. Recitals.

That the Recitals set forth above are true and correct. 5- 8
372
ri
Section 2. Approval of Fund Balance Policy.

That the City Council hereby adopt the Fund Balance Policy.

Section 3. Severability.

Section 4. Repeal of Conflicting Provisions.

That all the provisions heretofore adopted by the City
Council that are in conflict with the provisions of this Resolution are hereby repealed.

Section 5. Effective Date.

That this Resolution shall take effect upon its adoption.

Section 6. Certification.

That the City Clerk shall certify to the passage and
adoption of this Resolution and enter it into the book of original resolutions.

TBE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
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PASSED, APPROVED AND ADOPTED on this 16th day of May, 2013.

ATTEST:

Cyn is Scott, City Clerk
APPROVED AS TO FORM:

Steven
A
B. Quintanilla,
City Attorney

CITY OF RANCHO MIRAGE

CITY COUNCIL
Richard W. Kite, Mayor
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EXHIBIT " A"

FUND BALANCE POLICY

SEE ATTACHED
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Attachment A

CITY OF RANCHO MIRAGE

FUND BALANCE POLICY
I. Effective date of policy
This policy is effective upon adoption by City Council.

II. Purpose
In February 2009, the Governmental Accounting Standards Board ( GASB) issued GASB Statement No. 54, Fund Balance Reporting and Governmental . Fund Type Definitions ( Statement 54). Statement 54 is designed to improve the reporting of fund balance and to establish a hierarchy of fund balance classifications based primarily on the extent to which
governments are bound by constraints on resources reported in the funds. This policy will establish the procedures for reporting, within the annual financial statements,
unrestricted fund balance ( comprised of Committed,
Assigned, and Unassigned categories) within the City' s governmental funds. Statement 54 only applies to reporting of governmental funds and does not impact Enterprise,
Internal Service, or Fiduciary Funds.

III. Definitions:

Fund balance refers to the difference between assets and liabilities reported in the City' s governmental funds.

Generally there are limitations on the purpose for which all or a portion of the resources of a governmental fund may be used. The force behind these limitations can vary significantly, depending upon their source. Under
Statement 54 the fund balance reported in the annual
financial statements is categorized into five components whereby each component identifies the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the . fund can be spent. All five
components of fund balance will not always be used in any given fiscal year. The five components of fund balance are as follows.

Nonspendable: Resources that are 1) not in spendable
form, such as inventories, prepaids, long- term
receivables, or non- financial assets held for resale, or 2) required to be maintained intact such as an endowment. 1 5- 12 376
Restricted: Resources that are subject to externally
enforceable legal restrictions; these restrictions would be either 1) externally imposed by creditors ( such as
through debt covenants), grantors, contributors, or laws or regulations of other governments or 2) imposed by law through constitutional provisions or enabling
legislation.

Committed: Resources that are constrained to specific
purposes by a formal action of the City Council by
resolution. The constraint remains binding unless
removed or changed in the same formal manner by the City Council. Council action to commit fund balance must
occur within the fiscal reporting period while the
calculation of the committed balance may be determined
subsequently.

Assigned: For the General Fund, amounts constrained for the intent to be used for a specific purpose, but that
are neither restricted nor committed. Intent can be
expressed by the City Council or by an official or body to which the Council delegates the authority. Amount
reported as assigned should not result in a deficit in
unassigned fund balance. For all governmental funds
other than the general fund, any remaining positive
amounts not classified as nonspendable, restricted or
committed.

Unassigned: Within the General Fund, the residual
resources, either positive or negative, in excess of what can be properly classified as nonspendable, restricted, committed or assigned. The General Fund is the only fund that would report a positive amount in unassigned fund
balance. For all governmental funds other than the
General Fund, amount expended in excess of resources that are nonspendable, restricted or committed ( a residual
deficit). In determining a residual deficit, no amount
should be reported as assigned.
5- 13 377
IV. Policy:

1. When expenditures are incurred for purposes for which both restricted and unrestricted ( committed, assigned, or unassigned) fund balances are available, the City' s
policy is to first apply restricted fund balance. When
expenditures are incurred for purposes for which
committed, assigned, or unassigned fund balances are
available, the City' s policy is to first apply committed fund balance, then assigned fund balance, and finally
unassigned fund balance.

3. The City Council, as the highest level of decision- making authority, may commit fund balance for specific purposes pursuant to constraints imposed by resolution. For the
commitment of fund balance, resolution is the highest
form of action. These committed amounts cannot be used
for any other purpose unless the City Council removes or changes the specified use or amount through the same type of formal action taken to establish the commitment. City Council action to commit fund balance needs to occur
within the fiscal reporting period; but the amount, if
any, which will be subject to . the constraint, may be
determined at a subsequent period.

This policy has been prepared in accordance with Governmental Accounting Standards Board ( GASB) Statement No. 54. No other policy or procedure supersedes the authority and provisions of this policy.
5- 14 378

CERTIFICATION

STATE OF CALIFORNIA

COUNTY OF RIVERSIDE

CITY OF RANCHO MIRAGE
I, Cynthia Scott, City Clerk of the City of Rancho Mirage, California, do hereby certify that Resolution No. 2013- 22 was duly adopted by the City Council of the City of Rancho Mirage, California, at a regular meeting thereof held on the 16th day of May, 2013, by the following vote:

AYES: Smotrich, Weill, Kite
NOES: None
ABSENT: Hines, Hobart
ABSTAIN: None
Cynthia Scott, CMC
City Clerk
5- 15 379
EXHIBIT " B"
RESOLUTION 2013- 23

SEE ATTACHED
5- 16 380
7 RESOLUTION NO. 2013- 23

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO MIRAGE

APPROVING COMMMITMENT OF CERTAIN RESERVES FOR SPECIFIED PURPOSES CONSISTENT WITH THE FUND BALANCE POLICY.

WHEREAS, the Governmental Accounting Standards Board
GASB") is the authoritative body that sets accounting
principles for governmental agencies, including the City of Rancho Mirage; and
WHEREAS, GASB pronouncements comprise the majority of
generally accepted accounting principles for governmental agencies; and
WHEREAS, GASB has issued Government Accounting Standards Board No. 54 Fund Balance Reporting and Governmental Fund Type Definitions (" Statement 54") which requires that governmental agencies change the categories and terminology used to describe the components of fund balance; and
WHEREAS, Statement 54 is designed to improve the reporting of fund balance and to establish a hierarchy of fund balance classifications based primarily on the extent to which
governments are bound by constraints on resources reported in the funds; and
WHEREAS, the City Council has approved the Fund Balance Policy that is attached hereto as Exhibit " A" and incorporated herein by this reference, which policy comports with the requirements of Statement 54; and
WHEREAS, the Fund Balance Policy establishes the procedures for reporting, within the annual financial statements,
unrestricted fund balance within the City' s governmental funds; and
WHEREAS, staff proposes that certain reserves from the
City' s General Fund be committed for certain specified purposes, as set forth in Exhibit " B," attached hereto and made part hereof, and consistent with the Fund Balance Policy.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO

MIRAGE DOES HEREBY RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
5- 17 381
Section 1. Recitals.

That the Recitals set forth above are true and correct.

Section 2. Approval of Commitment of Certain Reserves
for Specified Purposes Consistent with the
Fund Balance Policy.

That the City Council hereby approve commitment of certain reserves as set forth in Exhibit " B," consistent with the Fund Balance Policy.

Section 3. Severability.

Section 4. Repeal of Conflicting Provisions.

That all the provisions heretofore adopted by the City
Council that are in conflict with the provisions of this Resolution are hereby repealed.

Section 5. Effective Date.

That this Resolution shall take effect upon its adoption.

Section 6. Certification.

That the City Clerk shall certify to the passage and
adoption of this Resolution and enter it into the book of original resolutions.

THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
5- 18 382
PASSED, APPROVED AND ADOPTED on this 16th day of May, 2013.

ATTEST:
id t Z
s Scott, City Clerk
APPROVED AS TO FORM:

Afki,
F
Steven B. Quiritanilla'
City Attorney

CITY OF RANCHO MIRAGE

CITY COUN
Richard W. Kite, Mayor
5- 19 383
EXHIBIT " A"

FUND BALANCE POLICY

SEE ATTACHED
r --
5- 20
384
Attachment A

CITY OF RANCHO MIRAGE

FUND BALANCE POLICY
I. Effective date of policy
This policy is effective upon adoption by City Council.

II. Purpose
In February 2009, the Governmental Accounting Standards Board ( GASB) issued GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions ( Statement 54). Statement 54 is designed to improve the reporting of fund balance and to establish a hierarchy of fund balance classifications based primarily on the extent to which
governments are bound by constraints on resources reported in the funds. This policy will establish the procedures for reporting, within the annual financial statements,
unrestricted fund balance ( comprised of Committed,
Assigned, and Unassigned categories) within the City' s governmental funds. Statement 54 only applies to reporting of governmental funds and does not impact Enterprise,
Internal Service, or Fiduciary Funds.

III. Definitions:

Fund balance refers to the difference between assets and liabilities reported in the City' s governmental funds.

Generally there are limitations on the purpose for which all or a portion of the resources of a governmental fund may be used. The force behind these limitations can vary significantly, depending upon their source. Under
Statement 54 the fund balance reported in the annual
financial statements is categorized into five components whereby each component identifies the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the fund can be spent. All five
components of fund balance will not always be used in any given fiscal year. The five components of fund balance are as follows.

Nonspendable: Resources that are 1) not in spendable
form, such as inventories, - prepaids, long- term
receivables, or non- financial assets held for resale, or 2) required to be maintained intact such as an endowment. 1 5- 21 385
Restricted: Resources that are subject to externally
enforceable legal restrictions; these restrictions would be either 1) externally imposed by creditors ( such as
through debt covenants), grantors, contributors, or laws or regulations of other governments or 2) imposed by law through constitutional provisions or enabling
legislation.

2. This policy delegates to the City Manager the authority to assign unrestricted fund balance amounts where the
City' s intent is for those amounts to be used for
specific purposes. This delegation of authority is for
the sole purpose of reporting these amounts in the annual financial statements.
3 The City Council, as the highest level of decision- making authority, may commit fund balance for specific purposes pursuant to constraints imposed by resolution. For the
commitment of fund balance, resolution is the highest
form of action. These committed amounts cannot be used
for any other purpose unless the City Council removes or changes the specified use or amount through the same type of formal action taken to establish the commitment. City Council action to commit fund balance needs to occur
within the fiscal reporting period; but the amount, if
any, which will be subject to _the constraint, may be
determined at a subsequent period.

COMMITMENT FUND BALANCE
5- 24
388
Attachment B
Committed Fund Balance for the General Fund Only:

Prudent Reserve:

The Prudent Reserve commitment is $ 25 million set aside for future revenue shortfall that meet or exceed the following. If the state reduces future revenue streams or if economic conditions lead to a decline in total general fund revenues of 9s or more from the prior year total general fund revenue amount in any given fiscal year. The City may utilize the Prudent Reserve funds to maintain levels of service to the City and its residents.

Disaster Recovery:

The Disaster Recovery commitment of $ 15 million is to cover costs and losses as a result of a major earthquake and disasters that require the activation of the City' s Emergency Operation Center ( EOC) in accordance with California Emergency Services Act.

Capital Projects:

The Capital Project commitment set aside is $ 10 million for land, equipment replacement, information technology equipment and software, facility and infrastructure renovation, upgrade and acquisitions. This set aside can also be used for solar and other " green" projects.

Economic Development:

Due to the passage of AB X1 26 and the loss of the redevelopment agency funding for economic development projects and programs. The Economic Development commitment of $ 5 million will be used to continue economic development efforts such as the Highway 111 Facade improvement and property upgrade program, as well as incentive and acquisitions programs to encourage retail and hotel growth within the City.

City of Rancho Mirage Public Library:

It is anticipated the General Fund will eventually have to supplement the operating and capital costs of the Library Fund. The Library Fund commitment of $ 5 million will be for those costs.

Ritz Spa Suite Purchase:
5 million will be committed for the purchase of the Spa Suite' s according to Operating Covenant and amendments.
5- 25 389
Section 19 Water:

5. 125 million will be committed for deposit into an escrow account relating to costs of bringing water to section 19 for development purposes. In the event the actual amount required for deposit into the escrow account is less than the $ 5. 125 million commitment, the remaining amount will cease to be committed and revert back to unassigned fund balance.
5- 26 390

CERTIFICATION

STATE OF CALIFORNIA

COUNTY OF RIVERSIDE

CITY OF RANCHO MIRAGE
I, Cynthia Scott, City Clerk of the City of Rancho Mirage, California, do hereby certify that Resolution No. 2013- 23 was duly adopted by the City Council of the City of Rancho Mirage, California, at a regular meeting thereof held on the 16th day of May, 2013, by the following vote:

AYES: Smotrich, Weill, Kite
NOES: None
ABSENT: Hines, Hobart
ABSTAIN: None
Cyn hia Scott, CMC
City Clerk
5- 27 391
392
RESOLUTION NO. 2026- _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM

DESERT, CALIFORNIA, ESTABLISHING AN OPERATING BUDGET
POLICY
WHEREAS, the Charter of the City of Palm Desert provides that the City Administrator shall propose budget recommendations for the next fiscal year under the direction of the Mayor and the City Council in the form, in the manner, and at a time as the Council shall prescribe by resolution; and
WHEREAS, the City desires to formalize its current budget procedures and policies; and
WHEREAS, City's Adopted Budget designates how all revenues shall be allocated among City functions, services, and liabilities, such as public safety, public works, parks, facilities, employee retirement costs, and community services; and WHEREAS, the City desires to establish a formal operating budget policy to meet best practices, support fiscal transparency, and ensure public participation; and WHEREAS, the City Council has been presented with an Operating Budget Policy in the form attached to this Resolution as Exhibit A and by this reference incorporated herein.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1. The foregoing recitals are true and correct and are incorporated herein by this reference.

Section 2. The City Council hereby adopts the Operating Budget Policy, attached hereto as Exhibit A.

Section 3. The City Manager is authorized to implement, administer, and periodically review and update the Operating Budget Policy, consistent with applicable law and City policy.

Section 4. The Operating Budget Policy shall be incorporated into the City’s Administrative Procedures as Policy No. FIN-014.

Section 5. This Resolution shall take effect immediately upon adoption. 393
RESOLUTION 2026- ______

Page 2 of 2 ends

ADOPTED ON ________________, 20__.

