HomeMy WebLinkAbout2021-10-26 - AGENDA REPORTS - EMERGENCY RENTAL ASSITANCE 2 FUNDINGO
Agenda Item: 9
1. CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR
CITY MANAGER APPROVAL:
DATE: October 26, 2021
SUBJECT: ADOPTION OF A RESOLUTION AUTHORIZING STATE
ADMINISTRATION OF EMERGENCY RENTAL ASSISTANCE 2
DEPARTMENT: Community Development
PRESENTER: Michael Villegas
RECOMMENDED ACTION
City Council:
1. Adopt a resolution authorizing the State of California to administer Emergency Rental
Assistance 2 funding on behalf of the City of Santa Clarita.
2. Authorize the City Manager or designee to execute all documents, subject to City Attorney
approval.
BACKGROUND
On March 23, 2021, the City Council approved the Santa Clarita COVID-19 Rental Assistance
Program (Program), using a one-time $6.3 million grant provided by the U.S. Department of the
Treasury (Treasury) to deliver critical assistance to the City of Santa Clarita's (City) low- and
moderate -income residents at risk of experiencing homelessness or housing instability due to the
COVID-19 pandemic. The Program was initially approved to provide payment for up to four full
months of rent, although it was subsequently expanded to cover five months, based on an
analysis completed of the applications received from April 1 to April 30, 2021.
In total, the Program received 799 unduplicated applications, helping settle the rental arrears of
528 households, equating to over $4.5 million in payments made directly to landlords to date.
The average assistance provided to each household thus far is $8,900. Program staff is in the
process of working with tenants to remit additional assistance within the parameters of the
Program and anticipates closing out the Program by the end of October. Staff anticipates the
Program expending approximately $5.9 million, with any excess funding being remitted to the
State of California (State) for administration.
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As part of the City Council's March 23 approval, a Memorandum of Understanding was
executed with the State for the administration of the City's $6.8 million State Block Grant to
deliver additional rental assistance to qualifying Santa Clarita residents. The State's
administration of this funding took effect on May 1, 2021, subsequent to the City's application
period closing. As both entities continue to issue payments, City staff coordinates with the State
on a daily basis to avoid a duplication of benefits. Based on information found on the State's
rental assistance dashboard, the State has provided rental assistance relief to 730 households,
equating to over $9.4 million in payments.
Emery Rental Assistance 2 Funding
Emergency Rental Assistance (ERA) 2 was established by the American Rescue Plan Act of
2021, directing an additional $5,010,401.60 to the City for purposes of providing rental
assistance. Taking lessons learned from ERA 1, the Treasury developed guidelines for ERA 2
that serve to expedite the delivery of payments and eliminate documentation burdens. Key
changes include mandating direct payments to tenants, which our Program currently does not
allow, as well as strongly encouraging the acceptance of self -attestations in lieu of physical
documentation. These new requirements are challenging, as they reduce the City's ability to
ensure proper checks and balances that protect the Program from fraud and misuse of funds.
The State will be administering ERA 2 on a statewide level, under its current rental assistance
program. The State's program recently underwent significant changes to enhance its accessibility
and increase participation. Most notably, the State is now providing full reimbursement for rents
and utilities owed. This is different from its original program which required that landlords and
utility providers forfeit 20 percent. In addition, the State has streamlined its application and
maintains a Rent Relief Contact Center that is open seven days a week, 7:00 a.m. - 7:00 p.m., to
respond to resident inquiries and provide application support.
After thoroughly reviewing the ERA 2 guidelines and considering the overlap in programs, the
most prudent decision is for the City's ERA 2 funding be administered by the State. In doing so,
residents will have a centralized process, continuity of service, and avoid disruption with the
funds currently being provided by the State through the Block Grant.
Upon approval of the recommended action, City staff will work with the Treasury to "upstream"
ERA 2 funding already received, and ensure any future ERA 2 funding is remitted to the State
for administration. Once this is completed, the State will officially take over management of all
ERA funds for Santa Clarita, which would also include reporting obligations to the Treasury. To
help ensure a smooth transition, City staff will work closely with State representatives and
conduct outreach using the City's social media platforms to inform Santa Clarita residents.
ALTERNATIVE ACTION
Other action as determined by the City Council.
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FISCAL IMPACT
There is no impact to the General Fund associated with this item. Funding for this program
comes from the United States Department of the Treasury, and will be upstreamed to the State of
California for administration.
