AGENDA #1c
TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
SUBJECT: Proposed 2001-2002 Community Development Program
DATE: March 28, 2001
The purpose of tonight’s public hearing is to receive citizen comments on a proposed plan for use of Community Development funds in fiscal year 2001-2002.
The U. S. Department of Housing and Urban Development has informed us that the Town will receive $441,000 of Community Development funds in fiscal year 2001-2002. In addition, we estimate that we will receive $35,000 of Community Development program income during the program year. Therefore, we propose activities for a total of $476,000.
· We propose to return to the Council for consideration of the Community Development Plan on April 23.
· We propose to submit an update to the 2000–2005 Consolidated Plan to the Department of Housing and Urban Development on May 15, 2001.
INTRODUCTION
We propose the following use of Community Development funds for 2001-2002. This plan is based on comments received at a January 23, 2001 public hearing and applications submitted by agencies requesting funds.
Public Housing
Renovations (Pritchard Park) $115,000
Refurbishing Program $ 55,000
Meadowmont Affordable Condominiums $ 80,000
Neighborhood Revitalization $ 80,000
Habitat for Humanity (Rusch Road Subdivision) $ 50,000
Community Services $ 20,000
Administration $ 76,000
Total $476,000
The proposed budget includes $35,000 of Community Development program income that we anticipate receiving in fiscal year 2001-2002. The benefit to programming projected program income is that the funds would be earmarked for a particular project and we would not have to amend the Community Development program mid-year. Typically, when we receive program income during the program year, the Council schedules a public hearing to receive citizen comments on how to spend the funds, and the Housing and Community Development Advisory Board reviews the proposal and provides the Council with a recommendation. The public hearing on March 28 would satisfy our public participation requirements. In addition, the Housing and Community Development Board will have the opportunity to review the proposed Community Development Plan at its meeting on March 27, 2001.
The Town of Chapel Hill has received Community Development grants since 1975 under the Housing and Community Development Act of 1974. This legislation provides funds to cities and counties to carry out activities that benefit low- and moderate-income families including: housing repair, public improvements, acquiring land for housing and economic development.
The primary objective of the Community Development program is to develop viable urban communities, by providing decent housing and a suitable living environment and expanding economic opportunities for low- and moderate-income households. Federal regulations define low-income as up to 50% of the median income and moderate-income as up to 80% of the median family income. According to the U.S. Department of Housing and Urban Development (HUD), the current 80% of the median income for a family of four in the Raleigh-Durham-Chapel Hill Metropolitan Statistical Area is $49,850 (Please see Attachment 1 for the Raleigh-Durham-Chapel Hill Median Family Income by Household Size).
Since the mid 1980’s, the Council has used a significant amount of Community Development funds for the renovation of public housing communities. These funds have been used to rehabilitate the exterior of public housing apartments, for drainage improvements, and to refurbish the interior of apartments. Over the past several years, the Council has also budgeted funds for affordable housing development such as the Scarlette Drive and Meadowmont Townhomes and Habitat for Humanity’s New Homeplace Subdivision, Neighborhood Revitalization activities with EmPOWERment, Inc., and community service activities programs with the YMCA, Community Cuisine and the Orange County Literacy Council.
The Consolidated Plan
On May 15, 2000, the Town and Orange County submitted to the U.S. Department of Housing and Urban Development a five-year Consolidated Plan covering fiscal years 2000–2001 through 2004–2005. The purpose of the Plan is to identify and prioritize the housing and community development needs for Chapel Hill and Orange County. The Plan also suggests how the Town and the County will address the needs over a five-year period.
The Plan also included a 2000-2001 Community Development plan and a preliminary five-year spending plan for use of Community Development funds approved by the Council and a 2000–2001 HOME Program approved by the Council, the Orange County and Hillsborough Commissioners, and Carrboro Board of Aldermen.
Public Participation Process
On January 23, 2001, the Council held the first public hearing to receive ideas from citizens about how funds could be spent in five areas: the Capital Improvements Program, the Town Budget, the Community Development Program, the HOME Program and the Comprehensive Grant. The hearing represented the first step in the Community Development planning process for 2001-2002.
Please see Attachment 2 for a summary of Community Development related comments and requests received at the January 23, 2001 public hearing and a summary of applications received.
