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HomeMy WebLinkAboutItem 13 AIS Reallocation of CDBG funds for Home Repair Program AGENDA ITEM SUMMARY Meeting Date: Meeting Type: Staff Contact/Dept.: Staff Phone No: Estimated Time: S P R I N G F I E L D C I T Y C O U N C I L Council Goals: ITEM TITLE: ACTION REQUESTED: ISSUE STATEMENT: ATTACHMENTS: DISCUSSION/ FINANCIAL IMPACT: M E M O R A N D U M City of Springfield Date: 6/17/2019 To: Gino Grimaldi COUNCIL From: Tom Boyatt, Community Development Division Director Sandy Belson, Comprehensive Planning Manager Erin Fifield, Community Development Analyst BRIEFING Subject: Reallocation of Community Development Block Grant (CDBG) funds for Home Repair Program MEMORANDUM ISSUE: Staff estimate Springfield’s Home Repair Program will run out of funds mid-June, creating a funding gap until August when FY2019-20 CDBG funds will be made available. Meanwhile, the City’s down payment assistance program has not been expending funds as planned, and has a surplus of allocated funding from prior years. It is estimated this amendment would leave enough funds for the down payment assistance program to continue in FY2019-20, and allow the Home Repair Program to operate in June, July and August. COUNCIL GOALS/ MANDATE: Promote and Enhance our Hometown Feel While Focusing on Livability and Environmental Quality BACKGROUND: Springfield’s Home Repair Program uses Community Development Block Grant (CDBG) funds to pay for needed repairs for low-income homeowners. Council has expressed support for the program, and is interested in expanding the program to help more homeowners. POTENTIAL SOLUTION: Reallocate prior year funds (FY 2017-18) from the SHOP program to the Home Repair Program. This shift would allow the Home Repair Program to operate in June, July and August without a funding gap, and would not affect the SHOP program, given the amount of remaining funds that would still be available for the program. PROCESS: Because these are federal funds, the City needs to follow its process to substantially amend a prior year (FY 2017-18) One Year Action Plan. City staff sent a Communication Packet Memorandum to Council on 5/6/2019, informing them of the issue, the intent to proceed with the substantial amendment process, and that the final decision would come before Council in June. On May 10th, the City issued a public notice of the proposed substantial amendment in the Register Guard, allowing the public 30 days to comment on the proposed amendment. On May 29th, the Community Development Advisory Committee (CDAC) held a public hearing on the proposed amendment. No one spoke during the public hearing, and no comments were received. The CDAC discussed the need to ensure both the down payment assistance program and the Attachment 1, Page 1 of 2 MEMORANDUM 6/6/2019 Page 2 Home Repair Program are successful and well-funded. CDAC RECOMMENDATION: Ultimately, the CDAC voted to recommend to City Council the substantial amendment as proposed: to reallocate $50,000 of the FY2017-18 CDBG One Year Action Plan from the down payment assistance program to the Home Repair program. This amendment would result in the Home Repair Program being fully funded through June, July and August, and would still allow the down payment assistance program to have $51,623 available for FY2019-20. RECOMMENDED ACTION: Approve the substantial amendment, and reallocate funds from the down payment assistance program to the Home Repair program. Attachment 1, Page 2 of 2 Eugene-Springfield FY 2017/18 One Year Action Plan City of Springfield CDBG program 1 City of Springfield – CDBG Program FY 2017/18 One Year Action Plan This summary describes specific housing and community development actions and activities the City of Springfield proposes to undertake with Community Development Block Grant (CDBG) funds during the program year beginning July 1, 2017 and ending June 30, 2018 (Fiscal Year 2017/18). It is one part of the Eugene-Springfield 2017/18 One-Year Action Plan. Communities that are entitled to receive funds from U.S. Department of Housing and Urban Development (HUD) must complete a Consolidated Plan every five years as well as annual Action Plans. The Consolidated Plan provides an assessment of needs of low- and moderate- income persons and a strategic five-year plan for taking actions to address those needs using Community Development Block Grant (CDBG) and HOME Investment Partnerships Program (HOME) funds received by the Cities of Eugene and Springfield. The One-Year Action Plan describes specific actions to be undertaken in a particular year with federal