REPORT TO THE CITY COUNCIL
July 31, 2014
FROM: JENNIFER CLARK, Director
Development and Resource Management Department
BY: CRYSTAL SMITH, Management Analyst III
Development and Resource Management / CDBG Section
SUBJECT
Title
* RESOLUTION - 4th amendment to Annual Appropriations Resolution No. 2014-95 appropriating $330,400 of Neighborhood Stabilization Program funds for development agreements previously approved by Council (Requires 5 affirmative votes)
Body
RECOMMENDATION
Adopt the 4th Amendment to AAR No. 2014-95 approving the appropriation of $330,400 of Neighborhood Stabilization Program 1 (NSP1) funds for projects previously approved by the City Council.
EXECUTIVE SUMMARY
On November 29, 2012, Council adopted a substantial amendment to the Annual Action Plan approving development agreements with Fresno Housing Authority and TFS Investments to carry out acquisition, rehabilitation, and leasing activities. The agenda item also approved the use of NSP1 revenue to complete the projects.
This agenda item seeks spending authority for $330,400 of revenue drawn at the end of the prior fiscal year for reimbursement of eligible program costs but not included in the carryover. These activities and associated reimbursement need to be appropriated at this time to complete the activities. These are not new funds for purposes of new development projects. Both programs are near construction completion and staff seeks to close out the program and make the final payment to the NSP3 development partners, as previously approved by Council.
BACKGROUND
The Neighborhood Stabilization Program (NSP) provides funding from the U.S. Department of Housing and Urban Development (HUD) to assist jurisdictions with addressing the impact the national foreclosure crisis had on local neighborhoods. The City of Fresno is the recipient of $10.969 million of NSP1 funds and $3.547 million of NSP3 funds, as authorized under the Housing and Economic Recovery Act of 2008 and the Dodd-Frank Wall Street Reform and Protection Act of 2010, respectively.
The City of Fresno is an entitlement jurisdiction that receives grant funding through the U.S. Department of Housing and Urban Development. As a requirement to receive the funding, the City is required to prepare an Annual Action Plan that details the jurisdiction's approved activities and funding. On November 29, 2012, Council adopted a substantial amendment to the Annual Action Plan approving development agreements with Fresno Housing Authority and TFS Investments to carry out acquisition, rehabilitation, and leasing activities. The agenda item also approved the use of NSP1 revenue to complete the projects.
As recipients of NSP funding, the City was charged with acquiring, rehabilitating, selling, and leasing foreclosed homes to persons at or below 120% of the area median income. To this end, the City, through its NSP partners, successfully:
· Acquired and rehabilitated 81 homes, a 118-unit complex near downtown, and a 32-unit apartment complex near Fresno State;
· Sold 71 homes under NSP1 to low to middle income households;
· Leased open units in the 32-unit apartment complex and the single family properties acquired under NSP3; and
· Created $4 million in program income under NSP1.
This agenda item seeks spending authority for funds drawn down at the close of the prior fiscal year that were not included in the carryover. Funds will be used to reimburse the NSP3 partners for eligible construction costs previously approved by Council. This revenue is not new funding available for new projects. Approval of the items allows the City to meet its contractual obligations.
ENVIRONMENTAL FINDINGS
This is not a project for purposes of CEQA. No environmental finding is required.
LOCAL PREFERENCE
Local preference is not applicable because of the use of federal funding.
FISCAL IMPACT
There is no fiscal impact to the General Fund. This action seeks appropriation authority for funds drawn down at the end of the prior program year and not captured as part of the carryover. NSP funds are received from HUD and are used for eligible construction activities.
Attachment: Exhibit A - 4th Amendment to AAR Resolution No. 2014-95