Title
Study session regarding amending the Community Development Block Grant Fiscal Year 2024-2025 Annual Action Plan. (Alvina Condon, Management Analyst II)
label
RECOMMENDATION
Recommendation
Staff recommends that the Community Development Block Grant Subcommittee of the City Council (CDBG Subcommittee) provide feedback regarding a proposed amendment to the City's Community Development Block Grant (CDBG) Program Fiscal Year 2024-25 (FY24-25) Annual Action Plan (AAP).
Body
BACKGROUND
The purpose of this session is to seek guidance from the CDBG Subcommittee on how spend down remaining funds in order to meet the U.S. Department of Housing and Urban Development (HUD) timely expenditure requirements for the City's CDBG Program. On June 8, 2024, the City received a letter from HUD stating the City is not carrying out its CDBG program in a timely manner and that continued noncompliance may result in sanctions, including the loss of funds and other corrective actions.
A grantee is considered to be in compliance with timely expenditure rules if, 60 days prior to the end of its program year, the balance in the grantee's line of credit, plus the balance of program income on hand, is not more than 1.5 times the most recent entitlement grant. When this 60-day test was conducted by HUD on May 2, 2024, it was calculated that South San Francisco had an adjusted line of credit balance of 2.25 times its annual entitlement grant. This was not a surprise to staff - it was anticipated that the City would fail to meet timely expenditure requirements due to the failure to complete a public improvement project in FY 23-24, the withdrawal of one of the City's minor home repair grantees from the Program, and delays in getting public service grantee contracts executed and funds flowing early in the fiscal year.
Currently, the City is holding $466,345 in Public Facility Improvement funds, $275,000 for minor home repairs, and $76,579.21 in repaid loans, for a total of $817,924....
Click here for full text