This year we asked agencies requesting Community Development funding to submit a standardized application. The application requested detailed information about the agencies requesting funds and the proposed projects. The application also included a list of eligible Community Development activities, as well as a list of the housing and community development priorities from the 2000–2005 Consolidated Plan adopted by the Council in April 2000. We believe that this process allowed agencies to more clearly understand the criteria by which the projects would be evaluated. This revised application process, along with our new monitoring procedures where we perform site visits to each agency to evaluate progress, will improve our overall Community Development performance.
DISCUSSION
Five-Year Plan
In April 2000 the Council adopted a five-year plan. (Please see Attachment 3). The plan includes a projection of Community Development funds through fiscal year 2004–2005, and proposes an amount of funds budgeted for each activity. The proposed plan serves as a guide to the Council when considering the use of future Community Development funds.
The plan proposes to continue funding public housing renovations, affordable housing projects, and community service activities over the next five years. We note that the recommendation for Community Service activities has decreased from $47,000 to $20,000 to emphasize housing objectives as contained in the Town’s Consolidated Plan.
Proposed 2001-2002 Community Development Plan
We propose the following activities for the 2001–2002 Community Development grant:
Rehabilitation of Public Housing: $170,000
We propose to budget $115,000 of Community Development funds for the rehabilitation of fifteen units at the Pritchard Park public housing community. Funds would be used for renovation expenses and for a portion of the Assistant Housing Director’s salary for oversight of the public housing renovation projects. Together with Comprehensive Grant funds, the 2001–2002 Community Development funds would be used to renovate the fifteen-unit community. Proposed renovation work would include the abatement of lead-based paint and asbestos, replacement of windows and screens, replacement of interior and exterior doors, replacement of furnaces, replacement of floor tiles, replacement of bathtub liners and surrounds, bathroom fixtures, plumbing and electrical upgrades, and interior and exterior painting.
We propose to appropriate $55,000 of Community Development funds to continue the public housing refurbishing program. This program includes minor repairs of public housing units.
Meadowmont Affordable Condominiums $80,000
We propose to budget $80,000 of Community Development funds to the Orange Community Housing Corporation to help pay the costs of constructing thirty-two condominiums in Meadowmont. The Council previously budgeted $80,000 of 2000–2001 Community Development funds and $30,000 from the Housing Loan Trust Fund for this project. The condominiums will be developed for first time homebuyers that currently live or work in Orange County earning less than 80% of the area median income. Funds would be used for development of the site and infrastructure improvements. We note that the proposed 2001–2002 HOME Program developed by the HOME Program Review Committee also proposes to budget $80,000 for this activity.
Neighborhood Revitalization: $80,000
We propose to budget $80,000 of Community Development funds to continue neighborhood revitalization activities. In previous years, funds were used in the Pine Knolls, Northside and public housing neighborhoods. This year we recommend that funds be used Town-wide to assist with the activities of local non-profit affordable housing developers including EmPOWERment, Inc. and the Community Land Trust in Orange County. Funds could be used for second mortgage assistance, property acquisition or renovation, public improvements, or community service activities. Activities must serve households earning less than 70% of the HUD published area median income. We recommend that the Council continue to authorize the Manager to approve specific projects for use of funds.
We propose to budget $50,000 to Habitat for Humanity to acquire property adjacent to property Habitat currently owns on Rusch Road located off of Rogers Road. Habitat intends to develop sixteen houses on the land for households earning less than 50% of the area median income. Acquisition of the additional property would allow Habitat to develop a larger subdivision.
We also propose that the Council consider budgeting an additional $50,000 from the Housing Loan Trust Fund for development costs including site improvements, architectural and engineering costs and infrastructure development). Funds are available in the Housing Loan Trust Fund for this activity.
Community Services: $20,000
We propose to budget $15,000 to the Chapel Hill–Carrboro YMCA to continue operation of after school programs for children living in the Pine Knolls neighborhood and the South Estes Drive public housing community.
We also propose to budget $5,000 to the Orange County Literacy Council to operate computer-based literacy programs to public housing residents and other lower income Chapel Hill residents.
Program Administration: $76,000
We propose to budget $76,000 for administration of the Community Development program. Funds would be used for the Community Development Coordinator’s salary, a portion of the Long Range Planning Coordinator’s salary, and overhead costs.
NEXT STEPS
All comments received during tonight’s public hearing and after the hearing will be summarized and submitted with the Consolidated Plan to the Department of Housing and Urban Development. The Housing and Community Development Advisory Board reviewed the proposed plan on March 27, 2001, and will forward its recommendation to the Council.
