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1994-0301_ORANGE, COUNTY OF_E1_Agenda Report0 0 AGENDA ITEM March 1, 1994 TO: George Scarborough, City Manager FROM: Thomas Tomlinson, Director of Planning SUBJECT: Modifications to Fiscal Year 1992-1993 Community Development Block Grant Contract (Year 18), to the City's Mobile Home Improvement Program Policy and Procedures Manual, and Execution of the Fiscal Year 1993-1994 Community Development Block Grant (Year 19) and HOME Contracts (Year 2). By Motion, authorize the Mayor to execute the modifications to the Fiscal Year 1992-1993 Community Development Block Grant contracts and to execute the Fiscal Year 1993-1994 Community Development Block Grant and HOME contracts and adopt the resolution modifying the Mobile Home Improvement Program Policy and Procedure Manual. A. Applicant or Property Owner City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 B. Summary and Recommendation 1. Fiscal Year 1993-1994 Community Development Block Grant (CDBG): The City Council is being requested to authorize the Mayor to execute the Year 19 Community Development Block Grant contracts (fiscal year 1993-1994) for the rehabilitation of mobile homes ($70,000), the rehabilitation of private properties ($30,000) and public facilities and improvements to the Lacouague Building ($34,000) (attachment 2). 2. Fiscal Year 1992-1993 Community Development Block Grant (CDBG): The City Council is being requested to authorize the Mayor to execute an amendment to the Year 18 Community Development Block Grant contract for rehabilitation of mobile homes in order to re -program funds from unused contracts into this contract in the amount of approximately $48,560 (attachment 3). FOR CITY COUNCIL AGEN Z�E / Ll Agenda Item 0 March 1, 1994 Modifications to the Mobile Home Improvement Policy and Procedure Manual: The City Council is being requested to modify the City's Mobile Home Improvement Program Policy and Procedures Manual to increase the maximum amount a household can receive from a Community Development Block Grant from $5000.00 to $15,000 (attachment 4). Fiscal Year 1993-1994 HOME Contract: The City Council is being requested to authorize the Mayor to execute the Year 2 HOME contract (fiscal year 1993-1994) which is in the amount of $50,000. These funds are to be utilized primarily for rehabilitation activities of owner occupied low income housing within the City, such as the existing mobile home and single family home rehabilitation programs, per the Federal HOME Guidelines (attachment 5). C. Background Environmental Processing: This project has been reviewed in accordance with the California Environmental Quality Act by the Planning Director and a Certificate of Exemption was issued for each of the above projects as it was determined that they are categorically exempt from review (class 1) Statute 15267. D. Prosect Description Fiscal Year 1993-1994 CDBG contracts: These three contracts were received from the County in late January of 1994 and require execution by the Mayor before expenditure of the Federal funds can commence. The three contracts are as follows: C41454: Rehabilitation of Mobile Homes: $70,000.00. Under this ongoing CDBG program, low income grant recipients receive up to $5,000 for the correction of health and safety violations on the mobile homes. (An increase in the grant amount is being requested below under modifications to the Mobile Home Improvement Policy and Procedure Manual). All seven of the City's mobile home parks are eligible for this program. This CDBG program has been aggressively expanded this past year by no longer utilizing a consultant to administer the program and by 0 0 Agenda Item 3 March 1, 1994 assigning a staff member to administer the program. Currently there are approximately 21 mobile homes undergoing rehabilitation as part of this program and an additional 20 mobile homes are anticipated to be completed by July of 1994. This represents a 250°s increase over the number of mobile homes rehabilitated last year. It is anticipated that an additional 100-150 mobile homes have outstanding health and safety violations and households that would qualify under the Department of Housing and Urban Development's (HUD) income requirements for assistance under this program. C41455: Rehabilitation of Private Properties: $30,000.00. This