ACTION REQUESTED:
Title
Communication from the City Manager and the Finance Director/Comptroller and Community Development Director with a Request to ADOPT an ORDINANCE Amending the City of Peoria BUDGET for Fiscal Year 2015 Relating to the 2015 CDBG, HOME and ESG BUDGETS to Reflect the Actual 2015 Allocation from the United States Department of Housing and Urban Development (HUD) and the Reallocation of Remaining Funds from Completed Projects and the Allocation of Program Income.
Body
BACKGROUND:
The City of Peoria is considered an entitlement jurisdiction by the United States Department of Housing and Urban Development (HUD). As such, funds from the Federal government, through HUD, are allocated to the City on an annual basis by the use of a formula. Unlike many grants, there is no competitive application for these funds. Each entitlement jurisdiction receives a set amount based upon Congressional funding and adjustments to the allocation formula. The City receives grant funds from the following grants - Community Development Block Grant (CDBG), HOME Investment Partnership Grant (HOME) and the Emergency Solutions Grant (ESG).
The amount of funding received by the City has steadily declined over the past decade (Attachment 1 - Historic HUD Funding Levels) from a high of almost $3.8 million in 2001 to the current level of slightly more than $2 million. This continued decline in funding has created significant pressure on programming and services that historically been funded with the annual HUD allocation.
Although the City’s HUD program year begins on January 1, the award notice of funding levels and subsequent grant agreements from HUD are generally not received until spring. This year, grant agreements were received in July 2015 - 6 months after the start of the City’s HUD program year. As such, the program budget approved by the city Council as part of the City’s 2014/2015 Biennial Budget must be amended to reflect the actual funding level. Further, as is usually the case, there are balances available from prior year projects that were not fully expended that need to be re-allocated to active projects. Additionally, with the implementation of HUD’s new Grant Based Accounting requirements staff has thoroughly audited all previous years’ unallocated funds and will reallocate to current projects. Finally, CDBG and HOME formula grants created program income by investing these funds into projects that generate repayment back to the City. As such, the receipt and uses of the program income funds needs to be allocated to eligible activities.
Requested Action #1 (programming with 2015 HUD funds)
The first action requested is to approve the program line-up as indicated on Attachment 2 - 2015 HUD Entitlement Budget. This document lists the recommended programs that will be provided using new funds from HUD. These programs and activities were approved by City Council as part of the 2015 HUD Annual Action Plan (March 24, 2015; council item # 15-086).
Requested Action #2 (re-allocation of prior year funds)
With the implementation of HUD’s new Grant Based Accounting requirements staff has thoroughly audited all previous years unallocated funds and will reallocate to current projects. The second action requested is to re-allocate funds from projects that have closed to current/existing projects as listed below:
CDBG Unused Funds Re-Allocation
|
Project # |
Control Account Description |
Unused Funds |
|
06XM00 |
2006 Christmas in April |
$2.54 |
|
07SP00 |
Systems Repair Program |
$1.88 |
|
08AR00 |
2008 Adopt-a-Ramp |
$1.03 |
|
08NN00 |
2008 Neighborhood Newsletters |
$2.87 |
|
08PS00 |
2008 Public Service Set Aside |
$1.79 |
|
08SP00 |
2008 Systems Repair Program |
$0.25 |
|
08XM00 |
2008 Christmas in April |
$0.29 |
|
09PS00 |
2009 Public Service Set Aside |
$1.22 |
|
14PS00 |
2014 Public Service Set Aside |
$4,515.54 |
|
SPASCD |
Special Assessment CDBG |
$0.38 |
|
02CD00 |
2002 CDBG Control Project |
$0.40 |
|
03CD00 |
2003 CDBG Control Project |
$1.00 |
|
04CD00 |
2004 CDBG Control Project |
$0.64 |
|
05CD00 |
2005 CDBG Control Project |
$0.45 |
|
06CD00 |
2006 CDBG Control Project |
$3.50 |
|
08CD00 |
2008 CDBG Control Project |
$0.48 |
|
09CD00 |
2009 CDBG Control Project |
$0.79 |
|
10CD00 |
2010 CDBG Control Project |
$0.30 |
|
11CD00 |
2011 CDBG Control Project |
$1.76 |
|
12CD00 |
2012 CDBG Control Project |
$24,240.22 |
|
14CD00 |
2014 CDBG Control Project |
$117,115.91 |
|
TOTAL AMOUNT TO BE RE-ALLOCATED |
$145,893.24 |