We will submit a recommended Community Development plan to the Council for consideration on April 23, 2001. A final Consolidated Plan must be submitted to the Department of Housing and Urban Development by May 15, 2001.
ATTACHMENTS
1. 2000 Median Household Income for Raleigh-Durham-Chapel Hill area (p. 6).
2. Summary of Comments and Community Development Requests (p. 7).
3. Proposed Five-Year Community Development Plan (p.12).
4. National Objectives of Community Development Legislation (p. 13).
2000 Raleigh-Durham-Chapel Hill MSA
|
# in Household |
100% of Median |
80% of Median |
70% of Median |
50% of Median |
30% of Median |
|
1 |
$43,950 |
$34,900 |
$30,520 |
$21,800 |
$13,100 |
|
2 |
$50,250 |
$39,850 |
$34,860 |
$24,900 |
$14,950 |
|
3 |
$56,500 |
$44,850 |
$39,270 |
$28,050 |
$16,800 |
|
4 |
$62,800 |
$49,850 |
$43,610 |
$31,150 |
$18,700 |
|
5 |
$67,800 |
$53,850 |
$47,110 |
$33,650 |
$20,200 |
|
6 |
$72,850 |
$57,800 |
$50,610 |
$36,150 |
$21,700 |
|
7 |
$77,900 |
$61,800 |
$54,110 |
$38,650 |
$23,200 |
|
8 |
$82,900 |
$65,800 |
$57,540 |
$41,100 |
$24,650 |
Source: U.S. Department of Housing and Urban Development (HUD)
Note: HUD has declared the Raleigh-Durham-Chapel Hill MSA a Low Housing Cost area therefore, income figures are adjusted to reflect this designation.
Revised 3/14/00
ATTACHMENT 2
The citizen comments received at the January 23, 2001 public hearing and applications for funding are summarized below. We note that all agencies that requested funding were required to submit an application.
Activities eligible for Community Development funding must meet one of three National Objectives:
· Benefit low- and moderate-income persons; or
· Aid in the prevention or elimination of slums and blight; or
· Treat urgent needs posing an immediate threat to public health and welfare.
Examples of eligible activities include acquisition and /or renovation of property, second mortgage assistance, and site development.
The following agencies submitted applications for affordable housing activities.
1. Chapel Hill Department of Housing
The Chapel Hill Department of Housing requested $190,000 of Community Development Program funds for the following purposes: $120,000 to renovate fifteen apartments in the Pritchard Park community; and $70,000 to continue the Five Year Refurbishing Program by refurbishing about 50 apartments.
Staff Comment: We propose to budget $115,000 for renovation of Pritchard Park and $55,000 for refurbishing apartments, slightly less than what is recommended in the five-year plan adopted by the Council in April 2000. The Town’s public housing is an important source of affordable rental housing and the Town’s investment in this property should be maintained. The renovation of public housing units is an eligible Community Development activity.
2. Community Land Trust in Orange County
The Community Land Trust in Orange County requested $100,000 for opportunities to purchase land and/or houses that might become available during the course of the year (not for specific projects). The property would be used to develop homes for first-time homebuyers earning less than 80% of median income. The Land Trust proposes to partner with other nonprofit to provide housing with guaranteed long-term affordability.
Staff Comment: We propose that the Council budget $80,000 of Community Development funds for Neighborhood Revitalization activities. The funds would be available to any qualified non-profit organization for a variety of activities including property acquisition, renovation, second mortgage assistance and community services. The Land Trust or another organization would be eligible to request neighborhood revitalization funds for specific projects. Funds could be used Town-wide. The use of funds for neighborhood revitalization activities is an eligible Community Development activity.
3. Habitat for Humanity of Orange County
Habitat for Humanity requested $100,000 of Community Development funds for two purposes: $50,000 to go toward the development of up to sixteen homes on a tract of land it owns on Rusch Road; and an additional $50,000 to purchase adjacent properties so they could develop a larger subdivision. The homes would be available to very low-income households earning 50% or less of median income.
Staff Comment: We propose to budget $50,000 of Community Development funds to acquire the additional property. The acquisition of property is an eligible Community Development program activity. We further propose that the Council consider budgeting an additional $50,000 from the Housing Loan Trust Fund for development costs (i.e. site improvements, architectural and engineering costs, infrastructure development).
