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02/21/2012 09 2012 Annual Action Plan Amendment; Report Related to Reduction of CDBG and HOME Program Funding BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 7 For Meeting of: February 21, 2012 _•! `:, V'� :' x.,i.,.: i ' .,r.. « 'S.. fir:., >: l4'. ?L i !�'_' .._, :v l"� ..rS ''rG Wi.iJ:_t - V12* ITEM TITLE: City Manager's report related to an Amendment to the 2012 Annual Action Plan concerning the budget reduction of CDBG and HOME program funding. SUBMITTED BY: Joan Davenport, Acting Director of Community and Economic Development (509) 576 -6417 CONTACT Archie M. Matthews, Neighborhood Development PERSON/TELEPHONE: Services Manager (509) 575 - 6101 SUMMARY EXPLANATION: The federal budget for 2012 reduced the expected CDBG entitlement amount by an estimated 17.3% and the expected HOME entitlement amount by an estimated 34.2 %. Bringing the estimated CDBG estimated amount to be received at approximately $887,581 and the estimated HOME amount to be received at approximately $393,000 in 2012. This reduced entitlement requires an Amendment to the City of Yakima 2012 Annual Action Plan CDBG and HOME entitlement amounts. Attached is a modified outline of the 2012 budget, reflecting potential changes to the program. Staff suggests that the reductions would be mostly spread across estimated CDBG programs therefore reducing programs equally as much as possible, there are still some significant reductions available to a few program lines that will allow for the least direct impact to low /moderate income individuals. The severe impact of the HOME entitlement reduction of 34.2 %, is compounded by the need to conclude the N. 3rd Street Affordable Housing project with the available 2012 HOME funds. This will likely severely impact some of the HOME homeownership programs for the program year of 2012. Two public hearings are required on these changes to the CDBG and HOME programs. Resolution Ordinance Other City Manager's (specify) Report Contract: Mail to: Contract Term: Amount: Expiration Date: Insurance Required? No Funding CDBG & HOME Phone: Source: APPROVED FOR SUBMITTAL: City Manager STAFF RECOMMENDATION: BOARD /COMMISSION RECOMMENDATION: ATTACHMENTS: Click to download ❑ Attachment - Annual Action Plan Budget Amendment 2012 Annual Action Plan_ J3uid et Amendments Due to the reduction in Fiscal Year 2012 allocations as received by the City of Yakima from the U S. Department of Housing and Urban Development (HUD), the City of Yakima Office of Neighborhood Development Services is proposing to amend the 2012 Annual Action Plan budget and programs as submitted to HUD The 2012 Annual Action Plan as adopted by the Yakima City Council estimated the allocations from HUD to be: • © Community Development Block Grant (CDBG) at $965,854 and actual is 5887.581 it HOME Investment at $537,347 and actual is S393 Due to the severe reduction, the Office of Neighborhood Development Services is proposing eliminating the Down Payment Assistance Program in order to complete the Neighborhood Stabilization Program as contracted with the State of Washington, concerning the North 3rd Street Affordable Housing Project The Down Payment Assistance Program is the only program currently proposed for elimination. The HOME funded "First Time Homeowner Program" will continue to assist first time homeowners as funding allows. The other programs are budgeted as shown on "2012 CDBG Estimated Expenditures" and the "2012 HOME "budget sheet (Please see the attached budget amendments) Written public comment will be received from January 30, 2012 through February 29, 2012, and should be directed to Archie M. Matthews, ONDS Manager 112 S. 8 Street Yakima, WA 98901 City of Yakima Office of Neighborhood Development Services 2012 CDBG ESTIMATED EXPENDITURES WITH S/B (Does NOT have Carry Forward Dollars) Program 2012 Total Program Delivery 2012 Estimated HUD Programs (CDBG) Expenses Expenses Admin Expenses I CDBG Single Family Rehabilitation 570.202 (b) } Senior / Disabled Rehabilitation 186,220 268,330 Total 186,220 268,330 454,550 II Community / Public Services 570.201 (e) Graffiti Abatement (approved by HUD 2007) 9,724 38,967 48,691 Fair Housing Counseling 507.201 (k) 5,000 47,279 52,279 Senior - Disabled Energy Assistance 5,000 5,000 OJC of WA 51,897 51,897 Total - 71,621 86,246 157,867 111 Public Facilities 570.201 (c) Southeast Community Cntr-I Miller Park Activity Cntr (or other public facilities in the neighborhood) Public Infrastructure 25,000 Total 25,000 25,000 IV Code Compliance 570.202 ( c ) (Program Delivery) 169,848 169,848 VI Administrative CDBG Costs 570.206 201,816 201,816 Grand Estimated Totals for Year 2009 282,841 524,424 201,816, 1,009,081 0 282,841 524,424 201,816 1,009,081 Entitlement Is estimated as Congress has not yet approved the national HUD Budget Program Income is estimated since the figure is unknown until the money is received Appropnate adjustment will be made, if needed, when HUD awards are received Carry forward will be encumbered when amount is known, in Spring, 201 2 1 ,009,081 Estimated 2012 CDBG Revenue 1,009,081 0 20% Admin 201,816 " Code Compliance consists of 2 FTE and 64% of Permit Tech- is currently under a program line but is still paid as a program delivery expense 1/24/2012 is Budget Prep 2009 DRAFT Guesstimate SS City of Yakima Office of Neighborhood Development Services 2012 HOME 2012 HOME ESTIMATED REVENUES 124 337 0000 33114.2HM HUD HOME Program 393,000 124 337 0000 33114.2HP HOME Program -Prior Year 2011 Carry Forward 124 337 0000 36140 HMI HOME Program Interest Income 12,000 124 337 0000 38500 HMP HOME Program Income 135,000 HOME Revenue Totals: 540,000 2012 HOME ESTIMATED EXPENDITURES — Program 2012 Total All activity is eligible under 92.205 (a) (1) Program Delivery 2012 Estimated HOME PROJECT CATEGORIES: Expenses Expenses Admin Expenses First -Time Homeowner Assistance (up to $30,000 each) 137,371 45,000 182,371 Down Payment Assistance (up to $4,000 each = 20 or more) 0 0 0 Single - Family Home Rehabilitation 0 Community Housing Development Organization 102,652 102,652 (CHDO: HUD requirement, minimum of 15% of 2012 HOME Entitlement plus Program Income) New Construction 178,260 22,717 200,977 0 Administrative HOME Costs 54,000 54,000 Grand Estimated Total Expenses for Year 2012 418,283 67,717 54,000 540,000 0 418,283 67,717 54,000 540,000 Entitlement is estimated as Congress has not yet approved the national HUD Budget. Program Income is estimated as the figure is unknown until the money is received. Appropriate adjustment will be made, if needed, when HUD awards are received. Carry forward will be encumbered when amount is known, in Spring, 2012 Estimated 2012 HOME EN and PI Revenue 540,000 10% Admin 54,000 1/24/2012 is Budget Prep.2009 Guesstimate