Agenda Item Wording:
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Conduct a public hearing to receive comments on the proposed 2019-20 Annual Action Plan Substantial Amendment III. Approve and appropriate the proposed 2019-20 Annual Action Plan Substantial Amendment III of $291,599 in CDBG Coronavirus Aid, Relief and Economic Security Act (CDBG-CV) reallocation funding.
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Deadline for Action: 8/1/2022
Submitting Department: Finance and Technology Services
Contact Name and Phone Number: Margie Perez, Housing Specialist, margie.perez@visalia.city <mailto:margie.perez@visalia.city>, (559) 713-4460; Melody Murch, Assistance Finance Director, melody.murch@visalia.city <mailto:melody.murch@visalia.city>, (559) 713-4379
Department Recommendation:
Staff recommends that City Council:
1. Conduct a public hearing to receive public comments on the proposed 2019-20 Annual Action Plan Substantial Amendment III; and
2. Approve and appropriate the proposed 2019-20 Annual Action Plan Substantial Amendment III of $291,599 in CDBG Coronavirus Aid, Relief and Economic Security Act (CDBG-CV) reallocation funding; and
3. Authorize the City Manager or their designee to submit the 2019-20 Action Plan Substantial Amendment III to HUD.
Background Discussion:
In response to the COVID-19 pandemic, The U.S. Department of Housing and Urban Development (HUD) has notified the City of Visalia, of an additional allocation of CDBG-CV funds to be used to prevent, prepare for, and respond to COVID-19. The CARES Act allocation was authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. On June 14, 2022, the City was notified of an additional $291,599 in CDBG-CV reallocation funds to be used to prevent, prepare for, and respond to COVID-19.
The City has previously received a total of $1,507,850 in CDBG-CV funds that were used for food assistance, and a Subsistence Payment Program. The Subsistence Payment Program included rental, mortgage, and utility assistance. On June 14, 2022, the City received official notification of a special allocation of CDBG-CV reallocation funds in the amount of $291,599 to be used to prevent, prepare for, and respond to COVID-19 as shown in Attachment A - HUD CDBG-CV Reallocation Letter.
The CARES Act made available $5 billion in CDBG-CV funds. CDBG-CV funds were allocated to grantees. However, some grantees did not apply for one or more allocation rounds or declined their awards. The remaining $3,069,687 of CDBG-CV funds are now reallocated to grantees that have demonstrated capacity to quickly expend CDBG-CV funds. The grantees eligible for this reallocation are limited to those that expended 99% or more of their CDBG-CV funds by January 4, 2022. As a result, the City received a special allocation of CDBG-CV reallocation funds in the amount of $291,599 to be used to prevent, prepare for, and respond to COVID-19. Administration is capped at 20 percent, which is $58,320 and the program delivery is $233,279 for a total of $291,599 in CDBG-CV funds as shown below in Table-1: CDBG-CV Reallocation Funding.
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Table-1: CDBG-CV Reallocation Funding |
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Administration at 20% |
$ 58,320 |
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Program Delivery |
233,279 |
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Total CDBG-CV Reallocation |
$ 291,599 |
To accept this reallocation of $291,599, the City must amend the 2019-2020 Action Plan. The contract amendment must be fully executed by September 23, 2022, which requires the amendment to be completed and sent to HUD by August 16, 2022, to allow for creation and execution of the contracts by the deadline.
Based on Council direction provided on August 1st, and community input the proposed 2019-20 Action Plan Amendment III consists of administering a COVID-19 Emergency Rental and/or Mortgage Assistance Program for low to moderate income working households who have been directly impacted by the Coronavirus Pandemic to prevent eviction. Assistance is set at $2,000 per household and is expected to assist approximately 116 eligible households to avoid evictions as well as assist landlords receiving rent to prevent future foreclosures in the City of Visalia. Per HUD CDBG-CV regulations, 6-month of assistance is the maximum allowable CDBG-CV assistance. As a result, beneficiaries will be required to have been directly impacted by the COVID-19 pandemic within 6-months of assistance. A Notice of Funding Availability will be released to allow all interested parties to apply for a contract to administer a COVID-19 Relief Emergency Rental/Mortgage Assistance Program.
Public Comment Period: In accordance with HUD CV waiver guidelines, the proposed substantial amendment must be published for no less than 5-days for public comment before it is submitted to HUD. The City of Visalia has provided a 10-day period to receive public comments on the proposed amendment to the 2019-20 Annual Action Plan. The 10-day public comment period was from August 5, 2022 through August 15, 2022. Tonight’s public hearing is the final step in the public comment period.
Fiscal Impact:
Approval of this item will appropriate $291,599 of additional CDBG-CV reallocation funds to prevent, prepare, and respond to the coronavirus pandemic to a COVID Emergency Rental/Mortgage Assistance Payment Program. CDBG funds are to be received on a reimbursement basis. This will require changes to be submitted to HUD in the Integrated Disbursement and Information System (IDIS) to property track and report on separate activities. No General Fund money is included in this item.
Prior Council Action:
*May 18, 2020: Budget Amendment and Initial appropriation of CDBG-CV funding.
*June 20, 2020: Approval of CDBG-CV Food Program agreement with CCFB
*August 17, 2020: Approval of a CDBG-CV Subsistence Payment Program.
*September 21, 2020: Council directed staff to prepare an amendment to the 2019-20 Annual Action Plan to allocate $739,863 in round 3 CDBG-CV funding and $160,137 in prior year unspent CDBG to the Subsistence Payment Program, to bring the total funding available to $1,200,000.
*October 15, 2020: Adoption of 2019-20 Annual Action Plan Substantial Amendment II to initiate a CDBG-CV Subsistence Payment Program.
*August 1, 2022: Receive Council direction on $291,599 in CDBG-CV reallocation funds.
Other: None.
Alternatives: None recommended.
Recommended Motion (and Alternative Motions if expected):
recommendation
Staff is recommending City Council:
1. Hold a public hearing to receive public comments on the proposed 2019-20 Annual Action Plan Substantial Amendment III; and
2. Approve and appropriate the proposed 2019-20 Annual Action Plan Substantial Amendment III of $291,599 in CDBG Coronavirus Aid, Relief and Economic Security Act (CDBG-CV) reallocation funding; and
3. Authorize the City Manager or their designee to submit the 2019-20 Action Plan Substantial Amendment III to HUD.
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Environmental Assessment Status: N/A
CEQA Review: N/A
Attachments: • Attachment A - HUD Visalia CDBG-CV Reallocation Letter • Attachment B - Draft 2019-20 Action Plan Amendment III • Attachment C - Proposed 2019-20 AAP CDBG-CV Amendment III PowerPoint