HomeMy WebLinkAbout2002-05-13 City Council (12)TO:
city of Palo Alto
City Manager’s Report
HONORABLE CITY COUNCIL
2
FROM:CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE:MAY 13, 2002 CMR:253:02
SUBJECT:PUBLIC HEARING: FISCAL YEAR 2002/03 COMMUNITY
DEVELOPMENT BLOCK GRANT FUNDING ALLOCATIONS
AND ANNUAL ACTION PLAN UPDATE OF THE
CONSOLIDATED PLAN FOR THE PERIOD 2000-2005; AND
RECOMMENDATION TO ADOPT A RESOLUTION OF THE
COUNCIL OF THE CITY OF PALO ALTO CONSENTING TO THE
HOUSING AUTHORITY OF SANTA CLARA COUNTY
TRANSACTING BUSINESS WITHIN THE CITY OF PALO ALTO
FOR THE PURPOSE OF ACQUIRING LAND AND DEVELOPINIG
AFFORDABLE HOUSING ON THE PARCELS LOCATED AT 33,
39 AND 45 ENCINA AVENUE
REPORT IN BRIEF
The Finance Committee considered the 2002-2003 CDBG allocations at a public hearing
on April 16, 2002. The Finance Committee voted to recommend to Council the approval
of the staff and Citizen Advisory Committee recommendations reflected in the attached
CMR:206:02. Subsequent to the Finance Committee actions, two changes have been
made to the funding allocation package.
In order to provide additional funding to enable proceeding with legal actions to secure
the Opportunity Center site, it has been requested by the Santa Clara County Housing
Authority and the Community Working Group that the City reserve up to $250,000 in
additional funding. The source of the reallocated $250,000 in CDBG funds is $112,000
from the 2001-2002 allocation to Alliance for Community Care to rehabilitate 560
Waverley Stree~ and $138,000 from the 2001-2002 and 2002-2003 CDBG Housing
Development Funds. The Waverley Street project has been terminated at the request of
Alliance’s Board of Directors. Any portion of the $250,000 not expended as part of the
Opportunity Center project will revert to the CDBG Housing Development Fund.
CMR:253:02 Page 1 of 7
In addition, it is recommended that the City Council authorize the Housing Authority to
utilize all actions necessary to develop the Opportunity Center project, such as eminent
domain. It is also recommended that the City Council approve the request by the
Community Working Group to transfer CDBG funds for the project to the Housing
Authority.
CMR:253:02 Page 2 of 7
RECOMMENDATION:
Staff recommends that the City Council:
o
Adopt the attached "Resolution of the City Council of the City of Palo Alto
Approving the Use of Community Development Block Grant Funds for Fiscal
Years 2002-2003 and the Preliminary Commitment of Funds From Fiscal Years
2003-2004 and 2004-2005," including contingency options and a change to a two-
year CDBG funding cycle.
Authorize. and direct the .City Manager, or his designee, to execute and submit to
HUD the application and other documentation necessary to file the application
with HUD, and to otherwise bind the City with respect to the application, before
the May 15, 2002 deadline.
0
o
Authorize and direct staff to Carry out any further required environmental
assessments and certifications for each project under the National Environmental
Policy Act (NEPA) prior to the commitment of funds.
Adopt the attached "Resolution of the City Council of the City of Palo Alto
Consenting to the Housing Authority of Santa Clara County Transacting Business
Within the City of Palo Alto for the Purpose of Acquiring Land and-Developing
Affordable Housing on Parcels Located at 33, 39 and 45 Encina Avenue," and
approve substitution of the Housing Authority for the Community Working Group
as the contact administrator of Opportunity Center 2001-2002 funding in the
amount of $480,000.
BACKGROUND
The purpose of the May 13, 2002 public hearing is for the City Council to review and act
on .the recommendations of the Finance Committee regarding the Fiscal Year 2002/03
CDBG funding allocations. The required 30-day public review period for the Draft
Annual Action Plan began on April 1, 2002 and concluded on April 30, 2002. Public
comments on the draft Annual Action Plan are appended to the report. The attached staff
report (CMR:206:02) provides background information on the 2002/03 CDBG process,
specific administrative issues, the funding proposals, the staff and Citizens Advisory
Committee (CAC) funding recommendations, and the draft Annual Action Plan.
The Finance Committee considered the 2002/03 CDBG allocations at a public hearing on
April 16, 2002. Attachment C contains the Finance Committee meeting minutes. The
Finance Committee voted to recommend to Council the approval of the staff and CAC
recommendations reflected in CMR:206:02. However, since the Finance Committee’s
actions on April 16, 2002, the Waverley Street project has been dropped and the City has
received a compelling request for a commitment of additional funds for the Opportunity
Center project.
CMR:~53:02 Page 3 of 7
DISCUSSION
Opportunity Center
During the last year, the Community Working Group (CWG)~ with the support of City
staff, decided to acquire an adjoining lot at 45 Encina Avenue for the purpose of
providing a larger and more functional site for development of the Opportunity Center.
With the three parcels (33, 39 and 45 Encina Avenue) the site will be 18,178 square feet
in size. The larger site allows the development of almost twice the number of housing
units over the services center (95 units versus 55 units). In addition, an improved layout
is possible for family and adult services and the underground parking can be more
efficiently designed.
CWG presently holds clear title to 33 Encina and acquired title to 39 Encina, subject to
the right to purchase claim by the former commercial tenant. CWG has made repeated
attempts to enter into a purchase agreement with the owner of 45 Encina and to resolve
title issues to 39 Encina. City staff has been involved in meetings and negotiations over
the last two months to facilitate an arrangement whereby CWG and the Housing
Authority could cooperate on the project. The two parties have now restructured the
project and the role of each entity in implementation.
The Housing Authority will take the lead role as the developer of both the service center
and the 95 housing units to be built over the center. It will be the applicant for the
complex mix of loans, grants and tax credit financing that must be assembled to construCt
this $17 million project. The Housing Authority Board of Commissioners also agreed on
April 23, 2002 to utilize its eminent domain authority, if necessary, to remove the
remaining title issues on the 39 Encina Avenue parcel, to acquire 45 Encina, and to
relocate the business that presently occupies that property. These changes should ensure
that full control of the entire site is obtained in time to meet the September 30, .2002
.deadline recommended by the Finance Committee, staff and the CAC. With the full
participation of the Housing Authority in resolving the site control issues, CWG will now
be able to proceed immediately with its architect to prepare and submit the Planned
Community zone change application to the City. The Housing Authority will act as the
administrator for the various contracts during the predevelopment period, including
architecture, engineering, relocation consultant and benefits and legal work. CWG has
submitted a letter requesting that the full amount of Palo Alto’s CDBG funds allocated
for the project be transferred to the Housing Authority (see Attachment D).
The Housing Authority’s legal counsel has advised staff that it is prudent to have the
Council expressly authorize the Housing Authority to use its legal powers to develop the
Opportunity Center project, including the proposed 95 units of housing, on the property
known as 33, 39 and 45 Encina Avenue. The attached resolution expresses the Council
consent to such actions.by the Housing Authority as are necessary to develop the project,
including utilizing its powers of eminent domain to secure the acquisition of the entire
site free and clear of any impediments to the construction of the project. The resolution
CMR:253:02 Page 4 of 7
does not in any way reduce, modify or constitute approval by the Council of any future
land use or zoning actions connected with the project.
As a condition of proceeding with the project, the Housing Authority Board requested
that the City reserve a total of $1,280,000 in funding (over the $1,030,000 already
planned) for acquisition, relocation and pre-construction costs. Staff supports an
additional $250,000 funding commitment at this time for land acquisition and related
costs. Staff recommends that Council include the $250,000 in the budget resolution for
the CDBG program for 2002-03. This action will provide the Housing Authority with the
assurances and the financial commitment it requested. However, these additional funds
will not be put under contract until it is clear how, and if, they should be spent. The
source of the $250,000 is CDBG funds, including $112,000 in funds reprogrammed from
the Alliance for Community Care’s project to rehabilitate the Waverley Street house, plus
$138,000 in current year and FY 2002-03 City CDBG Housing Development Funds. No
funds for the Opportunity Center project will be expended until Council has reviewed and
approved the funding and loan agreements for the use of the City’s funding.
Termination of Waverley House Project:
The attached CMR:206:02 to the Finance Committee includes a discussion on the status
of the property at 650 Waverley Street on page 6. At the time that CMR was written,
Alliance’s Board had decided to sell the property for the best price possible, although it
had agreed to consider offers from agencies interested in using the house for transitional
or permanent housing for homeless persons. Two n0n-profit agencies submitted purchase
offers to Alliance. One, .by the Emergency Housing Consortium, was for $800,000, and
the other, by Innvision, was for $1,100,000. Simultaneously, Alliance received an offer
from a private buyer for $1,200,000 which included a relatively short period to close
escrow. The Alliance Board accepted the private Offer due to the higher price and the
short closing. Escrow closed on April 30, as scheduled; and Alliance sent the City a
letter confirming that the $112,000 in. CDBG funds previously appropriated for the
building’s rehabilitation could be released for other purposes. Alliance had owned the
property free and clear of any debts or regulatory controls other than $12,936 in principal
and interest on a 1998 City CDBG loan for feasibility study work. The City’s loan was
repaid from the sales proceeds. In addition to the loss of a property that would have
housed up to 12 homeless adults, over $500,000 in housing subsidies from other public
and private funders (including. a $184,000 HUD Mc Kinney grant) will now be lost or
diverted to projects elsewhere in the County.
RESOURCE IMPACT
The Finance Committee approved a staff and CAC recommendation that the $112,000 in
Waverley House funds revert to the City’s Housing Development Fund if Alliance did
not agree to a sale to an acceptable successor agency by September 30, 2002. Staff
believes that those funds can now be more effectively used to help move the Opportunity
Center project forward. In the long run, should the funds not be needed for the
Opportunity Center, theywould revert to the Housifig Development Fund for future
S :kPLANkPLADIV\CMRk253 -02.doc Page 5 of 7
housing site acquisition. The $250,000 in additional funding for the Opportunity Center
will come from the following specific funds:
$112,000
$58,000
$8o,ooo
Reprogrammed Funds from Waverley House Project
FY 01 - 02 CDBG City’s Housing Development Fund
FY 02 -03 CDBG City’s Housing Development fund
$250.000 TOTAL
All of the above funding will revert to the CDBGHousing Development Fund if. not
proven necessary for the Oppormnity Center project~ A balance, of about $44,000 is
being !eft in the current years CDBG Housing Development Fund for City expenses
related to feasibility studies on a future multi-family housing site and at least $26,500 of
those funds will be expended this fiscal year. The transfer of $80,000 from FY 2002-03
City Housing. Dev.elopment Fund monies will reduce the allocation to that Fund,
previously approved by the Finance Committee, from $198,500 to $118,500. While this
reduces the funding available for future housing land acquisition, staff believes that
providing the necessary financial support to move the Opportunity Center project forward
is a more immediate priority.
ATTACHMENTS
Attachment A CDBG Funding Resolution for Fiscal Year 2002/03
Attachment B Resolution Consenting to the Housing Authority of Santa Clara County
Transacting Business Within the City of Palo Alto
Attachment C April 16, 2002 Staff Report (CMR:206:02)
Attachment D May 7, 2002 Letter from The Community Working Group, Inc.
p4 Suzanne Bayley, CD~or
DEPARTMENT HEAD REVIEW:
~EPHEN~EMSLI~
Director of Planning and Community Environment
Assistant City Manager
CMR:253:02 Page 6 of 7
cC:CDBG Citizens Advisory Committee
Human Relations Commission
2002/2003 Applicant Agencies
Housing Authority of Santa Clara County
CMR:253:02 Page 7 of 7
ATTACHMENT A
RESOLUTION NO.
RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO
APPROVING THE USE OF COMMUNITY DEVELOPMENT BLOCK
GRANT FUNDS FOR FISCAL YEARS 2002-2003 AND THE
PRELIMINARY COMMITMENT OF FUNDS FROM FISCAL YEARS
2003-2004 AND 2004-2005
: WHEREAS, on May 8, 2000, the Palo Alto City Council
approved and adopted a document entitled "Consolidated Plan", which
identified and established the Palo Alto housing and non-housing
community development needs, objectives, and priorities for the
period of July i, 2000 to June 30, 2005; and
WHEREAS, the 2002-03 Action Plan, the annual update to the
Consolidated Plan, was subjected to public review and commentary
during the period of April i, 2002, through April 30, 2002; and
WHEREAS, the potential uses of Community Development Block
Grant ("CDBG") funds were evaluated in light of the needs and
objectives identified in the Consolidated Plan and reflected in the
recommendations and comments of the Citizens Advisory Committee and
other interested citizens; and
WHEREAS, under the CDBG program, the highest priority is
given to activities which will benefit persons with low and
moderate incomes; and
WHEREAS, the City Council and the Finance Committee of the
City Council have held publicly noticed public hearings on the
proposed uses of the CDBG funds for fiscal year 2.002-03; and
WHEREAS, the fiscal year 2002-03 CDBG funds allocated to
theCity are proposed to implement the following programs;
NOW, THEREFORE, the Council of the City of Palo Alto does
RESOLVE as follows:
SECTION i. The uses of CDBG funds for fiscal year 2002-03
are hereby approved and authorized for the following programs:
Current Authorization:
Emergency Housing Consortium. EHC
provides temporary shelter and supportive
services for homeless individuals and
families. County-wide.8,490
020508 syn 0091073
II
II
II
II
II
o
Palo Alto Housing Corporation. Supportive
counseling program for low income residents
and prospective residents of single-room
occupancy housing in Palo Alto.
o
Shelter Network’s Haven Family House -
Transitional housing and comprehensive
supportive services for homeless families
at the agency’s Menlo Park facility. Haven
Family House seeks to permanently break the
cycle of homelessness, re-linking homeless
families with stable incomes, jobs, and
housing.
o
Clara Mateo Alliance’s Family Shelter Wing
and Elsa Segovia Day Center - Emergency
and transitional housing and supportive
services for homeless families with
children. New services include a
comprehensive day center for women
and children. All services are provided on
the grounds of the VA Campus in Menlo Park
Clara Mateo Alliance’s Shelter - Emergency
and transitional housing for homeless
persons at the VA campus in Menlo Park.
The shelter targets a difficult to serve
population such as homeless persons with
disabilities, psychiatric disorders,
substance-abuse issues, and those with
severe mental illness.
Urban Ministry of Palo Alto/InnVision -
Drop-in Center for the local homeless
population. Supportive services include
counseling, case management, light
meals, shelter referral, bus passes,
phone, mail, clothing, and referrals to
other agencies.
24,745
20,000
22,000
28,750
20,715
020508 syn 0091073
i0.
ii.
St. Vincent de Paul Society/St. Joseph
the Worker Center - The Center connects
day laborers with employers and provides
a safe alternative for laborers to find
employment. The Center also provides
a setting in which both.workers and
employers can meet and negotiate work
projects, hours and conditions. Addi-
tionally, clients are provided with
assistance in job readiness training,
and classes in English as a Second
Language. The allocation is contingent
upon the organization identifying and
occupying a site by September 30, 2002.
Mid-Peninsula Citizens for Fair Housing.
MCFH provides services to promote fair
housing, including complaint investigation,
counseling, advocacy and education.
City-wide.
City of Palo Alto. Department of Planning
and Community Environment. Overall CDBG
grant administration and capital improve-
ment project delivery costs associated with
federal funding. City-wide.
Housing Authority of Santa Clara County
with Community Working Group - Opportunity
Center. Predevelopment, relocation and
acquisition costs of a site for a new
facility to provide social services and
approximately 95 units of housing
affordable to extremely low income
persons. 33/39/45 Encina in Palo Alto.
Allocation is contingent upon the agency
securing site control by September 30,
2002.
City of Palo Alto - CDBG Housing Develop-
ment Fund. Provision of funds to be used
in conjunction with other City Housing
In-Lieu funds to acquire a site for a
new affordable housing project. Location
not yet determined.
I0,000
25,800
l O,OOO
8oo,oo6
118,500
020508 syn 0091073
3
12.Palo Alto Community Child Care - Ventura
Community Center. The project is to paint
the exterior of the 50-year old former
elementary school structure. The
facility is occupied by child-care and
other community serving programs and is
located in one of the most economically
disadvantaged sections of Palo Alto.98,000
13.Avenidas - The project provides upgrades
to the heating, ventilation, and air
conditioning system at the public facility
that serves Palo Alto’s senior population.
HVAC upgrades will promote a comfortable
atmosphere and improve the energy
efficiency of the building.120,000
14.Palo Alto Senior Housing Project, Inc. -
Stevenson House- Project will provide
upgrades to the emergency call system in
the 120 unit residential facility. Stevenson
House provides affordable rental housing to
low-income seniors.50,000
TOTAL $1,487,000
Contingent Authorizations:
If the St. Vincent de Paul St./Joseph
the Worker Center project (described
in item 7 above) has not met its
contingency obligation of site control
by the September 30, 2002 deadline, the
$10,000 in funding will be reauthorized
for the following program:
Community Housing, Inc. - Lytton Gardens.
Project is .to purchase tables, chairs
and other necessities for the senior
residential facility’s congregate dining
room. The facility provides affordable
independent and assisted housing for
low-income senior residents. $i0,000
020508 syn 0091073
4
If the Community Working Group’s
Opportunity Center project (described
in item i0 above)is unable to secure
site control of the necessary parcels
by the September 30, 2002 deadline, the
$800,000 allocation will be reauthorized
for the following programs:
Palo Alto Housing Corporation - Oak
Manor Townhouses. Project is to
replace the domestic water system at
the 33-unit family complex occupied
by low-income families. The building
was constructed in 1966 and has major
capital plumbing needs due to corroded
galvanized pipes that cause low water
pressure and abrupt water temperature
changes
City of Palo Alto - CDBG Housing
Development Fund. - Provision of
funds to be used for a new affordable
housing site.
$ 200,000
$ 600,000
SECTION 2. The total amount set forth under Section 1 of
this resolution hereby represents the proposed allocation of
$808,000 in CDBG funds, from the United States Department of
Housing and Urban Development ("HUD") for fiscal year 2002-03,
$30,000 in anticipated program income for .fiscal year 2002-03,
$45,000 in prior years program income, $14,000 in reallocated
contingency, funds, $420,000 in reallocated.funds from the SOFA
project, $112,000 in reallocated funds from the Alliance for
Community Care’s Waverley Street project and $58,000 in reallocated
funds from the CDBG Housing Development Fund.
SECTION 3. CDBG funding from future fiscal years 2003/04
and 2004/05 may be committed for the purchase in fiscal year
2002/03 of a new site for an affordable housing project. Up to
$i,000,000 in CDBG funding (including the unencumbered balance in
the CDBG Housing Development Fund) may b9 used for this purpose.
SECTION 4. CDBG funding from future fiscal years 2003/04
and 2004/05 may be committed for the purchase in fiscal year
2002/03 of a new site for an affordable housing project. Up to
$i,000,000 in CDBG funding (including the unencumbered balance in
the CDBG Housing Development Fund) may be used for this purpose.
020508 syn 0091073
5
SECTION 5. The City staff is hereby authorized to submit
the 2002-03 annual Action Plan update and appropriate application
forms to HUD for the fiscal year 2002-03 CDBG funds, and such money
shall be spent as set forth in this resolution. The Mayor, City
Manager and any other designated City staff or officials are hereby
authorized to execute such application forms and any other
necessary documents to secure these funds.
SECTION 6. The City Council hereby finds that the fiscal
year 2002-03 CDBG program authorized under Section 1 of this
resolution is not a project under the California Environmental
Quality Act ("CEQA"). However, the Council.further authorizes and
directs City staff to conduct any further environmental review, and
prepare any additional environmental assessments and certificates
that may be required, under CEQA and the National Environmental
Policy Act (NEPA) for each project under the fiscal year 2002-03
CDBG program prior to the release of funds for any such project.
INTRODUCED AND PASSED:
AYES :
NOES :
ABSTENTIONS :
ABSENT :
ATTEST :APPROVED:
City Clerk
APPROVED AS TO FORM:
Senior Asst. City Attorney
APPROVED AS TO CONTENT:
CDBG Coordinator
Mayor
City Manager
Director of Planning
and Community Environment
Director of Administrative
Services
020508 syn 0091073
ATTACHMENT B
RESOLUTION NO.
RESOLUTION OF THE COUNCIL OF THE CITY OF PALO
ALTO CONSENTING TO THE HOUSING AUTHORITY OF
SANTA CLARA COUNTY TRANSACTING BUSINESS WITHIN
THE CITY OF PALO ALTO FOR THE PURPOSE OF
ACQUIRING LAND AND DEVELOPING AFFORDABLE HOUSING
ON THE PARCELS LOCATED AT 33, 39 AND .45 ENCINA
AVENUE
WHEREAS, the Housing Authority of Santa Clara County has
proposed developing affordable housing (the "Development") on
property located at 33, 39 and 45 Encina Avenue within the City
of Palo Alto;
WHEREAS, the City desires that the Housing Authority of
Santa Clara County develop the Development on those parcels;
WHEREAS, Health and Safety Code Section 34209 authorizes
the Housing Authority of Santa Clara County to transact business
within the City if the City Council of the City consents;
WHEREAS, the City desires to consent to the Housing
Authority of Santa Clara County transacting business in the City
for the purposes of carrying out the Development, subject,
however, to the City granting any land use or similar approvals
necessary to develop the Development.
THEREFORE, the City Council of the City of Palo Alto
resolves as follows:
SECTION i.The City Council hereby approves and
consents to the Santa Clara County Housing Authority transacting
business and exercising its powers, including its power to
acquire real property by eminent domain, if necessary, in the
City of Palo Alto for the purpose of developing the Development
on the parcels located at 33, 39 and 45 Encina Avenue within the
City. Said approval and consent shall not constitute approval
of any land use or similar approvals necessary to develop the
Development.
SECTION 2. This Resolution shall take effect
immediately.
020508 syn 0091069
SECTION 3. The Council finds that the adoption of this
resolution does not constitute a project, under the California
Environmental Quality Act and the CEQA Guidelines and,
therefore, no environmental assessment is required.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:APPROVED:
City Clerk
APPROVED AS TO FORM:
City Attorney
Mayor
City Manager
Director of Planning and
Community Environ[nent
020508 syn 0091069
BUDGET
’02- ’03 City of Palo Alto
City Manager’s.Report
TO:HONORABLE CITY COUNCIL ATTACHMENT C
ATTENTION: FINANCE COMMITTEE
FROM:CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE:APRIL 16, 2002"CMR:206:02
SUBJECT:PROPOSED FISCAL YEAR 2002/03 COMMUNITY
DEVELOPMENT BLOCK GRANT (CDBG)
FUNDING ALLOCATIONS AND DRAFT ACTION PLAN
REPORT IN BRIEF
This report transmits the recommendations of City staff and the Citizens Advisory
Committee (CAC) for the expenditure of $1,317,000 in Community Development Block
Grant (CDBG) funds. The draft Action Plan includes the funding-recommendations,
contingency recommendations, a commitment of future year’s CDBG funds for an
affordable housing project, and proposed changes to the CDBG process that provide for a
two-year funding cycle beginning in fiscalyear 2003/04.
CMR:206:02 Page 1 of 11
RECOMMENDATION
Staff and the CDBG Citizen’s Advisory Committee recommend
Committee recommend to the City Council approval of the following:
that the Finance
Allocate CDBG funding as recommended by staff in the final 2002/03 Action Plan
update to the Consolidated Plan for the period 2000 to 2005, including the
contingency options.
2.Commit future CDBG funds to repay the General Fund for a portion of the CDBG
eligible site acquisition costs in connection with a new affordable housing project if a
site can be identified and acquired in 2002/03.
3.Include in the final 2002/03 Action Plan update to the Consolidated Plan fo~" the
period 2000 to 2005 a change to a two-year CDBG funding cycle beginning with the
2003/04 fiscal year as outlined in the draft 2002/03 Action Plan.
o
o
Authorize staff to submit the 2002/03 Action Plan to the Department of Housing and
Urban Development (HUD) by the May 15, 2002 deadline.
Authorize the City Manager, on behalf of the City, to execute the 2002/03 application
and Action Plan for CDBG funds and any other necessary documents concerning the
application, and. to otherwise bind the City with respect to the application and
commitment of funds.