ATTACHMENTS
Resolution
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9.a
RESOLUTION NO. 21-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA,
CALIFORNIA, AUTHORIZING PARTICIPATION IN THE STATE RENTAL ASSISTANCE
PROGRAM — ROUND 2
WHEREAS, On March 11, 2021, the American Rescue Plan Act of 2021 (Pub.L. No. 117-
2) ("ARPA") was signed into law. Section 3201 of Subtitle B of Title III of ARPA established the
federal Emergency Rental Assistance Program ("ERA 2"), and authorized the direct allocation of
funds to states, the District of Columbia, units of local government, territories, and high -need
grantees. The ERA 2 funds are intended to assist low-income households that have experienced
financial hardship during or due to the COVID-19 pandemic, are unable to pay for rent and
utilities, and are at risk of experiencing homelessness or housing instability; and
WHEREAS, California Assembly Bill No. 832 (2021-2022 Reg. Sess.) ("AB 832")
established the State of California's program for administering its share of ERA 2 funds (the "State
Rental Assistance Program — Round 2," "SRA 2," or "SRA 2 Funds"). AB 832 amended Sections
50897, 50897.1, 50897.2, 50897.3, and 50897.4 of, and added Sections 50897.2.1 and 50897.3.1
to, the Health and Safety Code. Health and Safety Code Section 50897.1, subdivision (a)(1),
authorizes the Department of Housing and Community Development ("HCD") to administer the
SRA 2 Funds in accordance with state and federal law; and
WHEREAS, pursuant to Section 3201 of Subtitle B of Title III of ARPA, the U.S.
Department of the Treasury ("Treasury") will allocate the City of Santa Clarita's ("City') ERA 2
funds (this allocation, and any and all additional tranches thereof, the City's "ERA 2 Allocation");
and
WHEREAS, pursuant to Health and Safety Code Section 50897.2.1, subdivision (a)(3),
HCD will apportion a share of the SRA 2 Funds to the City (this amount, and any and all
additional tranches thereof, the City's "Proportionate SRA 2 Share"); and
WHEREAS, the City intends and agrees that HCD will (1) receive and administer the
City's ERA 2 Allocation for and on behalf of the City; and (2) administer the City's Proportionate
SRA 2 Share; and
WHEREAS, HCD will administer the City's ERA 2 Allocation and Proportionate SRA 2
Share, pursuant to Health and Safety Code Section 50897.3.1, subdivision (b)(3); and
WHEREAS, in accordance with Section 3201(d)(1)(C) of ARPA, HCD will use ERA 2
funds to provide the City with a grant, which the City shall use to pay any costs it incurs, beginning
on March 11, 2021, to support and benefit the State Rental Assistance Program — Round 2 (such
costs, the City's "Supplemental Administrative Costs").
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9.a
NOW, THEREFORE, the City Council of the City of Santa Clarita, California, does
hereby resolve as follows:
SECTION 1. The City is hereby authorized and directed to make any necessary
arrangements to effectuate HCD's receipt of the City's ERA 2 Allocation for the purpose of
administering it for and on behalf of the City.
SECTION 2. The City is hereby authorized and directed to enter into, execute, and deliver
any and all documents (and amendments thereto) that are required or deemed necessary or
appropriate UNDER STATE OR FEDERAL LAW to govern the HCD's administration of the
City's ERA 2 Allocation for and on behalf of the City, as well as the City's acceptance of a grant
for payment of its Supplemental Administrative Costs (collectively, the "SRA 2 Documents").
Such SRA 2 Documents shall include an HCD-approved STD 213, Standard Agreement in a total
amount not to exceed $15 million (the "Standard Agreement''), and all amendments thereto.
SECTION 3. The City acknowledges and agrees that it shall be subject to the terms and
conditions specified in the Standard Agreement.
SECTION 4. Kenneth W. Striplin, City Manager, or his designee is authorized to execute
the SRA 2 Documents on behalf of the City for participation in the State Rental Assistance
Program — Round 2, subject to City Attorney approval.
SECTION 5. The City Clerk shall certify to the adoption of this resolution.
PASSED, APPROVED, AND ADOPTED this 26th day of October 2021.
ATTEST:
CITY CLERK
DATE:
MAYOR
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9.a
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss.
CITY OF SANTA CLARITA )
I, Mary Cusick, City Clerk of the City of Santa Clarita, do hereby certify that the
foregoing Resolution No. 21- was duly adopted by the City Council of the City of Santa Clarita
at a regular meeting thereof, held on the th day of 2021, by the following vote:
AYES: COUNCILMEMBERS:
NOES: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
CITY CLERK
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