is also an ongoing CDBG program which is now administered by City staff. Under this program, low income households can receive up to $5,000 in a grant and up to $5,000 in a 0% deferred interest loan to fund rehabilitations of their single family homes to address current health and safety code violations. Currently there are eight applicants on the eligibility list for these loans and grants and the processing of all of these applications is anticipated to be complete by the end of the calendar year. It is anticipated that an additional 20-30 households will be applying for assistance under this program in the next calendar year. C41456: Public Facilities and Improvements- Lacouague Building: $34,000.00. This is a continuation of a rehabilitation effort that received CDBG funding in Year 16 (fiscal year 1990-1991) for the design of the proposed rehabilitation of this building. The funds allocated in this contract are for the actual construction of the improvements and rehabilitation of the building. The City Council approved the reprogramming of funds into the Year 16 contract ($17,692.16) (CC Reso. 93-12-7-1) which are also to be used for the construction of the improvements to this building. Therefore, the total amount of grant funding available for this project under the Year 16 and Year 19 contracts is ($51,692.16). 9 Agenda Item 4 March 1, 1994 ON Modifications to the Fiscal Year 1992-1993 CDBG Contract: Funds are being reprogrammed from three existing CDBG contracts from previous years which have never been executed and are no longer feasible. The reason for the reprogramming of these funds is that the Department of Housing and Urban Development (HUD), who issues the funding, has set new guidelines for the CDBG program which state that all funding must be utilized within 18 months from receipt of those funds (signing of the contracts). The three contracts from which funds are being reprogrammed are from Years 11 (2 of them)(Fiscal Year 1985-1986) and Year 17 (Fiscal Year 1991-1992) and as such are subject to being reassumed by HUD unless the City reprograms them into eligible and active contracts such as the Mobile Home Improvement Program. The total amount of funds to be reprogrammed are $48,560 which will enable approximately 4-9 additional mobile homes to be rehabilitated in this funding year. As stated earlier, the Mobile Home Improvement Program is the City's most active and most successful CDBG program to date and therefore HUD has determined that it is eligible to receive the reprogrammed funds described above. Procedure Manual: Currently this manual, which dictates how the Mobile Home Improvement program is implemented, allows for grants of up to $5,000.00 per household (attachment 4). The $5,000.00 amount was decided upon in 1989 based on the average cost of rehabilitating a mobile home. Typical correction of health and safety code violations include repair/replacement of the roof, replacement of galvanized plumbing pipes with copper pipes, pigtailing aluminum wiring at the sockets and terminals with copper wiring and replacement of porch flooring and stairs. On the average these costs run anywhere from $3,500 to $13,000 depending on the extent of the needed work. In the past any repairs over the $5,000 limit had to be paid by the coach owner, who typically did not have the money to make the repairs and therefore they went uncorrected. The County also operates a Mobile Home Improvement program and under their program does not have any limits for the amount of assistance a coach owner can receive. The requested $15,000 limit was discussed with the County, who are in support of this limit, and who have suggested that rather than going from a $5,000 limit to no limits, that the City try the $15,000 limit first to determine if it is sufficient. It is staff's experience 0 Ll Agenda Item 5 March 1, 1994 thus far, that the $15,000 limit for grants will suffice for meeting the needs of the mobile home owners in the City. Therefore, staff recommends amending the current Mobile Home Improvement Policy and Procedure Manual to reflect a $15,000 grant limit. All Year 18 and 19 CDBG Mobile Home Improvement contracts with the County will be modified accordingly if this amendment is approved by the City. 4. Fiscal Year 1993-1994 HOME Contract: This contract (C41535) was received from