funds. The content of the One-Year Action Plan is guided by HUD. The Cities of Eugene and Springfield each receive an annual entitlement allocation of CDBG funds directly from HUD. The two Cities also receive HOME funds from HUD through the Eugene-Springfield HOME Consortium. The City of Eugene is the lead agency in the HOME Consortium. A summary of planned uses by the Eugene-Springfield HOME Consortium for the use of HOME funds is available from the City of Eugene, as well as a summary of planned uses of Eugene CDBG funds. The following describes only the planned uses of CDBG funds received by the City of Springfield. Coordination and Collaboration The Cities of Eugene and Springfield collaborate in multiple ways to plan for and implement affordable housing and community development activities. The Cities of Eugene and Springfield jointly prepare the five-year Consolidated Plan and coordinate preparation of the One-Year Action Plans, and Comprehensive Annual Performance and Evaluation Report. There are multiple forms for communication and collaboration between the jurisdictions and other public agencies, affordable housing developers, social service providers, and other interested parties. The Lane County Human Services Commission (HSC) and Poverty & Homelessness Board (PHB) offer ongoing opportunities for collaboration and communication. Attachment 2, Page 1 of 9 Eugene-Springfield FY 2017/18 One Year Action Plan City of Springfield CDBG program 2 Citizen Participation The City of Springfield encourages public participation in identifying specific needs and uses of CDBG funds in fiscal year (FY) 2017/18. The City of Springfield Community Development Advisory Committee (CDAC) is composed of community residents and was established by the City of Springfield to make recommendations concerning program policy and project selection to the City Council. On February 15, 2017, Springfield released its DRAFT CDBG One-Year Action Plan on its website and at City Hall. A 30-day public comment period commenced on February 15 and closed on March 17. Additionally, a public hearing was held by the CDAC on March 16, 2017. One written comment was received, identifying the need for housing in Springfield for women who have experienced chronic homelessness. At the public hearing, one person testified in support of local non-profits’ needs for capital funds. The CDAC held a discussion, and voted to recommend to City Council the summary of Springfield CDBG funded sources and uses as provided as Attachment A. Springfield’s City Council will consider the recommendation of the CDAC and public comments received before approving the One-Year Action Plan, which is scheduled for June 19, 2017. Affordable Housing Strategy The City is currently developing an affordable housing strategy to address the low supply of housing and to foster housing choice and affordability in the short and long term. Springfield is focused on developing a strategy that will make the most impact on addressing Springfield’s affordable housing needs. In previous years, Springfield has allocated some CDBG funds annually through a competitive Request for Proposals (RFP) process and relied on applications received to determine which strategies in the Consolidated Plan will be addressed. This year, given the affordable housing needs identified, City Council is prioritizing the strategy of increasing the supply of affordable housing, and is proposing an allocation toward that strategy. There may be the option for a competitive RFP regarding how that strategy will be implemented, but that process has yet to be developed. Activities Benefiting Low- and Moderate-Income Persons Generally, Springfield's CDBG-funded programs and projects are provided to benefit low- income residents living within the city limits of Springfield. Individuals participating in a CDBG- funded program are required to meet HUD Income Guidelines. In order to meet the CDBG National Objective of Benefit to Low and Moderate-Income Persons, CDBG-funded projects must either serve a specific low-income area, or provide tangible benefit to low- and moderate-income clientele (services, economic opportunities, housing). Funded programs and projects undergo periodic staff monitoring to ensure compliance with CDBG regulations. All of the allocations proposed in Springfield’s One Year Action Plan for FY 2017/18 would benefit low- and moderate-income persons. Attachment 2, Page 2 of 9 Eugene-Springfield FY 2017/18 One Year Action Plan City of Springfield CDBG program 3 Activities for the Prevention or Elimination of Slum and Blighted Conditions Another national