EVAN TRUBEE
MAYOR
ATTEST:

ANTHONY J. MEJIA

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Desert, California, on ______________, 20__.

ANTHONY J. MEJIA

CITY CLERK
394
RESOLUTION 2026- ______

Page 2 of 2 ends

EXHIBIT A
ADMINISTRATIVE POLICY NO. FIN-014 “OPERATING BUDGET POLICY” 395
396

CITY OF PALM DESERT

ADMINISTRATIVE PROCEDURES
Subject Operating Budget Policy
Policy No. FIN – 015
Date Issued: January 22, 2026
Approved by Resolution No. 2026- ___ Authorizing an Operating Budget Policy
Authored by Finance Department

OPERATING BUDGET POLICY
I. PURPOSE
The Government Finance Officers Association (GFOA) recommends that governments adopt a policy that defines a balanced budget, commits to ensuring a balanced budget is maintained in order to provide the best possible services to taxpayers, and provides disclosure when a deviation from a balanced budget occurs.

These Budget Policies establish the City of Palm Desert’s guidelines for budgetary decision-making and standards for sound fiscal performance. Adopting and consistently following these policies supports the City’s current and long-term goals in a fiscally responsible and sustainable manner, consistent with recognized municipal budgeting best practices. Objectives are as follows:
 Ensure timely adoption of a balanced annual budget.
 Promote long-term financial sustainability and structural balance.  Strengthen transparency and public participation.
 Ensure effective internal controls and budget compliance.  Improve capital planning and infrastructure lifecycle management through the TenYear CIP.  Support service delivery through performance and outcome measures.

II. SCOPE

1. Fiscal Year
The City of Palm Desert fiscal year is July 1 through June 30.

2. Roles
• City Council: Adopts budget and appropriations; establishes budget goals and priorities.
• City Manager: Directs budget development and implementation. • Finance Department: Leads forecasting, budget development, monitoring, reporting, and internal controls.
397
• Departments: Submit service level needs, staffing requests, and CIP proposals meeting priorities and goals of City Council.
• Public: Provides input through hearings and accessible budget information.

3. Annual Budget Phases

1. Budget Development

2. Budget Review

3. Budget Adoption

4. Budget Monitoring
III. OPERATING & CAPITAL BUDGET POLICIES

1. Balanced Budget Requirement
The City shall adopt and maintain a balanced annual operating budget and an integrated capital budget. Annual operating expenditures shall not exceed annual operating revenues plus available unrestricted fund balance, subject to reserve policy requirements.

Structural Balance: The City shall strive for a structurally balanced budget where ongoing expenditures are supported by ongoing revenues. The City shall not rely on one-time revenues, reserves, or deferrals to sustain ongoing costs, except as permitted under FIN003.
a. Administrative Policy No. FIN003 (Reserve Compliance) The City shall maintain reserves consistent with the City’s adopted Reserve Policy FIN003. Use of reserves in budget development or budget execution shall comply with FIN003 requirements, including minimum targets, approved purposes, replenishment requirements, and Council approval thresholds as applicable.

Reserves shall be used primarily for emergencies, disaster recovery, economic downturn stabilization, one-time strategic investments, and cash flow or timing needs consistent with FIN003.

2. Public Involvement & Transparency
Public participation shall be encouraged through public hearings, outreach and interactive publication of accessible budget materials and summaries on the City’s webpage. The City will strive to provide a user-friendly online budget portal, plain-language summaries, and ADA-compliant formats.

3. Council Role & Budget Priorities
City Council shall establish budget priorities early enough to inform the City Manager’s proposed budget. Council priorities may be adopted by resolution, incorporated into Council goal-setting, or otherwise communicated through the adopted budget calendar.

4. Multi-Year Financial Forecasting
The City shall prepare a multi-year financial forecast projecting revenues and expenditures over a five to ten-year period (or longer as available) to guide long-term fiscal planning and serve as the framework for annual budgeting. Forecasts will be implemented using 398
best practices and should include baseline trends and alternative scenarios, and identify risks, long-term obligations, and known cost drivers.

5. Operating Budget Standards
The operating budget shall include revenue and expenditure appropriations, staffing levels, department missions and objectives, and performance measures and targets.

Departments shall identify service impacts for proposed reductions and expected outcomes for enhancements.

6. Administrative Policy No. FIN-015 (Capital Improvement Program (CIP) Plan and Budget — Ten-Year CIP)
The City of Palm Desert shall develop and maintain a Ten-Year Capital Improvement Program (CIP) to plan for the repair, rehabilitation, replacement, and construction of municipal infrastructure and major assets.

The Ten-Year CIP shall be informed by asset condition assessments and lifecycle needs; service level priorities; regulatory requirements and risk reduction needs; strategic plans, Council priorities, and community input; funding constraints; and deliverability/readiness considerations.

The annual CIP budget shall be developed in conjunction with the operating budget to ensure the City can afford both the construction of assets and the long-term operating and maintenance impacts associated with completed projects.

In order to support informed decision making, the following enhancements will be included as part of the CIP Plan:
 Require a lifecycle or long-term asset impact statement for capital projects seeking funding (including estimated operating impacts when applicable).  Periodically evaluate stalled or inactive projects and reprogram funding when warranted to maintain deliverability and financial flexibility.  Use an adopted CIP prioritization framework to score and rank projects transparently and consistently.
 Use the Ten-Year horizon to identify long-term funding gaps and develop strategies (grants, partnerships, phased delivery, cost control).

7. Basis of Budgeting & Fund Inclusion
The City shall prepare budgets consistent with applicable accounting standards. The budget document shall present a comprehensive view of the General Fund and other budgeted funds, including the Ten-Year CIP and annual CIP appropriations.

8. Long-Term Infrastructure Affordability
The City will evaluate the affordability of the Ten-Year CIP by comparing projected capital needs with projected funding capacity and long-term operating impacts, and will identify funding gap strategies such as grant planning, phased delivery, prioritization adjustments, and O&M planning.
399
IV. BUDGET EXECUTION & CONTROLS

1. Budgetary Control
Budgetary control shall be established through the City’s annual appropriation authority.

Departments shall not expend beyond authorized appropriations unless revised through approved processes. The City Manager has the authority to move budgets inter and intra to support operating needs of the organization.

2. Financial Reporting & Monitoring
Finance shall monitor revenues and expenditures throughout the fiscal year, identify significant variances, and present regular monitoring reports to Council. At minimum, the City should provide a mid-year update to City Council (if necessary) and quarterly monitoring reports to Department Heads.

3. Budget Variance Response Policy (FIN003-Aligned)
When a deficit is projected, the City shall identify alternative funding sources, reductions, reallocations, or deferrals; require departments to submit mitigation plans when material overages are forecasted; and use reserves only in accordance with Reserve Policy FIN003, with required documentation and replenishment plans.

Deficit Trigger Protocol:
 Early Warning Trigger: projected variance > 1% of General Fund.  Action Trigger: projected variance > 2% of General Fund (activate spending controls and Council briefing).

4. Performance Reporting
Budgets shall include performance data and targets when feasible. The City should publish an annual performance and outcomes summary alongside the budget.

5. Encumbrances
Departments shall encumber funds expected to be spent in the current fiscal year and close unnecessary encumbrances prior to year-end. Exceptions may be granted for major contractual obligations in coordination with Finance.

V. REVENUE POLICIES

1. General Revenue Policies
Forecasts shall be supported by objective data and internal methodologies. General Fund revenues shall not be earmarked unless required by law or accounting standards.

2. One-Time Revenues
One-time revenues shall be used for one-time expenditures. Ongoing expenditures shall be funded by ongoing revenues. Surpluses should prioritize debt reduction, infrastructure backlog reduction, technology modernization, or reserve replenishment.

3. User Fees
User fees shall follow the City’s adopted user fee policy and be reviewed periodically. 400

4. Economic Indicators & Forecasting
The City shall consider multiple economic indicators and historical trends when developing revenue projections and maintain a revenue risk register for major revenue sensitivities.

5. Legislative & Policy Monitoring
Finance shall monitor State and federal policy changes affecting City revenues and adjust projections as needed.

VI. EXPEDENTURE POLICIES

1. General Expenditure Policies
The budget process shall weigh competing requests within fiscal constraints. New initiatives outside the annual budget process should be limited to urgent needs, accompanied by a funding plan, and may use reserves only in accordance with Reserve Policy FIN003 (Productivity Savings/Innovation Reserve).

2. Pension & OPEB Obligations
The City shall include appropriate funding for long-term obligations consistent with actuarial recommendations and legal requirements and include trends and risks in the multi-year forecast.

3. Budgeted Positions & Vacancy Factor
All positions shall be budgeted. Grant-funded positions shall be limited to grant duration.

Vacancy factors may be used where appropriate to align budget with expected actuals.

4. Employee Organization MOU’s
The City shall budget compensation and benefits consistent with labor agreements and include multi-year labor cost projections and fiscal impact analysis for significant changes.

VII. IMPLEMENTATION & COMPLIANCE
1) Finance shall publish annual budget instructions, calendar dates, and templates. 2) Departments shall comply with submission requirements and provide supporting evidence for requests.
3) Deviations from these policies require documentation and approval by the City Manager and/or City Council as applicable.
4) Policies shall be reviewed annually and updated as needed.

VIII. ATTACHMENTS (TEMPLATES)
 Attachment A — Annual Budget Calendar (Template)
 Attachment B — Operating Budget Request Form (Enhancement Template)  Attachment C — Deficit Response Playbook (FIN003-Aligned)  Attachment D — Ten-Year CIP Integration Summary
Attachment A — Annual Budget Calendar (Template)
Department Submissions Due March 1st
401
City Manager Proposed Budget
Released April 25th
Public Workshops/Hearings May
Council Budget Adoption 2
nd Meeting in June
Quarterly Monitoring Reports Dependent on Scheduled Department Meetings
Mid-Year Update 1
st Meeting in February
402
Attachment B — Operating Budget Request Form (Enhancement Template) Request Title:

Department:

Description:

Objective/Outcome:

Full Cost (staffing/operating/maintenance):

Funding Source:

Sustainability Plan:

Performance Measures:

Service Impacts if Not Funded:

At this time, all Requests are Done in Laserfiche and will continue to be electronic as systems change.
403
Attachment C — Deficit Response Playbook
Trigger Thresholds:
• Early Warning: >1% GF variance
• Action: >2% GF variance
Mitigation Menu:
☐Spending controls
☐Hiring review/freeze
☐Reduction tiers
☐Reallocations
☐Deferrals
☐Reserve use (FIN003 compliant) with replenishment plan Reporting:

Quarterly and as needed to Council; Mid-Year amendments as required. 404
Attachment D — Ten-Year CIP Integration Summary
• Ten-Year CIP updated annually with the budget process. • Capital projects include lifecycle and operating impact statements. • CIP projects prioritized using the adopted scoring framework. • Public transparency includes project maps, summaries, and progress reporting. • Coordination between CIP and operating budget ensures affordability of new assets. 405
406
RESOLUTION NO. 2026- _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM

DESERT, CALIFORNIA, ESTABLISHING A CAPITAL PLANNING AND

PRIORITIZATION POLICY
WHEREAS, the Charter of the City of Palm Desert provides that the City Administrator shall propose budget recommendations for the next fiscal year under the direction of the Mayor and the City Council in the form, in the manner, and at a time as the Council shall prescribe by resolution; and
WHEREAS, the City desires to formalize its current capital project planning and funding procedures and policies; and
WHEREAS, the City's Adopted Budget and Capital Improvement Program plan designates how all revenues shall be allocated among long-term projects, replacement costs, and facilities; and
WHEREAS, the City desires to establish a formal capital planning and prioritization policy to meet best practices, support fiscal transparency, and maintain fiscal responsibility; and
WHEREAS, the City Council has been presented with a Capital Planning and Prioritization Policy in the form attached to this Resolution as Exhibit A and by this reference incorporated herein.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:

Section 1. The foregoing recitals are true and correct and are incorporated herein by this reference.

Section 2. The City Council hereby adopts the Capital Planning and Prioritization Policy, attached hereto as Exhibit A.

Section 3. The City Manager is authorized to implement, administer, and periodically review and update the Capital Planning and Prioritization Policy, consistent with applicable law and City policy.

Section 4. The Capital Planning and Prioritization Policy shall be incorporated into the City’s Administrative Procedures as Policy No. FIN-015.

Section 5. This Resolution shall take effect immediately upon adoption. 407
RESOLUTION 2026- ______

Page 2 of 2 ends

ADOPTED ON ________________, 20__.

EVAN TRUBEE
MAYOR
ATTEST:

ANTHONY J. MEJIA

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Desert, California, on ______________, 20__.

ANTHONY J. MEJIA

CITY CLERK
408
RESOLUTION 2026- ______

Page 2 of 2 ends

EXHIBIT A
ADMINISTRATIVE POLICY NO. FIN-015
“CAPITAL PLANNING AND PRIORITIZATION POLICY”
409
410

CITY OF PALM DESERT

ADMINISTRATIVE PROCEDURES
Subject Capital Planning and Prioritization Policy
Policy No. FIN – 015
Date Issued: January 22, 2026
Approved by Resolution No. 2026- ___ Authorizing a Capital Planning and Prioritization Policy
Authored by Finance Department
I. PURPOSE
A Capital Plan (Capital Improvement Program) is a multi-year financial plan that lists and describes capital projects a local government plans to undertake, indicates how projects will be funded and projects the effect of the plan on key financial variables. The CIP reflects the City’s financial plan for repair, replacement, rehabilitation, and construction of municipal infrastructure and major assets that enhance value, prolong useful life, or adapt assets to new uses.

A Capital Project results in the acquisition or increased value of a capital asset (e.g. land, land improvements, infrastructure and equipment, etc.).

The Government Finance Officers Association (GFOA) recommends that state and local governments prepare and adopt comprehensive, fiscally sustainable, multi-year capital plans. A multi-year capital plan is intended to identify and prioritize expected capital needs based on strategic priorities and operational needs, establish project scope and cost, detail estimated amounts of funding from various sources, and project future operating and maintenance costs.

The Government Finance Officers Association (GFOA) also recommends that state and local governments establish an objective process for prioritizing capital improvement projects, to give decision-makers a basis for choosing the most compelling projects for funding and implementation.

II. POLICY STATEMENT
The City shall adopt a multi-year Capital Plan spanning at least five years in conjunction with the annual budget and five-year financial planning processes. The Capital Plan should include all of the City’s planned capital projects. To qualify as a capital project, the asset must comply with Administrative Policy No. FIN-008 Capital Asset Management, Section V.