• Re-allocate $28,777.33 to City’s Emergency Repair Program (Project - 13E00)
o Total available program funding amount = $47,589.49
• Re-allocate $117,115.91 to City’s Demolition Program (Project - DEMOCD)
o Total available program funding amount = $532,705.51
HOME Unused Funds Re-Allocation
|
Project # |
Control Account Description |
Unused Funds |
|
08WD00 |
2008 Warehouse District |
$2.25 |
|
09WD00 |
Glen Oak Whole House Rehab |
$1.25 |
|
11HIZH |
Harrison Zone Improvements |
$0.35 |
|
04CHDO |
2004 CHDO (HOME) CONTROL |
$0.02 |
|
05CH00 |
CHDO Development Fund Project |
$0.93 |
|
05HM00 |
2005 HOME Control Project |
$0.08 |
|
06HM00 |
2006 HOME Control Project |
$0.51 |
|
07PC00 |
2007 PCCEO HILP Control Project |
$0.50 |
|
08HM00 |
2008 HOME Control Project |
$0.94 |
|
TOTAL AMOUNT TO BE RE-ALLOCATED |
$6.83 |
• Re-allocate $6.83 to City’s Focus Housing Leverage Program (Project - 14FAHL)
o Total available program funding amount = $15,473.18
Requested Action #3 (allocation of CDBG and HOME program income)
Federal regulations define CDBG program income as - Any income received in a single program year by the recipient and all its subrecipients if the total amount exceeds $25,000. Therefore, income received in a single program year that is less than $25,000 is not considered to be CDBG program income. When the total amount is less than $25,000 the City can decide to either receipt the funds received as CDBG program income in IDIS (the Federal Accounting System) or allocate the funds to a local account. Once funds are receipted as program income in IDIS, the regulations governing the CDBG program now apply to those funds. However, allocating the funds to a local account provides the City with funds that are less restrictive than Federal regulations, but are still required to be used for specific purposes.
The total income received by the City for program year 2014 ($16,843.26) did not exceed $25,000.
• Allocate $16,843.26 to Capital Fund. These funds are to be used for any of the following activities:
o Funds for match or program leveraging for future grants or Community Development programs
o Temporary Code Enforcement Aides
o Equipment purchases for Community Development Field Staff
Continuation of Existing Program
Staff is also recommending that the following programs that were already approved by Council continue into the future unchanged. The programs listed are provided for informational purposes and to complete the picture of all available programming that will not receive new funding allocations in 2015.
|
Program |
Funds Available |
Type of Grant Funds |
|
Emergency Repair Program |
$18,812.46 -Total does not include the requested reallocate of funds listed above in Action #2 |
CDBG |
|
Health Department - Lead Grant Match |
$50,000 |
CDBG |
|
Local Historic District Rehab Program |
$50,000 |
CDBG |
|
Economic Development Program |
$313,860 |
CDBG |
|
Focus Area Housing Leverage Program |
$43,951.76 |
CDBG |
|
PCCEO Down Payment Program |
$100,000 |
HOME |
|
City Down Payment Program |
$110,705.61 |
HOME |
|
Focus Area Housing Leverage Program |
$15,466.35 |
HOME |
FINANCIAL IMPACT: HUD grant funds will be adjusted to the actual 2015 allocation amounts from the United States Department of Housing and Urban Development (HUD).
NEIGHBORHOOD CONCERNS: Public hearings and public comment periods are held per grant requirements prior to each program year. Programs and funding recommendations align with the comments received.
IMPACT IF APPROVED: HUD grant funds will continue to be made available to the community through a variety of programs and services described in Attachment 2 and listed in the continuation of existing programs summary.
IMPACT IF DENIED: HUD grant funds will not be used for the purposes defined in Attachment 2.
ALTERNATIVES: There are numerous uses for HUD grant funds and the listing included in under Attachment 2 is not exhaustive in terms of regulatory uses allowed. Different programs and/or services could be brought back to Council for further discussion.
EEO CERTIFICATION NUMBER: N/A
WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL’S 2014 - 2029 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?
1. Financially Sound City Government, Effective City Organization
2. Attractive Neighborhoods with Character: Safe and Livable
3. Grow Peoria: Businesses, Jobs, and Population
WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?
1. Reinvest in neighborhoods.
2. Have an efficient government.
3. Grow employers and jobs.
DEPARTMENT: Finance