BACKGROUND
Consolidated Plan
The 2000-2005 Consolidated Plan,. adopted by Council on May 8, 2000, is a strategic
plan of action that addresses priority housing and communi.ty development needs, and
sets specific goals for attaining identified objectives. The Consolidated Plan and the
Annual Action Plan updates are a requirement in order for the City to receive federal
funding from programs such as the Community Development Block Grant (CDBG) or
HOME Investment Partnership Act. The Draft 2002/03 Annual Action Plan update is
available for public review andcomment during the. period April 1 to April 30, 2002
(Attachment B).
The primary need identified in the Consolidated Plan is for affordable housing for low-
income persons or persons with special needs. The goal for the five-year period is to
provide 125 units of permanent, affordable housing. Palo Alto’s CDBG program is
directed toward expanding and maintaining the affordable housing supply, promoting
housing opportunities and choices, maintaining and improving community facilities, and
providing supportive services for targeted low-income groups, including persons who are
homeless, persons with disabilities, the elderly, and other special needs groups. All of the
CMR:206:02 Page 2 of 11
proposed projects for CDBG funding.for fiscal year 2002/03 address the priority housing
and supportive service needs identified in the adopted Consolidated Plan...
CDBG Regulations
The City of Palo Alto receives funds annually from HUD as an entitlement city under the
CDBG Program, authorized by Title I of the Housing and Community Development Act
of 1974 (the Act), as amended. The primary objective of the Act is "the development of
viable urban communities by providing decent housing and a suitable, living environment,
and expanding economic opporturiities, principally for persons of low and moderate
income."
HUD regulations require that all activities must meet one of the three national objectives
of the CDBG Program:
Benefit low- and very low-income persons
Aid in the prevention or elimination of slums or blight; or
Meet other community development needs having a particular urgency, or
posing a serious ’and immediate threat to the health or welfare of the
community.
Palo Alto has historically expended all of its CDBG funds on.projects benefiting low- and
very-low-income persons.
There are three primary CDBG program activity areas:
Public Services: Social service activities that benefit low-income persons. The
maximum amount that can be expended under this category is fifteen (15) percent of
the grant allocation and fifteen percent of the program income for the previous year.
For fiscal year 2002/03, the maximum available for public services is $134,700.
Public Service Cap Calculation:
2002/03 Entitlement Grant
Program Income - HIP 2001/02" (Est)
Program Income - PAHC 2001/02" (Est)
$8O8,O0O
50,000
40 000
898,000 x 15%= $134,700
Planning and Administration: This category may be used to reimburse for fair housing
activities, CDBG program management, oversight and coordination, environmental
reviews, and general planning activities. Federal regulations limit the amount that can
be spent in this category to twenty (20) percent of the grant and twenty percent of the
estimated program income for the following year. For fiscal year 2002103 funding is
limited to a maximum of $167,600.
CMR:206:02 Page 3 of 11
Planning/Administration Cap Calculation:
2001/02 Entitlement Grant
Program Income - HIP 2002/03" (Est)
Program Income - PAHC 2002/03" (Est)
$808,000
15,000
15,000
$838,000 x 20%=$167,600
*Federal regulations require caps to be calculated on program income for different years.
o Capital Projects: Capital improvement activities such .as housing acquisition,
rehabilitation, accessibility, and public improvements are the primary focus of the
CDBG program. There are no funding limitations in this category.
CDBG Applications
Applications for 2002/03 funding were mailed to area housing and human service
providers on November 1, 2001 and posted to the City’s website. A notice announcing
the availability of applications for 2002/03 CDBG funding was published in the Palo Alto
Weekly on November 2, 2001. A proposal writing workshop was conducted on
November 8, 2001 to assist applicants with program regulations and project eligibility
questions. The completed applications were due December 18, 2001. The City received
17 applications for funding totaling $4,247,100.
Citizen Participation
The City follows a Citizen Participation Plan to encourage public participation in the
CDBG allocation and assessment process. The Citizen Participation P!an calls for a nine-
member Citizens Advisory Committee (CAC), selected by the Mayor. One slot on the
CAC is reserved for a member of the City’s Human Relations Commission (HRC).
Members of this year’s CAC. are: Jonathan Foster, Chris Kelly, Liza Kniss-Salame,
David Negrin, Elsbeth. Newfield, Andrew Pierce (HRC Liaison), Jeffrey Rensch, Mark
Sabin and Joe Villareal. Andrew Pierce was selected as the Committee’g spokesperson.
The Committee met weekly during January and February 2002 to discuss and evaluate
the applications, interview the applicant agencies and come to a consensus on funding
levels.
DISCUSSION
In addition to the annual funding allocations for the three primary CDBG program
activity areas, three new circumstances are addressed in this report.
President Bush’s Budget Proposal for 2003/04
As part its 2003/04 budget, the Bush administration has proposed a change to the CDBG
program that would reduce by half the annual allocation to Palo Alto and eight other
communities across the country that have a per capita income of more than two times the
national average. If approved, this would reduce Palo Alto’s CDBG allocation to
approximately $400,000 per year. A reduction of this magnitude would have a
CMR:206:02 Page 4 of 11
significant impact on the’ CDBG program itself as well as the housing,, public facility, and
human service programs that rely on CDBG funding. Although the U.S. Congress is
currently debating the merits of this proposal, the outcome may not be known until the
federal budget is adopted in October 2002. .
The attached draft Action Plan for 2002/03 has included the proposal for a two-year
funding cycle beginning in fiscal year 2003/04 based on the assumption that the funding
for 2003/04 will not be significantly reduced. If the CDBG allocation is not reduced,
staff will return to Council with an amended Citizen Participation Plan describing the
changes to a two-year funding cycle. If the CDBG allocation is reduced, the CDBG
Program will be have to. be re-evaluated to determine the most efficient program based on
a reduced level of funding. Planning staff is reviewing various program options with
HUD and Urban County staff to plan for this eventuality.
Two-Year Funding Allocation Process
Staff is recommending a two-year funding cycle for the CDBG process. Many cities in
the Bay area have adopted extended,CDBG funding cycles and find them to be an
effective tool to streamline process and provide administrative relief to both city and non-
profit staff. Palo Alto’s Human Services Division adopted a two-year funding cycle for
the Human Resource Allocation Process (HSRAP) in fiscal year 2001/02 that will
conclude in 2002/03. Its experience has been positive and it intends to continue the two-
year funding cycle for the period 2003/04 through 2004/05.
Coordination of the CDBG and HSRAP funding processes is essential to the effective
delivery of local human service funding. Collaboration between the non-profit agencies
and the City’s funding sources is necessary to avoid confusion, duplication of effort, and
to ensure that the highest identified community needs are met. The two-year process
provides the opportunity for City and non-profit staff to undertake longer-term strategic
planning and maximize available funding resources.
Expenditure Rates/Contingency Allocations
HUD regulations require that CDBG funds be expended in a timely manner. The
regulatory requirement is that no more than 1.5 times a jurisdiction’s annual entitlement
grant amount may remain in the letter of credit 60 days prior to the end of the program
year. In an effort to reduce the backlog of unspent CDBG funds, HUD has informed all
jurisdictions of a new policy to employ monetary sanctions against jurisdictions that
exceed the regulatory standard. Failure to meet the expenditure standard by May 1, 2003
will cause HUD to reduce the City’s next grant by 100 percent of the amount in excess of
1.5 times the annual grant.
For this reason, all funding applications were scrutinized to insure the readiness of the
program or project to move forward and expend funds in a timely manner. Contingency
allocations have been recommended where site control may be an issue. Time limitations
CMR:206:02 Page 5 of 11
on the availabilityof the funding have been recommended for two projects - St. Vincent
de Paul’s Day Worker Center and the Community Working Group’s Opportunity Center.
If the projects have not met site control objectives by September 30, 2002, it is
recommended that the funding be moved to other projects so that the expenditure
standard can be met.
There is also a contingency, recommendation on the Alliance for Community Care
Waverley Street project that has committed un.expended funds from prior years. Alliance
for Community Care owns the residential property located at 650 Waverley Street in Palo
Alto. The property operated for many years as shared housing with supportive services
for persons with mental illness. Over the years the property fell into disrepair, and in
.1997 Alliance closed the program and relocated the remaining tenants to other facilities.
Alliance planned to raise the estimated $700,000 needed to rehabilitate the property and
reopen the house with the same or similar housing program. $112,000 in CDBG funds
were committed to the rehabilitation effort from two separate program years ($60,000
from 1999/2000; and $52,000 from 2001/02). Although Alliance raised the majority of
the money to rehabilitate the property, Alliance’s Board of Directors decided in February
2002 not to pursue the project due to a variety of operating funding issues, and as a result,
sell the property.
Alliance agreed to consider offers from other non-profit agencies for the property in an
effort to find a way to keep the. house in non-profit ownership and to benefit the same
population of very-low income, homeless, special needs persons. If a suitable
arrangement can be worked out, the public funds already raised for the rehabilitation
could be transferred to a new agency.
Due to the need to meet the expenditure standard, staff and the CAC propose that the.
$112,000 in CDBG funding (previously allocated to the Alliance project) revert to the
City’s Housing Development fund if an agreement with a successor agency has not been
accepted and approved by the City Council by September 30, .2002.
Commitment of Future CDBG Funds
The recommendation for the CDBG Housing Development fund is to make $1,000,000
available for a portion of the site acquisition costs for a new affordable rental housing
project. This can be accomplished by the commitment of future years CDBG funds. The
City has chosen the non-profit developer, Eden Housing, to identify and acquire, with the
City, an appropriate site for a new multi-family affordable housing project. Since the
cost of an acre of land in Palo Alto isestimated at $3 to $5 million an acre, it is
anticipated that all of the City’s Commercial and Residential funds (current balance of
approximately $2 million) as well as $1,000,000 in CDBG funds would be needed for
this purpose.
CMR:206:02 Page 6 of 11
If.the site can be acquired in fiscal year 2002/03, the $1,000,000 in CDBG funds could be
loaned from the General Fund and paid back from the balance in the CDBG Housing
Development Fund and from future CDBG allocations. HUD regulations permit
allocations from future year’s funding if the request precedes the expenditure and the
action had been noticed and identified in the Consolidated Plan or Action Plan updates.
The unencumbered balance in the City’s CDBG Housing Development Fund is
approximately $115,000. With the addition of the $198,500 2002/03 allocation, the
balance would be $313,500. If the Alliance project or the Community Working Group
project do not move forward as anticipated, an additional $112,000 and $350,000,
respectively, would also be available, totaling $777,000 available in 2002/03. The
additional $223,000 to refund the full $1,000,000 would come from the 2003/04 CDBG
allocation. If nocontingency funding is available to be added to the $313,500 balance,
the additional $686,500 needed to reimburse the general fund would come from fiscal
year 2003/04 and 2004/05 CDBG funds.
2002/03 Funds Available for Allocation .
The total amount available for allocation this year is $1,317,000. The City’s 2002/03
CDBG grant is $808,000, a five percent increase over the prior year’s grant of $771,000.
$14,000 in funds remaining from previous projects and $420,000 in 2000/01 CDBG
funds previously allocated to the Oak Court affordable housing project are being
reallocated to new projects. Also included are $30,000 in program income (income
generated directly from the use of CDBG funds) ’ expected to be received in 2002/03, plus
$45,000 in program income received in previous years in excess of the estimated amount.
In summary:
$8O8,OO0
420,000
14,000
15,000
15,000
45,000
$I,317,000
FY 2002/03 CDBG entitlement grant from HUD
Reallocation of 2000/01 CDBG funds for the Oak Court Project
Reallocation of other previous funds
Estimated program income for 2002/03 from the City’s Housing
Improvement Program (HIP), a single-family, residential
rehabilitation program that is no longer operational
Estimated program income for 2002/03 from the Palo Alto Housing
Corporation that is generated when rental income exceeds expenses
on specific properties acquired or rehabilitated with CDBG funds
Actual program income received in previous years in excess of the
estimated amounts that were allocated
CMR:206:02 Page 7 of 11
Funding Recommendations
The chart on the following page shows the applications that were received, the CAC and
staff funding recommendations, and the contingent recommendations. Elimination of
funding for the Palo Alto Housing Corporation Information and Referral. Service could
.have a potential impact on City staff as callers are referred to the proposed county-wide
housing information and referral web-based directory. Community Housing InC. would
only be provided with $10,000 for dining room furniture for the Lytton Garden’s senior
residential facility if the Day Worker Center is unable to obtain a suitable site by
September 30, 2002. The Palo Alto Housing Corporation’s application for water system
. repairs to the Oak Manor Apartments would be funded in the amount of $200,000. only if
the Community Working Group is unable to secure site Control by, September 30, 2002.