4. Orange Community Housing Corporation
The Orange Community Housing Corporation requested $80,000 of Community Development funds to develop thirty-two condominiums in the Meadowmont development. The condominiums will be developed for first time homebuyers earning less than 80% of the area median income.
Staff Comment: We propose to budget $80,000 of Community Development funds for this project in fiscal year 2001–2002. The project is eligible for funds under Community Development Program guidelines. In addition, this project will provide affordable home ownership opportunities to individuals and families that currently live or work in Orange County.
In 2000 – 2001, the Corporation requested $160,000 and the Council budgeted $80,000 of Community Development funds for this project. At that time, we informed the Council that because construction was not scheduled to begin until later in the year, we did not anticipate that the Corporation would spend the entire amount requested. Therefore, we recommended and the Council approved reserving $80,000 in the Housing Loan Trust Fund for this project, if it were needed. We reported that if funds were not needed, we would return the funds to the Housing Loan Trust fund and budget the remaining $80,000 in 2001-2002. We will return these funds to the Housing Loan Trust fund to be used for other eligible activities.
The use of funds for public service activities is eligible under federal Community Development regulations. Examples of public service activities includes programs concerned with employment, crime prevention, child care, health, drug abuse, education, fair housing counseling, energy conservation, homebuyer down payment assistance or recreational needs. The amount of Community Development funds used for public services cannot exceed 15% of the Town’s Community Development grant ($66,150 in 2001-2002).
In addition to meeting one of the National Objectives listed above, community or public service activities must provide:
(1) a new service; or
(2) a quantifiable increase in the level of an existing service than what was provided over the last fiscal year.
In the past, the Council has funded public service projects that support other Community Development objectives and activities, especially public housing and Neighborhood Revitalization. Some emphasis has also been placed on job training for low-income residents. We evaluated the following applications in terms of previous performance, and their relationship to other Community Development objectives. In general, we are recommending that some funding be set aside for community services, but that the Council emphasize housing objectives as contained in the Consolidated Plan.
The following agencies submitted applications for Community / Public Service activities:
1. Chapel Hill – Carrboro YMCA
The Chapel Hill – Carrboro YMCA requested $25,000 of Community Development funds to continue operation of After School Programs for children living in the Pine Knolls and South Estes Drive Family communities.
Staff Comment: We propose to budget $15,000 to the YMCA to continue its after school programs.
Since 1994, the Town has provided Community Development funds to the YMCA for its After School Program at the Pine Knolls Community Center. In 1999, the YMCA established a similar program at the South Estes Drive Community Center. Approximately 15 - 20 children were enrolled in each program. This year, the YMCA was not able to use the facilities at the Pine Knolls Community Center and combined the Pine Knolls program with the program currently operating at the YMCA facility on Airport Road. As a result, only five children from the Pine Knolls neighborhood are currently enrolled in the program. Approximately 16 children are currently enrolled in the South Estes Drive program. We have not conducted a performance review of the YMCA Program to determine if the requirements of the Town’s Performance Agreement have been met this year. We will complete our assessment of this program and forward the results to the Council with our recommendation on April 23.
2. Chapel Hill Training Outreach Project, Inc.
The Chapel Hill Training Outreach Project requested $27,868 of Community Development funds for its Family Resource Centers that serve the Trinity Court, Pritchard Park and South Estes public housing communities, and the low wealth and subsidized housing communities of Dobbins Hill and Pine Knolls. The Family Resource Centers are community-based family support programs that provide many support services, activities and resources to families such as parent education and support and family literacy.
Staff Comment: We do not recommend funding for this activity because of the overall emphasis on affordable housing objectives contained in the Consolidated Plan.
3. Community Cuisine
Community Cuisine requested $25,000 of Community Development funds to continue operation of its culinary skills programs. The program provides adult training sessions in the spring and fall and assists with job placement. The organization also sponsors a similar program for teenagers. Funds would be used to sponsor programs and for administrative expenses.
Staff Comment: Based on performance, we do not recommend funding this program at this time. The Council budgeted $22,000 of 2000–2001 Community Development funds to Community Cuisine for this project. To date, approximately $6,500 has been spent for program activities. A performance review of the program determined that the objective of providing an adult training program was not being met. At that time, we informed the organization that we would reduce Community Development funds if an adult program were not implemented by February 2001. The adult program is now underway. We recommend that when the program is complete, we review Community Cuisine’s performance and determine if the program has accomplished the intended goals and consider future funding at that time.