The Capital Plan should incorporate the following elements as relevant and appropriate:
a. Assessment of the physical condition of existing capital assets; b. Economic development projections, strategic plans, comprehensive plans, facility master plans and regional plans, including changes in federal, state, and county policy and regulations;
c. Prioritization of capital needs; and
d. Financial strategies and sources of funding: 1) for the acquisition or improvements associated with the project, and 2) for the subsequent annual operation and maintenance costs of the capital asset throughout its life. 411
III. PRIORITIZATION OF CAPITAL NEEDS
The City shall adopt an objective process of prioritizing capital improvement projects to ensure consistency with the General Plan, and in conjunction with the annual budget process or otherwise as capital funding becomes available, using the following factors:

1. Risk to Health, Safety and Environment:
a. Avoids or minimizes the risk to health, safety and environment associated with the infrastructure based on condition assessment of the asset, or the lack of an asset, that may include the age, size, material, capacity, and history of failure of the infrastructure; and
b. Urgency of the project to reduce the potential hazards to the public, property and environment.

2. Regulatory or Mandated Requirements:
a. Projects required to meet federal, state, or local laws; regulatory agency requirements; permit conditions; settlement agreements; grant conditions; or adopted codes and standards.
b. These projects are prioritized ahead of discretionary projects due to legal, operational, and liability impacts.
c. Departments must provide supporting documentation identifying the requirement, compliance deadline (if applicable), and consequences of noncompliance.

3. By legal mandate or consent decree;
a. By other regulatory requirements (project specific or programmatic), and b. Must comply with court orders and settlements or avoids plausible legal claims.

4. Asset Condition, Annual Recurring Costs and Asset Longevity:
a. Existing conditions and capacity to meet the basic level of service is deficient; b. Avoids potential failure due to substandard conditions; c. Improves the overall reliability of the capital asset and infrastructure system; d. Major implications of delaying the project such as significant future costs, or negative community impacts;
e. Extent to which reduces City operations and maintenance expenditures; and f. Increases the longevity of the capital asset or extends the useful life of the asset in the long term.

5. Community Investment and Economic Prosperity:
a. Contributes toward economic development and revitalization efforts; b. Reduces or avoids impacts to the community when infrastructure fails; c. Benefits under-served communities including those with low income households, low community engagement and low mobility or access to transportation systems; and
d. Located in a census tract that is deemed eligible for Community Development Block Grant (CDBG) funds.

6. Level and Quality of Service:
a. Improves existing conditions and capacity to meet the minimum level and quality of services that is deficient;
b. Addresses an infrastructure or facility deficit identified in a community plan; and c. Addresses the need to install new facilities or improve existing facilities to provide access to City services
412

7. Sustainability and Conservation:

Improves the health of the community and natural environment through sustainable designs with improved regional air quality and reduced greenhouse gas emission that contributes to climate change.

8. Funding Availability:

Rank is increased based on assessment of the amount of funding needed to complete the current project phase and the entire project.

9. Project Readiness:
a. Ready to enter the phase corresponding to the funding proposed; b. Delivered most expeditiously shall be preferred; and c. Complex environmental issues or known significant legal challenges shall be scored lower than projects without said complications.

10. Multiple Category Benefit and Bundling Opportunities:
a. Fulfills the prioritization factors described above across multiple scoring categories; b. Reduces construction costs by potentially bundling with adjacent projects; and c. Provides for partnering or bundling opportunities with other local, state, or federal agencies (e.g. leverages shared resources).

Implementation of this Policy is not intended to release or alter the City’s current or future obligations to complete specific capital improvement projects by specified deadlines, as may be imposed by court order, or order of any federal, state or local regulatory agency.

IV. REQUIRED INFORMATION FOR PROJECT SUBMITTAL
Departments will submit new projects with at least:
 Problem statement and scope
 Location and affected assets
 Condition/service data or best proxy
 Risk/safety impacts and ADA implications
 Climate resilience and sustainability impacts
 Cost estimate including all of the following:
1) Planning and Pre Development
2) Design and Engineering
3) Land, ROW & Site Acquisition
4) Permits, Regulatory and Compliance
5) Construction
6) Construction and/or Project Management
7) Testing, Inspecting & Quality Assurance
8) Furnishing, Fixtures, Equipment
9) Utitilies, Connections & Service Upgrades
10) Contingency and allowances
11) Financing and Debt Issuance Costs (if any)
12) Operations, Start Up & Closeout
13) Maintenance, Lifecycle and Replacement Reserves
 Funding sources identified + leverage potential (revenue generation)  Bundling/Multi-Asset Benefit
 Phase readiness and delivery constraints
V. DEFINITIONS
413
Capital Asset: Non-financial assets that are used in operations and have an initial useful life in excess of one year.

Capitalization Threshold: The minimum cost which an asset must exceed in order to be capitalized.

CIP (Capital Improvement Project): Any expenditure for the purchase, construction, replacement, addition or major repair of public facilities and major equipment.

City: The City of Palm Desert, the City of Palm Desert Housing Authority, the Palm Desert Public Library, the Successor Agency to the Palm Desert Redevelopment Agency, any community facilities district, any community services district or any other agency affiliated with the City of Palm Desert.

City Council: Shall mean the City Council, Housing Authority Board, Library Board, or Successor Agency to the Palm Desert Redevelopment Agency Board, or board of any community services district or community facilities district, as appropriate.

City Manager: Shall mean the City Manager, Housing Authority Executive Director, Library Executive Director, or Successor Agency to the Palm Desert Redevelopment Agency Executive Director, or head of any community services district or community facilities district, as appropriate, or his or her designee.

Real Property: Land and land improvements, buildings and building improvements, infrastructure, improvements other than buildings, intangible assets - permanent and temporary easements, works of art / historical treasures, and construction in progress.

Useful Life: The amount of time that an asset is expected to provide benefit. 414
RESOLUTION NO. 2026- _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM

DESERT, CALIFORNIA, ESTABLISHING A LONG TERM FINANCIAL

PLANNING POLICY
WHEREAS, the Charter of the City of Palm Desert provides that the City Administrator shall propose budget recommendations for the next fiscal year under the direction of the Mayor and the City Council in the form, in the manner, and at a time as the Council shall prescribe by resolution; and
WHEREAS, the City desires to formalize its current long term planning procedures and policies; and
WHEREAS, the City's Adopted Budget and Capital Improvement Program plan designates how all revenues shall be allocated among operations and long-term projects, replacement costs, and facilities; and
WHEREAS, the City desires to establish a formal long term planning policy to meet best practices, support fiscal transparency, and maintain fiscal responsibility; and WHEREAS the City Council has been presented with a draft Long Term Financial Planning Policy in the form attached to this Resolution as Exhibit “A” and by this reference incorporated herein.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1. The foregoing recitals are true and correct and are incorporated herein by this reference.

Section 2. The City Council hereby adopts the Long Term Financial Planning Policy, attached hereto as Exhibit A.

Section 3. The City Manager is authorized to implement, administer, and periodically review and update the Long Term Financial Planning Policy, consistent with applicable law and City policy.

Section 4. The Long Term Financial Planning Policy shall be incorporated into the City’s Administrative Procedures as Policy No. FIN-016.

Section 5. This Resolution shall take effect immediately upon adoption. 415
RESOLUTION 2026- ______

Page 2 of 2 ends

ADOPTED ON ________________, 20__.

EVAN TRUBEE
MAYOR
ATTEST:

ANTHONY J. MEJIA

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Desert, California, on ______________, 20__.

ANTHONY J. MEJIA

CITY CLERK
416
RESOLUTION 2026- ______

Page 2 of 2 ends

EXHIBIT A
ADMINISTRATIVE POLICY NO. FIN-016
“LONG TERM FINANCIAL PLANNING POLICY”
417
418

CITY OF PALM DESERT

ADMINISTRATIVE PROCEDURES
Subject Long Term Financial Planning Policy
Policy No. FIN – 016
Date Issued: January 22, 2026
Approved by Resolution No. 2026- ___ Authorizing a Long Term Financial Planning Policy
Authored by Finance Department
I. PURPOSE
The Government Finance Officers Association (GFOA) recommends that governments adopt a long-term financial plan of at least five years into the future. A long-term financial planning policy is intended to assist City leaders (elected officials and City management) in making prudent and informed financial decisions regarding economic development, tax policy and labor negotiations. Credit rating agencies encourage long-term financial planning and generally favor government entities with such plans when assigning bond ratings.

II. POLICY:

The City shall adopt a long-term financial plan spanning at least five years for all major City funds (e.g., General, Fire, Housing Authority, Desert Willow, etc.) in conjunction with the proposed annual budget. The long-term financial plan should incorporate the following elements as relevant and appropriate:
 An analysis of economic and demographic data at the national, state and local level;
 Past revenue and expenditure trends;
 Forecast assumptions;
 Forecasts of major revenues and expenditures based on known data, documented assumptions, and input from subject matter experts, and various internal and external stakeholders; and
 Compliance with existing City fiscal policies.
419
420

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: January 22, 2026
PREPARED BY: Lorena Ritchey, Management Analyst
SUBJECT: APPROVE OUTSIDE AGENCY FUNDING COMMITTEE
RECOMMENDATIONS FOR THE PROGRAM YEAR 2026-27

COMMUNITY DEVELOPMENT BLOCK GRANT ANNUAL ACTION PLAN

AND REALLOCATE COMMUNITY DEVELOPMENT BLOCK GRANT
FUNDS FOR PROGRAM YEARS 2023 AND 2024
RECOMMENDATION:

1. Conduct a public hearing and accept public comment to consider Substantial Amendments to the PY 2023 and PY 2024 CDBG Annual Action Plans.

2. Adopt a Substantial Amendment to PY 2023 to reallocate $50,000 in unused CDBG funds to PY 2026 for Desert ARC public infrastructure improvements.

3. Adopt a Substantial Amendment to PY 2024 to reallocate $80,000 in unused CDBG funds to PY 2026 for Desert ARC public infrastructure improvements.

4. Conduct a public hearing and accept public comment related to the Community Development Block Grant ("CDBG") Program Year (PY) 2026-27.

5. Approve Outside Agency Funding Committee ("Committee") recommendations for PY 2026- 27 CDBG award of subrecipients, programs and/or projects, and funding amounts as proposed.

6. Approve the use of the PY 2026-27 CDBG funding allocation awarded to the City of Palm Desert ("City") by the U.S. Department of Housing and Urban Development ("HUD") for the proposed funding of subrecipients' programs and/or projects recommended by the Committee.

7. Approve the City's PY 2026-27 CDBG Annual Action Plan ("Annual Plan") and authorize staff to submit to the County of Riverside Housing and Workforce Solutions (HWS).

8. Authorize the City Manager to execute any documents necessary to implement the actions taken herewith.

BACKGROUND/ANALYSIS:

The City of Palm Desert receives annual CDBG funds from HUD to support eligible public services and capital improvement projects benefiting low- and moderate-income residents. As part of routine program oversight, the City reviews prior-year CDBG projects to ensure compliance with HUD requirements, including timely expenditure of funds.

This review identified unspent funds from prior program years resulting from cost savings, scope changes, or alternative funding sources. To remain compliant with HUD timeliness requirements and ensure effective use of CDBG resources, these funds must be reallocated. The following section describes the City’s Substantial Amendment Reallocation Strategy for addressing these prior-year balances.
421
City of Palm Desert
Approve PY 2026-27 CDBG Recommendations and Reallocate Funds for PYs 2023 and 2024

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Substantial Amendment Reallocation Strategy
Over time, some CDBG-funded projects may not fully expend awarded funds due to cost savings, scope changes, or the availability of alternative funding sources. To remain compliant with HUD timeliness requirements, unspent funds must be reallocated.

The City has identified $130,000 in unspent CDBG funds from prior program years including Program Year 2023-2024 (PY 2023) and Program Year 2024-2025 (PY 2024). In consultation with the City's CDBG consultant and County HWS, staff developed a reallocation plan for City Council consideration. Pursuant to the City's Citizen Participation Plan, a Substantial Amendment is required when reallocating $25,000 or more, or when adding or removing a project.

Reallocation Details by Program Year
Program
Year
(PY)
Amendment
Type
Original
Project
Original
Allocation
Reallocated
Amount
Receiving
PY
Receiving Project
2023 Substantial
Amendment
The Joslyn
Center – ADA
Bathroom
Improvements
$50,000 $50,000 2026 Desert ARC –
Public Facilities and
Improvements
(HVAC
Replacement)
2024 Substantial
Amendment
The Joslyn
Center – ADA
Bathroom
Improvements
$75,000 $75,000 2026 Desert ARC –
Public Facilities and
Improvements
(HVAC
Replacement)
2024 Substantial
Amendment
Desert
Recreation
Scholarship
Program
$5,000 $5,000 2026 Desert ARC –
Public Facilities and
Improvements
(HVAC
Replacement)
Total — — — $130,000 — —
Community Impact
By reallocating $130,000 in unspent CDBG funds from prior program years to PY 2026 for Desert ARC, the City will direct additional resources toward public facilities and improvements meeting the criteria of HUD national objectives.

Project Year 2026-27 - Outside Agency Committee Recommendations The Outside Agency Committee, comprised of the Mayor, Mayor Pro Tem, City Manager, Finance Director, and Deputy Director of Economic Development, reviewed the PY 2026–27 CDBG applications and funding priorities. Each application was evaluated for consistency with HUD national objectives and the intended purpose of CDBG funds; when an application did not meet eligibility requirements, the reason was documented in the CDBG Funding Recommendations Budget Summary. The Committee recommends approval of the PY 2026– 27 CDBG budget in accordance with HUD requirements and the City’s anticipated allocation. 422
City of Palm Desert
Approve PY 2026-27 CDBG Recommendations and Reallocate Funds for PYs 2023 and 2024

Page 3 of 5 ends

The City anticipates receiving $365,400 in CDBG funds for FY 2026–27, which will be included in the Proposed Annual Budget. Federal regulations limit public services to 15% ($54,810) and program administration to 20% ($73,080) of the award; there are no funding caps for public facilities and improvements.

To achieve significant cost savings in program management, the City Council approved the Joint Recipient Cooperative Agreement with the County HWS on June 8, 2023. This agreement designates the City as a Metro City participant and transfers responsibility for the general administration of grant funds and the submission of all required reports to HUD from County HWS.