Staff and the CAC concur on all of the funding recommendations. Attachment A is a
narrative explaining the funding requests and funding recommendations in more detail.
CMR:206:02 Page 8 of 11
APPLICANT AGENCY
1.Emergency HousingConsortium
Shelter & Homeless Services
2.Palo Alto Housing Corporation
Barker Hotel & Alma Place Tenant Services
3. Palo Alto Housing Corporation
Housing Information & Referral
4. Shelter Network - Haven Family House
Transitional Housinl~ for Homeless Families
5. Clara-Mateo Alliance
Family Shelter & Services/Elsa Sel~ovia Center
6. Ciara-Mateo Alliance
Single/Couple Shelter & Services
7. Urban Ministry
Homeless Drop-in Center
8. St. Vincent de Paul
Day Worker Center
9.Lytton Gardens
Dining Room Furniture
2001/2002
FUNDING
PUBLIC SERVICES
8,490
22,745
23,175
18,000
12,000
28,750
N/A
N/A
N/A
2002/2003
FUNDING
REQUEST
8,490
61,211
36,000
20,000
22,000
28,750
25,000
I0,000
36,370
Total Public Services (Cap $134,700) 247,821
FAIR HOUSING/ADMINISTRATION
10. Mid-Peninsula Citizens for Fair Housing 24,800 25,800
Fair Housing Services
11. City of Palo Alto 130,000 140,000
Program Administration
Total Administration (Cap $167,600)165.800
CAPITAL PROJECTS
480,000
N/A
N/A
N/A
N/A
221,806
2,215,000
270,250
98,000
199,626
50,603
1,000,000
3,833,479
4,247,100
12;Community Working Group
Opportunity Center - Day Center/Housing
13.Palo Alto Housing Corp. - Oak Manor Apts.
Water System Repairs
14. Palo Alto Community Child Care
Exterior Painting of Ventura Community Center
15. Avenidas -Senior Center
HVAC & Lighting Upgrades
16. Stevenson House - Senior Housing
Emer[~ency Call System Upgrades
17.City of Palo Alto/Housing Development Fund
,New Rental Housing Project
Total Cap, ital Projects
TOTAL
CAC/STAFF
RECOMMEN-
DATIONS
8,490
24,745
-0-
20,000
22,000
28,750
20,715
10,000"*
-0o
134,700
25,800
140,000
165,800
550,000**
-0-
98.000
120,000
50,000
198,500
1,016,500
1,317,000
¯ CONTIN-
GENCY
FUNDING
10,000
350,000
**Allocation contingent upon Agency obtaining site control goals by 9/30/02, or funding
will be allocated to projects in contingency column.
CMR:206:02 Page 9 of 11
RESOURCE IMPACT
The proposed change to a two-year funding cycle is expected to reduce future
administrative costs and increase productivity. If the HUD expenditure standard is not
met, the City is in danger of having future CDBG allocations reduced.
POLICY IMPLICATIONS
All of the applications recommended for funding in fiscal year 2002/2003 are consistent
with the priorities established in the City’s adopted Consolidated Plan for the period 2000
to 2005. They are also consistent with the housing programs and policies in the adopted
Comprehensive Plan.
TIMELINE
Funding recommendations made by the Finance Committee will be forwarded to the City
Council for review and approval at a public hearing scheduled for May 13, 2002. The
funding allocations and Annual Action Plan update will be submitted to HUD by the May
15, 2002 deadline.
ENVIRONMENTAL REVIEW
For purposes of the National Environmental Policy Act (NEPA) and the California
Environmental Quality Act (CEQA), budgeting in itself is not a project. HUD
environmental regulations for the CDBG program are contained in 24 CFR 58
"Environmental Review Procedures for Title I Community Development Block Grant
Programs". The regulations require that entitlement jurisdictions assume the
responsibility for environmental review and decision making under NEPA. Prior to the
commitment or release of funds for each of the proposed projects, staff will carry out the
required environmental reviews or assessments, and certify that the review procedures
under CEQA, and HUD and NEPA regulations have been satisfied for each particular
project.
ATTACHMENTS
Attachment A:
Attachment B:
Narrative report with staff and CAC funding recommendations
2002/03 Draft Annual Action Plan Update of the Consolidated Plan
for the period 2000 to 2005
PREPARED BY:
Suzanne ~ayley, CDBG (~dordi6ator
CMR:206:02 Page 10 of 11
Director of Planning and Community Environment
CITY MANAGER APPROVAL:’~~), H~.~~
EMILY HARRISON
Assistant City Manager
CDBG Citizens Advisory Committee Members
2002/03 CDBG Applicant Agencies
CMR:206:02 ¯Page 11 of 11
ATTACHMENT A
STAFF AND CITIZENS ADVISORY COMMITTEE (CAC)
FUNDING RECOMMENDATIONS FOR 2002/03 ’
COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDING
PUBLIC SERVICE APPLICATIONS
Emergency Housing Consortium (EHC) - Emergency Shelter and Services ’
2011 Little Orchard Street, San Jose, CA 95125-
Funding Request
$8,490
2001/02 Funding
$8,490
Staff/CAC Recommendation
$8,490
Proposal: Agency provides emergency shelter and comprehensive supportive services to
homeless men, women, families with children, and youth in various facilities in Santa Clara
County. EHC operates a youth shelter in San Jose, the winter shelters at the National Guard
Armories in Sunnyvale and Gilroy, the regional Reception Center in San Jose, the Sobrato
Family Living Center in Santa Clara, and various other transitional housing programs in the
County. Supportive services include prepared meals, counseling, child care, transportation,
case management, job counseling, and skills workshops to help secure housing and/or
employment. ..
Discussion: Currentcontract objectives are being met. This agency provides the majority of
homeless shelter services in Santa Clara County, and is an important resource for persons
from the Palo Alto area. Agency anticipates providing 2,000 person/shelter nights to 50
unduplicated homeless persons from Palo Alto.
Priority Need: Shelter and services for persons who are homeless
2.Palo Alto Housing Corporation (PAHC) - Barker Resident Counseling
439 Emerson St., Palo Alto, CA 94301
Funding Request
$61,211
2001/02 Funding
$22,745
Staff/CAC Recommendation
$24,745
Proposal: The 26-unit Barker Hotel serves a very low-income population of residents with a
history of homelessness and special needs. A counselor and Service Coordinator provide
support to individual tenants as needs or problems arise, and on an on-going basis. These
intensive case management and supportive services play a vital role in helping the residents
maintain their stability and housing.
Priority Need: Prevention of homelessness
Discussion: Current contract objectives are being met. The Barker cannot be effectively
operated for the benefit of this population without additional services. The service program
has dramatically reduced the Barker’s turnover and eviction rates. PAHC requests additional
funding to extend the supportive services program to residents of the Alma Place Single
Room Occupancy Residency Hotel (SRO). Staff and the CAC support an increase to the
original program and encourage PAHC to explore other funding options for the Alma Place
program.
3. Palo Alto Housing Corporation - Housing Information and Referral Services
725 Alma Street, Palo Alto, CA 94301
Funding Request
$36,000.
2001/02 Funding
$23,175
Staff/CAC Recommendation
-0-
Proposal: Agency provides information and referral (I & R) services to seekers of affordable
housing. I & R services assist mostly lower-income persons in their search to identify
available affordable housing opportunities in Palo Alto and surrounding areas. Additionally,
callers may be counseled on eligible subsidy programs, waiting lists, and other housing
related issues. PAHC annually updates and distributes a comprehensive housing directory
that identifies waiting lists and resources in the area.
Priority Need: Supportive services for lower-income persons.
Discussion: Staff and the CAC do not recommend continued funding for this program. The
new county-wide housing website developed by Community Technology Alliance is
scheduled to go on-line in June 2002, and should alleviate some of the need for a local I & R
service. The City separately contracts with PAHC to provide information to the public and
administer the City’s Below-Market Rate (BMR) program, and PAHC will continue to
provide information to the public on the waiting lists for their own properties. City Planning
and Human Service staff will absorb other activities such as updating the housing directory
and answering calls with other housing questions.
4. Shelter Network - Haven Family House
260 Van Buren Road, Menlo Park, CA 94025
Funding Request
$20,000
2001/02 Funding
$18,000
Staff/CAC Recommendation
$20,000
Proposal: Haven Family House provides transitional housing and a comprehensive array of
supportive services to homeless families in a newly constructed facility in Menlo Park.
Families stay in one- and two-bedroom apartments for up to four months until they can re-
connect with permanent housing, jobs, and the skills and resources necessary to break the
cycle of homelessness. An on-site licensed childcare facility is also available.
Priority Need: Transitional housing and ~upportive services for homeless families with
children.
Discussion: Haven Family House is an important resource for homeless families with
children from northern Santa Clara County.. The facility expects to serve 50 homeless
families representingmore that 200 parents and children. It is expected that three to five of
the families will be from Palo Alto (representing approximately 11 to 20 parents and
children). Shelter Network estimates that 75 percent of families completing the program will
successfully return to permanent housing.
5.Clara-Mateo Alliance (CMA) - Family Shelter Wing
795 Willow Road, Bldg. 323-D, Menlo Park, CA 94025
Funding Request
$22,OOO
2001/02 Funding
$12,000
Staff/CAC Recommendation
$22,000
Proposal: The Clara-Mateo Alliance has six individual bedrooms devoted to homeless
families. Annually, 30 families (a total of 90 parents and children) are provided with housing
and supportive services. A transitional housing component is being added with the opening
of the Elsa Segovia Day Center for Homeless Women and Children. The Elsa Segovia Day
Center will be the only center for women and children between San Jose and San Francisco.
CDBG funds will be used to provide additional supportive services to program beneficiaries.
Priority Need: Shelter, supportive services, and transitional housing for homeless families,
and a Day Center for homeless women and children.
Discussion: This project is an important resource for the growing number of homeless
families with children in northern Santa Clara County. Additional funding this year will help
with staffing for the Elsa Segovia Day Center (opening in spring 2002).
6.Clara-Mateo Alliance - Shelter and Supportive Services
795 Willow Road, Bldg. 323-D, Menlo park, CA 94025
Funding Request
$28,750
2001/02 Funding
$28,750
Staff/CAC Recommendation
$28,750
Proposal: Clara-Mateo Alliance (CMA) provides a 63-bed shelter for homeless indi.viduals
and couples, and thirty transitional housing rooms for graduates of the shelter. They provide
supportive services aimed at increasing self-sufficiency and finding and maintaining stable
housing. The shelter targets the under-served populations such as homeless persons with
disabilities, mental illness, psychiatric disorders, and chronic substance abusers.
Priority Need: Shelter and services for persons who are homeless
Discussion: This program is an important link in the county’s homeless continuum of care. It
has been operating since 1997 and serves individuals and couples. It is a collaborative effort
with the Veterans Administration, other shelter and service providers and the counties of
Santa Claraand San Mateo. The facility serves the homeless sub-populations with some of
the greatest needs. It is anticipated that the total program will serve an average of 550
homeless persons annually.
7.Urban Ministry of Palo Alto/InnVision - Drop-In Center
400 Mitchell Lane, Palo Alto 94301
Funding Request
$25,000
2001/02 Funding
-0-
Staff/CAC Recommendation
$20,715
Proposal: Agency proposes to provide basic survival services to the local homeless
population. Services include a light breakfast, used clothing, toiletries, phone, mail,
messages, bus passes, and referrals to other agencies. Urban Ministry caseworkers are
available to assist clients find shelter, medical care, employment .and to help with other
problems. The Drop-In Center operates from the back of the Red Cross building at 400
Mitchell Lane in Palo Alto and serves more than 100 persons each weekday morning.
Priority Need: Shelter and Services for persons who are homeless.
Discussion: Urban Ministry of Palo Alto has merged with InnVision, a larger social service
agency based in San Jose. The merger brings increased administrative stability to Urban
Ministry through InnVision’s established expertise in federal funding and administrative
4
oversight. This collaborative effort will also provide increased programmatic opportunities
to help the program’s clientele.
