CC 2024-08-13_09h CDBG Funding ReallocationItem 9.h.
MEMORANDUM
TO: City Council
FROM: Bill Robeson, Assistant City Manager/Public Works Director
BY: Shannon Sweeney, City Engineer
SUBJECT: Community Development Block Grant (CDBG) Funding Reallocation
DATE: August 13, 2024
RECOMMENDATION:
1) Adopt a Resolution authorizing the City Manager to reallocate CDBG money previously
assigned to various City projects, to the Curb Ramp and Sidewalk Improvement Element
associated with the 2024 Pavement Maintenance Project. This CDBG money will be
applied to costs associated with the addition and replacement of curb ramps to meet
Americans with Disabilities Act (ADA) standards; and
2) Find that this item is not a project subject to the California Environmental Quality Act
(CEQA) because it has no potential to result in either a direct, or reasonably foreseeable
indirect, physical change in the environment. (State CEQA Guidelines, §§ 15060, subd.
(c)(2)-(3), 15378.)
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
Table 1 shows existing funding available from the CDBG program for various City projects
mentioned in Staff’s Recommendation. The total CDBG funding amount shown in Table
1 for City projects is $202,012.18.
Table 1: CDBG Funding Allocation
Item Amount Original Allocation Recommended Allocation
1 $59,416.49 2021 City Hall Front Entrance Project Curb Ramp and Sidewalk Improvement
2 $5,693.40 2023 CDBG Administration Curb Ramp and Sidewalk Improvement
3 $75,097.29 2023 CDBG Construction Curb Ramp and Sidewalk Improvement
4 $61,805.00 2024 CDBG Construction Curb Ramp and Sidewalk Improvement
All available CDBG funds are budgeted for their respective projects. This reallocation
does not impact various projects’ budgets, but simply changes the source of those funds.
Projects whose funding is recommended to be reallocated from CDBG will instead be
funded through the general fund, and vice versa. This recommendation does not
constitute a change in budget amounts, only the funding source. The carryovers and
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Item 9.h.
City Council
Community Development Block Grant (CDBG) Funding Reallocation
August 13, 2024
Page 2
budget reallocation will be completed in the First Quarter Financial Status report. This
approval will allow staff to move forward with the bidding process.
BACKGROUND:
On March 9, 2021, City Council approved $40,000 for a project named City Hall Front
Entrance Barrier Removal Project. The proposed project would install an accessible
entrance to the City Hall building, including installing exterior doors with automatic door
openers that can be easily operated by citizens with mobility limitations. This project also
addresses the first national CDBG objective by enhancing accessibility for individuals with
disabilities on City-owned property.
Since this City Hall ADA project was identified, additional funding has been made
available to it. County administrative staff has confirmed that a total of $59,416.49 is
allocated to this project (Item 1 in Table 1). The federal obligations associated with the
CDBG funding for this project have presented insurmountable difficulties with the
available funding. City staff still advocate for its completion and will be able to make
progress on its implementation by removing the extra federal obligations.
On February 14, 2023, City Council approved $6,111 for City administration and $56,749
for curb ramp and sidewalk improvement. Housing and Urban Development (HUD), the
federal organization that administers and distributes CDBG funds, adjusted local available
CDBG funds to $5,693.40 (Item 2 in Table 1) and $75,097.29 (Item 3 in Table 1),
respectively.
On February 13, 2024, City Council approved $58,960 in CDBG funds towards curb ramp
and sidewalk improvements on sidewalks adjacent to streets being paved and in
conjunction with scheduled pavement improvements. HUD increased local available
CDBG funds. As a result, the City’s 2024 funds received has been increased to $61,805
(Item 4 in Table 1).
ANALYSIS OF ISSUES:
The 2024 Pavement Maintenance Project is at 90% design review. The project originally
included the installation or replacement of 61 curb ramps adjacent to the 4.6 miles of
pavement scheduled to be treated, at a cost of $1.6 mill ion solely for curb ramp work. A
review of existing curb ramps revealed that all but eleven of those curb ramps meet either
exception or safe harbor elements of the ADA regulations, which negates the need to
replace them.
The remaining eleven curb ramps need to be either installed or replaced. The engineer’s
estimate solely for constructing these eleven remaining curb ramps is $167,000. A
prorated portion of other curb ramp project costs, such as mobilization, stormwater
monitoring, and traffic control can also be reimbursed using CDBG funds.
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Item 9.h.
City Council
Community Development Block Grant (CDBG) Funding Reallocation
August 13, 2024
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City staff worked closely with County CDBG program administration staff to ensure that
this reallocation is allowed. County staff has indicated that such an allocation can be
addressed through City Council approval and a letter signed by the City Manager
requesting the reallocation.
If any CDBG funds remain following the 2024 pavement maintenance project, these funds
can be reallocated to another project at a future date.
