Council Communication

Public Hearing on 2005 Community Development Block Grant (CDBG) award
Meeting Date:	March 15, 2005		Primary Staff Contact:	Brandon Goldman 552-2076 , goldmanb@ashland.or.us
Department:	Community Development		Secondary Staff Contact:	John McLaughlin, 552-2043 mclaughj@ashland.or.us
Contributing Departments:	none
Approval:	Gino Grimaldi

Statement: The City of Ashland provides Community Development Block Grants (CDBG) to eligible affordable housing projects within the City of Ashland. The City Council is to evaluate two proposals received for use of $190,000 in CDBG funds. Upon review of proposals the Council shall make an award to the selected applicant(s).
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Background: The City of Ashland received two proposals for the allocation of approximately $190,000 in Community Development Block Grant (CDBG) funds. Proposals requested were limited to affordable housing projects, the highest priority need identified in the 2000-2004 Consolidated Plan. The two proposals received both address this priority. Habitat for Humanity proposed utilizing $156,000 to purchase two lots from the Fordyce Street Co-Housing development to construct two homes benefiting low or extremely low income households. The Rogue Valley Community Development Community (RVCDC) requested $190,000 to purchase three existing town homes currently used as rentals for the purpose of rehabilitating the units and selling them to low or moderate income households. The Housing Commission held a Public Hearing on February 23rd to review the proposals. Unfortunately the council liaison and a Housing Commissioner had to recuse themselves due to the ongoing Fordyce Co-Housing Planning Action appeal and potential ex parte contacts and a conflict of interest. This, in combination with absent members, left the commission without a quorum and a special meeting of the Housing Commission was held on March 8th for commission deliberation and decision. At this subsequent meeting a quorum was present and the commission forwarded a recommendation as indicated below. During the Housing Commission public hearing the Habitat for Humanity representatives suggested modifying their proposal to $63,000 in CDBG funds. They further requested the commission consider reducing any allocation to RVCDC accordingly. Housing Commission members voiced concern over the division of the award and how it may compromise a project as proposed. Specifically of concern was the risk associated with awarding CDBG funds to the Habitat for Humanity project as the full subdivision (Fordyce Co-Housing) was denied by the Planning Commission and currently under appeal to the City Council. Further deliberation on the Habitat proposal involved the "net gain" in terms of number of affordable units given the two units proposed as affordable are required as part of the subdivision's pending zone change. The applicant indicated that these units could be provided to lower income households due to the contribution of CDBG funds. The Housing Commission determined the RVCDC project was relatively straight forward and had a high likelihood of success.
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Related City Policies: Community Development Block Grants are federal funds awarded through the City of Ashland to eligible projects that benefit low-moderate income households. Ashland's Consolidated Plan for use of CDBG Funds establishes which of the nationally recognized eligible uses are prioritized locally. The Staff Evaluation of the proposals included in the Council Packet (attachment pages B1-B14) provides Staff's determination that both proposals meet a national objective and are an eligible use of CDBG funds. Timely expenditure of CDBG funds is of specific importance to the City of Ashland. Should the City fail to expend the funds in a timely manner, the Department of Housing and Urban Development can impose sanctions thereby reducing future CDBG award allocations. Currently the City is considered timely. However given our limited annual CDBG allocation it is imperative that any project awarded CDBG funds demonstrate a readiness to proceed to ensure the City does not accumulate carryover in excess of 1.5 times the annual award allocation.
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Council Options: Upon review of the proposals received, and after hearing public comments, the Council shall determine whether the projects effectively address the goals outlined in the Consolidated Plan and which of the projects is the most appropriate use of CDBG funds. Should the Council determine that neither project, nor applicant, demonstrates the ability to complete the developments as proposed, the Council may elect to issue a new RFP and aggregate these funds into the 2006 CDBG Request for Proposals. Upon completion of award selections by the City Council, an annual CDBG Action will be developed to outline the new proposed use(s) of the CDBG funds. This 2005 Action Plan will be presented to Council at a public hearing for review and approval on May 3, 2003.
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Staff Recommendation: Staff recommends awarding $190,000 to RVCDC for the purchase of three existing town homes on Quincy Street, to be rehabilitated, and sold to households earning less than 80% area median income. Staff believes the project is viable and ready to proceed. Further staff recognizes the proposal provides a benefit that would not otherwise be possible without CDBG assistance. The City of Ashland Housing Commission reviewed the grant requests on Feb 23, 2005 and continued the hearing to March 8th, 2005. The Housing Commission has forwarded a recommendation to the City Council that the RVCDC be approved as presented, and be awarded the full $190,000 in 2005 CDBG funds.
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Potential Motions: • Move to approve the award of $190,000 in Community Development Block Grant Funds to the Rogue Valley Community Development Corporation for the acquisition of three town homes to benefit low-moderate income households. • Move to approve the award of $156,000 in Community Development Block Grant Funds to Habitat for Humanity for the acquisition of property to develop two dwellings to benefit low- income households, with the remaining $24,000 to be carried over for allocation in the 2006 award process.
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Attachments: Please click on the link below to view the following attachments:      • Housing Commission Minutes March 8and February 23, 2005 hearings (A1-A5)      • Staff Evaluation dated February 23, 2005 (B1-B14)      • RVCDC Application (C1-C20)      • Habitat for Humanity Application (D1-D28)

CDBG-Attachments.pdf (4230.2KB)

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