Title
Public Hearing on the Community Development Block Grant Program Five-Year Consolidated Plan Update (2023-2027) and Program Year 2023 Annual Action Plan
Recommended Action
Committee Recommendation:
At the April 26, 2023 Community Livability and Public Safety Committee, the Committee recommended to forward to the full City Council for approval staff recommendations for allocation of new Community Development Block Grant Funds for Program Year 2023.
City Manager Recommendation:
Hold a public hearing on the on the Community Development Block Grant Program Five-Year Consolidated Plan Update (2023-2027) and Program Year 2023 Annual Action Plan.
Report
Issue:
Whether to hold a public hearing on the on the Community Development Block Grant Program Five-Year Consolidated Plan Update (2023-2027) and Program Year 2023 Annual Action Plan.
Staff Contact:
Anastasia Everett, CDBG Program Specialist, 360.753.8277
Presenter(s):
Anastasia Everett, CDBG Program Specialist
Background and Analysis:
Every five years, communities who receive entitlement grants from U.S. Department of Housing and Urban Development (HUD) are required to prepare a five-year strategic plan called the “Consolidated Plan”. Olympia receives Community Development Block Grant (CDBG) and HOME Investment Partnership funds through an agreement with Thurston County, requiring a Consolidated Plan submission by July 2023.
The goal of the Consolidated Plan is to identify how funds will be targeted in an effort to develop viable urban communities by providing decent housing, suitable living environments, and expanding economic opportunities, principally for low- and moderate-income persons. The five-year consolidated plan lays the blueprint for each year’s Annual Action Plan (AAP) priorities.
Public hearings are required by HUD at two different stages of the program year for the Consolidated Plan. This hearing is an opportunity for the public to review and comment on the draft Consolidated Plan and the draft Program Year 2023 AAP.
The public comment period will remain open until July 5, 2023. Following the public hearing, City Council consideration of approval is scheduled for the Tuesday, July 11 regular City Council meeting. The Consolidated Plan and AAP will be submitted to HUD no later than July 15, 2023.
Joint Consolidated Planning Process with Thurston County: HUD requires that the City and the County work together to develop a joint Five-Year Consolidated Plan. The City and the County contracted with Mud Bay Consulting Services to scope the joint plan, to gather needs data and to assist in the development of priority strategies. The consultant has prepared a draft 5-year Consolidated Plan.
The Consolidated Plan goals are, in order of priority need:
1. Increase Affordable Housing
2. Preserve and Improve Existing Affordable Housing
3. Provide Services and Assistance to Improve Housing and Economic Outcomes
4. Provide Public Facilities and Infrastructure Improvements
2023 Action Plan Process
City Staff began the Annual Action Plan process in March by launching an RFP for eligible projects. Following the selection of projects, staff presented to the Olympia Planning Commission on April 17th. Staff presented to the Community Livability and Public Safety Committee on April 26th. At the April 26th, 2023 CLPS meeting, City staff proposed $60,000 of Program Year 2023 CDBG funding for the City’s Downtown Ambassador Program, a program CDBG has funded for the past ten years. The Downtown Ambassadors provide downtown residents and businesses with resources and outreach materials to promote Downtown safety. In 2023, the City and the County worked together to create an updated 5-year Consolidated Plan, which addresses the region’s needs and sets goals for the CDBG program. Housing related activities have been identified as the greatest priority need in our community. To better align with the CDBG program’s goals and Consolidated Plan priority needs, staff recommend changing the public service funding allocation to the Community Court Program. With additional funding, the Community Court Program can provide a more robust offering to help support the restorative justice process for our community's most underrepresented and marginalized populations. The updated proposed funding for Program Year 2023 is:
1. Rebuilding Together Thurston County - $75,000
a. Critical Home Repair
2. South Puget Sound Habitat for Humanity - $77,500
a. Critical Home Repair
3. Enterprise for Equity - $77,500
a. Microenterprise Assistance
4. Community Court - $60,000
a. Restorative Justice Program - Public Service
5. Homes First - $60,000
a. Electrification - Affordable Housing Preservation
6. Program and Administrative Costs (PAC) - $72,353
a. Staff costs for maintaining a compliant CDBG program
Staff propose a contingency project to be included in the Annual Action Plan. A contingency project is included to reduce administrative requirements in the event of program income being received, or a project cancellation. Program income is received by repayment of past CDBG rehabilitation loans and often is received in large lump sums when a loan holder decides to pay off an outstanding balance. These payments are unpredictable and cause staff to respond quickly in order to find a project that is fitting and an allowable expense. By including a contingency project, staff will be able to execute a CDBG contract in a timely manner that is already in the queue and included in future Annual Action Plans.
