City Council
MEETING DATE: 1/25/2017
TITLE:
Title
Substantial Amendment to the Community Development Block Grant (CDBG) Fiscal Year 2014-2015 and 2015-2016 Annual Action Plans
End
FROM:
John A. Corella, P.E. - City Engineer
RECOMMENDATION:
Recommendation
Staff is recommending that the City Council:
1. Approve a Substantial Amendment to the Fiscal Year (FY) 2014-2015 and 2015 - 2016 Annual Action Plans to program left over and unallocated funds to the Whitewater Neighborhood Street Improvement Project (Project); and,
2. Authorize the City Manager (or designee) to submit the Substantial Amendment to the U.S. Department of Housing and Urban Development (HUD) for their review and record.
Body
BACKGROUND:
Each year, the City submits to the U.S. Department of Housing and Urban Development (HUD) a One-Year Action Plan that describes the activities and the financial resources it will use to meet the City’s affordable housing and community development needs.
When a substantial change (programmatic or financial) is proposed to any activity within the Annual Action Plan, HUD requires the City to draft and submit a Substantial Amendment describing the changes. HUD also requires the City to conduct a public hearing to allow the public an opportunity to comment on the proposed substantial change.
DISCUSSION:
City staff is recommending a Substantial Amendment to its FY 2014-15 and 2015-16 Community Development Block Grant (CDBG) Annual Action Plans to program the unallocated funds leftover from previous projects that have been completed within these fiscal years. These funds have accumulated over the span of two years as a result of the City receiving project bids at amounts less than the engineer's estimated cost. The City is proposing to combine the leftover monies from the FY 2014-15 and 2015-16 CDBG awards to fund a public improvement Project that will benefit low and moderate income residents.
The following accounting illustrates how these amounts accumulated and which projects had leftover funding:
Moreover, in FY 2012-2013, the City offered Revolving Loans for income eligible residents to connect to their local sewer system. The City did not receive much interest and participation in this program and only entered into ten (10) loans. According to the loan terms, a lien was placed on the property until the entire amount of the loan is repaid. A few of these loans have been repaid through the refinance process while other residents continue to pay their monthly obligation of the loan. To date, the City has accumulated just over $11,000 of payments from these Revolving Sewer Loans.
City staff is also recommending this amount (and any program income generated amounts) be spent before the end of this fiscal year and end of this Five-Year Consolidated Plan cycle. Approval of this recommended action will ensure that the City will not have any significant funds pending going forward with its new Consolidated Plan and programs beginning July 1, 2017.
Staff is proposing that the unspent funds be programmed to public street improvements located within an income eligible area of the City. The Whitewater Neighborhood Project, as described in this Staff Report, are residential streets generally located in the low and moderate income area of Census Tract 449.15 (Block Group 1) south of Ramon Road, north of Corral Road, between Date Palm Drive and Cathedral Canyon Drive. The primary streets City Staff is planning on improving with these funds, combined with Assessment District funds, are Canyon Vista Road, Monte Vista Road, Aurora Vista Road, Desert Vista Road, Cielo Vista Road and Rancho Vista Road.
The Substantial Amendment will allow for adjustments to the Annual Action Plans so that this Project is properly accounted for within the FY in which the federal funds were made available and program funds to the new activity that were not previously mentioned in the Action Plans.
The proposed Substantial Amendment will:
• Allocate approximately $218,425.52 of the remaining funds from the FY 2014-15 Action Plan to the Whitewater Neighborhood Street Improvements; and,
• Allocate approximately $76,530.12 of the remaining funds from the FY 2015-16 Action Plan to the Whitewater Neighborhood Street Improvements; and,
• Allocate the program repayments generated from the former Revolving Sewer Loans in the amount of $11,033.71 to the Whitewater Neighborhood Street Improvement project.
The approval of the Substantial Amendment to the FY 2014-15 and 2015-16 Annual Action Plans will allow the City to reconstruct public residential roads in an income-eligible neighborhood of the City. The undertaking of this Project meets one of HUD’s National Objectives: benefitting low-and moderate income people and the respective area.
City Engineering Staff is preparing plans and is proposing to bid out the Project in February 2017. Once the bids are received, Staff will request approval from the City Council to expend these funds and complete the construction portion of the aforementioned Project.
ENVIRONMENTAL ANALYSIS:
In accordance with 24 CFR 58 of the National Environmental Protection Act (NEPA), each project that is provided assistance with federal funds must be evaluated to determine whether they are subject to environmental regulations. The environmental review of the proposed Whitewater Neighborhood Street Improvements will be prepared and uploaded onto the HUD Environmental Review Online System (HEROS) once the Substantial Amendment has been approved by City Council.
PUBLIC NOTIFICATION:
When a substantial change (i.e. adding an activity, canceling an activity or redirecting funds) is proposed to the City’s Action Plan, the City requires that the public be notified and a public hearing be held to allow the public an opportunity to comment on the proposed substantial changes.
City staff published a public notice announcing these amendments in the December 23th and January 6th edition of the Desert Sun. The public notice period ran from December 26, 2016 through January 24, 2017 (for 30 days). During this public notice period, Cathedral City residents were encouraged to participate and provide feedback regarding the Substantial Amendment and reallocation of funds.
FISCAL IMPACT:
Approval of the Substantial Amendment will have no adverse fiscal impact to the City’s General Fund. The City will program $294,955.64 in unallocated (floating) Community Development Block Grant (CDBG) funds left over from previously completed projects to the Whitewater Neighborhood Street Improvements. The City will also utilize $11,033.71 of program repayment funds towards the construction of the aforementioned Project for a total amount of $305,989.35.
|
Program Year |
Project (from) |
Project Funding |
Project (to) |
Project Funding |
|
FY 14/15 |
Unallocated Balance |
$218,425.52 |
Whitewater Neighborhood Street Improvements |
$218,425.52 |
|
FY 15/16 |
Unallocated Balance |
$76,530.12 |
Whitewater Neighborhood Street Improvements |
$76,530.12 |
|
FY 15/16 |
Program Income (Revolving Sewer Loans) |
$11,033.71 |
Whitewater Neighborhood Street Improvements |
$11,033.71 |
|
Total |
|
|
|
$305,989.35 |
ATTACHMENTS:
Substantial Amendment to FY 2014 and 2015 Action Plans