City of Ashland, Oregon / City Recorder / City Council Information / Packet Archives / Year 2004 / 09/07 / CDBG
CDBG
[Council Communication]
[Attachments]
Council Communication
| To: |
City Council |
| Title: |
Public Hearing on Community Development Block Grant (CDBG)
Program Year Change |
| Dept: |
Planning Department |
| Date: |
September 7, 2004 |
| Submitted By: |
Brandon Goldman, Housing Program Specialist
John McLaughlin, Director of Community Development |
| Approved By: |
Gino Grimaldi, City Administrator |
| Synopsis: |
Staff has proposed to change the Community Development Block Grant (CDBG)
program year from a calendar year (January - December) to a fiscal year (July
- June). The Housing Commission reviewed the proposed change in the Program
Year at their regular meeting on July 28th, 2005. The proposed change in
the CDBG program year is intended to coordinate Ashland's CDBG program to
match regional, state, and federal grant funding cycles, to streamline the
City's internal budgeting process, and to ensure awarded CDBG funds are available
soon after the award selection.
The following options are provided for consideration:
Option 1
This proposed change in the CDBG program year would shift the beginning of
the program year from January 1, 2005 to July 1, 2005. As a result of this
change, a 6 month delay in the competitive award process for the 2005 CDBG
is anticipated. In lieu of issuing a request for proposals (RFP) in August
of 2004 for an award to be made in November, the change to a fiscal year
would mean the RFP would not be issued until February 2005 with an award
to be made in April-June, to distribute funds after July 1st, 2005 upon approval
of the City's annual CDBG Action Plan..
In this option all funds would be aggregated into one award in the amount
of approximately $474,000 to be awarded in May-June 2005, to be available
upon approval of the 2005 Action Plan and completion of other regulatory
requirements (Environmental Review), in late August or September 2005 for
distribution. The selected project needs to be a project that is ready to
proceed to ensure the funds are expended in a timely manner.
The benefits of this option include a larger award that may result in a more
successful project, as well as more efficient use of staff time by consolidating
two award cycles.
Option 2
The City can opt to retain the existing program year (January 1-December
31) with no change. This option would then have the City immediately issue
an RFP for the award selection process to begin. Of the anticipated $474,000
only $274,000 would be available until April-May of 2005, when the City could
expect to receive its 2005 allocation from HUD.
Staff does not see a benefit in staying with the current program year due
to the difficulties associated with coordinating the award cycle with the
funding availability.
Option 3
The City can approve of the program year shift to a Fiscal Year, yet immediately
issue an RFP for the $274,000 amount (funds available in the current program
year) through the existing process. These funds would be available for
distribution upon approval of a modified 2004 Action Plan by HUD and applicable
environmental review and other regulatory requirements being met depending
on the project selected. The Council would, as always, reserve the right
to reject all proposals. Should that be the case, then the $274,000 amount
would be combined with the $200,000 for 2005 Fiscal Year with a new RFP in
February, 2005.
Benefits for this approach include making $274,000 available for a project
immediately, rather than waiting to combine this award with the coming year's
allocation. The downside of this is the staff/Commission/Council efforts
in processing two RFP's in a relatively short time, and the lower overall
grant dollars available for disbursement. |
| Recommendation: |
• The Council could move to modify the CDBG program year to a fiscal
year (July 1 - June 30) and aggregate past reprogrammed funds with the 2005
award for a single award process.
(Staff Recommendation - Option 1)
• The Council could move to modify the CDBG program year to a fiscal
year (July 1 - June 30) and award $274,000 of reprogrammed funds independently
of the 2005 allocation. However, the Council would maintain the right to
reject all proposals for the reprogrammed funds and ultimately aggregate
those funds with the 2005 award. (Housing Commission Recommendation -
Option 3)
Staff recommends Option 1, to change the CDBG program year
to be based on the Fiscal Year (July 1 -June 30th.) and aggregate past
reprogrammed funds with the 2005 award for a single award process. Staff
believes this option would provide applicants with a larger amount of available
funds to leverage larger scale affordable housing projects. A representative
of the Ashland Community Land Trust (ACLT) commented during public forum
at the August Housing Commission meeting that they believe that the combined
program funds with a longer time period for preparing a proposal would be
of greater benefit to the community and housing providers. Staff concurs
and believes that unless it can be clearly shown to the Council that there
is a project ready to go and is reliant on the current funding cycle, the
recommended shift to the fiscal year with combined program funds of $474,000
will more likely result in a project of benefit to the community.
The Housing Commission, after hearing testimony at the public hearing on
July 28th, has forwarded a recommendation to Council to select Option
3, to change the program year to match our fiscal year, and award
$274,000 in reprogrammed funds independently of the 2005 allocation. A
representative of the Rogue Valley Community Development Corporation (RVCDC)
presented testimony at that meeting stating that they would find it beneficial
to apply for the $274,000 during the current program year and that they had
a potential project.
In response to the Housing Commission's recommendations Staff immediately
issued an RFP for the $274,000 in reprogrammed funds on August 6th. The current
RFP was issued to ensure a timely award process, and provide a full month
for applicants to complete their proposals, in the event the Council chooses
Option 3 (to issue two separate RFPs) as recommended by the Housing Commission.
The closing date for proposals is September 7th, and thus staff has yet to
receive completed proposals, however it is staffs understanding that both
the Rogue Valley Community Development Corporation (RVCDC) and the Ashland
Community Land Trust (ACLT) have been working on completing proposals to
meet this deadline. All potential applicants are working with the understanding
that the Council is still to decide whether to change the program year, and
whether to aggregate funds into one or two separate award processes. As always,
the Council also maintains the right to reject all proposals.
In the event the Council elects to issue only one RFP for the combined total
of $474,000, in February of 2005 (Option 1), the current RFP will be nullified
and applicants will be able to submit revised proposals for the 2005 program
year. |
| Background: |
The City previously shifted from a fiscal year to a calendar year in
an effort to coordinate the CDBG program year with the construction season
and to balance staffing needs so that the CDBG award process would not occur
during peak construction season.
Since the program year shift to a calendar year CDBG awards have been made
in November. However, CDBG funds are not made available to the City for
distribution until Congress (federal) makes its appropriations to the Department
of Housing and Urban Development (HUD), thus such funds are typically not
available until April or May of the following year. This delay, from when
a property is initially identified in the RFP in August, to receiving funds
in May or June of the following year has been a hardship on property owners
willing to sell to a CDBG funded project. Such a delay was an unintended
consequence of the change to a calendar year and will in large part be resolved
if the program year is again based on Ashland's Fiscal Year. Given Ashland's
competitive real estate market such a delay places CDBG land acquisition
projects at risk. The shift from a calendar year to a fiscal year is expected
to reduce this delay from when an award is made to when funds are available
from 6-7 months to 1-2 months.
Another impetus for the proposed change to a fiscal year is to coordinate
the City of Ashland's CDBG program with that of the City of Medford, the
County and the State as well as Ashland's own budget year. There exists
opportunities for the City to eventually participate in a consortium with
Medford and the County to become an entitlement entity for HOME funds. These
funds, that are used to support affordable housing projects, require a
coordinated consortium and in synchronizing our program years that will simplify
the coordination necessary. Furthermore, it is staffs belief by providing
an award cycle consistent with the State and the City of Medford, local housing
providers can coordinate their activities and applications for funds more
effectively. |
| Attachments: |
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