objective of the CDBG program is the prevention or elimination of slums and blighted conditions in neighborhoods and communities, either by designating a specific area or by addressing conditions on a spot basis. In 2014, Springfield re-designated a Springfield Downtown Redevelopment Area, in compliance with CDBG regulations. The Downtown Redevelopment Area is pictured below. Springfield’s proposed One Year Action Plan for FY 2017/18 does not include an allocation toward the elimination of Slum and Blight. Attachment 2, Page 3 of 9 Eugene-Springfield FY 2017/18 One Year Action Plan City of Springfield CDBG program 4 Strategies to Address Priority Needs The City of Springfield receives an annual allocation of Community Development Block Grant (CDBG) funds from the U.S. Department of Housing and Urban Development (HUD). The City of Springfield will receive a CDBG allocation of $486,236 in FY 2017/18. Attachment A shows the allocated sources of funding for strategies in FY 2017/18. The adopted Eugene-Springfield 2015 Consolidated Plan emphasizes goals and strategies to meet priorities needs of low-income renters, low-income homeowners, people experiencing homelessness, and non-homeless special needs populations. Additional needs include increased employment opportunities for low income persons as well as low-income neighborhoods and areas that meet HUD’s definition of slums and blight. The priority strategies described below are intended to address one or more priority needs. Attachment B includes the adopted table of strategies to address the priority needs along with specific metrics to track progress over the five year period. The following narrative describes proposed allocations of Springfield CDBG funds for FY 2017/2018 as it relates to each strategy identified in the Eugene-Springfield 2015 Consolidated Plan. Certain strategies in Springfield are met through the Eugene-Springfield HOME allocations, and are indicated below. More details can be found regarding the allocation of HOME funds in the Eugene 2017/18 One-Year Action Plan. Affordable Housing Affordable housing goals are intended to address HUD program objectives to provide decent, safe, and affordable housing and address critical housing needs of low-income people in our community. A total of four affordable housing goals are included in the adopted Eugene-Springfield 2015 Consolidated Plan. Increase the Supply of Affordable Housing Housing Development – The City of Springfield recognizes that the housing supply is low, particularly affordable housing for low-income residents, and aims to add a net increase of units to the housing supply. Through land/property acquisition, potentially paired with site development and/or HOME funds, the City of Springfield proposes to allocate $211,054 of estimated new entitlement funds toward supporting new housing development. Additional funds allocated through the FY 2017/18 HOME Allocation will help to address this strategy. (see FY 2017/18 HOME Allocation) CHDO Operating Support – (see FY 2017/18 HOME Allocation) Attachment 2, Page 4 of 9 Eugene-Springfield FY 2017/18 One Year Action Plan City of Springfield CDBG program 5 Rehabilitate Existing Housing Stock Springfield Emergency Home Repair - The City of Springfield will continue to provide assistance to qualified low-income homeowners through its Emergency Minor Home Repair Program. These programs are funded from allocation from the new CDBG entitlement grant. Springfield proposes to allocate $55,000 in CDBG funds for this purpose. Provide Down Payment Assistance for Home Ownership Springfield Home Ownership Program - The City of Springfield continues to administer the very successful Springfield Homeownership Program (SHOP). The SHOP provides down-payment assistance for low-and very low-income households. Springfield proposes to allocate $50,000 in CDBG funds for this purpose. Remove Barriers to Affordable and Supportive Housing There are currently no funds allocated to this strategy. Springfield continues to seek opportunities to affirmatively further fair housing and inform others about the Fair Housing Council of Oregon’s Fair Housing Hotline. Community Development Community development goals are intended to satisfy HUD program objectives by providing human services; creating jobs; improving access to public facilities; and furthering neighborhood revitalization, planning, and community-building activities. A total of three community development goals were included in the adopted Eugene-Springfield 2015 Consolidated Plan. Support a Human Services Delivery System Non-profit services through the