MEETING DATE:
MARCH 26, 2024
SUBJECT:
Title
PROPOSED USES OF COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS FOR 2024-2025 ANNUAL ACTION PLAN
Body
Recommendation
Recommendation
OPEN, CONDUCT, AND CLOSE a public hearing on the proposed uses of Federal Community Development Block Grant Funds for the 2024-2025 Annual Action Plan.
Body
Board or Commission Action
Not Applicable
Relevant Council Strategic Theme
Quality of Life
Executive Summary
The U.S. Department of Housing and Urban Development (HUD) annually provides funding to eligible jurisdictions through the federal Community Development Block Grant (CDBG) entitlement program. Funds must be used for eligible projects and programs that benefit low- and moderate-income individuals and households in the City of San Marcos that are consistent with the City’s approved 2020-2024 Consolidated Plan (ConPlan), Resolution No. 2020-8759.
To receive funding and implement the goals and priorities of the 2020-2024 Consolidated Plan, the city must prepare and adopt an Annual Action Plan (AAP), outlining the use of CDBG resources for the fiscal year, that align with the city’s spending plan and projects identified in the five-year goals of the Consolidated Plan. CDBG funds are used primarily to support Public Services, Affirmatively Furthering Fair Housing, and Public Facility/Capital Improvement/Other Housing Related Projects.
HUD requires the city to conduct a public hearing to review and receive comment on the proposed 2024-2025 Annual Action Plan and open a 30-day public comment period. A second meeting to consider and adopt the 2024-2025 Annual Action Plan is scheduled for the City Council meeting on April 23, 2024.
Discussion
The purpose of the 2024-2025 AAP is to identify the actions, activities, and resources that will be used to address the current community needs and the goals identified in the Consolidated Plan. The authorizing statute of the CDBG program requires that each activity funded in the AAP, except for program administration and planning activities, must meet one of three national objectives which are:
• Benefit to low- and moderate- income (LMI) persons;
• Aid in the prevention or elimination of slums or blight; and
• Meet a need having a particular urgency (referred to as urgent need).
The LMI national objective is often referred to as the “primary” national objective because the statute requires that recipients expend 70 percent of their CDBG funds to benefit LMI persons. Low- and moderate-income is defined by HUD as an annual household income that is equal to or less than 80% of the County’s Area Median Income (AMI).
In the development of the 2024-2025 AAP, a Community Needs Survey was published in English and Spanish to collect input from San Marcos residents, business owners/employees serving San Marcos, and representatives from agencies serving San Marcos residents. The survey was published online and sent directly to community stakeholders, public service providers, and printed for completion at local outreach events. The survey yielded 289 responses ranking the highest needs as follows: community services and community facilities, followed by affordable housing and then economic development. Other notable citywide responses, not directly tied to LMI communities, included transportation/public transit, public safety, traffic mitigation and road/street maintenance.
Following the needs assessment, staff published an online application for public service providers and received thirteen (13) project applications for consideration in the 2024-2025 AAP. Combined, the total amount requested from all 13 providers is significantly higher than the funds available for public services. Staff utilized a scoring evaluation matrix developed with HUD-required threshold criteria, a quantitative ranking metric, and incorporated the results of the Community Needs Assessment to determine funding recommendations.
Proposed Annual Action Plan 2024-2025
Staff proposes projects and funding recommendations using the prior year allocation amount, $710,208, as HUD has not yet announced the 2024-2025 allocations. Additional prior year funds totaling $1,245,279 have been reserved to complete Richmar Park Phase 2 in FY 2024-2025. The 2024-2025 Draft AAP with funding and program details is included as Attachment 1. The 2024-2025 AAP proposes utilizing funds in the following categories:
|
Project |
Funding Category |
Activity |
|
Program Administration Max 20% of allocation |
Planning and Administration |
Staffing, management, accounting, fiscal oversight, contractors |
|
Nonprofit Coordination Max 15% of allocation |
Public Services |
Community service providers assisting low-mod income community, includes mandated Affirmatively Furthering Fair Housing services |
|
Community Facilities |
Public Facility and Capital Improvement |
Capital Improvement Project at the Senior Activity Center |
The draft 2024-2025 AAP is available on the city’s website and at City Hall for a 30-day public review and comment period. After incorporating public comments, the 2024-2025 AAP will be presented to the City Council at a second public hearing scheduled for April 23, 2024, for final approval and adoption. Once approved, the 2024-2025 AAP will be submitted to the Federal Department of Housing and Urban Development (HUD) for review. Upon approval by HUD, the funds will become available, through a reimbursable grant, beginning July 1, 2024. Public comment should be sent via email to neighborhoodservices@san-marcos.net <mailto:neighborhoodservices@san-marcos.net> for inclusion in the draft 2024-2025 AAP.
Environmental Review
There is no environmental review associated with the AAP approval process.
Fiscal Impact
The City’s estimated FY 2024-2025 CDBG allocation of $710,208 will be budgeted in CDBG Fund 207 and the CIP budget. Upon approval by HUD, the funds will become available, through a reimbursable grant, after July 1, 2024. The city will not be eligible to receive the CDBG grant funds if an AAP is not submitted to HUD.
Attachment(s)
1. Proposed 2024-2025 Annual Action Plan
Prepared by: Quinton Hufferd, Management Analyst
Submitted by: Sylvia Solis Daniels, Housing & Neighborhood Services Manager
Reviewed by: Tess Sangster, Community and Economic Development Director
Approved by: Michelle Bender, City Manager