HomeMy Public PortalAbout10) 8A Community Development Block Grant Funds for FY 2019-20AGENDA
ITEM 8 .A.
COMMUNITY DEVELOPMENT DEPARTMENT
DATE:
TO:
FROM :
MEMORANDUM
January 15 , 2019
The Honorable City Council
Bryan Cook , City Manager
Via : Michael D. Forbes , Commun ity Development Director
Scott Reimers , Planning Manager
By : Adam Gul ick , Associate Planner
SUBJECT: COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS FOR FISCAL
YEAR 2019-20
RECOMMENDATION:
The City Counci l is requested to :
1. Hold a public hearing rega rding the proposed allocation of Community
Development Block Grant (CDBG) funds for Fiscal Year (FY) 201 9-20 ;
2 . Authorize the City Manager to amend CDBG-funded program allocations up to 50
pe rcent of the approved allocation as ne cessary throughout the FY ; and
3 . Adopt Resolution 1 9-5379 establish ing the CDBG-funded programs and
allocations below for FY 2019-20 (Attachment "A "). The total CDBG Budget for FY
2019-20 includes the estimated allocation of $190 ,000 , unallocated prior years '
funds of $77,429 , and up to $285 ,080 of carryover from FY 2018-19 :
i. Housing Rehab ilitation Loan and Handyworker Grant Program :
ii. Asbestos Testi ng and Removal Program :
ii i. Youth Scholarship Program :
Total FY 2019-20 CDBG Budget:
BACKGROUND:
$425 ,000
$ 99 ,009
$ 28 ,500
$552,509
1 . In 1974 , the CDBG Program was enacted through the Hous ing and Commun ity
Development Act of 197 4 . The City has been receiving CDBG funds fr om the Los
Angeles County Community Development Commission (LACDC ) since 1974 .
City Counci l
January 15 , 2019
Page 2 of 5
2 . On June 4 , 2018 , the City was informed of the 2018 income guidelines through a
CDBG Bulletin (Attachment "B"). At this time , the 2019 income guidelines have not
been released . The City is required to follow the 2018 income gu idelines until
further notice .
3. On December 24 , 2018 , a public notice was published in the Temple City Tribune
stating the intended CDBG-funded programs and allocations for FY 2019-20
(Attachment "C").
ANALYSIS:
The CDBG Program was established with the primary object ive of develop ing v iable
communities by creating suitable living environments , maintaining and creating decent
housing , and creating and maintaining job opportunities for low-and moderate-income
persons . Every city receives an annual CDBG allocation based upon population . Cities
in Los Angeles County with a population under 50 ,000 , such as Temple City, rece ive
funds through the LAC DC and is referred to as a non-entitlement jurisdiction .
CDBG funds can only be used to accomplish certain pre -designated nationa l objectives
set forth by this federal program . Specifically , funds need to address slum and blighted
conditions , to assist or benefit low-and moderate-income famil ies , to ass ist with
emergency conditions (e .g . natural disasters) threatening public health and safety , or to
meet the needs of special population groups , such as the disabled or senior citizens .
In the past , the City has been able to use CDBG funds for the Hous ing Rehab ili tation
Loan Program , the Handyworker Assistance Program , the Youth Scholarsh i p Program ,
the installation of Americans with Disabilities Act (ADA) approved surfacing for the
playgrounds at Temple City Park and Live Oak Park , the installation of ADA ramps at
various intersections throughout the City , and ADA imp rovements to publ ic parki ng lots
along Las Tunas Drive and Temple City Boulevard .
The City is required to allocate $267,429 of CDBG funds for FY 2019-20 . Th is includes
the City 's estimated annual allocation of $190 ,000 and $77,429 of unallocated funds
carry i ng over from the previous fiscal year and /or prior home improvement loans paid
back to the City . In the rare event the City does not expend all of its FY 2018-19 CDBG
funds ; the City could have up to an additional $285 ,080 of CDBG funds to use on FY
2019-20 programs . This would result in a total of $552 ,509 of CDBG funds ava ilab le for
FY 2019-20 ; however, a more conservative esti mate of CDBG funds ava il able for FY
2019-20 would be $267,429 . Since the actual allocation or carry over funds may be
different from the estimates , staff is recommending that the City Counci l authorize the
City Manager to adjust the program allocations as needed to reflect the ava i lable
funding . The City is requ i red to conduct a public heari ng to solicit input f ro m the
community and to ensure that the proposed CDBG Projects meet commun ity needs and
HUD guidelines . The City publ ished a notice in the newspaper (Attachment "B") notifying
City Council
January 15, 2019
Page 3 of 5
the public of the City's intended CDBG programs and allocations for FY 2019-20 . Staff
recommends that the programs and relative funding levels for FY 2019-20 , as follows .