ALTERNATIVES:
The following alternatives are provided for the Council’s consideration:
1. Reallocate existing City CDBG funds as shown in Table 1;
2. Leave CDBG funds as currently allocated; or
3. Provide other direction to staff.
ADVANTAGES:
CDBG is a federally funded program. Federal programs have significant administrative
requirements including environmental review, disadvantaged business entity verification,
and Section 3 (economic opportunities for low – and very low – income persons) reporting.
These requirements are onerous to both City staff and contractors on small projects like
the ones shown in Table 1. Smaller companies are often unwilling or unable to meet these
requirements, which creates challenges in competitively bidding projects. Firms that
compete on larger construction projects are more accustomed to meeting federal
requirements, as larger construction projects are likely to have federal funding
components associated with them.
By consolidating funds into a single larger project, CDBG funds can be used more
efficiently. When contractors are required to meet federal obligations, administrative
requirements are an added cost to the project. On smaller projects, these costs are a
larger fraction of the project cost, leaving fewer funds available for construction. The
administrative cost of meeting federal regulations becomes a smaller fraction of larger
jobs, especially since larger firms are better equipped to address those requirements and
are more familiar with what is needed.
The administrative load on City staff is reduced substantially if the funds are consolidated
into one larger project rather than multiple smaller projects. City staff are required to
submit regular reports, numerous forms demonstrating compliance wi th federal
requirements, and reimbursement requests. By consolidating the funding, City staff will
only be tasked with completing this paperwork for one large project rather than numerous
small ones, which is a more efficient use of staff time.
DISADVANTAGES:
No disadvantages identified. All projects identified as previously funded by CDBG funds
will be funded using other funding sources instead.
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Item 9.h.
City Council
Community Development Block Grant (CDBG) Funding Reallocation
August 13, 2024
Page 4
ENVIRONMENTAL REVIEW:
This item is not a project subject to the California Environmental Quality Act (CEQA)
because it has no potential to result in either a direct, or reasonably foreseeable indirect,
physical change in the environment. (State CEQA Guidelines, §§ 15060, subd. (c)(2)-(3),
15378.)
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
ATTACHMENTS:
1. Proposed Resolution Authorizing CDBG Reallocation
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ATTACHMENT 1
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ARROYO GRANDE AUTHORIZING COMMUNITY
DEVELOPMENT BLOCK GRANT (CDBG)
REALLOCATION
WHEREAS, on March 9, 2021, City Council approved CDBG funds towards a City Hall
Front Entrance Barrier Removal Project; and
WHEREAS, on February 14, 2023, City Council approved CDBG funds towards curb
ramp and sidewalk improvements and CDBG program administration; and
WHEREAS, on February 13, 2024, City Council approved CDBG funds towards curb
ramp and sidewalk improvements; and
WHEREAS, CDBG funds remain in these various projects as shown in Exhibit A; and
WHEREAS, CDBG funds may be reallocated via a written request to the County of San
Luis Obispo, signed by the City Manager; and
WHEREAS, this reallocation does not change the budget or nature of projects identified
in the Fiscal Year 24-25 budget, but simply consolidates all of the CDBG funds available
to Curb Ramp Improvement element of the 2024 Pavement Maintenance Project, and
funds the remaining projects from the general fund; and
WHEREAS, consolidating these funds by reallocating them to a single project allows
these funds to be used more efficiently and reduces staff administration time ; and
WHEREAS, the action is exempt from the California Environmental Quality Act (CEQA)
pursuant to State Guidelines Section 15060 (c)(2),(3), 15378 as it does not constitute a
“project” under CEQA.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Arroyo
Grande hereby recommends that existing CDBG funds currently allocated to various
City projects be reallocated and consolidated to the Curb Ramp and Sidewalk
Improvement project associated with the 2024 Pavement Maintenance Project as listed
in Exhibit A attached hereto and incorporated herein by this reference.
On motion of Council Member , seconded by Council Member
, and on the following roll call vote, to wit:
AYES:
NOES:
ABSENT:
the foregoing Resolution was passed and adopted this 13th day of August, 2024.
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RESOLUTION NO.
PAGE 2
CAREN RAY RUSSOM, MAYOR
ATTEST:
JESSICA MATSON, CITY CLERK
APPROVED AS TO CONTENT:
MATTHEW DOWNING, CITY MANAGER
APPROVED AS TO FORM:
ISAAC ROSEN, CITY ATTORNEY
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RESOLUTION NO.
PAGE 3
EXHIBIT A
REALLOCATION OF PROGRAM YEAR 2022-2024 COMMUNITY DEVELOPMENT
BLOCK GRANT (CDBG) FUNDS
Amount Original Allocation Recommended Allocation
$59,416.49 2021 City Hall Front Entrance Project Curb Ramp and Sidewalk Improvement
$5,693.40 2023 CDBG Administration Curb Ramp and Sidewalk Improvement
$75,097.29 2023 CDBG Construction Curb Ramp and Sidewalk Improvement
$61,805.00 2024 CDBG Construction Curb Ramp and Sidewalk Improvement
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