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Home My WebLink About2023-05-23 - AGENDA REPORTS - AMEND 2020 21 AAPO Agenda Item: 1 1. CITY OF SANTA CLARITA AGENDA REPORT PUBLIC HEARINGS CITY MANAGER APPROVAL: TAA,/� DATE: May 23, 2023 SUBJECT: SUBSTANTIAL AMENDMENT TO THE 2020-21 ANNUAL ACTION PLAN DEPARTMENT: Community Development PRESENTER: Tracy Sullivan RECOMMENDED ACTION City Council approve the Draft Substantial Amendment to the 2020-21 Annual Action Plan and funding recommendations contained therein, and authorize the City Manager or designee to execute all required documents, subject to approval of the City Attorney. BACKGROUND Each year, the City of Santa Clarita (City) receives approximately $1.4 million in Community Development Block Grant (CDBG) funds from the U.S. Department of Housing and Urban Development (HUD). This entitlement allocation is based on a formula that takes into account population, poverty levels, and overcrowding. In order to receive CDBG funds, the City is required to submit a Consolidated Plan (Con Plan) at least every five years. The current Con Plan addresses the five-year period of 2019-20 to 2023- 24 and was adopted by the City Council on April 23, 2019. The City is also required to submit an Annual Action Plan every year, which outlines the specific ways that each year's CDBG Entitlement funds will be spent. Entitlement funds must adhere to the following spending caps: a maximum of 15 percent toward public services, a maximum of 20 percent toward administration, and a minimum of 65 percent toward capital projects. Furthermore, any unspent funds from a prior year, regardless of the original identified use, must only be spent on capital moving forward. With every CDBG dollar spent, the City must ensure compliance with CDBG program guidelines, as well as federal cross -cutting regulations. For capital projects, this entails ensuring an environmental review process is performed under the National Environmental Policy Act Page 1 Packet Pg. 14 O (NEPA). In addition, HUD requires that entitlement jurisdictions carry out CDBG-funded programs in a timely manner and prevent an accumulation of unspent money. Over the last three fiscal years, the City has allocated a total of $1,792,356 in CDBG Entitlement funds with the intent to spend these funds to assist with the development of a permanent, year- round homeless shelter (Shelter Project). The ability to spend CDBG funds on the Shelter Project was later deemed ineligible by HUD due to noncompliance under NEPA regulations. This determination by HUD has prevented the City from spending CDBG funds on the Shelter Project, and requires the City to update the Fiscal Year 2020-21 Annual Action Plan to reallocate the approximately $1.8 million toward a different project in order to ensure timely expenditures. The mechanism to update the Annual Action Plan is known as a Substantial Amendment (SA), which requires a public hearing before the City Council. The Draft SA reallocates the funding for park improvement projects. This recommendation is based on past successes administering CDBG funds for similar projects, such as the Canyon Country Inclusive Park Project and the West Creek Inclusive Park Project. As shown, CDBG provides necessary funds to expand accessibility at park locations and incorporate inclusive play elements for underserved populations. Future park sites that have been identified for this funding include Valencia Glen Park and Old Orchard Park. Park improvements achieve the City's Con Plan Priority to Improve and Expand Facilities and Infrastructure, and additionally meet the HUD National Objective of Low/Mod Income Limited Clientele Removal ofArchitectural Barriers. On April 9, 2023, the City published a notice of the proposed Substantial Amendment to the FY 2020-2021 Annual Action Plan informing the public of the 30-day public comment period and the public hearing to be held on May 23, 2023. ALTERNATIVE ACTION Other action as directed by City Council. FISCAL IMPACT Projects recommended for funding will utilize CDBG funds and will not impact the General Fund. ATTACHMENTS Public Hearing Notice Substantial Amendment 5.23.23 Page 2 Packet Pg. 15 1.a NOTICE OF PUBLIC HEARING FOR A DRAFT SUBSTANTIAL AMENDMENT TO THE 2020-21 ANNUAL ACTION PLAN City of Santa Clarita — City Council Meeting Notice is hereby given that the City of Santa Clarita (City) will conduct a public hearing for a draft Substantial Amendment (Amendment) to the 2020-2021 Annual Action Plan (Plan) on Tuesday, May 23, 2023, at or after 6:00 p.m., in the Council Chambers at Santa Clarita City Hall, 23920 Valencia Boulevard, Santa Clarita, California, 91355. The draft Amendment to the 2020-2021 