• Housing Rehabilitation Loan and Handyworker Grant Program:
This Housing Rehabilitation Loan Program has been popu l ar in the commun ity since
it was established in the mid-1990 's . In FY 2016-17 , the loan and grant program
were combined into one program to help streamline projects and reduce
administrative work . The Housing Rehabilitation Loan Program provides deferred
loans (maximum $35 ,000) to below moderate-income homeowners to make
necessary major home repairs and/or correct Building and Zoning Code violations .
Since FY 2014-15 , the City has assisted 11 below moderate-income households . A
lien recorded on the property requires that the owners pay back their loan if the
house is sold , is changed to a rental , or the property is ref inanced . When the loan is
paid back , the money is recycled back into the City's CDBG Programs .
Due to a significant level of interest in the community , the City brought back the
Handyworker Grant Program in FY 2015 -16 . This program a lso assists income-
eligible households with necessary and essential home repa irs (max imum $1 0 ,000).
The program is geared towards smaller repairs to help improve the qua lity of life ,
such as : roof repairs or replacement , window rep lacement, painting , stucco ,
electrical , and plumbing repa irs or replacement. Since FY 2015-16 , the City has
issued grants to 14 below moderate-income households .
At the time of this report , there are approximately 20 res idents on the waiting list for
this program . Staff recommends allocating $425 ,000 or approxi mately 77 percen t of
the CDBG funds in FY 2019-20 , which includes $340 ,000 t o assist below moderate-
income households with needed repairs and up to $85,000 of program
administration costs to cover the City's consultant.
• Asbestos/Lead-Based Paint Testing and Removal Program:
This ongoing program offers grants to home improvement loan and handyworker
grant participants whose homes have tested positive for asbestos and/or lead -based
paint. The grant is used to mitigate or abate hazardous cond itions in con j unction
with the loan and grant programs ; such abatement is required si nce federa l funds
are being utilized . The funds vary based on the number of projects requiring
asbestos and/or lead-based paint testing , and required abatement work . Depending
on the scope of work, the asbestos and/or lead-based testing can range from $200
to $1 ,000 per residence . If the proposed area of construction tests pos it ive for
asbestos and/or lead -based paint, abatement work is required and can cost up to
$8 ,000 or more depending on the amount of area being disturbed .
Staff recommends that the allocation be $99 ,009 or 18 percent of the CDBG funds
for FY 2019-20. This amount would provide for testing and abatement work , if
needed , for the households that are assisted through the Housing Rehabilitat ion
City Council
January 15, 2019
Page 4 of 5
Loan Program and Handyworker Grant Program . The $99 ,009 allocation includes
up to $19 ,802 of program administration costs to cover the City's consultant. As
with all of the CDBG funded programs , any funds left remaining at the end of the
program 's fiscal year would be carried over to the following fiscal year.
• Youth Scholarship Program:
The Youth Scholarship Program qual ifies as a "publ ic service" program . Under the
HUD CDBG guidelines , a max imum of 15 percent of the annual CDBG allocation
can be used for public serv ice programs . This is an ongoing program enabling
Temple City youth under the age of 18 to participate in various City -sponsored
recreation activities . The scholarship amount covers a portion of the recreation
activity fee for members of eligible households . For youths from extremely low-and
low-income households , the scholarship would cover 75 percent of the fee . This is
the most utilized CDBG program in the City , which typically expends all of the
program funds by April or May of the program 's fiscal year. The program issues
approximately 75 to 1 00 scholarships each fiscal year.
Staff recommends that the allocation be $28 ,500 or 5 percent of the CDBG funds for
FY 2019-20 ; however, this program is limited to 15 percent of the C ity's annual
allocation.