8.St. Vincent de Paul Society- St. Joseph the Worker Center
2040 S. 7th Street San Jose, CA 95112
Funding Request 2001102 Funding
$10,000 N/A
Staff/CAC Recommendation
$10,000
Proposal: Agency proposes to continue the St. Joseph the Worker Center as. soon as a new
site has been identified. The St. Joseph the Worker Center was formed in Mountain View six
years ago to connect day laborers with employers. The Center provided a safe alternative for
laborers, who often gather along E1 Camino Real in Mountain View, Los Altos and Palo
Alto, to find employment. The Center provided a setting in which both workers and
employers could meet and negotiate work projects, hours and conditions. St. Vincent de Paul
staff also help with job applications and job readiness training, including classes in English
as a Second Language..The Center lost its lease last fall, and has been working with the City
of Mountain View since that time to identify another suitable site.
Priorit~ Need: Supportive services for lower-income persons.
Discussion: Agency anticipates serving approximately 3,000 unduplicated workers annually
once a new site has been identified. Staff and the CAC recommend funding for this program
contingent upon the St. Joseph the worker Center opening at a new site by September 30,
2002. If the Center has not opened by that date, the 2002/03 CDBG funds will no be
available for this project, and will instead be allocated to the Lytton Gardens dining room
furniture project.
9.Community Housing, Inc., - Lytton Gardens Dining Room Furniture
656 Lytton Avenue, Palo Alto, CA 94301
Funding Request
$36,370
2001/02 Funding
N/A
Staff/CAC Recommendation
-0-/$10,000
Proposal: Community Housing Inc. owns and operates Lytton Gardens I and II providing
318 units of affordable housing and multi-level care to low-income seniors. This proposal is
to replace dining room tables and chairs that are challenging for frail seniors to move.
Priorit,¢ Need: Support services for low-inc.ome persons.
Discussion: Staff and the CAC recommend funding of $10,000 for this project if the St.
Vincent de Paul Day Worker Center has not opened by September 30, 2002. Funds would be
provided for the purchase of new dining room tables and chairs.
FAIR HOUSING/ADMINISTRATION
10.Mid-Peninsula Citizens-for Fair Housing (MCFH) -Fair Housing Services
457 Kingsley Avenue, Palo Alto, CA 94301
Funding Request
$25,800
2001/02 Funding
$24,800
Staff/CAC Recommendation
$25,8OO
Proposal: Agency provides investigation, counseling and legalreferral for victims of housing
discrimination as well as community outreach and education regarding housing rights.
MCFH serves the mid-peninsula area from Redwood City through Cupertino/Sunnyvale and
Fremont. MCFH seeks to reduce discrimination in housing and provide redress for those
who have been discriminated against. HUD regulations require CDBG entitlement
jurisdictions to affirmatively furttier fair housing choice.
Priority Need: Fair Housing Services
Discussion: Current contract objectives are being met. Agency proposes to investigate 15
cases of housing discrimination next year, as well as to initiat.e public outreach and
community education campaigns through workshops, presentations and advertisements.
11.City of Palo Alto - Department of Planning and Community Environment
250 Hamilton Avenue, Palo Alto, CA. 9430i
Funding Request
$140,000
2001/02 Funding
$130,000
Staff/CAC Recommendation
$140,000
Proposal: Funding is requested to reimburse the City General Fund for costs related to the
overall management, coordination, monitoring and evaluation of the CDBG Program,
including oversight of public service contracts, data gathering, studies, analysis, plan
preparation, and the identification of actions for implementation of plans.
Priority Need: CDBG Program Administration and support "
Discussion: The cost of administering the CDBG program is approximately $200,000 per
year. A reimbursement of $140,000 from grant funds is well within the 20% administrative
cap and helps alleviate General Fund budgeting constraints.
CAPITAL AND/OR HOUSING PRO~[ECTS
12. Community Working Group (CWG) - Opportunity Center of the Mid-Peninsula
33/39/45 Encina Way, Palo Alto
Funding Request
$2,215,000
2001/02 Funding
$48O,OOO
Staff/CAC Recommendation
$550,000
Proposal: This proposal is to provide funding for pre-development, relocation and site
acquisition expenses related to the Opportunity Center.project of the Mid-Peninsula. The
project has been delayed so that negotiations could continue for a third contiguous site that
could potentially increase the number of housing units provided from 55 to 95. The
Opportunity Center facility will provide multiple services for the homeless and those at risk
of becoming homeless, including familieS with children. The request for $2,215,000 includes
a request for City staff to submit a grant application for the State HOME Program and for
City Housing Reserve funds.
Priority .Need: Affordable housing and supportive services for low and veryqow income
persons who are homeless or at-risk of being homeless.
Discussion: Staff and the CAC are very supportive of this project, but recommend
conditioning the provision of the 2002/03 CDBG funds on CWG obtaining site control on all
three parcels by September 30, 2002. If negotiations on the parcels cannot proceed, the
funding will be redirected to the Palo Alto Housing Corporation Oak Manor Apartments
capital construction project, and the City’s Housing Development Fund. The total cost of the
proposed Opportunity Center project is now nearing $21 million. Additional funding may be
considered if the project continues to moves forward. Staff will evaluate the potential for the
project to receive a successful allocation of HOME funds at the time the next Notice of
Funding Availability is released.
13.Palo Alto Housing Corp. - Oak Manor Townhouses Water System Replacement
630 Los Robles, Palo Alto, CA 94306
Funding Request
27O,25O
2001/02 Fundin[~
N/A
Staff/CAC Recommendation
-0-/$200,000
Proposal: Palo Alto Housing Corporation acquired the 33-unit Oak Manor Townhouses in
1991. The complex consists of both two and three-bedroom units, occupied by very-low, low
and moderate income families, 22 of the units are assisted under the Section 8 Moderate
Rehabilitation Program through the Santa Clara County Housing Authority. The four
building complex was built in 1966 and has major capital plumbing needs. The PAHC
proposal is to replace the domestic water supply system because of corroded galvanized pipes
that cause low water pressure and abrupt water temperature changes.
Priority Need: Rehabilitation of affordable rental housing
Discussion: Maintaining the existing stock of affordable rental housing in good condition
is a goal ofboth the City and the Palo Alto Housing Corporation. The cost of replacing the
domestic water supply system is beyond the scope of normal operating reserves. Staff and
the CAC recommend $200,000 in funding if the Opportunity Center project does not obtain
site control by the September 30, 2002 deadline.
14.Palo Alto Community Child Care- Ventura Community Center Exterior Painting
3990 Ventura Ct., Palo Alto, CA 94306
¯ Funding Request
$98,000
2001/02 Funding
N/A
Staff/CAC Recommendation
$98,000
Proposal: Palo Alto Community Child Care (PACCC) leases the Venmra Community Center
from the City and as the majority tenant isresponsible for facility repair and maintenance.
The community activities at the site include: Sojourner Truth Child Development Center;
PACCC offices; Country Day Little School; Heffalump parent co-op preschool; Ventura
Activity Center (a teen program sponsored by the YMCA); Self Help and Resource
Exchange; 2nd¯ Harvest Food Bank; Henry Page Computer Center; PAUSD Adult School;
Sports and Games Summer Camp; and a police sub-station. The 50-year old structures in
which these programs operate are in urgent need of repair. The Ventura Center is in the
middle of the most economically disadvantaged section of Palo Alto. The proposal is to
repaint the exterior of the Center.
Priority Need: Community facility repairs and maintenance
Discussion: Staff and the CAC recommend full funding for this project. Expensive, lead
safe work practices are required on this project because of the presence of young children.
15. Avenidas - HVAC and Lighting Upgrades
450 Bryant Street, Palo Alto, CA 94301
Funding Request
$199,626
2001/02 Funding
N/A
Staff/CAC Recommendation
$120,000
Proposal: Avenidas proposes basic lighting and HVAC system upgrades to the senior
community fac.ility in order to promote a comfortable atmosphere and to improve the energy
efficiency of the building. The system has been maintained by patch jobs over the past
several years and is in need of a completely new system.
Priority Need: Community facility repairs and maintenance
Discussion: Staff and the CAC support funding the HVAC portion of the project that has
the most urgency. The recommended funding will almost cover the total cost of the
estimated HVAC upgrade. The lighting portions of the project can be funded from another
source or undertaken at a later date.
16.Palo Alto Senior Housing Project, Inc. - Stevenson House/Emergency Call System
455 E. Charleson Road, Palo Alto, CA 94306
Funding Request
$50,603
2001/02 Funding
N/A
Staff/CAC Recommendation
50,000
Proposal: Stevenson House provides 120 units of affordable rental housing to low-income
seniors. Since seniors are living longer, and there are almost no assisted living facilities for
low-income seniors, Stevenson House is attempting to provide supportive services to their
residents to help them maintain their independence as long as possible. Their proposal is to
replace the emergency call system that is used to summon help in an emergency. The
original system was installed 33 years ago and has inherent limitations. A new system will
enable the facility to better monitor frail residents.
Priority Need: Rehabilitation of affordable rental housing
Discussion: Staff and the CAC recommend funding for this project to keep the frail residents
in a safe environment and help them maintain their independence as long as possible.
9
Providing grant funding for projects like this will also help Stevenson~ House maintain the
low rental structure.
17.City of Palo Alto - CDBG Housing Devdopment Fund
Planning Department, City Hall
Funding Request
$1,000,000
2001/02 Funding
$221,806
Staff/CAC Recommendation
$198,500/350,000
Proposal: This proposal is to set aside a significant sum of CDBG funds for site costs for a
subsidized lower income rental housing project. The number of units to be built would
depend on the size of the site and the type of housing constructed. Sites for family rental
housing would probably be developed with 50 to 75 units and sites for elderly or single room
occupancy housing would be developed with up to 100 units. Eden Housing has been
selected as the non-profit developer for the project.
Several potential sites are currently under consideration. At this time it is not possible to
provide a project budget, but in very general terms, the City would need to contribute 30 to
40 percent of total costs, including land, construction and other costs in order for the rents to
be affordable.. The developer will combine the City’s funds with other housing subsidies,
such as Low Income Housing Tax Credits or other State, County of federal funds, to finance
the project. As an example, a 50-unit family apartment project may cost $15 million in total
development costs with as much as $4 million needed from the City. The requested
$1,000,000 would be a portion of the City’s contribution in conjunction with approximately
$2 million from the housing reserve funds.
Since the $1,000,000 in CDBG funds will be needed in fiscal year 2002/03 for site
acquisition, the General Fund could loan the difference between the balance in the CDBG
Housing Development Fund and it could be paid back in the next two years of CDBG
allocations. This would also help the City remain in compliance with the HUD expenditure
standard.
Priority Need: Affordable rental housing
Discussion: Staff and the CAC recommend funding $198,500 in 2002/03 funds for the new
affordable housing project. If the Opportunity Center project has not secured site control by
September 30, 2002, $350,000 from that allocation will also revert to the CDBG Housing
¯Development Fund. If the General Fund loans the project funding, it is recommended that it
be repaid from 2003/04 and 2004/05 CDBG funding allocations.
ATTACHMENT B
CITY OF PALO ALTO
Housing and Community Development
DRAFT
2002/2003 ACTION PLAN
Annual Update of the City’s Consolidated Plan for the Period
July 1, 2000 to June 30, 2005
Public Review Period April 1, 2002 - April 30, 2002
Prepared by Department of Planning & Community Environment
250 Hamilton Avenue
Palo Alto, California 94301
Steve Emslie, Director
For Information, Please Contact: Suzanne Bayley
Planning Division, City of Palo Alto (650) 329-2428
CITY OF PALO ALTO
FISCAL YEAR 2002/2003 ACTION PLAN
ANNUAL UPDATE TO THE CITY’S CONSOLIDATED PLAN
FOR THE PERIOD JULY 1, 2000 TO JUNE 30, 2005
Background and Introduction
This Action Plan is the 2002/2003 annual update to the City’s Consolidated Plan for the Period
July 1, 2000 to June 30, 2005. It describes the eligible programs, projects and activities the City
plans to undertake with funds that are expected to be available during the 2002/03 fiscal year.
The Consolidated Plan is a five-year planning document that describes local conditions and
resources, identifies priority housing, human service, and community.development needs, and
outlines a strategy and plan to address the identified needs. The Consolidated Plan and the
annual Action Plan updates are submitted to the U.S. Department of Housing and Urban
Development (HUD) to enable the City of Palo Alto to receive and administer federal.funds
under the Community Development Block Grant (CDBG) program.