Human Services Commission (HSC) – The City of Springfield collaborates with Lane County to fund human service providers. The Human Services Commission (HSC) is the intergovernmental board that guides the use of funds and oversees the activities of agencies receiving funds. Agencies to be funded will be determined through a competitive Request for Proposals (RFP) administered by the HSC. Springfield proposes to allocate 15% of New Entitlement funds to the HSC. Promote Economic Development There are currently no FY 2017/18 funds allocated to this strategy. Make Strategic Investments to Improve Neighborhoods There are currently no FY 2017/18 funds allocated to this strategy. Attachment 2, Page 5 of 9 Attachment A Eugene-Springfield FY 2017/18 One Year Action Plan City of Springfield CDBG program City of Springfield FY 2017/18 CDBG Funding Allocation Summary - FINAL Sources of Funding FY 2017/18 CDBG Entitlement Grant (estimated) $ 486,236 Total sources $ 486,236 Uses of Funding Increase the supply of affordable housing Acquisition, site improvements, clearance, etc. $ 211,054 Rehabilitate Existing Housing Stock Home Repair Program for Low-income Homeowners $ 55,000 Provide Down Payment Assistance for Home Ownership Down payment assistance for Low-Income Homebuyers $ 50,000 Support a Human Services Delivery System Non-profit services through the Human Services $ 72,935 Commission (HSC) Administration and Planning $ 97,247 Total uses $ 486,236 Attachment 2, Page 6 of 9 EUGENE – SPRINGFIELD CONSOLIDATED PLAN 2015 Priority Needs - Table Priority Need Explanation Renters - Low and very low income people need increased access to quality affordable rental housing • A significant majority of low-income renters spend more than 30% of their income on housing costs (Eugene – 76%, Springfield – 74%) • A significant majority of low-income renters experience over-crowding, substandard housing, or a housing cost burden (Eugene – 78%, Springfield – 76%) • A large percentage of low-income renters spend more than 50% of their income on housing costs (Eugene – 51%, Springfield – 34%) Home Owners - Low and very low income people need increased access to affordable home ownership opportunities and support to remain homeowners • A significant majority of low-income owners experience over-crowding, substandard housing, or a housing cost burden (Eugene – 76%, Springfield – 57%) • A significant majority of low-income owners spend more than 30% of their income on housing costs (Eugene – 64%, Springfield – 56%) • A large percentage of low-income owners spend more than 50% of their income on housing costs (Eugene – 40%, Springfield – 31%) Homeless - People need access to housing and supportive services to prevent them from becoming homeless and to leave homelessness • A total of 11,668 homeless individuals were served in FY 2014 by agencies funded by Lane County. • The three public school districts in Eugene and Springfield report 1,616 homeless youth during 2014, and this definition includes students who are staying with friends or family. • The definition of homeless for purposes of this Plan includes people who are “doubled-up”. Non-Homeless Special Needs Populations - People with special needs including seniors, ex-offenders, people with HIV/AIDS, victims of domestic violence, people with drug and alcohol addictions, people who are evicted or foreclosed, people with physical and mental disabilities, veterans, youth and college students, and youth aging out of foster care. • Special needs populations need additional support as it relates to affordable housing, human services, and employment opportunities. Employment Opportunities - People who have low incomes, are unemployed or underemployed need a broader range of employment opportunities, including self-employment • Between 2007 and 2010, Lane County lost nearly 18,000 jobs. • The loss of jobs combined with the subsequent recession, have widened the gap between employed wages and housing costs. Low-Income Areas & Areas of Slums and Blight – Geographic areas defined as areas of slums and blight or as low-income areas need additional support for rehabilitation and public facility improvements • There are several areas in this community that are or could meet the HUD requirement for an areas of slums and blight which would allow different uses of CDBG funds. These areas could benefit from increased investments in the area. • There are several areas of this community that are characterized by 51% or more low- to moderate-income residents, which can benefit from increased investments in this area. Eugene-Springfield FY 2016/17 One Year