4. Orange County Literacy Council
The Orange County Literacy Council requested $9,250 to expand its literacy labs into the Community Computer-based Literacy Project. The Project provides computer-based literacy classes to public housing residents and low-income Chapel Hill residents, and integrates computer technology into individual tutoring with low-income Chapel Hill adult learners. The Literacy Council would use the funds for an intern to serve as Project Coordinator for the computer based literacy program.
Staff Comment: We believe that the Literacy Council operates a needed service in an effective manner. Even though we recommend a focus on housing, we believe that $5,000 should be allocated to the Literacy Council.
The Town Council previously appropriated $15,000 of 1999–2000 Community Development funds to the Literacy Council to establish a computer literacy lab program for public housing residents. The Literacy Council has provided tutoring at South Estes and Trinity Court/Pritchard Park using equipment purchased with Community Development funds as well as one-on-one tutoring at various sites. It does outreach to public housing residents and other low-income citizens to try to recruit them into the program and increase the scope of its work. The organization has requested an extension of its Performance Agreement to June 30, 2001, because an additional computer lab has been established at another site (Hargraves Center) and there are additional participants for the program. A balance of $2,700 from its existing allocation of funds would be used for this purpose. In summary, the organization has steadily and effectively provided a valuable service to a gradually increasing number of low-income persons.
Other Requests
1. Youth Creating Change Serteen Club
The Youth Creating Change Serteen Club requested $18,821 to help establish a community-based, youth-owned arcade and entertainment center to be called Club Exposure. The arcade will provide a safe environment for low- and moderate-income youth and will promote education and positive interaction among the youth. Profits from the business would be used to create a scholarship fund for low-income youth.
Staff Comment: At this time, we do not propose to budget Community Development funds for this activity. The organization has secured only a small portion of funds required for this project. In addition, we suggest that the group develop a long-term financial and management plans and further develop its business plan. We also suggest that the Club work with the surrounding community members, businesses and organizations to discuss how this project could impact the community. We do not believe that this program relates to the objectives of other local programs supported with Community Development funds.
ATTACHMENT 3
|
Activity |
2000–2001 |
2001–2002 |
2002–2003 |
2003–2004 |
2004–2005 |
|
Public Housing Renovation |
$120,000 |
$120,000 |
$120,000 |
$120,000 |
$120,000 |
|
Public Housing Refurbishing |
$70,000 |
$60,000 |
$60,000 |
$50,000 |
$50,000 |
|
Neighborhood Revitalization |
$72,600 |
$79,000 |
$79,000 |
$80,000 |
$80,000 |
|
Meadowmont Townhomes |
$80,000 |
$80,000 |
$0 |
$0 |
$0 |
|
Affordable Housing Projects |
$0 |
$0 |
$71,000 |
$80,000 |
$80,000 |
|
Community Services |
$47,000 |
$47,000 |
$56,000 |
$56,000 |
$56,000 |
|
Administration |
$76,400 |
$80,000 |
$80,000 |
$80,000 |
$80,000 |
|
TOTAL GRANT |
$466,000 |
$466,000 |
$466,000 |
$466,000 |
$466,000 |
National Objectives of Community Development Legislation
Congress established the Community Development program in 1974 by consolidating a number of grant programs into one “block grant”. The primary objective is:
“development of viable urban communities, including decent housing and a suitable living environment and expanding economic opportunity, principally for persons of low and moderate-income.” (Housing and Community Development Act of 1974)
To receive future Community Development Block Grant funds, Chapel Hill must certify that its overall program carries out this primary objective. In addition, each Community Development Block Grant activity must:
1. Benefit low- and moderate-income persons; or
2. Aid in the prevention or elimination of slums and blight; or
3. Treat urgent needs posing an immediate threat to public health and welfare.
Eligible activities for Community Development Block Grant funding
(from Federal Regulations)
Community Development Block Grant funds may be used for the following types of activities (provided national objectives are also met):
· acquisition of property
· disposition of property
· public facilities and improvements
· clearance, demolition and removal of buildings
· some public services (subject to some limits in regulations)
· relocation
· housing rehabilitation, preservation and code enforcement
· economic development activities
· new housing construction (subject to some limits in regulations)
· planning and administrative costs
Alternatives that are generally not eligible include:
· buildings used for the general conduct of government
· general government expense
· political activities
· purchase of equipment and personal property
· operating and maintenance expenses