ACTION REQUESTED:
Title
Communication from the City Manager and the Finance Director/Comptroller and the Community Development Director with a Request to ADOPT an ORDINANCE Amending the City of Peoria 2016/2017 BIENNIAL BUDGET Relating to the CDBG, HOME and CAPITAL BUDGET for FISCAL YEAR 2016 to Reflect the Actual 2016 Allocation From the United States Department of Housing and Urban Development (HUD) and the Transfer of CDBG Program Income to the Capital Fund.
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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.
On March 22, City Council Approved the Budget for CDBG, HOME, and ESG (Item # 16-088). On June 2, HUD announced a slight increase of $2,738 to the City’s 2016 HOME allocation and this was reflected in the funding the City received on August 15. This additional funding must be allocated to a 2016 HOME project.
In addition, CDBG formula grants create program income through projects that generate repayments to the City. These program income funds need to be moved to local accounts and allocated to eligible activities.
Requested Action #1 (Amendment for 2016 HOME funds)
The first action requested is to approve the additional $2,738 in HOME funds for the CHDO project for a total of $302,738 for this project as reflected in Attachment 1 - 2016 HUD Entitlement Budget. The rest of the budget remains the same as what was approved on March 22.
Requested Action #2 (allocation of CDBG 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. 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 2015 ($5,614.98) did not exceed $25,000.
• Allocate $5,614.98 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
FINANCIAL IMPACT: HUD HOME grant funds will be adjusted to the actual 2016 allocation amounts from the United States Department of Housing and Urban Development (HUD) and CDBG program income will be reallocated to local accounts.
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 1.
IMPACT IF DENIED: Additional HOME grant funds will not be used for the purposes defined in Attachment 1 and CDBG program income will not be reallocated.
ALTERNATIVES: These additional funds could be allocated to the other HOME program for 2016 - Focus Housing Leverage Program. CDBG program income could be receipted and used for more restrictive HUD approved activities.
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