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HomeMy WebLinkAbout05-04-2009 Housing & Community Development Commission HOUSING AND COMMUNITY DEVELOPMENT COMMISSION PLANNING CONFERENCE ROOM, CITY HALL MONDAY, MAY 4, 2009 12:00 P.M. 1. Call Meeting to Order 2. Public Comment of Items Not on the Agenda 3. Staff/Commission Comment 4. Discussion of the FY10 Annual Action Plan and Budget 5. Adjournment ,~ 1 =~ 5u..a 110.. t~w~~ ~ ~_.~ -..~ CITY OF IOWA CITY MEMORANDUM Date: May 1, 2009 To: Housing & Community Development Commission From: Tracy Hightshoe, Community Development Planner Re: FY10 CDBG & HOME Allocation HUD posted the Federal Fiscal Year 2009 (City FY10) CDBG and HOME awards on their website. While the City has not received its official award letter from HUD, the CDBG and HOME allocations should be very close to the numbers posted. Based on these numbers, Iowa City will receive additional funding in both the CDBG and HOME programs. The City will receive a 2.5% increase in CDBG funds (FY09 $651,005, FY10 $667,273) and an 11% increase in HOME funds (FY09 $613,731, FY10 $682,363). This represents a total increase of $84,900, a 5.89% increase (total also includes the 2009 Stimulus funds). As the FY10 allocation represents more than a 5% increase from the budgeted amount, the motion from the March 26 HCDC meeting requires us to meet again to discuss how to allocate the additional funds. The March 26 Motion stated the following: Shaw amended his motion to state that if there is additional funding of less than 5% of the FY10 allocation (and 2009 ARRA funds) additional CDBG funds will be allocated to Shelter House - New Construction and additional HOME funds will be allocated pro rata between TBRA and Dolphin. If the City receives more than 5% of the FY10 allocation (and 2009 ARRA funds), the commission will meet again to discuss. At this meeting, HCDC will discuss how to allocate the additional CDBG and HOME entitlement funds. The recommendation will be forwarded to Council for their May 5 meeting. As this meeting is very short notice, please contact staff if you are not able to come. If you plan to join the meeting by a teleconference call, please forward the phone number staff is to call to connect you to the meeting. Two staff memos were submitted to Council in regards to the FY10 Annual Action Plan and funding recommendations. One outlined the process HCDC went through to formulate a budget recommendation and the other addresses the Council earmark for economic development activities. Staff is recommending that the economic development fund not receive FY10 funds as there is a current balance of $120,000. Please review the attached memos. Once again, thank you for your flexibility. l ~ 1 -~= -~... ~~W!-:~ :::-~..~.~ CITY OF IOWA CITY MEMORANDUM DATE: April 27, 2009 TO: FROM: RE: City Council Steve Long, Community Development Coordinator ~ Approval of the FYl0 Annual Action Plan A public hearing on the FYl0 Annual Action Plan, which formally allocates the City's CDBG and HOME funds, will be held on May 5. In addition, City Council will also be considering the approval of the FYl0 Annual Action Plan at the May 5 meeting. The deadline for submission of this plan to the U.S. Department of Housing and Urban Development (HUD) is May 15. The applications for CDBG and HOME funds became available in December 2008 and the Housing and Community Development Commission (HCDC) received the completed applications in January 2009. The Commission members toured many of proposed project sites on February 17 and 18 and then each applicant made a short presentation to HCDC members on February 19. HCDC members developed rankings for each project and met on March 12 and March 26 to formulate funding recommendations. On April 16, HCDC held a public meeting to discuss the FYl0 Annual Action Plan, which included their funding recommendations. At that meeting, HCDC voted to recommend approval of the FYlO Annual Action Plan as presented. There is a memo in your packet from Tracy Hightshoe that outlines our recommendation for the CDBG Economic Development Fund. If you choose to allocate the $95,000 in CDBG funds to other CDBG eligible projects then the funds must go to one or a combination of the following projects; Public Facility (Shelter House - New Construction, MECCA - Facility Rehabilitation, Community Mental Health Center - Facility Rehabilitation) or Housing (Isis Investments LLC - Rental, The Housing Fellowship - Rental, Dolphin Lake Point - Homeownership or William Wittig - Rental). The above projects are all eligible; however, staff recommends that the funds be allocated based on the projects with the highest HCDC ranking. The two highest ranked