The Consolidated Plan is meant to serve as a guide to insure that federal.funds are directed
toward the most urgent community needs, and that funding decisions are consistent with locally
identified priorities and strategies. The Action Plan describes how the activities to be undertaken
with CDBG funds in 2002/2003 will meet the long-term goals and objectives outlined in the
Consolidated Plan. The Action Plan also identifies the actions the City will undertake to
affirmatively further fair housing choice.
Public Review and Public Hearings
HUD regulations require that the Draft Action Plan be available for a 30-day public review and
comment period. The review and comment period for the 2002/03 Action Plan is from April 1,
2002 to April 30, 2002. Interested citizens are invited to comment on the Draft Action Plan at
either of the public hearings on April 16, 2002 and May i3, 2002 at 7:00 p.m. in the Council
Chambers, or by submitting written comments by April 30, 2002 to:
Suzanne Bayley, CDBG Coordinator
City of Palo Alto
Department of Planning and Community Environment
250 Hamilton Avenue
Palo Alto, CA 94301
E-mail address: suzanne_bayley@city.palo-alto.ca.us
Citizen Participation
The City of Palo Alto has an adopted Citizen Participation Plan that provides for a nine-member
CDBG Citizens Advisory Committee (CAC). The CAC process encourages public participation
in the CDBG allocation and evaluation review process. The CAC met on January 8, 17, 24, 31;
February 7, 12, 21; and March 5, 2002 to review and evaluate the applications, interview the
applicant agencies, review the Consolidated Plan priorities, and make funding recommendations
on the applications submitted for 2002/03 CDBG funding.
EXECUTIVE SUMMARY OF THE CONSOLIDATED PLAN
The City of Palo Alt0 is a suburban Califomia City situated on the northem border of Santa
Clara County in the heart of Silicon Valley. The City is known for its association with the world
famous educational and research institution of Stanford University, a major center for medical
care and research. Palo Alto is also a center of international culture, art, shopping and food.
Palo Alto has a resident population of approximately 58,600 people. According to 2000 census
data, the Citywide breakdown by race is as follows: White 77%, Asian 17%, Black 2%, Other or
Two or More Races 5%. Palo Alto is, overall, a very affluent community. In 1990, only 4.6% of
the population were below the poverty level. The 2002 median income for a family of four in
Santa Clara County is $96,000, one of the highest in the nation.
There is a greater demand for housing in Palo Alto than can be met. This is because Palo Alto is
a desirable place to live, there are more jobs than housing units, there is an intense demand for
available units, and there is very little land available for new housing development. Developers
of affordable housing projects must, therefore, compete with developers of market rate housing
for the limited land available.
The City of Palo Alto’s Consolidated Plan and Hoiasing Element both emphasize the great need
for affordable housing for low and very low income households in Palo Alto. While all types of
housing are needed in the City, the Consolidated Plan objectives focus on the creation and
preservation of rental housing with an emphasis on housing for very low and low-income
persons especially those who are homeless, at-risk of becoming homeless, those with special
needs, and families with children.
The main housing goal for the five-year Consolidated Plan is to increase the supply of affordable
rental housing by 125 units. It is a high priority to increase the number of units suitable for
families with children. CDBG funds will be targeted to very low and low-income renters,
especially families with children, homeless individuals and those "at-risk" of becoming
homeless, persons with special needs, and elderly persons. The need to preserve the existing
affordable rental housing stock is an important ongoing objective. A high priority is also placed
on providing housing with supportive services for persons with special needs such as the frail
elderly, and those with developmental, physical and mental disabilities.
The Santa Clara County Collaborative on Housing and Homelessness has adopted a countywide
Continuum of Care strategy and approach to the problems ofhomelessness. By identifying gaps
in services on a regional basis, the needs of persons who are homeless or are at-risk of becoming
homeless can be more effectively addressed. The City of Palo Alto participates in the
Collaborative and has identified as a high priority need, the provision of additional resources in
northern Santa Clara County for homeless services and supportive housing. Specifically, a
facility is needed for the provision of services such as showers, laundry, counseling, information
and referral, respite, and case,management. Additionally, more units of transitional and
permanent housing are needed for this population.
Priorities for non-housing community development needs are to:
1.Expand, modernize, rehabilitate and make seismic and other safety related
improvements to facilities that serve low-income and special needs populations
2.Support the accessibility of all services and facilities for persons with disabilities
3.Support the creation of an indoor Day Center facility, for the provision of supportive
services for homeless persons (with the potential of a housing component)
4. Support organizations that provide a variety of human services to low-income, at-risk
populations
5.Provide assistance and supportive services to low and very-low income Pal0 Alto.
residents to keep them from becoming homeless
RESOURCES AVAILABLE
The City of Palo Alto encourages local non-profit housing and public service agencies to pursue
all available public and private funding sources in order to achieve the goals of the Consolidated
plan. Most projects and activi.ties secure funding from a variety of sources including private
donations, charitable foundations, and church and community fundraising to leverage federal~
state and local funding.
Federal Resources
Community Development Block Grafit (CDBG) Funds
The City receives CDBG funds as an entitlement grant through the U.S. Department of Housing
and Urban Development (HUD). in fiscal year 2002/03, the City will allocate $1,317,000 in
CDBG funds to eligible activities that address the needs identified in the Consolidated Plan. The
amount of the City’s 2002/03 CDBG entitlement grant from HUD is $808,000, program income
is $75,000 and reallocated funds total $434,000. Program income is income directly generated
from the use of CDBG funds that i.s returned to the CDBG program and reallocated to new
activities.
FY 2002/03 CDBG Allocation
Estimated Program Income 2002/03 (HIP)
Estimated Program Income 2001/02 (PAHC)
Excess Prior Year Program Income
Reallocated Funds (Miscellaneous)
Reallocated Funds (2000/01 Oak Court)
$808,000
15,000
15,000
45,000
14,000
420.000
1,317,000
Loan repayments from the City’s former Housing Improvement Program (HIP) single-family -
rehabilitation loan program are estimated to be $15,000 for next year. Income from the Palo
Alto Housing Corporation (PAHC) is alsoestimated to be $15,000 for next year. PAHC funds
are collected when rental income exceeds expenses on properties acquired or rehabilitated with
CDBG funds. Prior year program income funds are funds received in prior years that were in
excess of the estimated program income amounts, and were not previously allocated to projects.
HOME Program
The City of Palo Alto does not receive a direct allocation of HOME Program funds from HUD.
The only way to access HOME funds is for the City, or eligible nonprofit organizations to apply
to the State of California for the funds in an annual competition. Due to excessive demand for
the State’s HOME allocation, and rating criteria that does not favor areas like Palo Alto, it is
difficult to secure an award. At the time the next Notice of Funding Availability (NOFA) is
published, the City will evaluate ali potentially suitable projects to determine whether or not to
apply for a HOME grant. It is possible that the Opportunity Center project could be a candidate
for a HOME allocation.
Low Income Housing Tax Credit Program
It is anticipated that the Palo Alto Housing Corporation will apply for Low Income Housing Tax
Credits (LIHTC) for the Oak Court multi-family rental housing project being created on the
vacated site of the old Palo Alto Medical Foundation in the downtown area.
Local and Other Resources
Housing Reserve
The primary local housing resource available in the City of Palo Alto is the City’s Housing
Reserve. The Housing Reserve has two components
Commercial Housing In-Lieu Fund - this fund is used primarily to increase the number of
new affordable housing units for Palo Alto’s work force. It is funded with mitigation fees
required from developers of commercial and industrial space. As of March 31, 2002, the
Commercial Fund had a balance of approximately $19,814.
Residential Housing In-Lieu Fund - this fund can be used for acquisition, rehabilitation,, new
construction and predevelopment of low-income housing. It is funded with mitigation fees
provided under Palo Alto’s Below Market Rate (BMR) housing program from residential
developers, and money from other miscellaneous sources, such as proceeds from the sale or
lease of City property. As of March 31, 2002, the Residential Fund had an unrestricted
balance of $1,319,625.
Housing Development Fund
The purpose of the Housing Development Fund is to have funds available on an ongoing basis to
utilize when necessary to facilitate the development, rehabilitation and preservation of low
income, multi-family housing. Housing development opportunities come up throughout the year
and, due to the nature of the real estate market, a quick response is frequently necessary. The
Housing Development Fund includes money from several sources: the CDBG Housing Fund, the
City Housing Reserve (with the Commercial and Residential components), and HOME trust
funds. Each funding source is accounted for separately.
Housing Development Funds may be used to pay for costs associated with the investigation of
the feasibility of sites or properties for potential acquisition by the City, or nonprofit
organizations, for affordable housing. These costs usuallS, need to be paid prior to a project
being officially created in the budget. Typically these costs are for appraisals, environmental
studies and soil testing, title reports and design sketches.
The actual process for initiating a project will vary depending on the particular circumstances.
Usually, a nonprofit sponsor will apply to the Department of Planning and Community
Environment for housing subsidy funds when they are in negotiation for a particular site. At
other times, the City may issue a Request for Proposal once it has secured or identified a
potential housing site.
The City may provide funding from a variety of sources depending on the nature of the project.
The Planning Department will present recommendations for each project together with a
proposed funding package to the City Council for approval. In almost all cases, funds will be
provided as a loan secured by the property. The repayment terms and interest rate have to be
tailored to the particular project since affordable housing typically is financed from multiple
sources with specific requirements.
Funds may also be used for emergency loans for home rehabilitation even though the City no
longer has an active sing!e family rehabilitation loan program. It is possible that serious
emergency needs may occur, and in such situations, income qualified homeowners could apply
for a rehabilitation loan in order to make necessary repairs. The intent is only to provide
financial assistance to income eligible homeowners whose homes, have serious building code
deficiencies and who have no other resources to undertake repairs.
Housing Trust of Santa Clara county (HTSCC)
The HTSCC is a public/private initiative, dedicated to creating more affordable housing in Santa
Clara County, using a revolving loan fund and grant-making program to complement and
leverage other housing resources. The City of Palo Alto has contributed $500,000 toward the
initial $20 million investment capitalization. The Palo Alto Housing corporation received a
$400,000 award of funds for the Oak Court family rental project, and it is expected that several
other projects in Palo Alto may receive funding from this source.
Redevelopment Agency (RDA)
The City of Palo Alto is in the process of forming a Redevelopment Agency that will eventually
provide a 20% set-aside fund to assist in the creation for new affordable housing units within the
City of Palo Alto.
The chart on the following page identifies the local, public and private resources available, and
the type of activities that may be undertaken with each funding type.
LOCAL, PUBLIC AND PRIVATE RESOURCES FOR AFFORDABLE HOUSING
Activity Acquisition Rehab
LOCAL, PUBLIC
Commercial
Housing In-Lieu
Fund
Residential Housing
In-Lieu Fund
Redevelopment
Agency
City Owned Land
MCC Program
Housing Bond Trust
Santa Clara County
Housing Trust Fund
Santa Clara County
Housing
Authority/Section 8
County Department
of Social Services
PRIVATE RESOURCES
BMR Rental &
Owner Program .
Private Lenders:
AHP
Nonprofit
Developers
Private Foundations
and Churches
New
Construction
X
x x x
x x x
x
x x x
x x x
x x x
Home
Buyer.
Assistance
X
X
X
Rental
Assistance
X
Homeless
Assistance
X
X
X
X
Homeless
Prevention
X
X X X
X X X
X X
X X
X
X
X
X
X
X
Leveraging and Matching Requirements
The City of Palo Alto will leverage federal and private housing funds to the greatest extent
feasible consistent with the goals identified. The City will encourage housing project sponsors to
seek private financing and private grants, and to fully utilize other state and federal housing
development subsidies such as the low-income housing tax credit program. The City will also
utilize its local Housing Reserves, as appropriate, to leverage federal and private housing funds
and to provide any required matching funds. Where eligible, CDBG funds could be used as a
portion of the matching requirement for federal housing programs.
7
Geographic Distribution
The Map appended to this report shows the location of all the proposed activities for fiscal year
2002/03. The City considers the provision of all types of housing assistance on a citywide basis
consistent With the policies of the Comprehensive Plan. The City does not have specific target
areas for housing activities, but attempts to provide housing affordable to lower-income persons
throughout the City.