County HWS requires PY 2026-27 CDBG applications to be submitted to the County Board of Supervisors for approval in January 2026. To meet the County's HWS December 18, 2025, submittal deadline, the City opened its local application period on October 15, 2025, with a published deadline of November 15, 2025. Because the deadline fell on a Saturday, applications were accepted through the next business day, November 17, 2025.

County HWS has acknowledged and agreed with the City Council’s January 2026 approval timeline. Notice of Funding Availability was posted on the City’s CDBG webpage, published in The Desert Sun, and distributed directly to prior recipients and interested organizations via email and phone outreach.

The City received six (6) applications. The County conducted the initial eligibility review, determining that three applications did not meet national objective requirements. The remaining three (3) applications were evaluated by the Committee, and funding recommendations were developed based on their eligibility. Applications that did not meet the national objective criteria are listed individually in the table with a $0 funding recommendation.

Of the three applications recommended for funding, two applicants, Joslyn Center and Desert ARC, are located within the City of Palm Desert and have received CDBG funding in prior years.

Operation SafeHouse, Inc., located in Thousand Palms operates the Harrison House Transitional Living Program, which serves 10 unduplicated homeless youth ages 18–24, and have also received CDBG funding in prior years. The Harrison House program provides an 18- month transitional living environment with shelter, case management, counseling, education, and job-training assistance, with a goal of placing participants into living-wage employment and permanent housing. The program is not duplicative of CityNet or CVAG, which focus on outreach and short-term homelessness response, as Operation SafeHouse provides long-term, residential transitional housing with on-site supportive services.

The Committee’s funding recommendations are presented in the table on the following page and will be incorporated into the Annual Action Plan submitted to the County HWS, if approved. 423
City of Palm Desert
Approve PY 2026-27 CDBG Recommendations and Reallocate Funds for PYs 2023 and 2024

Page 4 of 5 ends

Program Year 2026-27 Community Development Block Grant Funding Recommendations $365,400 Applicant Activity Description PY 26-27
Request
PY 26-27
Recommendatio
n
PY 25-26
Approved*
Public Services (15%)
1 Jewish Family of the
Desert Emerg Financial Assistance $10,000 $0 $0
2 Jewish Family of San
Diego Street Outreach $15,000 $0 $0
3 Operation Safe House
Inc
Youth Homeless Transitional
Living $18,000 $18,000 $16,750
4 Food in Need of
Distribution FIND Mobile Market - PDHS $20,000 $0 $0
TOTAL $63,000 $18,000 $16,750
Public Facilities and Improvements (No Cap)
5 The Joslyn Center Replace (7) A/C Units $100,000 $100,000 $100,000 6 Desert ARC Replace (7) HVAC Units $471,212 $174,320 $0 TOTAL $571,212 $274,320 $100,000
Program Administration (20% Cap)
7 County Administrator County's shared cost 13% $47,502 $47,502 $0 8 City Administrator City's shared cost 7% $25,578 $25,578 $73,000 TOTAL $73,080 $73,080 $73,000
GRAND TOTAL $707,292 $365,400 $189,750
For PY 2025–26, City Council approved additional program funding totaling $175,250 for Desert Recreation District, Fair Housing, and the Palm Desert Housing Authority, which, when combined with $18,750, results in a total approved CDBG allocation of $365,000.

It should be noted that the recommended allocation to Desert ARC is not inclusive of the $130,000 recommended reallocation. When combined, this funding approach results in a total project allocation of $304,320, supporting timely project completion and the effective use of prioryear funds.

Public Review:

PY 2026-2027 Recommendation of CDBG Funds:

As a condition for receiving CDBG funds, grant recipients must be consistent with the County HWS Consolidated Plan, and the City must conduct a public hearing to allow input from the public. City staff published a 30-Day Notice of Public Hearing in the Desert Sun on December 21, 2025, and a 10-Day Notice of Public Hearing on January 22, 2026, in English and Spanish.

Substantial Amendment:

The 30-day public comment period for the Substantial Amendment posted from December 18, 2025, through January 18, 2026. Notice of the public hearing was published in The Desert Sun on December 18, 2025. The draft Substantial Amendment was posted on the City's website for public review throughout the entire comment period.

Legal Review:
424
City of Palm Desert
Approve PY 2026-27 CDBG Recommendations and Reallocate Funds for PYs 2023 and 2024

Page 5 of 5 ends

This report has been reviewed by the City Attorney’s Office.

FINANCIAL IMPACT:

The City anticipates receiving approximately $365,400 in CDBG funds for FY 2026-27, which will be budgeted in CDBG Fund 2204800-4388000. Up to 20% of the award may be allocated to administrative costs to manage the CDBG Program which will be split between the County and City (13%/7% respectively). Remaining funds will be allocated to the various program awardees.

The administrative amount allocated to the City will reimburse the General Fund for associated staff costs. In total, the City currently has $1,077,361 in multi-year CDBG allocations awarded across all active projects. All eligible CDBG project costs are 100% reimbursable by HUD.

ATTACHMENTS:

1. CDBG Funding Recommendations Budget Summary

2. Palm Desert Program Year 2023 Annual Action Plan Substantial Amendment 3

3. Palm Desert Program Year 2024 Annual Action Plan Substantial Amendment 2

4. CDBG Presentation will be provided prior to the meeting 425
426

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Community Development Block Grant Funding Recommendations Budget 427

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Program Year 2026-27 Community Development Block Grant Funding Recommendations $365,400
Applicant Activity Description Funding
Request
OAC
Recommendation
Public Services (15%)
1 Jewish Family of the Desert Emergency Financial Assistance $10,000 $0 2 Jewish Family Service of San
Diego Street Outreach $15,000 $0
3 Operation Safe House Inc Youth Homeless Transitional Living Program $18,000 $18,000 4 Food in Need of Distribution FIND Mobile Market - Palm Desert High School $20,000 $0
TOTAL $63,000 $18,000
Public Facilities and Improvements (No Cap)
5 The Joslyn Center Replace (7) Air Condition Units $100,000 $100,000 6 Desert ARC Replace (7) HVAC Units $471,212 $174,320
TOTAL $571,212 $274,320
Program Administration (20% Cap)
7 County Grant Administrator County's shared cost 13% $ 47,502 $47,502 City Grant Administrator City's shared cost 7% $ 25,578 $25,578 TOTAL $ 73,080 $73,080
GRAND TOTAL $ 707,292 $365,400
428

Page 3 ends

Summary of Grant
Applications
Below you will find a summary of each grant application for Fiscal Year 2026-27.

County and City CDBG Allocation: $365,400

1. Jewish Family Service of the Desert (Public Services)  Requested Amount: $10,000
 Funding Recommendation: $0
 Project Name: Case Management Emergency Financial Assistance for Palm Desert residents
 Program Description:

Jewish Family Service of the Desert (JFS) – Case Management Program. JFS provides free, year-round bilingual (English/Spanish) case management to residents throughout the Coachella Valley. The program delivers individualized client advocacy and emergency financial assistance to low- and moderateincome households, helping residents cover past-due rent, utilities, food, and medication. JFS anticipates increasing the number of Palm Desert individuals and families receiving emergency financial assistance by approximately 35.

Denied: Per the County Grant Administrator, the proposal lacks a clear and focused service delivery plan, includes multiple unfocused purposes, and does not adequately document that at least 51% of beneficiaries are low- to moderate-income Palm Desert residents.

Additionally, the requested funding level—$10,000 for 35 clients (approximately $286 per client)—raises concerns about the feasibility of delivering meaningful services at the proposed per-client amount.

2. Jewish Family Service of San Diego (Public Services)  Requested Amount: $15,000
 Funding Recommendation: $0
 Project Name: Basic Necessities for Individuals Facing Homelessness- Street Outreach
 Program Description:

Jewish Family Service of the Desert (JFS) – Homeless Support & Street Outreach operates two HUD-funded Permanent Supportive Housing programs that provide safe and affordable housing for up to 207 chronically homeless individuals and families in Riverside County. In alignment with the regional “No Wrong Door” policy, JFS conducts daily outreach to people experiencing homelessness, offering immediate basic needs—food, water, hygiene kits, clean clothing, and backpacks with essential supplies—along with assessments, information, and referrals to appropriate service providers.

CDBG funds will support food, hygiene items, and outreach supplies for individuals engaged through street outreach in Palm Desert and Desert Hot Springs.
429

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Denied: Per the County Grant Administrator, does not meet the CDBG national objective.

These services and activities fall under the Emergency Solutions Grant (ESG) program, which specifically funds homeless operations.

3. Operation Safehouse (Public Services)
 Requested Amount: $18,000
 Funding Recommendation: $18,000
 Project Name: Harrison House Transitional Living Program  Program Description:
o The agency serves runaway youth, homeless and at-risk youth in the Coachella Valley. The agency requests funds for staffing to continue the operation of the Harrison House (transitional living home), which supports homeless young adults ages 18 to 24 who seek to become independent and self-sufficient adults. The agency proposes to serve 10 young people.

4. Food in Need of Distribution, Inc. dba: FIND Regional Food Bank (Public Services)
 Requested Amount: $20,000
 Funding Recommendation: $ 0
 Project Name: FIND Mobile Market – Palm Desert High School  Project Description:

FIND Food Bank operates the Community Mobile Market at Palm Desert High School, providing fresh, nutritious food directly to low- and moderate-income Palm Desert residents. The market distributes fruits and vegetables, proteins, pantry staples, and culturally appropriate items, staffed by trained personnel and volunteers who assist with distribution, safety, and referrals to additional services. Funds will support essential operational needs—including transportation, staffing, and supplies—ensuring the Mobile Market continues to offer reliable, accessible, and high-quality food assistance to the community.

Denied: Per the County Grant Administrator, this does not meet HUD Public Service requirements because HUD requires unduplicated client counts for activities that qualify under the Limited Clientele national objective. Total participant counts alone are not sufficient for CDBG compliance.

5. The Joslyn Center (Public Facilities and Improvements)  Requested Amount: $ 100,000
 Funding Recommendation: $ 100,000
 Project Name: Joslyn Center Air Conditioning Replacement  Project Description:

The Joslyn Center seeks funding to replace seven (7) aging HVAC units specifically four (4) 5-ton air conditioning compressors and associated heating units serving the Wellness Center, and three (3) units serving the Arthur Newman Theater. All systems were installed in 2007 and operate with obsolete R-22 refrigerant, making repairs costly and unreliable. These units have 430

Page 5 ends

exceeded their useful life and are among the oldest at the facility. Replacement is essential to maintain safe, reliable cooling, especially during the summer months when the Center functions as a community “cooling center.” New units will also improve energy efficiency and reduce operating costs.

Up to 20% of project funds will support required design and project management to ensure full CDBG compliance.

6. Desert ARC (Public Facilities and Improvements)
 Requested Amount: $471,212
 Funding Recommendation: $174,320
 Project Name: Desert ARC Replacement HVAC Units – Building 1  Program Description:

Desert ARC provides essential day programs, job training, and supportive services to adults with intellectual and developmental disabilities in a safe and inclusive environment. To maintain reliable climate control, Desert ARC seeks funding to replace seven (7) aging HVAC units serving in Building 1 of its Palm Desert campus where clients spend the majority of their day. These units have exceeded their useful life, experience frequent failures, and no longer operate efficiently, creating health and safety concerns, especially during extreme summer heat. Replacing the systems will ensure consistent indoor comfort, improve energy efficiency, reduce maintenance costs, and support the wellbeing of the hundreds of clients who rely on Desert ARC’s programs each day. The new HVAC systems will also provide an estimated 15-year service life for Building 1, ensuring long-term reliability and stability for program operations.

7. City of Palm Desert (Administration)
 Requested Amount: $73,080
 Funding Recommendation: $73,080
 Project Description:

Estimated allocation shared with the County.

JointMetro Cooperating Contract Formula: 13% County and 7% City County receives $365,400 × 0.13 = $47,502
City receives $365,400 × 0.07 = $25,578
431
432
City of Palm Desert PY 2023 Draft Annual Action Plan w. Substantial Amendment 3 1 OMB Control No: 2506-0117 (exp. 09/30/2021)
SA3: Cancelling SA2 Project and reallocating those funds ($50k) for a total of $130k in combined funds to Desert Arc PY 26 HVAC Project.- December 202530k
SA2: Substantial Amendment to request to reallocate remaining unused Admin funds ($50k) to Joslyn Center ADA restroom project for a total of $180k in Public Facility Funding as part of SA2- April 2025 Previous SA: Request to add $50k to Joslyn Center ADA project for a total of $130k as part of SA1- Approved November 2024 Expected Resources
AP-15 Expected Resources – 91.220(c)(1,2)
Introduction
Anticipated Resources
Program Source
of Funds
Uses of Funds Expected Amount Available Year 1 Expected Amount
Available
Remainder of
ConPlan
$
Narrative Description
Annual
Allocation:
$
Program
Income:
$
Prior Year
Resources:
$
Total:
$
CDBG public -
federal
Acquisition
Admin and
Planning
Economic
Development
Housing
Public
Improvements
Public Services 393,904.00 0.00 0.00 393,904.00 1,575,616.00 As part of SA3- $50k in
remaining funds allocated to
Desert Arc HVAC project.

As part of SA2- $50k in
remaining funds allocated to
Joslyn Center for ADA
restroom project. Project
cancelled.
433
City of Palm Desert PY 2023 Draft Annual Action Plan w. Substantial Amendment 3 2 OMB Control No: 2506-0117 (exp. 09/30/2021)
Program Source
of Funds
Uses of Funds Expected Amount Available Year 1 Expected Amount
Available
Remainder of
ConPlan
$
Narrative Description
Annual
Allocation:
$
Program
Income:
$
Prior Year
Resources:
$
Total:
$
HOME public -
federal
Acquisition
Homebuyer
assistance
Homeowner rehab
Multifamily rental
new construction
Multifamily rental
rehab
New construction
for ownership
TBRA 0.00 0.00 0.00 0.00 0.00

Table 1 - Expected Resources – Priority Table
Explain how federal funds will leverage those additional resources (private, state and local funds), including a description of how matching requirements will be satisfied
In addition, the County of Riverside Adult Services/Homeless Unit and CoC Collaborative Applicant has funding allocated for (1) Emergency Shelter, (2) Prevention, (3) Rapid Rehousing, (4) Outreach, (5) HMIS/data collection, and (6) ESG Administration. The City continues to provide its allocation of ProRata Share funding to the County for distribution through the CoC; however, the County has indicated that it is unable to provide the City with the dollar amount of its share, but does recognize that the City is participating.