Plan includes financial and programmatic information on the number, type, and funding of programs and activities to be undertaken with federal Community Development Block Grant (CDBG) funds. Citizens are encouraged to participate and provide comments on this item by attending the public hearing. The draft Amendment to the 2020-2021 Plan identifies a total of up to $1,779,880 in 2020-2021 CDBG Entitlement Program savings. The City invites public comment regarding the draft documents during the thirty (30) day public comment period, which begins April 23, 2023. The draft documents will be available for review on the City's website at www.santa-clarita.com/housing, and during normal business hours at the office of the City Clerk, Santa Clarita City Hall, 23920 Valencia Blvd, Suite 120, Santa Clarita, CA 91355. Comments may be emailed to dplazo@santa-clarita.com, or submitted in person or by U.S. Mail to Donya Plazo, City of Santa Clarita, 23920 Valencia Boulevard, Santa Clarita, CA 91355. Written comments must be received by May 23, 2023, at 5:00 p.m. Copies of the City Council meeting agendas will be available 72 hours prior to the meeting date at the City Clerk's Office at City Hall, located at 23920 Valencia Blvd., Suite 120, Santa Clarita, CA 91355, or on-line at www.santa-clarita.com/agendas. Further information may also be obtained by contacting Donya Plazo, Project Technician, at 661.255.4368, or by email at dplazo2santa-clarita.com. If you wish to challenge the action taken on this matter in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the City Council, at or prior to, the public hearing. Para los que hablan espanol, si usted tiene preguntas o desea mas informaci6n sobre este producto, por favor p6ngase en contacto con Donya Plazo, Project Technician, al 661.255.4368 o por correo electr6nico a dplazo@santa-clarita.com. Gracias. Date: April 6, 2023 Mary Cusick, MMC City Clerk Published: April 8, 2023 Packet Pg. 16 1.b SUBSTANTIAL AMENDMENT to the 2020-2021 ANNUAL ACTION PLAN BACKGROUND The City of Santa Clarita (City) is an Entitlement Jurisdiction for Community Development Block Grant (CDBG) funds from the Department of Housing and Urban Development (HUD). The City receives an annual allocation of CDBG Entitlement funds to provide programs and services to primarily low- and moderate -income residents of the City. In the Fiscal Year (FY) 2020-2021 Annual Action Plan (AAP), the City identified Entitlement funds and prior year savings totaling $666,848 to be allocated for the development of a new permanent, year-round homeless shelter (Shelter Project) to be owned and operated by the non-profit Bridge To Home. The Shelter Project was an eligible activity under the HUD Matrix Code 03C — Homeless Facilities. It met the National Objective of serving a Low/Mod Income Limited Clientele of Homeless Persons, who are presumed by HUD to be principally low/mod income. It met the City's 2020-2025 Consolidated Plan Priority of Improve and Expand Facilities and Infrastructure. In FY 2021-2022 and in FY 2022-2023, the City undertook Substantial Amendments of the FY 2020-2021 AAP which allocated additional Entitlement funds and prior year savings to the Shelter Project. Over those three fiscal years, a total of $1,792,356 in CDBG funds were allocated to the Shelter Project as shown below. Fiscal Year Annual Entitlement Funds Prior Year 2020-2021 $250,000 $416,849 2021-2022 $583,872 $187,283 2022-2023 329,400 $24,952 Subtotal $1,163,272 $629,084 PROPOSED SUBSTANTIAL AMENDMENT In 2023, the City determined that the Shelter Project does not meet the eligibility requirements under the CDBG Program. The City now wishes to amend the FY 2020-2021 AAP to defunct the Shelter Project, release all funds allocated to it ($1,792,356), and identify a new use for those funds. The City has determined that the best use for the funds is the Parks Improvement Project (Parks Project). The Parks Project will make improvements to local parks to benefit low -moderate income / CDBG-eligible residents within the City. The Parks Project is an eligible activity under the HUD Matrix Code 03F — Parks, Recreational Facilities. Each Activity undertaken will meet either the National Objective of Low/Mod Income Limited Clientele - Removal orArchitectural Barriers, or the National Objective of Low/Mod Area. The Parks Project meets the City's 2020-2025 Consolidated Plan Priority of Improve and Expand Facilities and Infrastructure. PUBLIC OUTREACH On April 9, 2023, the City published a notice of the proposed Substantial Amendment to the FY 2020-2021 Annual Action Plan informing the public of the 30-day public comment period and the Public Hearing to be held on May 23, 2023. Packet Pg. 17