Jessica Cejnar Andrews / Yesterday at 4:28 p.m. / Community, Local Government
Crescent City Pursues CDBG Dollars for Microenterprise Loan Program, Storm Sewer Master Plan; Councilors explore development of housing rehabilitation assistance program
In addition to seeking 2022 Community Development Block Grants to continue providing micro-enterprise loans to local businesses and developing a stormwater drainage master plan, Crescent City staff will explore the creation of a grant-funded housing rehabilitation program.
But since it will take time for the city to work out the guidelines, the staffing and to determine if it’s a task it can do in-house, its grants consultant, Lorie Adams, recommended waiting until CDBG 2023 application process before seeking funding.
“It’s a heavy burden,” she told councilors in Crescent on Monday. “It’s just a matter of making sure everything is in place, your guidelines are solid, you have your housing committee and everyone is educated. Everyone is ready to get going. »
On Monday, four Crescent City Council members cleared staff to prepare an application for $750,000 in CDBG dollars to continue its micro-business loan program, which benefits small businesses with five or fewer employees, including the owner. .
Councilors also authorized staff to apply for a $250,000 planning and technical assistance grant for the storm sewer master plan. Mayor Pro Tem Isaiah Wright was absent.
Under the state’s 2022 Funding Availability Notice, Crescent City may submit up to three grant applications totaling $1.5 million under the criteria of housing, utilities, technical assistance and economic development, according to Adams.
Statewide, $30 million is available in CDBG funding, which comes from the US Department of Housing and Urban Development and is allocated by the California Department of Housing and Community Development.
In addition to the Micro-Business Loan Program, other CDBG-funded programs in Crescent City include the North Coast Rape Crisis Team, the Community Food Council’s Pacific Pantry and Mobile Pantry, and the Aid Loan Program to businesses in the city.
According to Crescent City Grants Coordinator Bridget Lacey, most of these programs operate under CDBG Open Grants 2020. Since 50% of these grants have yet to be spent, the city cannot request dollars. to CDBG for these programs, she said.
The City has until June 20 to submit its application.
It was Crescent Councilman Blake Inscore who raised the idea of getting CDBG dollars for a housing rehabilitation program. He acknowledged that creating such a program would be a heavy burden on staff, but argued that there were “lots of older people” who could benefit from such a program.
“I know when the senior center has done things like this across the county, we’ve gotten really good responses from people that we’ve had a positive impact on,” he said. “The other element is that the city has tried to be very proactive, since I’ve been on council, in solving code enforcement issues instead of just coming in with the paperwork, basically with the gavel.”
Noting that the city can apply for up to $1.5 million in 2022 CDBG dollars, Inscore pointed out that after requesting $750,000 for the micro-enterprise loan program and $500,000 for the sewer master plan storms, she could pursue the remaining $500,000 for a home rehabilitation program.
“This housing rehabilitation program could actually impact specific individuals and make a material difference (for) the people who live in our city,” he said.
According to Adams, housing rehabilitation programs are popular, but implementing them requires a lot of resources. Some communities focus primarily on weathering their residents’ homes while others focus on their senior population, modifying their homes to help address any mobility issues residents might have, she said. declared.
Other communities are working with their code enforcement department to help residents address health and safety issues — potential code violations — Adams said.
“The program is provided to individuals through equity loans and some grants, and it’s all designed within your guidelines and how you want to provide it,” she told the city council. “Then they go through a process of working with staff to make sure they are eligible for income and the property is eligible – there are title issues that can prevent a property from being eligible. Then they go through the process of getting the city loan.
According to Adams, the city sets the terms, including whether or not interest is charged on the loan and whether the homeowner can defer payments. The agency also helps residents contact a contractor, she said.
To receive CDBG dollars for a home rehabilitation assistance program, the city would need to determine whether it can run the program itself or whether it must contract with an outside consultant or nonprofit organization, a said Adams.
She said her company, The Adams Ashby Group, had worked with communities in the past to create housing rehabilitation assistance programs, including helping them develop guidelines and find staff.
“It took about $50,000 in total to line everything up, and that includes my time and the time of city staff to put these documents in place (and) to put the training in place,” Adams told advisers. . “We don’t implement the programs anymore — it’s too expensive for a consultant to implement these programs on behalf of the communities. A hybrid is much better, or finding a nonprofit you can partner with. Then we step in and help with the training and make sure they implement (the program) appropriately. »
Adams also pointed out that rehabilitation projects can be large — a bathroom or kitchen renovation — requiring the resident to leave the house for several weeks during construction. The agency often finds itself having to ensure that no shortcuts or secondary measures are taken during the rehabilitation project, she said.
Adams pointed out that Crescent City once had a strong housing rehabilitation assistance program.
Crescent City manager Eric Wier said the program came early in his career at the city, which still handles a handful of those loans it processes on an annual basis. He argued that to be successful, the city would need to contract with the “right subrecipient.”
“To really run a successful program, it almost really feels like you have to be there for that person and really hold their hand step by step,” he said. “It’s not like we can be the city and just give them the funds directly and it’ll be fine most of the time.”
City Attorney Martha Rice also pointed out that a loan-based housing assistance rehabilitation program also requires ongoing staff time to manage loan repayment.
According to Lacey, when loan repayments come with terms of 30 years or the life of the property, the city can’t just take the home from the owner. There is an option in the CDBG grant for housing rehabilitation programs where there is an end date, she said.
That end date would come in the form of a seven-to-ten-year forgivable loan typically, according to Adams.
“What they’re going to do is create a program where (the loan) is repayable at 1/7th or 1/10th each year the person stays in the unit,” she said. “If they stay for the seven or 10 years, the funds are granted and that eliminates any repayment requirement. If the person sells their home before meeting this obligation, it will require a return of the funds.
Inscore said that while asking the city to submit a grant application for a housing rehabilitation assistance program by June 20 would be a big ask, it wanted to explore a project with a limited scope, so “we don’t let’s not talk about 30-year loans”. He said he liked the idea of forgivable loans based on “very specific criteria”.
“I think we’ve spent a lot of time over the last few years talking about infrastructure,” he said. “We spent a lot of time talking business. We’ve spent a lot of time talking about food pantries and that kind of stuff, and we really haven’t had a chance to talk about helping people who live in the city. This is an opportunity for us to give people a hand. And if it works, great. And if not, I understand that, but I would like us to at least explore the possibility.