Palm Desert Housing Authority Revenue (Program) Income: (Formerly referred to as Redevelopment Housing SetAside Funds): Formerly, SetAside Funds were used for housing activities such as acquisition, rehabilitation, new construction, rental assistance, and the Homebuyers own Payment Assistance Program. The Palm Desert Housing Authority is the housing successor entity established to preserve existing housing units and affordability of its current portfolio; however, funding is limited to revenues derived from the properties and 434
City of Palm Desert PY 2023 Draft Annual Action Plan w. Substantial Amendment 3 3 OMB Control No: 2506-0117 (exp. 09/30/2021)
programs (rents, sales, payoffs, etc.).
435
City of Palm Desert PY 2023 Draft Annual Action Plan w. Substantial Amendment 3 4 OMB Control No: 2506-0117 (exp. 09/30/2021)
If appropriate, describe publicly owned land or property located within the jurisdiction that may be used to address the needs identified in the plan

NOT APPLICABLE
Discussion
The City will continue to allocate CDBG funding and other sources of funding when and where available to meet the needs of qualifying individuals as designated by HUD. Programs and projects will be targeted that address goals and objectives identified within the Annual Action Plan and Consolidated Plan. In addition, the funds will be targeted so as to provide the maximize benefit to those in need. 436
City of Palm Desert PY 2023 Draft Annual Action Plan w. Substantial Amendment 3 5 OMB Control No: 2506-0117 (exp. 09/30/2021)
Annual Goals and Objectives
AP-20 Annual Goals and Objectives
Goals Summary Information
Sort
Order
Goal Name Start
Year
End
Year
Category Geographic
Area
Needs Addressed Funding Goal Outcome Indicator
1 Support Essential
Senior Services
2023 2028 Non-Homeless
Special Needs
Citywide Affordable Senior
Housing (Increase)
Increase Senior
Services and
Programming
Senior
Transportation
(Enhance Options)
CDBG:
$150,000.00
Public service activities other
than Low/Moderate Income
Housing Benefit: 3000 Persons
Assisted
2 Support Public and
Community
Facilities
Improvement
2023 2028 Non-Housing
Community
Development
Citywide Senior
Transportation
(Enhance Options)
CDBG:
$1,256,124.00
Public Facility or Infrastructure
Activities for Low/Moderate
Income Housing Benefit:
50000 Households Assisted
3 Preserve and
Enhance Affordable
Housing
2023 2028 Affordable
Housing
Citywide Affordable Senior
Housing (Increase)
Increase
Affordable Housing
Reduce vacancies
in the City
Rental Assistance
CDBG:
$100,000.00
Public service activities for
Low/Moderate Income
Housing Benefit: 5 Households
Assisted
437
City of Palm Desert PY 2023 Draft Annual Action Plan w. Substantial Amendment 3 6 OMB Control No: 2506-0117 (exp. 09/30/2021)
Sort
Order
Goal Name Start
Year
End
Year
Category Geographic
Area
Needs Addressed Funding Goal Outcome Indicator
4 Support Fair
Housing Initiatives
2023 2028 Citywide Reduce vacancies
in the City
Rental Assistance
CDBG:
$21,500.00
Public service activities other
than Low/Moderate Income
Housing Benefit: 500 Persons
Assisted
5 Fund Vital
Community and
Homeless Services
2023 2028 Homeless Citywide Increase Senior
Services and
Programming
CDBG:
$42,500.00
Homeless Person Overnight
Shelter: 300 Persons Assisted
Homelessness Prevention:
2000 Persons Assisted
Table 2 – Goals Summary
Goal Descriptions
1 Goal Name Support Essential Senior Services
Goal Description
2 Goal Name Support Public and Community Facilities Improvement Goal Description
3 Goal Name Preserve and Enhance Affordable Housing
Goal Description
4 Goal Name Support Fair Housing Initiatives
Goal Description
5 Goal Name Fund Vital Community and Homeless Services
Goal Description
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Projects
AP-35 Projects – 91.220(d)
Introduction
The Annual Action Plan identifies funding the following activities:

Public Services ($59,000)
Public Facilities and Improvements ($306,124 amount increased as part of SA1; SA2) Program Administration ($38,780 amount decreased and funds rolled to Public Facilities and Improvements as part of SA2)
Projects
# Project Name
1 Public Service
2 Public Facilities and Improvements
3 Program Administration
Table 3 - Project Information
Describe the reasons for allocation priorities and any obstacles to addressing underserved needs
The City identifies its highest priority needs during its citizen participation process every year and the Consolidated Plan process every five years. Activities are funded annually taking into consideration these highest priority needs. The primary obstacle to address underserved needs in the community is the lack of resources to provide a greater level of assistance. 439
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AP-38 Project Summary
Project Summary Information
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1 Project Name Public Service
Target Area Citywide
Goals Supported Support Fair Housing Initiatives
Fund Vital Community and Homeless Services
Needs Addressed Reduce vacancies in the City
Funding CDBG: $59,000.00
Description Desert Aids Project ($10,000), Elder Love USA, Inc. ($19,000), Fair Housing Council of Riverside County ($21,500), and Operation SafeHouse ($8,500).Eligible Activity (Matrix Code): 05A; 05D; 05E; 05J.

CDBG National Objective: LMC
Target Date 6/30/2024
Estimate the number
and type of families
that will benefit from
the proposed activities
Desert Aids Project: 130
Elder Love USA, Inc: 25
Fair Housing Council of Riverside County: 500
Operation SafeHouse: 10
Location Description Desert Aids Project: 1695 N. Sunrise Way Palm Springs, CA 92262 Elder Love USA, Inc.: 41550 Ecclectic Street, Palm Desert, CA 92260 Fair Housing Council of Riverside County: 3933 Mission Inn Avenue, Ste. 100, Riverside, CA 92501
Operation SafeHouse: 9685 Hayes Street, Riverside, CA 92503 Planned Activities Desert Aids Project: the program transforms the lives of low-income, under-employed HIV-positive clients.

Elder Love USA, Inc.: The agency will provide homeowner health and safety repairs to elderly owners and/or disabled and 65 years of age or older to their homes
Fair Housing Council of Riverside County: Mandated fair housing services
Operation SafeHouse: Case management services for homeless youth at a transitional living facility
2 Project Name Public Facilities and Improvements
Target Area Citywide
Goals Supported Support Public and Community Facilities Improvement Preserve and Enhance Affordable Housing
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Needs Addressed Increase Affordable Housing
Funding CDBG: $256,124.00
Description Funding public facilities and improvements at the City of Palm Desert Cahuilla Hills Park ADA Compliance Project ($146,124), Desert ARC ADA Restroom ($30,000), and The Joslyn Center ADA Restroom ((added $50k for a total of $130k as part of SA1)) ((added additional $50k for a total of $180k as part of SA2)) project cancelled. SA3 includes adding $50k to PY26 Desert Arc HVAC Project. Eligible Activity (Matrix Code): 03F; 03G; 03A. CDBG National Objective: LMC
Target Date 6/30/2024
Estimate the number
and type of families
that will benefit from
the proposed activities
Cahuilla Hills Park ADA Compliance: 1 facility improvement Desert ARC: 1 facility improvement
The Joslyn Center: 1 facility improvement
Location Description City of Palm Desert Cahuilla Hills Park: 45-825 Edgehill Drive, Palm Desert, CA 92260
Desert ARC: 73-255 Country Club Dr, Palm Desert, CA 92260 The Joslyn Center: 73-750 Catalina Way, Palm Desert, CA 92260 Planned Activities City of Palm Desert Cahuilla Hills Park ($146,124) – ADA restroom upgrades, ADA-compliant parking space and trailhead grading/paving to provide ADA access
Desert ARC ($30,000) – ADA restroom upgrade & SA3 includes HVAC Upgrades in PY26 ($50,000)
The Joslyn Center ($130,000) – ADA restroom upgrade (added $50k for a total of $130k as part of SA1) ((added $50k for a total of $180k as part of SA2))
3 Project Name Program Administration
Target Area Citywide
Goals Supported Support Public and Community Facilities Improvement Preserve and Enhance Affordable Housing
Needs Addressed Increase Affordable Housing
Funding CDBG: $78,780.00 reduced to $28,780 and remaining funds transferred to Public Facilities Improvements, The Joslyn Center as part of SA2 442
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Description Program Administration ($78,780) Eligible Activity (Matrix Code): 21A.

CDBG National Objective: Planning and Administration: CDBG Citation:
570.206(a)
Target Date 6/30/2024
Estimate the number
and type of families
that will benefit from
the proposed activities
Program Administration: N/A
Location Description Program Administration: 73510 Fred Waring Drive, Palm Desert, CA 92260
Planned Activities
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AP-50 Geographic Distribution – 91.220(f)
Description of the geographic areas of the entitlement (including areas of low-income and minority concentration) where assistance will be directed The City of Palm Desert is located in Riverside County; particularly, the Coachella Valley. Historically, the City has not had any low- and moderate-income census tracts; however, the City now has two eligible census tracts as of recently (ACS data). CDBG funds will be used for low- and moderate-income clientele (or presumed benefit).

Geographic Distribution
Target Area Percentage of Funds
Citywide 100
Table 4 - Geographic Distribution
Rationale for the priorities for allocating investments geographically The City has not historically funded CDBG activities based upon geographic areas since there have not been eligible low and moderate-income census tracts; however, HUD recently revised the census criteria used to determine eligibility. As a result, the City now has two CDBG-eligible census tracts. City staff is currently exploring the possibility of a Section 108 Loan for City Council’s consideration in subsequent program years.

Discussion

NOT APPLICABLE
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Affordable Housing
AP-55 Affordable Housing – 91.220(g)
Introduction
The City will not undertake any projects to address affordable housing in the 2023 Program Year.

One Year Goals for the Number of Households to be Supported Homeless 0
Non-Homeless 0
Special-Needs 0
Total 0
Table 5 - One Year Goals for Affordable Housing by Support Requirement One Year Goals for the Number of Households Supported Through Rental Assistance 0
The Production of New Units 0
Rehab of Existing Units 0
Acquisition of Existing Units 0
Total 0
Table 6 - One Year Goals for Affordable Housing by Support Type Discussion
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AP-60 Public Housing – 91.220(h)
Introduction
The City will not undertake activities that address public housing in the program year.

Actions planned during the next year to address the needs to public housing Not Applicable. The City does not own nor operate public housing.

Actions to encourage public housing residents to become more involved in management and participate in homeownership
Not Applicable. The City does not own nor operate public housing.

If the PHA is designated as troubled, describe the manner in which financial assistance will be provided or other assistance
Not Applicable. The City does not own nor operate public housing.

Discussion
Not Applicable. The City does not own nor operate public housing. 446
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AP-65 Homeless and Other Special Needs Activities – 91.220(i) Introduction
The City will continue to work with nonprofit organizations, government agencies, and other stakeholders to fund activities that help prevent and reduce homelessness.

Describe the jurisdictions one-year goals and actions for reducing and ending homelessness including
Reaching out to homeless persons (especially unsheltered persons) and assessing their individual needs
The County of Riverside CoC has established chronically homeless persons as the highest need priority based on the goals HUD has established in its Opening Doors Federal and Strategic Plan to Prevent and End Homelessness. The CoC has implemented a Coordinated Entry System (CES) to ensure appropriate intervention is utilized to serve those who are homeless and providing for a prioritization of vulnerability and linkage to community resources and housing based on the vulnerability prioritization. Within the CoC, there are several outreach teams from County, cities, and nonprofit homeless providers that cover specific populations or geographic regions in the County. There is also specific outreach teams serving the mentally ill, veterans, youth and chronic homeless. The Behavioral Health Systems Department has outreach peer specialists that perform initial field assessments, in depth assessments, referrals to all contacts, linkage to various community organizations.

Addressing the emergency shelter and transitional housing needs of homeless persons The Housing First approach adopted by the County and CoC requires that homeless are helped into permanent housing or rapid re-housing as soon as possible. Transitional housing beds have begun to decrease countywide and permanent housing is increasing because of reallocations made in the HUD CoC Program Consolidated Application and the CoC’s success in obtaining new funding for permanent supportive housing. Both transitional housing and emergency shelters focus on lessening the time that a homeless person or family’s length of time homeless (LOTH) in the shelter by effective and quick assessment of homeless clients and getting them stabilized into permanent housing with intensive case management initially and support in the initial phase of residency in permanent housing. This period will serve as a time to address the other needs to maintain self-sufficiency either by accessing mainstream benefits, employment or medical or mental health support.

The CoC collaborates with the City and other stakeholders to integrate CoC programs, Emergency Solutions Grant (ESG), Social Services to Veteran Families (SSVF), and CDBG funding to increase the number of persons with rapid re-housing assistance. Also, other non-McKinney-Vento funding sources, such as Emergency Food and Shelter Program (EFSP), funded under Federal Emergency Management Agency (FEMA) will be matched as a source for rental / mortgage assistance for families that are 447
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homeless or at-risk of homelessness in the County’s strategy to meet this goal.

Helping homeless persons (especially chronically homeless individuals and families, families with children, veterans and their families, and unaccompanied youth) make the transition to permanent housing and independent living, including shortening the period of time that individuals and families experience homelessness, facilitating access for homeless individuals and families to affordable housing units, and preventing individuals and families who were recently homeless from becoming homeless again
The CoC implemented a Coordinated Entry System (CES) to assess homeless persons using the VI-SPDAT that tracks the length of time a client has been on the streets or in an emergency shelter. DPSS uses HUD’s CoC Program planning grant funding to measure system-wide performance in HMIS, such as length of time homeless. This is used to help the CoC prioritize and house those with longest length of time homeless. The planning process also included working with the CoC Standards and Evaluation Committee to continue developing strategies to prioritize persons with longest time homeless and most severe needs, including:

The CoC has also adopted a Housing First approach that is evidenced-based and endorsed by HUD to place a homeless person in permanent housing and provide supportive services intended to keep them stably housed.

Homeless CoC youth providers have implemented outreach and service-based events in the communities to draw homeless youth, unaccompanied and transitional age into contact with services available to them. The Operation SafeHouse is the only CoC youth provider that has opened a permanent supportive housing program called the Harrison House, which is for transitional age youth, in the eastern desert region of Riverside County.

Helping low-income individuals and families avoid becoming homeless, especially extremely low-income individuals and families and those who are: being discharged from publicly funded institutions and systems of care (such as health care facilities, mental health facilities, foster care and other youth facilities, and corrections programs and institutions); or, receiving assistance from public or private agencies that address housing, health, social services, employment, education, or youth needs.