• One-Time Program or Project:
The City Council pre viously expressed intere st in e stablishing an economic
development program ut il izing CDBG funds . Such programs typically involve loans to
new or expanding small businesses , w ith such businesses required to create new
jobs for low-income employees . The prog rams must operate within the strict
guidelines set by HUD , including ongoing city monitoring of job positions and hiring
practices . Since Temple City is a non -entitlement city , any program would also have
to be approved by LAC DC and comply w ith LACDC 's own requ i rements .
Given these challenges , only a few non-entitlement cities in Los Angeles County
have used CDBG funds for economic development, with varying leve ls of success .
Out of the 47 cities participating in the Los Angeles Urban County Consolidated Plan ,
Claremont is currently the only city with a CDBG -funded economic development
program . Claremont's program provides forg ivable loans to new or expanding
bus inesses . Businesses must create one new permanent, full -time equivalent
position for every $25 ,000 in funding, which must be filled by an employee from a
low-income household . The City of Covina previously offered a small business loan
program but found that most of the bus ines se s funded through the program c losed
within a few years, and that interest in the program had declined . As such, the
Covina City Council decided to use CDBG funds for other programs beginning in FY
2016-17 . The City of West Covina uses CDBG funds for a business loan program ,
but has additional flexibility to administer the program as an entitlement city.
City Council
January 15 , 2019
Page 5 of 5
Temple City 's current CDBG programs help to preserve existing affordable hous ing
by repair i ng and ma i ntaining housing units owned and occupied by households
below the moderate-income level. This is one of the goals of the City's 2014-2021
General Plan Housing Element, with the aim to rehabilitate at least 24 single-family
properties during the eight-year term of the Housing Element. If the City re duces
funds available for the home improvement program , an alternative funding source
would be needed to keep the program operating to meet this goal. Further, the
ongoing success of the housing rehabilitation programs has allowed the City to meet
its annual funding drawdown requirement to avoid having funds recaptured by
LACDC . Shifting this funding to an economic development program where the level
of interest and program success is unknown could result in the City being unab le to
meet drawdown requirements in future years .
If the Cit y Council wishes to move forward w ith an economic development program , it
would need to be brought back at a future City Counci l meetin g . The City could
create an out-of-cycle program that does not coincide with the fiscal year. Any such
program would have to be developed and adm inistered in a manner consistent with
all LACDC and HUD prog ram requirements .
CITY STRATEGIC GOALS :
Approval of the CDBG Allocations for FY 2019-20 will further the City's Strategic Goals
of Publi c Health and Safety, Quality of Life, and Eco nomic Development.
FISCAL IMPACT:
This action will impact the FY 2019-20 City Budget by designating an estimated
$552,509 worth of CDBG funds as follows :
Housing Rehabilitation Loan and Handyworker Grant Program :
Asbestos Testing and Removal Program :
Youth Scholarship Program :
Total
$425 ,000
$ 99 ,009
$ 28,500
$552 ,509
The programs are funded entirely with CDBG funds , so there 1s no impact on the
General Fund .
ATTACHMENTS:
A. Resolution 19-5379
B. CDBG Bulletin 18-0008-2018 CDBG Incom e Guidelines
C. CDBG FY 2019-20 Public Hearing Notice , Temple City Tribune , December 20 ,
2018
ATTACHMENT A
RESOLUTION NO. 19-5379
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMPLE
CITY, CAUFORNIA, APPROVING THE CITY 'S PRC>POSED
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAMS FOR
FISCAL YEAR 2019-2020
WHEREAS, in 1974, the President of the United States signed into law the Housing
and Community Development Act of 1974 (Act); and
WHEREAS, the primarily goals of Title I of Act are to develop a viable urban
communities by providing decent housing and suitable living environment, and expanding
economic opportunities for persons of low and moderate income; and
WHEREAS, the City of Temple City has participated in the Community Deve lopment
Block Grant (CDBG) with the County of Los Angeles for severa l years; and
WHEREAS, the City of Temp l e City desires to partic i pate with the Lo s Angeles Urban
County CDBG Program for Fiscal Year 2019-2020; and
WHEREAS, the City of Temple City has been notified of the availabi lity of an estimated
$267,429 of CDBG funds for Fiscal Year 2019 -2020, an al l ocation of $190,000 and $77,429 of
una llocated funds. The City of Temp le City could have up to an additiona l $285,080 depending
on the final expenditures for Fiscal Year 2018 -2019, for a total of $552 ,509; and
WHEREAS, on December 24, 2018, a publ ic notice was published in the Temple City
Tribu ne statin g the intended CDBG -funded programs for FY 2019-2020; and
WHEREAS, on January 15, 2019, the City Counci l of the City of Temple City conducted
a public hearing to so lic it comments and suggestions form the community for the utilization
of these funds .