Action Plan City of Springfield CDBG program 1 Attachment 2, Page 7 of 9 EUGENE – SPRINGFIELD CONSOLIDATED PLAN 2015 Strategies to Address Priority Needs – Table 2015 Eugene/Springfield Consolidated Plan Strategy Priority Needs Addressed Possible Examples Measurements Eugene/ Springfield HOME Consortium Eugene CDBG Springfield CDBG Increase the supply of affordable housing (Consortium HOME and Community Development Block Grant) Renters, Home Owners, Homeless, Special Needs Land Acquisition. Development of new rental housing. Operating Support for Community Housing Development Organizations Number of rental units constructed, reconstructed, acquired or preserved 600 50 Number of CHDO’s Assisted 4 Housing for homeless added 20 Number of sites acquired 2 1 Homeowner housing added 10 5 Rehabilitate existing housing stock affordable to low-income persons (Community Development Block Grant) Renters, Homeless, Special Needs, Low-Income Areas, Home Owners Continue and expand publicly supported rehabilitation and accessibility improvements. Number of rental units rehabilitated 350 5 Number of home owner units rehabilitated 150 200 Provide down payment assistance for home ownership (Community Development Block Grant) Home Owners Assist low-income residents with the first time purchase of a home. Households assisted with direct assistance to home buyers 10 50 Remove barriers to affordable and supportive housing (Community Development Block Grant) Renters, Home Owners, Homeless, Low Income Area Non Homeless Special Needs Support programs that assure housing opportunities are provided without discrimination. Support Housing Policy Board. Update Fair Housing Plan. Maintain Housing Policy board Yes Yes Number of fair housing events 20 5 Maintain fair housing services Yes Yes Update Fair Housing Plan Yes Yes Attachment 2, Page 8 of 9 EUGENE – SPRINGFIELD CONSOLIDATED PLAN 2015 Strategy Priority Needs Addressed Possible Examples Measurements Eugene/ Springfield HOME Consortium Eugene CDBG Springfield CDBG Support a human services delivery system to address the needs of homeless persons and special needs populations (Community Development Block Grant) Homeless, Special Needs Fund capital improvements to facilities owned by non-profits. Fund non-profit services through the Human Services Commission. Persons assisted with public facility activities 25,000 5,000 Persons assisted with public service activities 110,000 65,000 Number of public facilities improved 15 4 Number of transitional or emergency beds added 20 5 Promote economic development and employment opportunities through the creation of jobs and business development (Community Development Block Grant) Employment Opportunities Provide below market financing to local businesses creating or retaining jobs. Provide micro-enterprise training and development opportunities. Jobs created or retained 200 5 Businesses assisted 50 1 Micro business trainees 300 55 Make strategic investments to improve low income neighborhoods and other areas of slums and blight (Community Development Block Grant) Renters, Owners, Homeless, Special Needs, Low Income Areas and Slums & Blight, Employment Opportunities Provide financing for activities which eliminate slums and blight, including acquisition, clearance, rehab and historic preservation and economic development activities. Businesses assisted with façade treatment or building rehab 2 Number of projects completed 2 2 Persons assisted with public facility activity 5,000 6,000 Attachment 2, Page 9 of 9 2016-2017 OYAP DRAFT City of Springfield Proposed Amendment to Prior Year One Year Action Plan for Community Development Block Grant (CDBG) Funds The City of Springfield is proposing a substantial amendment to a prior year Action Plan to reallocate federal Community Development Block Grant (CDBG) funds received as follows: Prior Year Action Plan Amount Funded Prior Year Allocated Strategy Proposed Amendment FY 2017/18 $50,000 Provide down-payment assistance to low-income homeowners Reallocate funds to Rehabilitate existing housing stock affordable to low-income persons. Staff estimate Springfield’s Home Repair Program will run out of funds mid-June, creating a funding gap until August when FY20 funds will be made available. Meanwhile, the City’s down payment assistance program has not been expending funds as planned, and has a surplus of allocated funding from prior years. It is estimated this amendment would leave enough funds for the down payment assistance program to continue in FY2019-20, and allow the Home Repair Program to operate in June, July and August. Attachment 3, Page 1 of 1