HomeMy WebLinkAboutStaff Report 193-05City of Palo Alto
. City Manager's Report
TO: HONORABLE CITY COUNCIL 5
FROM: CITY MANAGER·
DATE: MARCH 21, 2005
DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
CMR: 193:05
SUBJECT: APPROVAL OF RESOLUTION IN SUPPORT OF THE COMMUNITY
DEVELOPMENT BLOCK GRANT PROGRAM
RECOMMENDATION
Staff recommends that the City Council approve the attached resolution supporting the critical
role that the Community Deveiopment Block Grant (CDBG) Program has played in the City of
Palo Alto and requesting that Congress continue the current funding formula for 2006 CDBG
grants and continue to maintain the CDBG Program as a separate program.
BACKGROUND
The President's FY2006 budget proposes the creation of a "Strengthening America's
Communities Initiative" which combines 18 existing direct grant programs, including CDBG,
into one with a total program budget that is nearly $1 billion less than the current CDBG
Program alone. As a result of this pending legislation, mayors, city council members, and non-
profit service providers across the nation are contacting their Congressional delegations
informing them of just how severe these proposed cuts, if enacted, would be to their
communities. The Mayor of Palo Alto has already sent letters to Senators Feinstein and Boxer
.and Congresswoman Eshoo regarding this proposal.
DISCUSSION
The CDBG Program in Palo Alto has played a critical role in community and economic
development in the City by providing funds to address a variety of housing and community
development needs for the past thirty years. In the past ten years Palo Alto has used over $6
million in CDBG funds to help build and revitalize over 600 rental-housing units and over
$500,000 to rehabilitate community centers, senior center and homeless centers. Recently, over
$1.2 million in CDBG funding was used for the Opportunity Center, a mixed-use project which
will provide 89 units of affordable housing and critical supportive services for the homeless and
those at risk of becoming homeless.
CDBG funds are essential to support fragile members of the Palo Alto community, such as low-
income elderly and homeless families and individuals. With the proposed elimination of the
program, the City will no longer be able to fund such services as the Urban Ministry drop-in
center, the Clara-Mateo Alliance shelter, the Catholic Charities long term care ombudsman
CMR: 193:05 Page lof2
program, and the Palo Alto Housing Corporation's SRO resident support services program.
These programs provide services to over 8,000 Palo Alto residents on an annual basis.
RESOURCE IMPACT
The City will also be forced to layoff 1.5 employees that currently administer the program in the
city. The elimination of the program will also affect contractors and businesses that service the
program, resulting in an overall economic loss to our community. If the CDBG Program is
modified as currently proposed by the President it could mean the elimination of the Program as
it currently exists in Palo Alto and a loss in grant funding of up to $900,000 annually.
POLICY IMPLICATION
The recommendation in this staff report is consistent with HUD policies and does not represent
any change to City policies.
APPROVEDBY:~~~=-~ __ ~ ____ ~=-~ __ ~ ____________ __
E EMS IE, DIRECTOR OF PL ING AND COMMUNITY
ENVIRONMENT ) .
CITY MANAGER APPROV~ ~" 0
EMILYHARRISON, ASSISTANT CITY MANAGER
. Attachment:
A -Resolution in Support of the Community Development Block Grant (CDBG) Program
CMR: 193:05 Page 2 of2
Attachment A
NOT YET APPROVED
RESOLUTION NO.
RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO
IN SUPPORT OF THE COMMUNITY DEVELOPMENT BLOCK
GRANT PROGRAM
WHEREAS, for thirty years America's
large and small cities in California,
Development Block Grant (CDBG) grants to
affordable housing, eliminate blight, and
investment, and
cities, including both
have used Community
ciea~e jobs, provide
generate new economic
WHEREAS, CDBG funds represent a catalyst for creating more
affordable housing, making it possible for the City of Palo Alto to
use $6 million to help build and revitalize over 600 rental housing
units in the past ten years; and
WHEREAS, the CDBG program offers a mechanism for assisting
public facilities, whereby Palo Alto used over $500,000 to
rehabilitate community centers, senior centers and homeless
shelters in the past ten years; and
WHEREAS, the CDBG program offers a mechanism for assisting
public facilities, whereby Palo alto used over $500,000 to
rehabilitate community centers, senior centers and homeless
shelters in the past ten years and; and
WHEREAS, the CDBG program has assisted various public
service agencies, which serve an average of 8,000 people per year;
and
WHEREAS, the President has proposed a new "Strengthening
America's Communities Initiative" which combines 18 direct grant
programs, including CDBG, into one within the Economic Development
Administration (EDA); and
WHEREAS, at' $3.71 billion, the new program (which combines
18 programs) is nearly $1 billion less than the current CDBG
program alone; and
WHEREAS, without proper funding forCDBG, we risk
undermining the economic well being of our communities, the future
generations that live there, and the nation as a whole.
NOW, THEREFORE, the Council of the City of Palo Alto does
RESOLVE as follows:
1
050315 syn 0120003
'.: I. ~. ,"
NOT YET APPROVED
SECTION 1. The City Council request that Congress enact a
FY 2005 budget and appropriations package that funds CDBG formula
grants at no less than $4.355 billion, which is level with FY 2005
allocations; and
SECTION 2. That Congress maintain the CDBG as a separate
and distinct program from other economic development programs that
provides a direct and flexible sources of funding to local
governments; and
SECTION 3. That Congress maintain the current "dual
formula" system where 70 percent of CDBG funds go to entitlement
communities based on population; and
SECTION 4. The Council will send copies of this resolution
to Senator Barbara Boxer and Senator Dianne Feinstein, and to the
League of California Cities, Attention: Genevieve Morelos, 1400 K
Street, 4th Floor, Sacramento, CA 95814.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:
City Clerk
APPROVED AS TO FORM:
Senior Asst. City Attorney
APPROVED AS TO CONTENT:
CDBG Coordinator
050315 syn 0120003
2
APPROVED:
Mayor
, Ci ty Manager
Director of Planning
and Community Environment
Director of Administrative
Services