CDBG Entitlement Status Discussion September 13, 2011 City Council Workshop

 Received letter from Department of Housing and Urban Development providing City with option to pursue CDBG Entitlement Status  City must respond in writing no later than September 16  Must decide whether to: 1)Pursue CDBG Entitlement Status, or 2)Continue under Small Cities CDBG Program Background

 Federal Program that started in 1974 in order to provide funding for housing and community development.  The National Objectives of the Program are to: 1)Benefit low- and moderate-income persons (LMI) 2)Prevent or eliminate slum or blight 3)Address urgent community development needs (Emergency)  The program, administered and funded by the Department of Housing and Urban Development, consists of two components: 1)Entitlement - provides funds directly to urban areas 2)Small Cities - provides funds to the states for distribution to rural areas CDBG Program in General

 FFY Million Grants)  Currently undergoing review by Governor for FFY2012  Competitive Program (246 Eligible Communities)  $750,000 Maximum Grant Award  Two Categories: Regular and Economic Development  The City currently has $750,000 grant in Regular Category for Owner-Occupied Housing Rehabilitation Program Small Cities CDBG Program

 Annual Application Cycle  City Eligible Every 3 Years for Grant Award  Three Areas in Regular Category  Neighborhood Revitalization  Primarily Infrastructure Funding  Area Benefiting Must Be LMI  Not really an area that Qualifies for LMI  Commercial Revitalization  City Not Eligible (51% of Entire City Must be LMI)  Housing Rehabilitation  Current Owner-Occupied Housing Rehabilitation Grant  Housing Beneficiary Must Be LMI Small Cities CDBG Program Regular Category

 Open Application Cycle, Up to 2 Open ED Grants  Infrastructure, Grants/Loans to Businesses  Must Create at Least 22 Jobs, 51% Must be Offered to LMI  What if Business Doesn’t Create Jobs? Grant Paid Back! Small Cities CDBG Program Economic Development Category

 Based on FFY2011, Annual City Allocation may be $330,100  Funding for FFY2012 and Future is Uncertain  Local Decision on Programs & Projects to Fund  Must meet National Objectives  Area Must Qualify (51% Must be LMI)  Very Difficult to Demonstrate in Palm Coast  Beneficiary Must Qualify (Must be LMI) CDBG Entitlement Program

Example Project/Programs that Beneficiary Must be LMI  Housing Related Activities  Acquisition  Construction  Rehabilitation  Public Services (Limited to 15% of Grant)  Senior Services  Handicapped Services  Legal Services  Youth Services  Transportation Services  Economic Development  Infrastructure Development  Direct Financial Assistance to For-Profits  Technical Assistance  Microenterprise Assistance CDBG Entitlement Program

 If Entitlement Status is Pursued, Following Must Be Completed  Analysis of Impediments  Consolidation Action Plan  Annual Action Plan  Staff would recommend existing program/projects that would meet National Objectives for CDBG funding  Business Assistance Center Activities  Afterschool and Summer Recreation Programs  Current Owner-Occupied Housing Rehabilitation Program CDBG Entitlement Program

Small Cities (Existing)Entitlement TypeCompetitiveNon-Competitive Legislative ClimateUncertain Grant Amount$750,000 (3 yrs. (3 yrs. $1M) Grant AdministrationLess More (Up to 20% Allowance) Project/Program Funding Possibilities InfrastructureNo Economic DevelopmentLimitedYes Housing RehabilitationYes Public ServicesNoLimited Policy Discussion (Choice, Not Both)