Agenda

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Finance Committee

Meeting Date:	01/14/2020
FROM:	Bill Gallardo

Subject:

Approval of the Application for Participation in the Community Development Block Grant Program (CDBG) for Fiscal Years 2020-21, 2021-22 and 2022-23

RECOMMENDATION

Approve the application for Fiscal Years 2020-21, 2021-22 and 2022-23 for Housing Rehabilitation to the County of Orange for Community Development Block Grant (CDBG) funding.

BACKGROUND/DISCUSSION

The Federal Housing and Community Development Block Grant Program (CDBG) was established under legislation passed by Congress in 1974 to provide housing and other assistance for low-income persons. It is funded by the Federal Department of Housing and Urban Development (HUD) and administered by the County of Orange for cities under 50,000 in population.

The City has been very successful in receiving CDBG grants to implement the Single Family Rehabilitation Program; alley improvements identified in the Neighborhood Enhancement Plan; and capital improvements to Pioneer Hall and the Senior Center. Project eligibility is limited as the County only funds what is deemed "high priority projects," including addressing homelessness, housing rehabilitation, alley improvements and senior centers.

The City has received CDBG funding annually for the past 45 years for housing rehabilitation of single family homes owned by low-income residents. Qualified homeowners must meet federally prescribed requirements to participate in the Program. Each year, 10 to 15 homes are improved and many neighborhoods in Brea have been enhanced.

The County released the Fiscal Years 2020-21, 2021-22 and 2022-23 CDBG application package on November 20, 2019 and required that completed applications be submitted by December 23, 2019. This timeframe did not allow the opportunity to bring the application to Finance Committee or the City Council prior to submittal. The County requires a Council resolution in order for Brea's application to be considered in the competitive process.

The Public Hearing scheduled for January 21, 2020 is being conducted to conform to HUD and County requirements to give the public an opportunity to participate in the application process. At the conclusion of the Public Hearing, the Council will be asked to approve by resolution the City's participation in the Fiscal Years 2020-21, 2021-22 and 2022-23 CDBG grant program.

The Single Family Rehabilitation Loans will be used to correct health, safety and building code violations. The majority of the funds received will be utilized for single family home loans and mobile home grants. The remaining funds will be used for program delivery expenses to perform inspections of the project sites, contract document preparation, and coordinating contractors/construction. The recipients of the loans and grants must be low-income households, which is defined as earning 80% or less of County median income. The requested grant amount is $180,000 for all three Fiscal Years (2020-21, 2021-22 and 2022-23).

SUMMARY/FISCAL IMPACT

The City of Brea applies annually to the County of Orange for Federal Community Development Block Grant (CDBG) funding in order to provide low-income single family rehabilitation loans and grants to qualified Brea homeowners.

The CDBG application for Fiscal Years 2020-21, 2021-22 and 2022-23 are requesting $180,000 for the Single Family Housing Rehabilitation Program, where no match is required. Staff implementing the Program is paid from the Housing Successor Fund. Thus, there is no negative fiscal impact to the General Fund.

RESPECTFULLY SUBMITTED

William Gallardo, City Manager
Prepared by: Marie Dao, Management Analyst
Concurrence: Chris Emeterio, Acting Community Development Director

Attachments
Application