the County on February 14, 1994 and is for a grant amount of $50,000. The County has specified that the funds are to be utilized primarily for rehabilitation activities of owner occupied low income housing within the City, such as the existing mobile home and single family home rehabilitation programs. None of the HOME funds are to be used for direct rental assistance, and if rental units are rehabilitated they will be subject to a 10 year affordability requirement, per HOME Guidelines. E. Issues No issues have been identified. F. Staff Analysis By reprogramming funds ($48,560) from CDBG contracts which are no longer viable, the City will be able to assist approximately 4-9 more mobile home owners this funding year than would have been possible under HUD's initial award. The low income households of the City will benefit from the increase in Federal funds allocated for their assistance. This increase in households assisted with CDBG funding also significantly increases the City's standing for future receipt of grants from HUD as these awards are largely based upon the City's demonstrated expenditure of funds and the number of households assisted. Two other facts exist which also contribute favorably to the City's likelihood of receiving additional Federal and State funding in the future and the City's increased ability to attract both non-profit and for-profit developers of low income housing. These facts are that the administration of the City's Housing Services is now being done by a City staff member and no longer by an outside consultant, and that the City's has recently exhibited a more aggressive 0 0 Agenda Item 6 March 1, 1994 approach to providing more low income related housing assistance as evidenced in the Year 20 CDBG application, the new Mortgage Credit Certificate Program and the Housing Opportunities Program, which is under development. FINANCIAL CONSIDERATION If the above requested funds are approved for reprogramming and the Year 19 CDBG and Year 2 HOME contracts are authorized for signature by the Mayor, the total for all active CDBG and HOME (Years 16, 18 and 19) grants will be $405,252 (attachment 6). The City is authorized to spend $60,050 of these funds on staff costs associated with the administration/management of these contracts. Any additional staff costs are billed to the CRA set-aside fund for low income housing related projects and do not come out of the City's General Fund. This represents a savings in staff costs to the City's General Fund. The remaining $345,202 of CDBG and HOME funds is to be utilized for project implementation costs within the next 18 months. Staff will make a presentation to the County regarding the Year 20 CDBG and HOME application on February 22, 1994. The City will receive notification of the County's recommendation to HUD for funding of the Year 20 CDBG and HOME program by March 21, 1994. PUBLIC NOTIFICATION A Public Hearing Notice including the project description, date, time and location of said hearing was published in the Capistrano valley News. ALTERNATE ACTIONS 1. Approve authorizing the Mayor to execute the modifications to the Fiscal Year 1992-1993 Community Development Block Grant contracts and to execute the Fiscal Year 1993-1994 Community Development Block Grant and HOME contracts and adopt the resolution modifying the Mobile Home Improvement Program Policy and Procedure Manual, or; 2. Deny to authorize the Mayor to execute the modifications to the Fiscal Year 1992-1993 Community Development Block Grant contracts and to execute the Fiscal Year 1993-1994 Community Development Block Grant and HOME contracts and adopt the resolution modifying the Mobile Home Improvement Program Policy and Procedure Manual, or; 3. Continue the item and direct staff to return with further information on specified issues. Agenda Item 7 March 1, 1994 RECOMMENDATION By Motion, authorize the Mayor to execute the modifications to the Fiscal Year 1992-1993 Community Development Block Grant contracts and to execute the Fiscal Year 1993-1994 Community Development Block Grant and HOME contracts and adopt the resolution modifying the Mobile Home Improvement Program Policy and Procedure Manual. Respectfully submitted, �ir/1�V�s Thomas Tomlinson, Planning Director Attachments 1. Draft Resolution 94-3-1 2. Fiscal Year 1993-1994 Contracts 3. Fiscal Year 