The proposed contingency project for PY23 is housing rehabilitation for low- and moderate-income persons. Housing rehabilitation includes but is not limited to critical home repair, energy efficiency improvements and accessibility improvements.
Process and Timeline
The process includes three primary parts:
1. Public and stakeholder input,
2. Drafting the Consolidated Plan and Annual Action Plan,
3. Action to approve the Consolidated Plan and the 2023 Action Plan and submitting to HUD for approval by July 15.
Following the public comment period and public hearing, staff will recommend approval of the draft Consolidated Plan and Draft 2023 AAP at the July 11, 2023, regular business meeting of the City Council.
Climate Analysis:
CDBG is a flexible grant that can be used to support the City’s climate goals. In 1980, the U.S. Congress gave the CDBG program a mandate to support energy efficiency and renewable energy technologies in property rehabilitation.
Typical energy efficiency activities funded by CDBG include design features to public facilities improvements promoting energy efficiency. Activities may also include public energy conservation services, assistance to neighborhood-based organizations undertaking energy conservation projects, and the development of energy use strategies to achieve maximum energy efficiency.
The City of Olympia has invested a significant amount of CDBG funding into energy efficiency projects in the 2021 and 2022 program years. Examples of prior projects include solar installation, home weatherization and home electrification for low- to moderate-income households.
CDBG staff have worked collaboratively with the Climate program to provide fully subsidized heat pump installations for low- and moderate-income households through the Energize Olympia campaign. Staff will continue to explore collaborative opportunities between the programs.
Equity Analysis:
Outreach for the needs assessment and market analysis began before implementation of the City’s required Equity Analysis for staff reports. Key improvements that could be made to future processes include trans-inclusive gender identity data collection and disability data. CDBG funds must primarily benefit 80% or under Area Median Income (AMI) persons. There are statistically major disparities in income that tie to marginalized groups in our community. In the City of Olympia, the total population determined to be below the poverty line is 7,489 individuals out of our total population of 51,076. Poverty is more prevalent in some races and ethnicities in Thurston County. 15.5% of Black or African American residents are below the poverty level, compared to 9.1% white residents.
CDBG funding can be used in a variety of activities to improve accessibility for residents with disabilities in our community. Eligible activities include reconstruction of sidewalks to install ramps and rehabilitation of homes or public facilities to include the removal of architectural barriers to accessibility. Examples of projects funded in program years 2021 and 2022 include critical home repair by our subrecipient, Rebuilding Together Thurston County. Critical home repair projects funded include installation of handrails, wheelchair ramps and safety equipment in the home. The City’s CDBG is also funding the installation of an accessible elevator in the Behavioral Health Youth Facility owned by Community Youth Services.
CDBG funds can also be used to provide energy efficiency upgrades to low- and moderate-income persons in the community, which for many years have been inaccessible to many families as the cost of energy improvements can be significantly higher than what is affordable. This use of funds helps close the disparity in who can benefit from high efficiency heat pumps or solar installation. Energy efficiency upgrades also often lower the cost of electricity for the homeowner or tenant, which reduces the utility burden on households.
Neighborhood/Community Interests (if known):
CDBG funding is used to support Olympia residents at or below 80% AMI. CDBG funding priorities align with the 5-year HUD Consolidated Plan, and more specific goals are targeted annually in the AAP. Supporting low-moderate income Olympia residents is a high priority for the community, and CDBG funded projects help meet many of the City’s goals outlined in the One Community Plan. CDBG funding can benefit low-moderate income residents on an area basis (such as neighborhood improvements), limited clientele basis, or provide housing and jobs benefits.
Financial Impact:
The City of Olympia receives between $350,000 and $400,000 annually from HUD as a formula allocation. The Five-Year Consolidated Plan funding forecast for 2023-2027 is $1,900,000. The City also receives Program Income annually, averaging between $50,000 and $200,000. This public hearing is for residents to comment on the initial needs assessment and market analysis, which will inform the drafting of the upcoming Consolidated Plan Update for 2023-2027.
Options:
1. Hold a public hearing on the Five-Year Consolidated Plan Update and 2023 AAP process.
2. Delay the public hearing on the Five-Year Consolidated Plan Update and 2023 AAP process and risk non-compliance resulting from a late submission to HUD. Provide staff direction on next steps.
3. Take another action.
Attachments:
Thurston - Olympia 2023-2027 Consolidated Plan
Olympia 2023 Annual Action Plan
Consolidated Plan Appendices