Census tract 5107 in the Olive-West Meadow/Ventura area is characterized as an area of
considerably greater population and housing diversity than that which is found in most parts of
Palo Alto. Although there are no areas within the City that are considered areas of minority
concentration, the 1990 census identified this tract as having the highest minority concentration
of any non-split Citytract. More than half the housing units are in multiple-unit (3+) structures,
and nearly two-thirds are renter-occupied. Block Group 2 has a large proportion of modest rental
housing, a relatively high proportion of minority and ethnic groups, and 48.6% of the households
are below the CDBG income eligibility limits. The entire tract is above HUD’s first quartile
threshold of 27.08 percent for area benefit activities.
Specific efforts have been coordinated in the City’s Community Service and Police Departments
to focus on activities and services in the Ventura neighborhood. A number of City-sponsored
programs and activities serving low and very low-income persons have either been undertaken or
proposed. A police substation was opened in the area with the goal of improving contact with
the community.
Changes to Strategy
HUD has informed the City of Palo Alto of a change of policy relating to the timely expenditure
of CDBG fimds. The federal regulatory standard is that no more than 1.5 times ajurisdiction’s
annual entitlement grant amount may remain in its letter of credit 6Odays prior to the end of the
program year. HUD now intends to employ monetary sanctions against jurisdictions that exceed
the regulatory standard. Failure to meet the expenditure standard by May 1, 2003 .will cause
HUD to reduce the City’s next grant by 100% of the amount in excess of 1.5 times the annual
grant.
For this reason, all funding allocations for 2002/03 were scrutinized to insure the readiness of the
program or project to move forward and expend funds in a timely manner. Contingency
allocations have been recommended where site control may be an issue. Time limitations on the
availability of funding have been recommended for St.. Vincent de Paul’s St. Joseph the Worker
Day Center, the Community Working Group’s.Opportunity Center, and Alliance for Community
Care’s Waverley Street project. If the projects have not met site control, objectives by September
30, 2002 the funds will be made available to other projects identified in this Plan so that the
expenditure standard can be met.
This new standard will increase the difficulty in providing funds for affordable housing since
multi-family housing projects typically take more time and planning and are subject to more
delays than other capital projects. It may create situations where lower priority activities will be
flndertaken instead of higher priority activities simply because they are easier to accomplish and
ready to proceed.
The City is also considering changing to a two-year CDBG funding cycle beginning with the
2004/05 fiscal year. Many cities in the Bay Area have adopted extended CDBG funding cycles
and find them to be an effective tool to streamline "process" and provide administrative relief to
both city and non-profit staff. Palo Alto’s Human Services Division adopted a two-year funding
cycle for the Human Resource Allocation Process (HSRAP) in fiscal year 2001/02 that will
conclude in 2002/03. Their experience has been positive and they intend to continue the two-.
year funding cycle for the period 2003/04 through 2004/05.
Coordination of the CDBG and HSRAP funding processes is essential to the effective delivery of
local human service funding. Collaboration between the non-profit agencies and the City’s
funding sources is necessary to avoid confusion, duplication of effort, and to ensure that the
highest identified community needs are met. The two-year process provides the opportunity for
City and non-profit staff to undertake longer-term strategic planning and to maximize available
funding resources.
200212003" ACTIVITIES TO BE UNDERTAKEN
All of the activities to be unde’rtaken in the 2002/2003 CDBG funding cycle address the priority
housing and community development needs identified in the Consolidated Plan. The attached
"Listing of Proposed Projects" describes the 2002/03 funding for each project in detail, the funds
allocated, the expected project beneficiaries, and the HUD national objective.
Housing Activities
City of Palo Alto Housing’Strategy
The Consolidated Plan proposes a five-year strategy to develop i 25 newly constructed rental
units over the 2000-2005 planning period. The 125 units would be affordable to households in
the very low or low-income categories and would meet a portion of the housing production goals
mandated by the Association of Bay Area Governments (ABAG). In this fiscal year the Palo
Alto City Council adopted the creation of new affordable rental housing as one of their top five
priorities.
The City has made significant progress on the first housing project that is part of the 2000-2005
Consolidated Plan strategy. The Oak Court project is the development of 53 units of new rental
housing for families with children on approximately 1.25 acres in the South of Forest Avenue
area (SOFA). The City obtained the site through a combination of a developer land dedication,
in-lieu of providing Below Market Rate units in the other projects in the Plan area, and City
purchase of the remaining land that makes up the site. The City Council selected Palo Alto
Housing Corporation (PAHC) as the housing developer. It is anticipated that construction could
commence by late summer of 2002. On February 4, 2002, the City Council approved an
agreement with PAHC which provides a loan of approximately $2,000,000 (from the City’s
Housing Reserve Fund) for development expenses and site costs.
CDBG Housin~ Development Fund - $198,500
The City Council chose the creation of more affordable housing as one of their top five priorities
this fiscal year. To help meet the affordable housing need, the City of Palo Alto proposes to
purchase a site for a new affordable rental housing development with money from the CDBG
and Housing Reserve funds. Eden Housing has been selected as the non-profit developer to
assist in site identification and project development and management. It is estimated that
$1,000,000 willbe needed in CDBG funding for the project. Since the acquisition of the land is
expected to take place in fiscal year 2002/03, the $1,000,000 will be loaned from the General
Fund, and then reimbursed from CDBG funds (a combination of the existing balance in-the
CDBG Housing Development Fund and future year’s CDBG allocations).
The unencumbered balance in the CDBG Housing Development Fund is currently $115,000.
$198,500 will be allocated in fiscal Year 2002/03. Additionally, $350,000 from the Opportunity
Center Project and $112,000 from the Alliance for Community Care Project may revert to the
Housing Development fund if those projects do not proceed as planned. The balance of the
$1,000,000 will be repaid from CDBG allocations in fiscal years 2003/04 and 2004/05.
Opportunity Center- 33/39/45 Encina Way, Palo Alto, CA - $550,000
The Community Working Group (CWG) proposes to develop an Opportunity Center for
homeless i,ndividuals and families that would provide basic social services and have a
transitional and permanent housing component. CWG has partnered with the Housing Authority
of the County of Santa Clara, the Palo Alto Housing Corporation, and InnVision for the
development and service aspects of the project. The proposed project will be a mixed-use
facility that will house multiple services for those who are homeless and those who are at-risk of
becoming homeless. It will include drop-in services, such as showers and laundry facilities,
lockers, light snacks, information and referral, transportation assistance, a clothes closet,
substance abuse counseiing, and fellowship.
CWG amended the original proposal by increasing the size of the project from two parcels to
three parcels. Adding the property at 45 Encina will allow CWG to expand the number of
housing units from 50 to approximately 95 units and enhance the long-term financial viability of
the entire project.
In fiscal year 2001/02, $480,000 in CDBG funding was allocated to the project for acquisition
costs. CWG acquired title to the property at 33 Encina and has attempted to purchase the
adjacent properties at 39 and 45 Encina. In accordance with Section 570.200 (h) of the CDBG
regulations, the City plans to reimburse CWG for the acquisition costs of 39 Encina (which is
scheduled to close escrow on April 5, 2002) as soon as an agreement has been approved by the
City Council.
An additional $550,000 in CDBG funds are being allocated in 2002/03 for additional site
acquisition costs, predevelopment costs and relocation expenses. The provision of the $550,000
is contingent upon CWG obtaining site control of 45 Encina by September 30, 2002. If the funds
have not been committed by that time, they will revert to the following projects: Housing
Development Fund for expenditure on a new affordable housing site - $350,000; Palo Alto
Housing Corpor~ition Oak Manor Townhomes/water system repairs - $200,000.
Palo Alto Senior Housing, Inc. (Stevenson House) - $50,000
Stevenson House is a 120 unit residential facility for low-income seniors located at 455 E.
"Charleston Road in Palo Alto. The facility presently serves 134 very-low income elderly
residents with an average age of 79 yea.rs old. The facility is 33 years old and in need of
10
continuing maintenance and upgrades to maintain its viability as senior housing. Stevenson
House is unable to recover the costs of major repairs through rental increases if they are to keep
the rents affordable. This proposal is to upgrade the original emergency call system for the frail
residents. The rehabilitation of existing lower-income rental housing is a high priority in the
Consolidated Plan.
Palo Alto Housing Corporation -Oak Manor Townhomes Water System Repairs
The non=profit Palo Alto Housing Corporation owns and operates the 33-unit Oak Manor
Townhomes at 630 Los Robles in Palo Alto. The building was constructed in 1966 and was
purchased by PAHC in 1991. It has a combination of two and three bedroom units suitable for
families. The existing galvanized water pipes have deteriorated and need to be replaced. This
project would receive $200,000 in CDBG funding for fiscal year 2002/03 only if the Opportunity
Center Project has not secured site control by September 30, 2002.
Alliance for Communi~ Care - Waverley Street House
Alliance for Community Care owns the property at 650 Waverley Street. The house was used
for many years as supportive shared housing for low-income persons with mental illness, The
property is a two-story residential structure built in 1904 and is eligible for listing on the
National Register of Historic Places. There is a.need for extensive renovations and maintenance
including seismic and structural repairs, replacement of major systems such as roofing, electrical,
plumbing and heating, and other problems such as termite infestation.
The City of Palo Alto had committed $112,000 in prior year’s CDBG funding to assist with the
$700,000 in identified rehabilitation work. Although Alliance successfully raised the balance of
the money necessary to complete the rehabilitation, the Board of Directors decided in February
2002 not to pursue the project due to a variety of operating funding issues.
Alliance has agreed to consider offers from other non-profit agencies for the property in an effort
to find a way to keep the house in non-profit ownership and to benefit the same population of
very=low income, homeless, special needs persons. If a suitable arrangement can be worked out,
the public funds already raised for the rehabilitation could be transferred to a new agency.
Due to the need to meet the HUD expenditure standard, however, the $112,000 will revert to the
City’s Housing Development fund if an agreement with a successor agency has not been
approved and accepted by the City Council by September 30, 2002.
Non-Housing Community Development Activities
The following capital projects address the Consolidated Plan’s priority to "expand, modernize,
rehabilitate and make seismic and other safety related improvements to facilities that serve low-
income and special needs populations"
Avenidas - Senior Center HVAC Upgrades - $120,000
The Avenidas Senior Center at 450 Bryant Street in Palo Alto offers over fifty different services
and programs for Palo Alto’s senior population. Approximately 6,000 unduplicated clients are
"served at the facility each year, more than half qualify as low-inc0me. The proposed HVAC
11
improvements will increase the comfort of the program participants and improve the energy
efficiency of the building. ..
Palo Alto Community Child Care Ventura Community Center - Exterior Painting - $98,000
The buildings at the Old Ventura School site, at 3990 Ventura Court are in need of upgrades and
repairs including exterior painting. The Ventura site is the only public facility in the Ventura
neighborhood. PACCC has provided many needed services to the community by collaborating
with agencies that provide programs and services for low-income residents, senior, teens and
families. Professionally painting the exterior of the buildings will substantially improve the site
and benefit the entire neighborhood.
Proposed Public Service Activities
CDBG public service funds will be targeted to the following programs in fiscal year 2002/03:
$ 8,490
$24,745
$22,000
$28,750
$20,000
$20,715
$10,000
to Emergency Housing Consortium - Emergency Shelter.
to Palo Alto Housing Corporation - Barker Hotel Tenan~ Counseling Program
to Clara-Mateo Alliance - Elsa Segovia Center for Homeless Families
to Clara-Mateo Alliance - Shelter/Transitional Housing for Individuals
to Shelter Network = Haven Family House Family Transitional Housing
to Urban Ministry - Homeless Day Center and Services
to St. Vincent de Paul - St: Joseph the Worker Program*
* $10,000 from this project will revert to the Lytton Gardens Senior Residential facility at 656
Lytton Avenue in Palo Alto for new dining room furniture if site control is not assured by
September 30, 2002.
Human Services
In addition to the CDBG public service funds, the City will provide $1,311,580 from the General
Fund in support of human services through its Human Service Resource Allocation Process
(HSRAP). The HSRAP funds, in conjunction with the CDBG public service funds, are
distributed to local non-profit agencies whose programs serve the needs of seniors, children,
youth and families, persons with disabilities, and those who are homeless, or at risk of
homelessness. A variety of supported programs provide mental and physical health care
services, tenant/landlord mediation, subsidized child care, support for victims of domestic
violence and rape, senior services, adolescent counseling, emergency food, nutritional services,
recreational activities, and subsidized para-transit services.