1992-1993 Contract 4. Modified Mobile Home Improvement Policy and Procedure Manual S. Fiscal Year 1993-1994 HOME Contract 6. CDBG and HOME Funds Worksheet CP\CDBGMOAI.CC TT: MR: hs RESOLUTION NO. 94-3-1-2 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA, AUTHORIZING THE MAYOR TO EXECUTE MODIFICATIONS TO THE YEAR 18 COMMUNITY DEVELOPMENT BLOCK GRANT CONTRACTS AND TO EXECUTE THE YEAR 19 COMMUNITY DEVELOPMENT BLOCK GRANT CONTRACTS AND APPROVING MODIFICATIONS TO THE MOBILE HOME IMPROVEMENT POLICY AND PROCEDURE MANUAL TO ALLOW FOR GRANTS OF UP TO $15,000 PER HOUSEHOLD WHEREAS, the applicant, the City of San Juan Capistrano, has requested that the City Council authorize the Mayor to execute modifications to the Year 18 Community Development Block Grant contracts and to execute the Year 19 Community Development Block Grant contracts and to approve modifications to the Mobile Home Improvement Program Policy and Procedure Manual to allow for grants of up to $15,000 per household; and, WHEREAS, the Planning Director has reviewed the proposed contracts and modifications in accordance with the California Environmental Quality Act and has determined that the projects are categorically exempt from review (Class 1) Statute 15267, and therefore issued a Certificate of Exemption; and, WHEREAS, a public hearing has been duly advertised and held to review and receive public testimony on the applications; and, WHEREAS, the City Council of the City of San Juan Capistrano finds and determines as follows: The proposed modifications to the Year 18 contract and the proposed Year 19 contracts for Community Development Block Grants will provide additional funding to assist low-income households within the City. 2. The proposed modification to the Mobile Home Improvement Policy and Procedure Manual increasing the maximum grant amount to $15,000 per household will enable low-income households to receive adequate funding to correct their outstanding health and safety code violations and to improve the quality of their mobile homes. NOW, THEREFORE, BE iT RESOLVED, that the City Council of the City of San Juan Capistrano does hereby authorize the Mayor to execute modifications to the Year 18 Community Development Block Grant contracts and to execute the Year 19 Community 4- 0 Development Block Grant contracts and does approve of the proposed modifications to the Mobile Home Improvement Program Policy and Procedure Manual to allow for grants of up to S 15.000 per household. PASSED, APPROVED, AND ADOPTED this 1st day of March .1994. GrA.LENE C BELL, MA7R ATTEST: STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss CITY OF SAN JUAN CAPISTRANO ) I, CHERYL JOHNSON, City Clerk of the City of San Juan Capistrano, California, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. 94-3-1-2 adopted by the City Council of the City of San Juan Capistrano, California, at a regular meeting thereof held on the lst day of March 1994, by the following vote: AYES: Council Members Jones, Hausdorfer, Nash, Vasquez and Mayor Campbell NOES: None ABSTAIN: None ABSENT: None (SEAL) CHERYL JOMSeW, CITY CLERK -2- 0 0 ATTACHMENTS 2 - 5 These attachments are available for public review at the City Clerk's counter and a copy is available in the City Council office for the City Council's review. 0 Iwo. l 0 CDBG AND HOME PROGRAMS FUNDING Total Proi. Admin Year 16: Lacouague Building: C40937: $17,692/ $14,154/ $ 3,538 Year 18: Mobile Home Rehab: C41176: $98,560/ $78,848/ $19,712 Year 18: Single Fam. Rehab: C41175: $25,000/ $20,000/ $ 5,000 Year 19: Lacouague Building: C41456: $34,000/ $27,200/ $ 6,800 Year 19: Mobile Home Rehab: C41454: $70,000/ $56,000/ $14,000 Year 19: Single Fam. Rehab: C41455: $30,000/ $24,000/ $ 6,000 Total CDBG Funds: $275,252 $220,202 $55,050 HOME Year 18: Mobile Home Rehab: C41244: $80,000/ $80,000/ none Year 19: Undetermined: C -----: $50,000/ $45,000/ $5,000 ------------------------------------------------------------------- Total HOME Funds: $130,000 $125,000 $5,000 Totals Effective 2/94 ATTACHMENT 6 Tota Pro!. Admin Lacouague Building: $ 51,692 $ 41,354 $ 10,338 Mobile Home Rehab: $168,560 $134,848 $ 33,712 Single Fam. Rehab: $ 551000 $ 44,000 $ 11,000 HOME: ------------------------------------------------------------------ $130,000 $125,000 $ 5,000 Total Funds: $405,252 $345,202 $ 60,050 Effective 2/94 ATTACHMENT 6