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF TEMPLE
CITY, CAUFORNIA AS FOLLOWS:
SECTION 1 . The City Council finds that al l the facts set forth in the Rec ita ls of th i s Resolution are
true and correct.
SECTION 2. That the Mayor, City Manager or their designee are authorized and directed to submit
the City's fina l Planning Summary for Fiscal Year 2019 -2020 to the County of Los Ange les ,
reflecting the funding allocations set forth herein. Shou l d the City's final allocation be less or more
Reso lution No. 19-5 379
Page 2 of 3
than the, the City Manager i s authorized to mod ify each program up to 150 percen t of the figures
li sted below:
Progra m Name HUD Activity Propose Use of Funds Proposed
Allocat ion
Hous i ng Lo w/Moderate Provides deferred loans ($35 ,000) and $425,000
Rehabilitation Hou sing grants ($10,000) to income qualified
Loan and sing l e-fam i ly household s to correct cod e
Handywor ker vio lations and /or to provide decent, safe ,
Grant Program and sanitary housing in Te mpl e City.
Asbestos Testing Lo w/Moderate Provides grants to qualified low-an d $ 99,009
and Removal Housing moderate-i ncome households
Prog ram participating i n the home improvement
program to test an d abate asbestos
and/or l ead -base d pa int.
Youth Scholarship Pr ovid es scholarships to ch ild ren ages 17 $ 28,500
Program ye ars old and younge r in bel ow
moderate-i ncome families allowing them
to participate in vari ous recrea tion
cla sses/activi ti es offered b y t he City's
Pa rks an d Recreation Department.
SECTION 1 . The Cit y Cler k sha l l cert ify to th e passage and adoption of th i s resolution .
PASSED , APPROVED , AND ADOPTED t his 151h day of January, 2019.
Wi lli am Man, M ayor
ATTEST : APPROVED AS TO FORM :
Peggy Kuo , City Clerk Eric S. Vail, City Attorney
Resolution No. 19-5379
Page 3 of 3
I, Peggy Kuo, City Clerk of the City of Temple City, hereby certify that the foregoing
Resolution No. 19-5379 was adopted by said Council at the regu lar meeting held on the 15 1h day
of Janua ry 2019, by the fol lowing vo te :
AYES:
NOES :
ABSENT:
ABSTAIN :
Council member -
Councilmember-
Council member -
Councilmember-
Pegg y Kuo, City Clerk
ATTACHMENT B
LOS ANGELES COUNTY 6. @
GMU BULLETIN
COMMUNITY DEVELOPMENT COMMISSION /HOUSING AUTHORITY • 700 W. Main Street • Alhambra • California 9180 1
NUMBER : CDBG18-0008
FRHS18-0001
BFH18-0001
SUBJECT : 2018 INCOME GUIDELINES
DATE :
June 4, 2018 IMMEDIATELY
EFFECTIVE DATE:
TO: PARTICIPATING CITIES
COMMUNITY-BASED ORGANIZATIONS
OTHER PUBLIC AGENCIES
COUNTY DEPARTMENTS
CDC DIVISIONS
1 2
PAGE OF
The 2018 income guidelines (effective June 1, 2018) for use in Community Development Block Grant
(CDBG), Bringing Fa mili es Home (BFH), and Fam i ly Reunification Housing Subsidy (FRHS) programs
are listed below. These guidelines should be used to determine comp liance w ith each program's
objective of providing benefit t o income-eligibl e persons. They are also used in determ ining eligibility
for the Public Housing and Section 8 Programs and are effective until a new sched ul e is issued .
The CDBG Program defines ann ual income acc ord ing to the Section 8 Housing Assistance Payments
Program , thus we are subject to the def inition of "Ext re mely Low-Income," per the 2014 Consolidated
Appropriations Act. Sin ce the 30 % Average Median Income (AMI ) limits are not the same as the
"Extremely Low-Income" limits, th e CDBG Program must use the incom e guidelines, as outl ined below .