Services and Resources Targeted to Homeless Persons
The following services for persons in the Palo Alto community who are very low-income,
homeless, or at-risk of becoming homeless, are provided with supplemental .funding from the
City of Palo Alto either with CDBG or HSRAP funding. The goal of all the services listed is to
prevent homelessness, help move people .out ofhomelessness and to reduce the number of
persons below the poverty line.
12
Alliance for Community Care: Mental health.outreach and service linkage for Palo Alt0’s adult
homeless population. A casework counselor works in the Palo Alto area to help low-income,
disabled adults access existing mental health and other community resources.
American Red Cross: .Homeless prevention program that provides direct assistance to families
experiencing financial difficulties. The.purpose of the program is to help families remain in their
housing and avoid becoming homeless. Agency provides rental and utility assistance as well as
counseling and information and referral to eligible low-income families.
City of Palo Alto Season Jobs Program: Designates several temporary, seasonal employment
opportunities invarious City of Palo Alto Departments, for persons who are homeless and
unemployed. The.program is targeted to individuals who are motivated to improve their
situations and re-enter the work force.
Clara-Mateo Alliance Shelter: Shelter and Transitional Housing with casework counseling and
supportive services for homeless individuals, couples and families who are actively working
toward achieving their goals and overcoming homelessness.
Elsa Segovia Day Center for Homeless Women and Children: Day center and supportive
services including child care, health care, employment counseling, clothing and respite for
homeless families with children. This program is expected to open in the spring of 2002.
Emergency Housing Consortium: Shelter and supportive services to homeless persons at the
National Guard Armory in Sunnyvale, the San Jose Reception Center, and other transitional
housing programs in Santa Clara County operated by the agency. Supportive services include
meals, childcare, health care, information and referral, and job and life-skills training.
Shelter Network - Haven Family House: Transitional housing with supportive services in Menlo
Park for"previously homeless families with children. The newly renovated facility includes
individual apartments and an on-site childcare center.
Mayview Community Clinic: Basic primary health care services and health education and
referral services to uninsured low income and homeless individuals from the Palo Alto area.
Palo Alto Housing Corporation - Barker Tenant Counseling: Counseling and case-management
services for the low-income residents of the Barker Hotel at 439 Emerson Street in Palo Alto.
Many of the residents have a history of homelessness and special needs. The program plays a
vital role in helping the residents maintain their stability and housing.
Second Harvest Food Bank: Distributes supplemental groceries and food services to very low-
income seniors and people with disabilities through the Operation Brown Bag Program.
Groceries are distributed weekly at the Ventura School site to income eligible participants.
Social Advocates for Youth: Crisis intervention, counseling and short-term shelter and crisis
resolution treatment services for at-risk youth who are beyond parental control, or have run
away, or who are homeless. The youth shelter is located in Mountain View.
13
Support Network for Battered Women: Emergency shelter and supportive services for victims of
domestic violence, primarily battered women and their children. Supportive services include
food, transportation, counseling, and legal services. Victims often must deal with issues of
homelessness in the context of a violent domestic situation.
Urban Ministry of Palo Alto: Services for very-low income or homeless persons including
bagged groceries; hot meals, emergency shelter, information and referral, case-management and
money management (payee) programs. The Urban Ministry staffs the outdoor morning drop-in
center located behind the Red Cross building at 400Mitchell Lane. Bagged groceries are
distributed daily at the Downtown Food Closet located at 425 Hamilton Avenue in Palo Alto.
.Community Technology Alliance: Shelter hotline and voicemail services for homeless
individuals and families. The voicemail service helps case-managed clients attain individual
goals such as securing health care, housing or employment. A countywide housing information
and referral website is being developed to assist service providers and housing seekers.
St. Joseph the Worker. Program: The day worker program in Mountain View helps low-income
job seekers connect with employers in a dignified professional atmosphere. Support services and
classes are also offered to help workers increase and improve their language and job skills. The
program does not currently.have a location, but is expected to secure a new site in the near future
and continue its program.
Transition from Homelessness to Permanent Housing
Shelter Plus Care (S + C): The S + C program is administered through the Office of the Santa
Clara County Homeless Coordinator. It is a federal grant program that provides Section 8 rental
assistance to participating landlords on behalf of eligible tenants for a period of up to five years.
Extensive support services are a necessary and required component of the. program that targets
people who are homeless and disabled. There are 12 housing units available for S + C clients in
Palo Alto.
The Barker Hotel: The Barker is owned and operated by the Pal0 Alto Housing Corporation
(PAHC), and has 26 units of permanent Single Room Occupancy (SRO) housing at rents
affordableto persons with incomes between 30% and 50% of the median income.. Five of the
Barker’s units are fully accessible by wheelchair users~ Priority for occupancy is for persons
who are homeless (either unsheltered or sheltered), persons with disabilities, and persons with
extremely’low-incomes. Six of the units are available with tenant based Section 8 subsidies
through the Shelter Plus Care program.
Alma Place: Alma Place is located at 753 Alma Street in Palo Alto, and is also owned and
operated by the Palo Alto Housing Corporation. The project, a 106-unit single room occupancy
resident hotel, is affordable to low and very low income persons due to the layering of subsidies
from City Housing Reserve funds, a private bank loan, an Affordable Housing Program (AHP) .
Grant, and an award of low income housing tax credits. The studio apartments rent for $330 to
$490 per month and are available to persons earning between $6,600 and $20,000 a year. Six of
.ttie units are available with tenant based Section 8 rental subsidies through the Shelter Plus Care
program.
14
Haven Family House: Shelter Network of San Mateo County owns and operates this transitional
housing facility for families with children located at 260 Van Buren Road in Menlo Park.
Families reside in one and two bedroom apartments for two to four months depending on their
individual case plans and situations. Comprehensive case management, support services, and
on-site licensed childcare are available to help families break the cycle ofhomelessness..
Analysis of Impediments to Fair Housing Choice
The City of Palo Alto completed an Analysis of Impediments to Fair Housing Choice on
February 6, 1996. That report identified a lack of housing options affordable to persons of low
and moderate income as the major impediment to housing choice. Housing discrimination was
also identified as an impediment, with cases based on familial status the most often reportedl
However, the number of Cases of discrimination against persons with physical and mental
disabilities has also been increasing.
The City of Palo Alto has joined with other Santa Clara County entitlement jurisdictions to
undertake a countywide fair housing study. The project is behind schedule, but will be revised to
include 2000 census data. The draft report, which includes 2000 census data, is expected to be
completed by May of 2002. The study will include a demographic analysis, a lending analysis, a
review of government programs and policies, a survey of Santa Clara residents and service
organizations, an assessment of the delivery of fair housing services, and a plan-for, the
development of new strategies. The information from the finalized survey will be the basis for
potential revisions to the Analysis of Impediments to Fair Housing Choice.
Palo Alto plans to undertake the following actions to foster and maintain affordable housing and
to address housing discrimination during the 2002/03 fiscal year:
¯ /. Provide tenant/landlord counseling and mediation services for Palo Alto residents through
Project Sentinel.
¯ ," Support Community Technology Alliance’s Countywide website that lists subsidized
housing opportunities, wait lists and vacancies.
¯ /" Provide CDBG funds to the Community Working Group to commence development of the
Opportunity Center to benefit homeless and very low-income persons.
¯ / Provide CDBG funding to the Housing Development Fund for the potential development of a
new affordable housing site in Palo Alto.
¯ / Continue to support the Human Relations Commission in their documentation and
investigation of hate crimes, and in their support of diversity, disability, and affordable
housing issues.
¯ " Continue to monitor the provision of fair housing services by MCFH to ensure that adequate
services are being provided, and that services are provided cost effectively.
,/ Work with the Santa Clara County CDBG entitlement cities in their effort to finalize a
countywide study of fair housing issues, and to implement any recommended improvements
to the delivery of services on a regional basis.
¢"Provide funding to the local fair housing agency, Mid-Peninsula Citizens for Fair Housing
(MCFH) to reduce discrimination in housing by:
15
a. Investigating a minimum of 15 cases of housing discrimination
b. Conducting 25 consultations with persons who believe they have been discriminated
against
c. Maintaining a pool of 50 testers for investigations and conducting 3 training’s
d. Maintaining a panel of 10-15 attorneys for referral and coordinating an annual
meeting for participating attorneys
e.Running biweekly ads in the Palo Alto Weekly and daily ads in the San Jose Mercury
News; and running one display ad promoting fair housing
f.Distributing 100 fair housing brochures
g. Running 20 public service announcements for local radio/TV broadcasts
h. Making 7 educational presentations to the community
i.Monitoring and reporting on four rental sites
j. Showing the educational video on hbusing discrimination produced by MCFH on
local cable TV
Amendments to Plan
Prior to the submission of any substantial change in the proposed use of funds, citizens will be
provided reasonable notice of, and the opportunity to comment on, any proposed Action Plan
amendment(s).
Urgent Need Activities
In the event of a local, state or federal disaster declaration for areas within the boundaries of the
City of Palo Alto, the City reserves the right to use CDBG or other available federal funds to
abate immediate and necessary hazards. Such funds may be used for staff efforts, loans, or
outright grants to affected parties, as approved by City Council and allowable under the pertinent
Federal Guidelines.
Lead-Based Paint Hazards
The City will continue to require testing and lead hazard reduction in housing rehabilitation
efforts funded with Federal funds. The City of Palo Alto, along with the other CDBG
entitlement cities in Santa Clara County, is working to establish adequate capacity to comply
with the new Lead-Based Paint Regulations (24 CFR Part 35) that were effective September 15,
2000. The City received an extension from the U.S. Department of Housing and Urban
Development for implementation of the new regulations until January 10, 2002 in order to
address the capacity issue.
Monitoring of Activities
The City of Palo Alto follows the monitoring requirements for the use of Federal funds as
~irected by HUD. The City’s Department of Planning and Community Environment monitors its
housing production goals and all the activities carried out to further the goals of the Consolidated
16
Plan. For activities funded by CDBG and HOME programs, an annual performance report is
completed based on HUD regulations and in accordance with HUD standards. The Consolidated
Annual Performance and Evaluation Report (CAPER) is available to the Citizens Advisory
Committee and the general public for comments during a 15-day review period. This report
identifies the actual dollars expended, the beneficiaries served, and the program goals achieved.
The City requires subrecipients of CDBG funds to submit semi-annual and annual performance
reports outlining the extent to which program goals have been achieved, and the number of
beneficiaries who have been served. Program performance is measured against the specific
program objectives outlined in the contract scope of services. Additionally, CitY staff will
monitor each subrecipient, as necessary, to insure compliance with all regulations governing
their administrative, financial, and programmatic operations, and to make sure the subrecipients
achieve their performance objectives within the prescribed schedule and budget.
Coordination
The CDBG entitlement cities (Palo Alto, Sunnyvale, Mountain View, Santa Clara, Gilroy,
Milpitas, San Jose), and the Urban County of Santa Clara continue to meet to discuss issues of
mutual concern and to share information and strategies for addressing affordable housing, .
homelessness, fair housing, and other issues of common concern. The meetings have helped the
participants better understand the County and nonprofit social service structure within the
County.
The City of Palo Alto continues to collaborate with neighboring jurisdiction in both Santa Clara
and San Mateo County on issues relating to homelessness in northemSanta Clara County and
southern San Mateo County. The City actively participates in the Santa Clara County Housing
and Homeless Collaborative.
The Quality Housing and Work Responsibility Act of 1998 requires public housing authorities
(PHA’s) to develop and implement five-year plans that describe their long range goals and a
strategy for achieving the identified goals. These plans provide details about the PHA’s
operations, program participants, programs andservices. The PHA is required to ensure that.
their plan is consistent with any applicable Consolidated Plans for jurisdictions in which the
PHA is located. This new requirement allows for some collaborative discussions on the role of
the Santa Clara County Housing Authority in meeting the housing needs of low-income persons
in Palo Alto.
To ensure a coordinated approach to the City’s human service funding efforts, the CDBG
Coordinator and the Administrator of Human Services meet to review and discuss applications
received through both the CDBG and HSRAP processes. Additionally, a member of the Human
Relations Commission serves on the CDBG Citizens Advisory Committee to avoid duplication ