Report Prepared by: Kimberly Nutt, Housing Program Specialist, Development Services Department/Housing Division
Title
SUBJECT: Provide Staff Direction on Project Funding Proposals Received for Program Year 2019-2020 HUD Annual Action Plan Coronavirus Aid, Relief, and Economic Security (CARES) Act Community Development Block Grant Coronavirus (CDBG-CV) Funding; and Authorize Staff to Begin Negotiating Contracts for Services
REPORT IN BRIEF
Considers project applications for the prevention, preparation, and response to the COVID-19 Coronavirus that were submitted by community non-profit organizations for use of the additional HUD CDBG-CV funds amended into the Program Year 2019-2020 Annual Action Plan; and requests direction from the City Council on which proposals to approve and fund. Also considers an expedited contractual approval process to allow services to be implemented as quickly as possible, pending HUD approval and required environmental clearances.
RECOMMENDATION
City Council - Adopt a motion:
A. Identifying and Approving submitted funding request applications for CDBG-CV and CDBG project funding for the Prevention of, Preparation for, and Response to the COVID-19 Coronavirus; and,
B. Allocating new CDBG-CV and reallocated CDBG funding sources to the projects approved in A above, pursuant to the Amended Program Year 2019-2020 Annual Action Plan; and,
C. Directing staff to negotiate contracts for service, pursuant to the applications and funding source allocations approved and allocated in A and B above; and,
D. Authorizing the City Manager or the Assistant City Manager to execute all associated documents and contractual agreements for services to allow for an expedited approval process, pursuant to HUD and City Attorney approval; and,
E. Requesting staff return to the City Council with Information Only contracts as they are executed and implemented; and,
F. Authorizing the Finance Officer to make any necessary budget adjustments.
Body
ALTERNATIVES
1. Approve, as recommended by staff; or,
2. Approve, subject to conditions as specified by the City Council; or,
3. Deny the request; or,
4. Refer back to staff for reconsideration of specific items as requested by the Council; or,
5. Defer action to a future meeting (date and time to be specified in the motion).
AUTHORITY
Charter of the City of Merced, Section 200.
CITY COUNCIL PRIORITIES
As provided for in the 2019-20 Adopted Budget and 2015-2020 Consolidated Plan/Strategic Plan, and Program Year 2019 Amended Annual Action Plan.
DISCUSSION
Past Actions
On April 2, 2020, the City of Merced received notice from HUD of a special allocation of Community Development Block Grant Coronavirus (CDBG-CV) grant funds in the amount of $661,246, which was made available by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), that was signed into Public Law on March 27, 2020. These funds are to be used specifically to prevent, prepare for, and respond to the immediate need and growing effects of the COVID-19 Coronavirus.
CDBG-CV grant funds are still be subject to the same oversight, monitoring, reporting, and other requirements as regular CDBG funds and programs are, but are not subject to the normal 15% public services cap. In addition, many of the same project activities as CDBG are listed as eligible activities for CDBG-CV funding, but must be coronavirus-related. Regular CDBG funds can also be redirected to this effort, and if used towards Coronavirus relief, also receive the 15% cap removal, as long as the same activity is not funded by other HUD funds through another program or agency.
At the last City Council meeting on May 18, 2020, the Council approved substantial amendments to the 2015-2020 Consolidated Plan and the Program Year 2019-2020 Annual Action Plan to add new CDBG-CV funding sources and goals, objectives, and activities to the respective plans.
To recap further, Council appropriated the following funding sources, amounts, and activities at the last meeting:
• CDBG-CV funds: $500,000 for Economic Development Activities (for business loan program)
• CDBG-CV funds: $100,000 for Public Service Subsistence Payments (for rental/mortgage and utility assistance programs)
• CDBG-CV and a portion of 2019 CDBG funds: $100,000 for Public Service Food Bank activities that assist with operating costs of food banks/food delivery programs.
• 2019 CDBG funds: a total of $86,485 was reallocated to Public Services, and is available to appropriate to specific projects.
Community Need and Appropriation CDBG-CV and CDBG funds
Through public comments gathered from the City Council meeting of April 20, 2020, when a COVID-19 Recovery Plan concept was introduced, as well as through emails and calls to City staff from local organizations and advocacy groups over the past weeks, three immediate needs have emerged within our community: 1) a need for small businesses to keep solvent and keep their staff employed; 2) a need to keep residents in their current housing units, with electricity and gas utilities, to avoid homelessness due to loss of income and inability to pay rent or mortgages; and, 3) a need to provide food to the increasing number of families and individuals who have lost income due to stay-at-home and business closure orders of the State and County Health officials.
To respond to those needs, on May 4, 2020, Council approved a COVID-19 Recovery Plan, that directs staff to focus CDBG-CV and CDBG funding activities on: 1) a small business loan program aimed at retaining and rehiring former employees; 2) rental and utility assistance program; and, 3) operating cost assistance to food banks that would go toward helping to feed families in need. Council directed staff to seek out vendors and community partners who could assist the City with setting up these programs.
On April 16, 2020, before the last Council meeting and in anticipation of this process, the Housing Division published a Notice of Funding Availability (NOFA) in the Merced Sun-Star and Merced County Times local newspapers, advertising the funding opportunity and call for proposals to help prevent, prepare for, and respond to the coronavirus. Following the May 4 meeting, an application was posted on the Housing Division’s webpage with a submittal deadline of May 22, 2020, that requested that projects be focused on the above-discussed needs and activities.
At the time Council approved the Consolidated and Annual Plan amendments on May 18, 2020, as discussed above, Council also requested that staff return with the results of the Request for Proposals to allow for the consideration of any additional 2019-2020 CDBG funding.
Accordingly, the following proposals have been received:
|
Applicant |
Services |
Amount |
|
Merced County Food Bank |
Food Bank Assistance |
$100,000 |
|
Sierra Saving Grace |
Rental/Mortgage & Utility Assistance |
$100,000 |
|
Salvation Army |
Rental/Mortgage & Utility Assistance |
$100,000 |
|
United Way |
Rental/Mortgage & Utility Assistance |
$100,000 |
|
United Way |
Workplace Stabilization Program |
$500,000 |
|
Kingsview Behavior Health |
Garden for Work Experience/Social Distancing - Atwater |
$10,000 |
Staff is seeking direction on how to proceed with contract negotiations related to the proposals received. In an effort to expedite the allocation of CDBG-CV funding, staff is also requesting that the Council provide the City Manager or Assistant City Manager the authority to execute the service agreements, pursuant to HUD and City Attorney approval, as well as environmental clearances. The approved agreements will be brought back to the City Council for adoption as “Information Only” agreements as they are executed and implemented.
IMPACT ON CITY RESOURCES
Due to this new allocation of HUD CDBG-CV funding, the City’s total HUD CDBG entitlement grant funds will increase by the allocation amount of $661,246, and there is no anticipated impact to the City’s General Fund. Funding for the new $661,246 CDBG-CV allocation and existing CDBG funds will be from Fund 018.
ATTACHMENTS
None.