The CoC Discharge Policy is mandated by the State and followed by the CoC. The CoC established a Discharge Planning Committee, responsible for implementing policies and protocols and coordinating with various organizations, to ensure that persons being discharged from a publicly funded institution or system of care are not discharged immediately into homelessness. The goals are to identify discharge housing needs inclusive of housing and supportive services and to link the individual with community resources that will include mental health services, substance abuse support, and housing. The Hospital Association of Southern California Inland Area serves as the lead agency on the Discharge Planning 448
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Committee to facilitate communication regarding the discharge planning needs of homeless persons from acute care hospitals. The Riverside County University Health System – Behavioral Health, collaborates with DPSS and the CoC in the coordination and implementation of discharge planning for homeless individuals disabled by a serious mental health and/or substance abuse disorder(s). Foster Care and extended foster care programs help transition dependent youth who are emancipating from foster care to independent living. The Department of Public Social Services, Riverside Sheriff’s, and Probation Department support the Continuum of Care’s mission of working towards reintegrating persons leaving correctional facilities to community-based living and self-sufficiency.

Discussion

NOT APPLICABLE
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AP-75 Barriers to affordable housing – 91.220(j)
Introduction:

The City does not plan to undertake any activities this program year using CDBG funds to remove barriers to affordable housing.

Actions it planned to remove or ameliorate the negative effects of public policies that serve as barriers to affordable housing such as land use controls, tax policies affecting land, zoning ordinances, building codes, fees and charges, growth limitations, and policies affecting the return on residential investment
The City does not plan to undertake any activities this program year using CDBG funds to remove barriers to affordable housing.

Discussion:

NOT APPLICABLE
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AP-85 Other Actions – 91.220(k)
Introduction:

The City will continue to work with various stakeholders to meet the needs of its residents that remain in-need of CDBG-eligible activities consistent with Consolidated Plan goals.

Actions planned to address obstacles to meeting underserved needs The City will continue to work toward the reduction/elimination of obstacles to meet underserved needs through the funding of various organizations that are established to provide direct services to those in need. The City is not equipped to provide direct services; therefore, funding organizations that do is essential to our success in addressing the identified goals and objectives. The City will continue to partner with service providers to address obstacles and address barriers that exist. In addition, the City works with the County of Riverside, the CoC, local agencies, nonprofits, etc. to address various aspects related to CoC programs and activities, as well as obstacles that face the underserved in general.

However, the CoC addresses issues relative to homelessness, mental and physical illnesses, domestic violence, etc. and has a wide range of members where collaboration in other areas is an option. Through these working relationships, obstacles such as lack of communication between agencies, improved services, limited resources, tracking and monitoring, and other needed resources are obtained, gaps in services are better identified, and there is a more cohesive approach to identifying and resolving issues.

Actions planned to foster and maintain affordable housing The City and the Palm Desert Housing Authority will continue to maintain the existing affordable housing stock through the funding sources identified previously; however, as noted with the elimination of redevelopment agencies, there is no longer what is considered “20% Set Aside Funds”. Therefore, maintaining existing properties and programs will be the primary focus, provided funding is available, for some time to come. However, new projects and programs will be planned and implemented where and when possible.

Actions planned to reduce lead-based paint hazards
The City’s Building & Safety and Housing departments distribute informational pamphlets on Lead Based Paint Hazards and refer all calls to the County of Riverside Environmental Health Department. The City addresses this issue on a case-by-case basis through multiple steps.

Actions planned to reduce the number of poverty-level families The City is continuing to team up with service providers to provide assistance for poverty level families, including funding food and services options during the Program Year. In addition, the City will seek out additional partnerships for programs that encourage self-sufficiency including employment and training, 451
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housing options, and safety net programs.

Actions planned to develop institutional structure
The City will continue to work with outside agencies to maintain and develop relationships, including with nonprofit organizations, private businesses, the CoC, and nonprofit organizations in the region.

Actions planned to enhance coordination between public and private housing and social service agencies
The City will continue to work with various County departments, agencies, and nonprofit organizations to identify and carry out goals and objectives of the CDBG Program, and to create a more cooperative working relationship with all interested parties. The City invites these groups to attend public hearings, community meetings, and special meetings that address specific programs and projects. The City has an approved Citizen’s Participation Plan that it follows in this regard. In addition, City staff regularly attends CoC meetings that involve multiple organizations and various County Departments as well as other local jurisdictions wherein discussions are held on homelessness as well as supportive services to other at-risk groups of individuals and families.

Discussion:

The City completed in Analysis of Impediments for Fair Housing Choice (AI). The City identified the following Goals to address contributing factors/impediments to fair housing:
• Goal #1: Support Non-Discriminatory Leading Practices • Goal #2: Preserve existing housing stock
• Goal #3: Support the prevention of housing discrimination • Goal #4: Support home ownership
• Goal #5: Support the development of affordable housing • Goal #6: Update land use policies and practices to facilitate development of affordable housing • Goal #7: Improve collaboration with regional organizations agencies 452
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Program Specific Requirements
AP-90 Program Specific Requirements – 91.220(l)(1,2,4)
Introduction:

Community Development Block Grant Program (CDBG)
Reference 24 CFR 91.220(l)(1)
Projects planned with all CDBG funds expected to be available during the year are identified in the Projects Table. The following identifies program income that is available for use that is included in projects to be carried out.

1. The total amount of program income that will have been received before the start of the next program year and that has not yet been reprogrammed 0

2. The amount of proceeds from section 108 loan guarantees that will be used during the year to address the priority needs and specific objectives identified in the grantee's strategic plan. 0

3. The amount of surplus funds from urban renewal settlements 0

4. The amount of any grant funds returned to the line of credit for which the planned use has not been included in a prior statement or plan 0

5. The amount of income from float-funded activities 0
Total Program Income: 0
Other CDBG Requirements

1. The amount of urgent need activities 0

2. The estimated percentage of CDBG funds that will be used for activities that benefit persons of low and moderate income.Overall Benefit - A consecutive period of one, two or three years may be used to determine that a minimum overall benefit of 70% of CDBG funds is used to benefit persons of low and moderate income. Specify the years covered that include this Annual Action Plan. 0.00% HOME Investment Partnership Program (HOME)
Reference 24 CFR 91.220(l)(2)

1. A description of other forms of investment being used beyond those identified in Section 92.205 is as follows:

Not applicable
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2. A description of the guidelines that will be used for resale or recapture of HOME funds when used for homebuyer activities as required in 92.254, is as follows:

Not applicable

3. A description of the guidelines for resale or recapture that ensures the affordability of units acquired with HOME funds? See 24 CFR 92.254(a)(4) are as follows:

Not applicable

4. Plans for using HOME funds to refinance existing debt secured by multifamily housing that is rehabilitated with HOME funds along with a description of the refinancing guidelines required that will be used under 24 CFR 92.206(b), are as follows:

Not applicable

5. If applicable to a planned HOME TBRA activity, a description of the preference for persons with special needs or disabilities. (See 24 CFR 92.209(c)(2)(i) and CFR 91.220(l)(2)(vii)).

Not applicable

6. If applicable to a planned HOME TBRA activity, a description of how the preference for a specific category of individuals with disabilities (e.g. persons with HIV/AIDS or chronic mental illness) will narrow the gap in benefits and the preference is needed to narrow the gap in benefits and services received by such persons. (See 24 CFR 92.209(c)(2)(ii) and 91.220(l)(2)(vii)).

Not applicable

7. If applicable, a description of any preference or limitation for rental housing projects. (See 24 CFR

92.253(d)(3) and CFR 91.220(l)(2)(vii)). Note: Preferences cannot be administered in a manner that limits the opportunities of persons on any basis prohibited by the laws listed under 24 CFR 5.105(a).

Not applicable
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Housing Trust Fund (HTF)
Reference 24 CFR 91.220(l)(5)

1. Distribution of Funds
a. Describe the eligibility requirements for recipients of HTF funds (as defined in 24 CFR § 93.2). b. Describe the jurisdiction’s application requirements for eligible recipients to apply for HTF funds. c. Describe the selection criteria that the jurisdiction will use to select applications submitted by eligible recipients.
d. Describe the jurisdiction’s required priority for funding based on geographic distribution, which is a description of the geographic areas of the State (including areas of low-income and minority concentration) in which it will direct assistance during the ensuing program year. e. Describe the jurisdiction’s required priority for funding based on the applicant's ability to obligate HTF funds and undertake eligible activities in a timely manner. f. Describe the jurisdiction’s required priority for funding based on the extent to which rents for units in the rental project are affordable to extremely low-income families. g. Describe the jurisdiction’s required priority for funding based on the financial feasibility of the project beyond the required 30-year period.
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h. Describe the jurisdiction’s required priority for funding based on the merits of the application in meeting the priority housing needs of the jurisdiction (such as housing that is accessible to transit or employment centers, housing that includes green building and sustainable development features, or housing that serves special needs populations).
i. Describe the jurisdiction’s required priority for funding based on the location of existing affordable housing.
j. Describe the jurisdiction’s required priority for funding based on the extent to which the application makes use of non-federal funding sources.

2. Does the jurisdiction’s application require the applicant to include a description of the eligible activities to be conducted with HTF funds?

3. Does the jurisdiction’s application require that each eligible recipient certify that housing units assisted with HTF funds will comply with HTF requirements?

4. Performance Goals and Benchmarks. The jurisdiction has met the requirement to provide for performance goals, consistent with the jurisdiction’s goals established under 24 CFR 91.215(b)(2), by including HTF in its housing goals in the housing table on the SP-45 Goals and AP-20 Annual Goals and Objectives screens.

5. Rehabilitation Standards. The jurisdiction must establish rehabilitation standards for all HTF-assisted housing rehabilitation activities that set forth the requirements that the housing must meet upon project completion. The jurisdiction’s description of its standards must be in sufficient detail to determine the required rehabilitation work including methods and materials. The standards may refer to applicable codes or they may establish requirements that exceed the minimum requirements of the codes. The jurisdiction must attach its rehabilitation standards below. If the jurisdiction will not use HTF funds for the rehabilitation of housing, enter “N/A”.

In addition, the rehabilitation standards must address each of the following: health and safety; major systems; lead-based paint; accessibility; disaster mitigation (where relevant); state and local codes, ordinances, and zoning requirements; Uniform Physical Condition Standards; Capital Needs Assessments (if applicable); and broadband infrastructure (if applicable). 456
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6. Resale or Recapture Guidelines. Below, the jurisdiction must enter (or attach) a description of the guidelines that will be used for resale or recapture of HTF funds when used to assist first-time homebuyers. If the jurisdiction will not use HTF funds to assist first-time homebuyers, enter “N/A”.

7. HTF Affordable Homeownership Limits. If the jurisdiction intends to use HTF funds for homebuyer assistance and does not use the HTF affordable homeownership limits for the area provided by HUD, it must determine 95 percent of the median area purchase price and set forth the information in accordance with §93.305. If the jurisdiction will not use HTF funds to assist first-time homebuyers, enter “N/A”.

8. Limited Beneficiaries or Preferences. Describe how the jurisdiction will limit the beneficiaries or give preferences to a particular segment of the extremely low- or very low-income population to serve unmet needs identified in its consolidated plan or annual action plan. If the jurisdiction will not limit the beneficiaries or give preferences to a particular segment of the extremely low- or very low-income population, enter “N/A.”
Any limitation or preference must not violate nondiscrimination requirements in § 93.350, and the jurisdiction must not limit or give preferences to students. The jurisdiction may permit rental housing owners to limit tenants or give a preference in accordance with § 93.303 only if such limitation or preference is described in the action plan.

9. Refinancing of Existing Debt. Enter or attach the jurisdiction’s refinancing guidelines below. The guidelines describe the conditions under which the jurisdiction will refinance existing rental housing project debt. The jurisdiction’s refinancing guidelines must, at minimum, demonstrate that rehabilitation is the primary eligible activity and ensure that this requirement is met by establishing a minimum level of rehabilitation per unit or a required ratio between rehabilitation and refinancing. If the jurisdiction will not refinance existing debt, enter “N/A.” <TYPE=[section 9 end]>
Discussion:
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458
Annual Action Plan
2024
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3rd Substantial Amendment: A 3rd Substantial Amendment has been requested in January, 2026 to reallocate funds in the amount of $80,000 from PY24 after the cancellation of the Joslyn Center restroom project and reallocate funds to the Desert Arc PY26 HVAC Upgrade Project. 2nd Substantial Amendment: A 2nd Substantial Amendment has been requested in December, 2025 to reallocate remaining funds in the amount of $14,987.64 from PY24 in Admin savings to the Palm Desert Housing Authority who has also asked to reallocate all allocated Public Facilities Improvements Project funds to an urgent drainage issue in one of the parking areas from their original parking lot project. The total allocation to the PDHA would now be $ 232,744.11, including funds from all program years as follows:
2019 $5,596.38
2020 $8,784.90
2021 $59,723.44
2022 $32,467.73
2023 $1,184.02
2024 $124,987.64
1st Substantial Amendment: A Substantial Amendment has been requested in April, 2025 to fully allocate all unspent CDBG funds by repositioning funds with eligible projects. This includes the change in funding for the previously approved PY2024 Desert Arc Project to being fully funded with PY20 CDBG-CV funds in the amount of $180,000 as part of PY20 SA4. PY24 SA1 also includes the funding of the Palm Desert Housing Authority Public Facilities Improvements Project- Parking Lot Upgrades in the amount of $110,000 in PY24 funds for a total of $217,756.47 through the utilization of prior year funds as follows:
2019 $5,596.38
2020 $8,784.90
2021 $59,723.44
2022 $32,467.73
2023 $1,184.02
2024 $110,000.00
Executive Summary
AP-05 Executive Summary - 24 CFR 91.200(c), 91.220(b)

1. Introduction
459
Annual Action Plan
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As a requirement of the U.S. Department of Housing and Urban Development, this document represents the Program Year 2024 Annual Action Plan. The City of Palm Desert (City) has been allocated funds from the Community Development Block Grant (CDBG) .

2. Summarize the objectives and outcomes identified in the Plan This could be a restatement of items or a table listed elsewhere in the plan or a reference to another location. It may also contain any essential items from the housing and homeless needs assessment, the housing market analysis or the strategic plan.

The Annual Action Plan is intended to fund high-priority community needs identified during the annual Citizen Participation Plan process while concurrently aligning with the goals of the previously approved Program Year 2024-2028 Consolidated Plan.

3. Evaluation of past performance
This is an evaluation of past performance that helped lead the grantee to choose its goals or projects.