public facility projects not fully funded are Shelter House - New Construction and MECCA - Facility Rehabilitation. The two highest ranked housing projects not fully funded are Isis Investments LLC - Rental and The Housing Fellowship - Rental. If needed, amendments or changes to this plan may be considered at the May 5 meeting. If changes are made to the FYlO Annual Action Plan, Council could approve the plan, as amended, that evening. A draft copy of the FYl0 Annual Action Plan was included in your April 30 Council information packet. You can also find the FY10 Annual Action Plan at www.icgov.org/actionplan. Copies of the applications and staff reports are available at the Iowa City Public Library and at the Planning and Community Development Department at City Hall. If you have any questions about the FYl0 Annual Action Plan or about the proposed projects please feel free to contact me at 356-5250 or at steve-Iong@iowa-city.org. ,~ 1 -~= -~ ~~W~*t ""~~~.~ --, - CITY OF IOWA CITY MEMORANDUM Re: April 29, 2009 City Council Tracy Hightshoe, Community Development Planne~ Community Development Block Grant Economic Development Fund Date: To: From: Unfortunately, due to the timing of meetings staff was not able to discuss the following issue at a Council Economic Development Committee prior to your May 4 Council work session. As a recipient of Community Development Block Grant (CDBG) funds, City staff reviews measures set up by the U.S. Department of Housing and Urban Development (HUD) to evaluate how the City administers the federal dollars we receive. One of these measures is the City's expenditure rate of CDBG funds. This is the amount of funds that can remain in the City's line of credit before spending the funds on eligible activities. After reviewing the list of the proposed FY10 projects and our current CDBG expenditure rate, staff has concerns about an additional allocation of $95,000 for the CDBG Economic Development fund. As of right now the fund has a balance of $120,000 with no pending applications. If the City allocates the proposed FY10 allocation of $95,000 the fund will have $215,000. The City's anticipated FY10 CDBG entitlement allocation is $651,000. HUD does not allow entitlement cities to have expenditure ratios that exceed 1.50 times their entitlement. Iowa City must spend the CDBG funds on a timely basis or risk increased monitoring, more staff time preparing reports on how to increase our spending rate, or simply risk the funds being recaptured by the Treasury. The Economic Development Fund is a great tool for economic development when staff has the capacity to complete marketing efforts and work with lenders to obtain the types of applicants the City wishes to pursue. Due to time constraints now and in FY10 with the drafting of our Consolidated Plan, a.k.a. CITY STEPS for 2011-2015 (starting this May going through September), community development department workload with flood related grants, housing rehabilitation on flood impacted homes, stimulus funding, HMGP buyouts, Single Family New Construction Program, and our regular CDBG and HOME workload staff will have difficulty attracting/directing funds to the type of businesses the City wants to support. The allocation process for these funds is very time consuming. Recently, our HUD representative clarified the interpretation of who is eligible for economic development funds. This guidance will narrow which businesses we can fund. To be eligible for the funds, at least 51 % of the jobs created or retained must be made available or held by low-to-moderate income (LMI) persons. If funding a business, this LMI standard must be applied to the entire business or if the business is expanding, the standard must be met for the entire expansion. This will place more emphasis on the City finding and allocating funds to eligible micro-enterprises who typically need less funding than larger businesses, but who will also need more staff time explaining the process, going over the agreements and general monitoring. $120,000, the current amount in the fund, would allow us to assist approximately six businesses (average allocation of $20,000), which is a historically high number for the City. Community Development staff recommends retaining the available $120,000 for economic development applicants and allocating the $95,000 (FY10 funds) to different CDBG eligible projects that can be spent on a timely basis. Staff would like to present this recommendation to the Council at your May 4 work session. Staff anticipates that by FY11 we can resume full funding for the Economic Development fund. Please contact me at 356.5244 or by email at tracy-hightshoe@iowa-city.org with any questions.