2018 INCOME LIMITS
Number of Persons Extremely Low-Income Low-In come Moderate-Income
1 $20,350 $33 ,950 $54 ,250
2 $23,250 $38,800 $62 ,000
3 $26,150 $43,650 $69 ,750
4 $29,050 $48,450 $77,500
5 $31,400 $52 ,350 $83 ,700
6 $33 ,740 $56 ,250 $89,900
7 $38,060 $60 ,100 $96,100
8 $42,380 $64,000 $102,300
Please note that the 2018 median family income for Los Angeles County is $69 ,300.
Comm u nity Development Division-Grants Management Unit (CDD-GMU}
Putting Do lla r s In to Action
Participating Agencies
June 4, 2018
Page Two
These guidelines refer to the terms in determin ing income levels for the above-mentioned programs.
In order to clar ify any misunderstanding from the differences in terms between the Pub lic Housing,
Section 8 , CDBG , BFH, and FRHS Programs , the following is provided for your information :
COMPARISON OF TERMS IN DETERMINING INCOME LEVELS
BFH & FRHS CDBG SECTION 8 % OF MEDIAN
Extremely Extremely Extremely Equal to or
Low-Income Low-Income Low-Income less than 30%
Not Eligible Low-Income Very 31% to 50% Low-Income
Not Eli ible Moderate-Income Low-Income 51 % to 80%
For all agencies utilizing CDBG -approved Public Service Self-Certification Forms , please be sure to
incorporate these revised income gu idelines into your forms immediately (the Public Service
Self-Certification Form does not apply to the BFH and FRHS Programs).
Should you have any questions, please contact your Program Manager.
SCOTT STEVENSON, Director
Commun ity Development Division
SS :OV:BT·JSB:rb
K:IGMU COMMON\BULLETINS (Work ing File· WORD Verslo n)ICDBG\2018\20181ncome Guidc lines.docx
ATTACHMENT C
CITY OF TEMPLE CITY
PUBLIC HEARING NOTICE
COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS
FOR FISCAL YEAR 2019-2020
Notice is hereby given that the City Council of the City of Temple City will consider the
use of Community Development Block Grant Funds for Fiscal Year (FY) 2019-2020 at their
meet ing of January 15 , 2019 , at 7 :30 p .m . in the C ity Council Chambers of the C ity Hall ,
located at 5938 Kauffman Avenue , Temple City .
Community Development Block Grant (CDBG) Funds must be used to achieve the
stated national objectives of this Department of Housing and Urban Development (HUD)
program . Specifically, these available Federal-Government funds must be used to eliminate
slum and blight conditions , assist low and moderate-income households, address "spot blight",
emergency purposes , or to meet the needs of special population groups , such as the disabled .
The City of Temple City is anticipated to have an allocation of $190 ,000 and an
additional $7 7 ,429 of unallocated prior years ' funds available for FY 2019-2020 , for a total of
$267,429 . If all of the FY 2018-2019 CDBG funds are not expended by June 30 , 2019, the
City could have up to an add itional $285 ,080 of CDBG funds available for FY 2019-2020 . That
would result in a total of $552 ,509 of CDBG funds available for FY 2019 -2020 . The
recommended CDBG programs may include but are not lim ited to -Housing Rehabilitation
Program ; Lead and Asbestos Testing and Removal Program ; Youth Scholarship Program ;
Park Construction Project; and Tree Planting Project. The above-enumerated amounts are
based upon preliminary estimates from HUD and actual amounts to be expended may be
modified as part of the City 's budget process to reflect the availability of funds . The approved
CDBG projects and accompanyi ng budget will be submitted to the County of Los Angeles
Community Deve lopme nt Commission for inclusion in its application to HUD .
Any interested persons wishing to provide input on housing and community
development as it relates to the use of the 2019-2020 CDBG funds may contact the
Community Development Departm e nt at City Hall by phone (626) 285-2171 . Written
comments may also be submitted to : City of Temple City Community Development
Department , 9701 Las Tunas D rive , Temple City , CA 91780. Comments will be received
through January 15 , 2019 .
Published : Temple City Tribune
Date : December 24 , 2018
Peggy Kuo
City Clerk