A performance evaluation is annually assessed through HUD’s review of the Consolidated Annual Performance and Evaluation Report (CAPER). This document states the objectives and outcomes identified in each Annual Action Plan and includes an evaluation of past performance through measurable goals and objectives relative to actual performance. Prior documents can be found at the Palm Desert City Hall.

4. Summary of Citizen Participation Process and consultation process Summary from citizen participation section of plan.

The City held a public comment period from May 31, 2024 - July 1, 2024. On June 27, 2024, the City Council held a public hearing to provide residents an additional opportunity to review and comment on programming of CDBG funds.

As part of SA3, the City utilized it’s Citizen Participation Plan and held a 30-day Public Comment Period and notified the Public 15 days prior to the Public Hearing for consideration of approval of the SA3.

As part of SA2, the City utilized it’s Citizen Participation Plan and held a 30-day Public Comment Period and notified the Public 15 days prior to the Public Hearing for consideration of approval of the SA2.

As part of SA1, the City utilized it’s Citizen Participation Plan and held a 30-day Public Comment Period and notified the Public 10 days prior to the Public Hearing for consideration of approval of the SA1. 460
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5. Summary of public comments
This could be a brief narrative summary or reference an attached document from the Citizen Participation section of the Con Plan.

No public comments received.

6. Summary of comments or views not accepted and the reasons for not accepting them No public comments received.

7. Summary
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PR-05 Lead & Responsible Agencies – 91.200(b)

1. Agency/entity responsible for preparing/administering the Consolidated Plan Describe the agency/entity responsible for preparing the Consolidated Plan and those responsible for administration of each grant program and funding source.

Agency Role Name Department/Agency
Lead Agency PALM DESERT
CDBG Administrator City Manager's Office / City of Palm Desert HOPWA Administrator
HOME Administrator
HOPWA-C Administrator
Table 1 – Responsible Agencies
Narrative (optional)
Consolidated Plan Public Contact Information
Joe Barron
Senior Contracts and Grants Analyst City of Palm Desert 73510 Fred Waring Drive, Palm Desert, CA 92260 [email protected] | 760.776.6491 | www.palmdesert.gov 462
Annual Action Plan
2024
5 OMB Control No: 2506-0117 (exp. 09/30/2021)
SA2
Lorena Ritchey
Management Analyst, City of Palm Desert
73510 Fred Waring Drive, Palm Desert, CA 92260
[email protected] | 760.776.6477 | www.palmdesert.gov 463
Annual Action Plan
2024
6 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-10 Consultation – 91.100, 91.200(b), 91.215(l)

1. Introduction
The City followed its HUD-approved Citizen Participation Plan to consult with the public, nonprofit organizations, governmental agencies, and other stakeholders to prepare the Annual Action Plan as required by 24 CRF 91.100.

Provide a concise summary of the jurisdiction’s activities to enhance coordination between public and assisted housing providers and private and governmental health, mental health and service agencies (91.215(l))
The City conducted outreach and issued public notices regarding the application process for PY24 subrecipient awards.

The City's Outside Agency Funding Committee recommended CDBG budget recommendations, which are incorporated into the Annual Action Plan. The City held a 30-day public comment period from May 31 - June 27, 2024.

On June 27, 2024, the City Council held a public hearing to provide residents an additional opportunity review and comment regarding CDBG funding recommendations. The City Council approved the submission of the Annual Action Plan.

Describe coordination with the Continuum of Care and efforts to address the needs of homeless persons (particularly chronically homeless individuals and families, families with children, veterans, and unaccompanied youth) and persons at risk of homelessness.

The City is actively involved in multiple activities to address the needs of homeless persons, which include coordination with the Continuum of Care. For example, the City is involved in regional coordination efforts between stakeholders throughout the Coachella Valley and Riverside County.

The City has historically funded homelessness services coordinated regionally through the Coachella Valley Association of Governments (CVAG). Since 2017 CVAG has allocated its regional financial commitments for other homelessness services. Last year the City made a financial commitment in the amount of $100,000 to CVAG to continue to implement homelessness services. A summary of accomplishments can be found at City Hall.

The City operates a homelessness assistance program as well. The program that has a primary focus on homelessness locally. The program contracts with the Riverside University Health System to provide a 464
Annual Action Plan
2024
7 OMB Control No: 2506-0117 (exp. 09/30/2021)
Behavioral Health Specialists in Palm Desert to focus on providing homelessness services. Please note the County of Riverside coordinates the Continuum of Care as well.

Describe consultation with the Continuum(s) of Care that serves the jurisdiction's area in determining how to allocate ESG funds, develop performance standards for and evaluate outcomes of projects and activities assisted by ESG funds, and develop funding, policies and procedures for the operation and administration of HMIS The City does not receive Emergency Solutions Grant (ESG) funds.

2. Describe Agencies, groups, organizations and others who participated in the process and describe the jurisdiction’s consultations with housing, social service agencies and other entities
465
Annual Action Plan
2024
8 OMB Control No: 2506-0117 (exp. 09/30/2021)
Table 2 – Agencies, groups, organizations who participated 1 Agency/Group/Organization Fair Housing Council of Riverside County, Inc., Agency/Group/Organization Type Service-Fair Housing
What section of the Plan was addressed by Consultation? Housing Need Assessment Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to provide
public services (fair housing).
2 Agency/Group/Organization Cove Communities Senior Association dba The Joslyn Center
Agency/Group/Organization Type Services-Elderly Persons What section of the Plan was addressed by Consultation? Non-Homeless Special Needs Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to provide
public services (elderly persons).
3 Agency/Group/Organization Desert Recreation District
Agency/Group/Organization Type Services-Children
What section of the Plan was addressed by Consultation? Non-Homeless Special Needs Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to provide
public services (youth persons).
4 Agency/Group/Organization OPERATION SAFE HOUSE, INC.

Agency/Group/Organization Type Services-Children
Services-homeless
466
Annual Action Plan
2024
9 OMB Control No: 2506-0117 (exp. 09/30/2021)
What section of the Plan was addressed by Consultation? Homelessness Needs - Unaccompanied youth Homelessness Strategy
Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to provide
public services (youth homeless persons).
5 Agency/Group/Organization Neighborhood Partnership Housing Services Agency/Group/Organization Type Housing
What section of the Plan was addressed by Consultation? Anti-poverty Strategy Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to provide
housing rehab.
6 Agency/Group/Organization DESERT ARC
Agency/Group/Organization Type Services-Persons with Disabilities What section of the Plan was addressed by Consultation? Non-Homeless Special Needs Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to construct
public facilities and improvements (serving people with disabilities).
7 Agency/Group/Organization RANCH RECOVERY CENTER
Agency/Group/Organization Type Services-Persons with Disabilities Services-Health
What section of the Plan was addressed by Consultation? Non-Homeless Special Needs Anti-poverty Strategy
467
Annual Action Plan
2024
10 OMB Control No: 2506-0117 (exp. 09/30/2021)
Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to construct
public facilities and improvements (serving people with addictions).
8 Agency/Group/Organization WeeCare
Agency/Group/Organization Type Services-Children
What section of the Plan was addressed by Consultation? Non-Homeless Special Needs Briefly describe how the Agency/Group/Organization was consulted. What are the anticipated outcomes of the consultation or areas for improved coordination?
The subrecipient applied for CDBG funds to provide
public services (youth persons).

Identify any Agency Types not consulted and provide rationale for not consulting The City attempts to keep a comprehensive list of stakeholders potentially eligible to receive CDBG funds for activities consistent with the Consolidated Plan goals. As some stakeholders undergo staffing changes, on occasion City staff is unaware of such changes throughout the program year. As a result, some stakeholders may not realize the City is attempting to consult with their organizations during the Annual Action Plan process. To mitigate this concern, City staff updates its contact list annually to ensure proper channels of communication with stakeholders Other local/regional/state/federal planning efforts considered when preparing the Plan Name of Plan Lead Organization How do the goals of your Strategic Plan overlap with the goals of each plan?
Continuum of Care Housing Services Authority Both address issues pertaining to homelessness and special needs housing.
468
Annual Action Plan
2024
11 OMB Control No: 2506-0117 (exp. 09/30/2021)
Name of Plan Lead Organization How do the goals of your Strategic Plan overlap with the goals of each plan?
Housing Element City of Palm Desert Both include the goal of fostering affordable housing.

Table 3 – Other local / regional / federal planning efforts Narrative (optional)
The City encouraged cooperation and coordination through the Citizen's Participation Plan process. The City followed the process as outlined in the Executive Summary Citizen's Participation Plan Section. In addition, the City is a member of the Coachella Valley Association of Governments (CVAG) Homeless Committee that consists of Mayors or Councilmember's of each of the nine (9) Coachella Valley communities as well as the County of Riverside, and a representative from Supervisor V. Manuel Perez's office, and Ex-officials who are represent atives from organizations that serve homeless and similar client base. In addition, three of the Ex -officials are also representatives of the CoC's Eastern Region Committee that reports to the CoC BOG. Through this committee and the CoC, the City is able to work with other local government agencies and service providers to address issues on a local and regional (Coachella Valley) basis and obtain input and insight into community needs that are included within the Consolidated Plan.
469
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 12 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-12 Participation – 91.105, 91.200(c)

1. Summary of citizen participation process/Efforts made to broaden citizen participation Summarize citizen participation process and how it impacted goal-setting The City conducted outreach and issued public notices regarding the application process for subrecipient awards.

Citizen Participation Outreach
Sort Order Mode of Outreach Target of Outreach Summary of response/attendance
Summary of
comments received
Summary of comments
not accepted
and reasons
URL (If
applicable)
1 Newspaper Ad
Minorities
Non-English
Speaking - Specify
other language:

Spanish
No response received
No comments
received
NA
Table 4 – Citizen Participation Outreach
470
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 13 OMB Control No: 2506-0117 (exp. 09/30/2021)
Expected Resources
AP-15 Expected Resources – 91.220(c)(1,2)
Introduction
Anticipated Resources
Program Source of
Funds
Uses of Funds Expected Amount Available Year 1 Expected Amount
Available
Remainder
of ConPlan
$
Narrative
Annual Description
Allocation:
$
Program
Income: $
Prior Year
Resources:
$
Total:
$
CDBG public -
federal
Acquisition
Admin and Planning
Economic Development
Housing
Public Improvements
Public Services 365,446 0 0 365,446 0

471
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 14 OMB Control No: 2506-0117 (exp. 09/30/2021)
Program Source of
Funds
Uses of Funds Expected Amount Available Year 1 Expected Amount
Available
Remainder
of ConPlan
$
Narrative
Annual Description
Allocation:
$
Program
Income: $
Prior Year
Resources:
$
Total:
$
HOME public -
federal
Acquisition
Homebuyer assistance
Homeowner rehab
Multifamily rental new
construction
Multifamily rental rehab
New construction for
ownership
TBRA 0 0 0 0 0

Table 1 - Expected Resources – Priority Table
Explain how federal funds will leverage those additional resources (private, state and local funds), including a description of how matching requirements will be satisfied
The above sources of funding have been identified as available funds to be leveraged with, where and when possible, nonprofit organizations and other entities awarded CDBG funds to provide assistance to meet the goals and objectives as outlined within the City's Five-Year Consolidated Plan and One-Year Annual Action Plan. Funded organizations will also utilize awarded funds to leverage, where and when possible, dollars available through the organization as well as other grant awards and/or donations to undertake programs/projects that may not otherwise be possible. Organizations have more flexibility to utilize funding more efficiently and effectively to provide needed support services to clients.
472
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 15 OMB Control No: 2506-0117 (exp. 09/30/2021)
If appropriate, describe publicly owned land or property located within the jurisdiction that may be used to address the needs identified in the plan NA in Palm Desert
Discussion
The City will continue to allocate CDBG funding and other sources of funding when and where available to meet the needs of qualifying individuals as designated by HUD. Programs and projects will be targeted that address goals and objectives identified within the Annual Action Plan and Consolidated Plan. In addition, the funds will be targeted so as to provide the maximize benefit to those in need. 473
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 16 OMB Control No: 2506-0117 (exp. 09/30/2021)
Annual Goals and Objectives
AP-20 Annual Goals and Objectives
Goals Summary Information
Sort
Order
Goal Name Start
Year
End
Year
Category Geographic
Area
Needs Addressed Funding Goal Outcome Indicator
1 Support Public and
Community Facilities
Improvement
202
3 202
8 Non-Housing
Community
Development
Citywide Affordable Senior
Housing (Increase)
Increase Senior
Services and
Programming
Senior
Transportation
(Enhance Options)
Increase Affordable
Housing
Reduce vacancies
in the City
Rental Assistance
CDBG:
$240,200
Public Facility or Infrastructure
Activities other than
Low/Moderate Income Housing
Benefit: 1000 Persons Assisted
2 Support Fair Housing
Initiatives
202
3 202
8 Citywide Affordable Senior
Housing (Increase)
Increase Affordable
Housing
Reduce vacancies
in the City
CDBG:
$31,816
Public service activities other
than Low/Moderate Income
Housing Benefit: 500 Persons
Assisted
474
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 17 OMB Control No: 2506-0117 (exp. 09/30/2021)
Sort
Order
Goal Name Start
Year
End
Year
Category Geographic
Area
Needs Addressed Funding Goal Outcome Indicator
3 Fund Vital
Community and
Homeless Services
202
3 202
8 Homeless Citywide Increase Affordable
Housing
CDBG:
$23,000
Public service activities other
than Low/Moderate Income
Housing Benefit: 250 Persons
Assisted
Table 2 – Goals Summary
Goal Descriptions
1 Goal Name Support Public and Community Facilities
Improvement
Goal
Description
2 Goal Name Support Fair Housing Initiatives
Goal
Description
3 Goal Name Fund Vital Community and Homeless Services
Goal
Description
475
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 18 OMB Control No: 2506-0117 (exp. 09/30/2021)
Projects
AP-35 Projects – 91.220(d)
Introduction
The Annual Action Plan identifies funding the following activities:

Public Services 15%
Public Facilities and Improvements 65%
Program Administration 20%
Projects
# Project Name
1 Public Services
2 Administration
3 Public Facilities and Improvements- The Joslyn Center 4 Public Facilities and Improvements- Desert Arc*
5 Public Facilities & Improvements- The Ranch Recovery Centers, Inc
6 Public Facilities & Improvements- Palm Desert Housing Authority 7 Public Facilities & Improvements- Desert Arc SA3
Table 3 - Project Information
Describe the reasons for allocation priorities and any obstacles to addressing underserved needs
The City identifies its highest priority needs during its citizen participation process every year and the Consolidated Plan process every five years. Activities are funded annually taking into consideration these highest priority needs. The primary obstacle to address underserved needs in the community is the lack of resources to provide a greater level of assistance. *Project 4 moved to PY20-CV funds as part of PY24 AAP SA1 476
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 19 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-38 Project Summary
Project Summary Information
477
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 20 OMB Control No: 2506-0117 (exp. 09/30/2021)
1 Project Name Public Services
Target Area Citywide
Goals Supported Support Fair Housing Initiatives
Fund Vital Community and Homeless Services
Needs Addressed Increase Affordable Housing
Reduce vacancies in the City
Rental Assistance
Funding CDBG: $54,816
Description Youth Service Programs and Fair Housing Programs designed to meet the needs of local residents.

