DEPARTMENT: Neighborhood and Housing Services
DEPARTMENT HEAD: Verónica R. Soto, FAICP, Director
COUNCIL DISTRICTS IMPACTED: City-Wide
SUBJECT:
Substantial Amendment #3 to the FY 2020 HUD Action Plan and Budget (CDBG-CV, CDBG, HOME and HOPWA)
SUMMARY:
Ordinance authorizing Substantial Amendment #3 to the FY 2020 HUD Action Plan and Budget in response to COVID-19 to reprogram FY 2020 Community Development Block Grant (CDBG) and HOME Investment Partnerships Program (HOME) funds and to program CARES Act funding for the Community Development Block Grant (CDBG-CV) and Housing Opportunities for Person with AIDS (HOPWA) programs. The Ordinance programs: (1) CDBG and CDBG-CV Funds in an amount not to exceed $12,716,783 to the COVID-19 Emergency Housing Assistance Program; (2) HOME Investment Partnerships Program (HOME) funding to the following eligible activities: (a) up to $1,319,000 to the NRP Group for Alazan Lofts; (b) up to $650,000 to Atlantic Pacific Companies for Legacy at Piedmont; and (c) up to $1,537,840 for the Owner Occupied Rehabilitation/Reconstruction Program; and (3) HOPWA in an amount not to exceed $297,456. This ordinance also amends the Citizen Participation Plan outlined in the City’s FY 2016-2020 Consolidated Plan to include expedited public notice procedures and authorize virtual public hearings.
BACKGROUND INFORMATION:
On August 8, 2019, City Council approved the $23.6 million FY 2020 Action Plan and Budget (Action Plan) for the four federal grant programs funded by the U.S. Department of Housing and Urban Development (HUD). On April 2, 2020 the City of San Antonio (the City) received award letters for $7,707,015 in CDBG-CV and $297,456 in HOPWA funding authorized by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
As a federal entitlement municipality, adjusting the adopted action plan budget by 10% or more, requires a substantial amendment process that includes a public notice, a 30-day public comment period and a public hearing prior to any City Council action. However, the CARES Act reduced the public comment period to not less than 5 days and allows for virtual public hearings when necessary for public health reasons and is applicable for current year funding, CARES Act funding, and next year’s entitlement funding. Staff has notified HUD of the City’s intent to amend the Citizen Participation Plan to reflect these changes. Staff issued a public notice in the San Antonio Express News in both English and Spanish on April 17, 2020 initiating the public comment period which will run through April 22, 2020. A virtual public hearing will be held on April 22, 2020 at 2 pm.
ISSUE:
In an effort to assist vulnerable populations at risk of homelessness during COVID-19, staff recommends approval $12,716,783 in CDBG and CDBG-CV funding for the COVID-19 Emergency Housing Assistance Program with $7,707,015 from CARES Act (CDBG-CV) and $5,009,768 that has been redirected from existing FY2020 CDBG awards, canceled activities and program income. It should be noted that CARES Act funding will not be deployed until the City receives this funding from HUD.
COVID-19 Emergency Housing Assistance is delivered by the Neighborhood and Housing Services Department. CDBG-CV and CDBG funding will be utilized to assist households whose incomes are at or below 80% Area Median Income for the general purpose of preventing homelessness. CDBG-CV and CDBG funding will be utilized for one-time emergency rent or mortgage payments for three months to households. An estimated 3,250 households will be served with maximum assistance of up to $3,000 per household. The administrative costs are 15% of the allocation. Staff is currently working to ensure an equitable approach to programmatic implementation. Requests for rental and mortgage assistance increased from 57 per week to over 5,300 per week. In response, staffing increased from 8 to 41 for the program. NHSD also procured software process the applications more quickly and streamlined the application process.
The City also identified HOME funding in the amount of $3,506,840 that has been redirected from existing FY2020 HOME awards, canceled activities and program income for the following activities previously funded with CDBG:
Alazan Lofts | NRP Group | Council District 5
An $18 million, 88-unit rental housing development, called Alazan Lofts, located on El Paso St. and S. Colorado St., in Council District 5. Staff proposes awarding $1,319,000 in HOME funding as gap financing. This development will consist of 72 units restricted to households at 60% or below of area median income (AMI), 8 units restricted to households at 30% or below of AMI and 8 will be unrestricted.
Legacy at Piedmont | Atlantic Pacific Company | Council District 3
An $14.6 million, 49-unit rental housing development, called Legacy at Piedmont, located at 826 E. Highland Blvd., in Council District 3. Staff proposes awarding $650,000 in HOME funding as gap financing. This development will consist of 39 units restricted to households at 60% or below of AMI and 10 units restricted to households at 30% or below of AMI.
Owner Occupied Rehabilitation and Reconstruction Program | NHSD | City-wide
The City will utilize $1,537,840 of HOME funds to assist approximately 14 low to moderate income homeowners in need of rehabilitating or reconstructing their homes. Funds available may assist with all aspects of rehabilitation and construction including weatherization, lead based paint abatement, and clearance activities.
These actions are necessary to fund the COVID 19 Emergency Housing Assistance Program. The total budget for the COVID 19 Emergency Housing Assistance Program is 15,833,834. Of this amount $3,636,233 comes from the San Antonio Housing Trust, Risk Mitigation Fund Balance, Affordable Housing Budget Reallocation, and $750,000 in CDBG funding that was reprogrammed on April 16, 2020. This ordinance programs $12,716,783 in CDBG Funding. Any remaining funds not used for the program will be included in the Fy2020 HUD Action Plan and Budget.
ALTERNATIVES:
An alternative to awarding this funding for the recommended activities would be to reject the recommendation; however, this proposed action is in response to the public health emergency that has impacted many vulnerable people at risk of homelessness.
FISCAL IMPACT:
This ordinance approves Substantial Amendment #3 to the FY 2020 HUD Action Plan and Budget to program and reprogram $12,716,783 in Community Development Block Grant funding and CARES Act Funding to the COVID-19 Emergency Housing Assistance Program to assist vulnerable populations at risk of homelessness during COVID-19; and reprogram $3,506,840 in HOME Investment Partnerships Program funding to Alazan Lofts, Legacy at Piedmont and the Owner Occupied Rehabilitation Program; and program $297,456 to eligible HOPWA activities. There is no impact to the City’s General Fund.
RECOMMENDATION:
Staff recommends approval of an Ordinance authorizing Substantial Amendment #3 to the FY 2020 HUD Action Plan and Budget to assist vulnerable populations at risk of homelessness and to mitigate the impacts of COVID-19.