Target Date 9/30/2025
Estimate the number
and type of families
that will benefit from
the proposed activities
100 youth will receive services and 500 households will receive fair housing support
Location Description Fair Housing Council of Riverside County: 3933 Mission Inn Avenue, Ste. 100, Riverside, CA 92501
Operation SafeHouse: 9685 Hayes Street, Riverside, CA 92503 Planned Activities Fair Housing Council of Riverside County: Mandated fair housing services
Operation SafeHouse: Case management services for homeless youth at a transitional living facility
Desert Recreation District: Scholarships for families and individuals in the community who may otherwise be unable to participate in recreational activities
2 Project Name Administration
Target Area Citywide
Goals Supported Support Public and Community Facilities Improvement Support Fair Housing Initiatives
Fund Vital Community and Homeless Services
478
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 21 OMB Control No: 2506-0117 (exp. 09/30/2021)
Needs Addressed Affordable Senior Housing (Increase)
Increase Senior Services and Programming
Senior Transportation (Enhance Options)
Increase Affordable Housing
Reduce vacancies in the City
Rental Assistance
Funding CDBG: $70,430 $55,442.36 SA2 as calculated at end of year Description CDBG Administration. Eligible Activity (Matrix Code): 21A. CDBG National Objective: Planning and Administration: CDBG Citation:
570.206(a)
Target Date 9/30/2025
Estimate the number
and type of families
that will benefit from
the proposed activities
Admin supports those entities supporting families.

Location Description
Program Administration: 73510 Fred Waring Drive, Palm Desert, CA 92260
Planned Activities Reporting, oversight, monitoring of subrecipients. 3 Project Name Public Facilities and Improvements- The Joslyn Center Target Area Citywide
Goals Supported Support Public and Community Facilities Improvement Needs Addressed Senior Transportation (Enhance Options) Funding CDBG: $75,000
Description ADA Restroom improvements- Continuation in 2024 with additional funding.

Target Date 9/30/2025
Estimate the number
and type of families
that will benefit from
the proposed activities
500 seniors will benefit from facility improvements.

Location Description The Joslyn Center: 73-750 Catalina Way, Palm Desert, CA 92260 479
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 22 OMB Control No: 2506-0117 (exp. 09/30/2021)
Planned Activities This multi-phase project will entail a full remodel of each of the five restrooms on The Joslyn Center campus in order to make them fully compliant with ADA requirements and become fully handicap accessible as set forth in the report and survey of Disability Access Consultants conducted on May 21, 2018. This project will benefit all 2000+ members as well as other members of the public and guests that utilize The Joslyn Center. It is estimated that at least 500 individuals consisting of members, public and guests will directly benefit from the ADA upgrades. This request represents the second phase of this project which is the remodel of men's and women's restrooms in building two which consists of meeting rooms and the Arthur Newman Theater.

Because of rising
construction costs, it would be possible to break the remodel of the building’s two restrooms into separate projects consisting of the individual men's and women's restrooms. This option was available in the restroom remodel recently completed in building one. This choice is available by requesting responsive bidders to submit bids for both restrooms and for just one restroom. This would delay the ultimate completion of the project, but allow some flexibility because of rising construction costs. Remodeling the restrooms to ADA compliance is a priority for The Joslyn Center because many of our members experience physical disability which requires a fully accessible restroom.
4 Project Name Public Facilities and Improvements- Desert Arc- reproposed as part of SA3
Target Area Citywide
Goals Supported Support Public and Community Facilities Improvement Needs Addressed Reduce vacancies in the City
Funding CDBG: $80,000
Description HVAC Upgrades
Target Date 9/30/2026
Estimate the number
and type of families
that will benefit from
the proposed activities
500 LMI households will benefit from infrastructure improvements Location Description Desert ARC: 73-255 Country Club Dr, Palm Desert, CA 92260 480
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 23 OMB Control No: 2506-0117 (exp. 09/30/2021)
Planned Activities Desert Arc's HVAC (Heating, Ventilation, and Air Conditioning) Replacement Project will encompass the removal and replacement of nine (9) obsolete, rooftop HVAC units on Building 3 of its Palm Desert campus (73275 Country Club Drive). The total amount needed for the HVAC Replacement Project is $509,587.00 with roughly half of the total amount being allocated toward equipment costs at $271,187.00. The current HVAC units are 17 years-old, with an average lifespan of 15 years, and use an R-22 refrigerant coolant which will no longer be available/produced due to new EPA (Environmental Protection Agency) regulations. The old units will be replaced with new 410-A refrigerant rooftop HVAC units which can be retrofitted into the existing system's footprint. The replacement of these units is urgent for two reasons.

Firstly, the 410-A HVAC units will not be available after December 31, 2024 and the 2025 units will require additional construction and fortification to the roof of Building 3 in order to compensate for the additional weight of the 2025 units. Retrofitting the 410- A HVAC units will save crucial time and funds. Secondly, California Department of Social Services Title 22 (Division 6, Chapter 3, Section 82088) mandates that Desert Arc maintain a comfortable temperature for clients at all times with a maximum indoor temperature of 85 degrees F or 30 degrees F less than outside temperatures in areas of extreme heat. Due to the excessive summer temperatures in Palm Desert, which can reach up to 120 degrees F, it is imperative for Desert Arc to maintain a climate controlled facility to ensure the health and well-being of its clients (people with intellectual and developmental disabilities) and staff while also staying in line with state regulations. 5 Project Name Public Facilities & Improvements- The Ranch Recovery Centers, Inc Target Area Citywide
Goals Supported Support Public and Community Facilities Improvement Needs Addressed Reduce vacancies in the City
Funding CDBG: $55,200
Description HVAC units, appliances, dorm room improvements Target Date 9/30/2025
Estimate the number
and type of families
that will benefit from
the proposed activities
10 ELI Individuals with Chronic Substance Abuse Disorder 481
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 24 OMB Control No: 2506-0117 (exp. 09/30/2021)
Location Description
Planned Activities Funds are allocated to complete several capital improvement projects at 2 facilities. Time and continuous use take a physical toll on our facilities and, while we take care to maintain and repair everything we can, there comes a point where replacement is necessary. The items requested will help improve the treatment environment for the patients in our
care, improving their safety and well-being. Additionally, a well-kept facility is beneficial for mental and emotional health. Many of our contracts only allow us to utilize contract dollars for direct treatment costs and many of our capital improvement purchases and upgrades are funded through charitable contributions. Projects include: HVAC units, appliances, dorm room improvements
6 Project Name Public Facilities- PD Housing Authority
Target Area Citywide
Goals Supported Enhance public facilities
Needs Addressed Low-to-Moderate Income Housing
Public Facilities
Funding CDBG: $217,756.47 SA2 $232,744.11
Description Public Facilities Improvements- Parking Lot Upgrades at Public Housing Facility
Target Date 5/1/2025
Estimate the number
and type of families
that will benefit from
the proposed activities
250 Public Housing Authority residents
Location Description
Planned Activities Parking Lot Improvements
482
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 25 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-50 Geographic Distribution – 91.220(f)
Description of the geographic areas of the entitlement (including areas of low-income and minority concentration) where assistance will be directed The City of Palm Desert is located in Riverside County; particularly, the Coachella Valley. Historically, the City has not had any low- and moderate-income census tracts; however, the City now has two eligible census tracts as of recently (ACS data). CDBG funds will be used for low- and moderate-income clientele (or presumed benefit).

Geographic Distribution
Target
Area
Percentage of
Funds
Citywide 100
Table 4 - Geographic Distribution
Rationale for the priorities for allocating investments geographically The City has not historically funded CDBG activities based upon geographic areas since there have not been eligible low and moderate-income census tracts; however, HUD recently revised the census criteria used to determine eligibility. As a result, the City now has two CDBG-eligible census tracts. City staff is currently exploring the possibility of a Section 108 Loan for City Council’s consideration in subsequent program years.

Discussion
483
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 26 OMB Control No: 2506-0117 (exp. 09/30/2021)
Affordable Housing
AP-55 Affordable Housing – 91.220(g)
Introduction
One Year Goals for the Number of Households to be Supported Homeless 0
Non-Homeless 0
Special-Needs 0
Total 0
Table 6 - One Year Goals for Affordable Housing by Support Requirement One Year Goals for the Number of Households Supported Through Rental Assistance 0
The Production of New Units 0
Rehab of Existing Units 0
Acquisition of Existing Units 0
Total 0
Table 7 - One Year Goals for Affordable Housing by Support Type Discussion
484
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 27 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-60 Public Housing – 91.220(h)
Introduction
The City will not undertake activities that address public housing in the program year.

Actions planned during the next year to address the needs to public housing Not Applicable. The City does not own nor operate public housing.

Actions to encourage public housing residents to become more involved in management and participate in homeownership
Not Applicable. The City does not own nor operate public housing If the PHA is designated as troubled, describe the manner in which financial assistance will be provided or other assistance
Not Applicable. The City does not own nor operate public housing Discussion
Not Applicable. The City does not own nor operate public housing 485
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 28 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-65 Homeless and Other Special Needs Activities – 91.220(i) Introduction
The City will continue to work with nonprofit organizations, government agencies, and other stakeholders to fund activities that help prevent and reduce homelessness.

The CoC collaborates with the City and other stakeholders to integrate CoC programs, Emergency Solutions Grant (ESG), Social Services to Veteran Families (SSVF), and CDBG funding to increase the number of persons with rapid re-housing assistance. Also, other non-McKinney-Vento funding sources, such as Emergency Food and Shelter Program (EFSP), funded under Federal Emergency Management Agency (FEMA) will be matched as a source for rental / mortgage assistance for families that are 486
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 29 OMB Control No: 2506-0117 (exp. 09/30/2021)
homeless or at-risk of homelessness in the County’s strategy to meet this goal.

The CoC Discharge Policy is mandated by the State and followed by the CoC. The CoC established a Discharge Planning Committee, responsible for implementing policies and protocols and coordinating with various organizations, to ensure that persons being discharged from a publicly funded institution or system of care are not discharged immediately into homelessness. The goals are to identify discharge housing needs inclusive of housing and supportive services and to link the individual with community resources that will include mental health services, substance abuse support, and housing. The Hospital Association of Southern California Inland Area serves as the lead agency on the Discharge Planning 487
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 30 OMB Control No: 2506-0117 (exp. 09/30/2021)
Committee to facilitate communication regarding the discharge planning needs of homeless persons from acute care hospitals. The Riverside County University Health System – Behavioral Health, collaborates with DPSS and the CoC in the coordination and implementation of discharge planning for homeless individuals disabled by a serious mental health and/or substance abuse disorder(s). Foster Care and extended foster care programs help transition dependent youth who are emancipating from foster care to independent living. The Department of Public Social Services, Riverside Sheriff’s, and Probation Department support the Continuum of Care’s mission of working towards reintegrating persons leaving correctional facilities to community-based living and self-sufficiency.

Discussion
488
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 31 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-75 Barriers to affordable housing – 91.220(j)
Introduction:

The City does not plan to undertake any activities this program year using CDBG funds to remove barriers to affordable housing.

Discussion:
489
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 32 OMB Control No: 2506-0117 (exp. 09/30/2021)
AP-85 Other Actions – 91.220(k)
Introduction:

The City will continue to work with various stakeholders to meet the needs of its residents that remain in-need of CDBG-eligible activities consistent with Consolidated Plan goals.

Actions planned to reduce the number of poverty-level families The City is continuing to team up with service providers to provide assistance for poverty level families, including funding food and services options during the Program Year. In addition, the City will seek out additional partnerships for programs that encourage self-sufficiency including employment and training, 490
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 33 OMB Control No: 2506-0117 (exp. 09/30/2021)
housing options, and safety net programs.

Discussion:
491
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 34 OMB Control No: 2506-0117 (exp. 09/30/2021)
Program Specific Requirements
AP-90 Program Specific Requirements – 91.220(l)(1,2,4)
Introduction:

1. The total amount of program income that will have been received before the start of the next program year and that has not yet been reprogrammed 0

2. The amount of proceeds from section 108 loan guarantees that will be used during the year to address the priority needs and specific objectives identified in the grantee's strategic plan. 0

3. The amount of surplus funds from urban renewal settlements 0

4. The amount of any grant funds returned to the line of credit for which the planned use has not been included in a prior statement or plan 0

5. The amount of income from float-funded activities 0
Total Program Income: 0
Other CDBG Requirements

1. The amount of urgent need activities 0

2. The estimated percentage of CDBG funds that will be used for activities that benefit persons of low and moderate income.Overall Benefit - A consecutive period of one, two or three years may be used to determine that a minimum overall benefit of 70% of CDBG funds is used to benefit persons of low and moderate income. Specify the years covered that include this Annual Action Plan. 0.00% 492
City of Palm Desert PY 24 CDBG Annual Action Plan- Approved 35 OMB Control No: 2506-0117 (exp. 09/30/2021)
HOME Investment Partnership Program (HOME)
Reference 24 CFR 91.220(l)(2)

1. A description of other forms of investment being used beyond those identified in Section 92.205 is as follows:

2. A description of the guidelines that will be used for resale or recapture of HOME funds when used for homebuyer activities as required in 92.254, is as follows:

3. A description of the guidelines for resale or recapture that ensures the affordability of units acquired with HOME funds? See 24 CFR 92.254(a)(4) are as follows:

5. If applicable to a planned HOME TBRA activity, a description of the preference for persons with special needs or disabilities. (See 24 CFR 92.209(c)(2)(i) and CFR 91.220(l)(2)(vii)).

7. If applicable, a description of any preference or limitation for rental housing projects. (See 24 CFR

NA
493

Palm Desert City CouncilJanuary 22, 2026

Palm Desert City Council
January 22, 2026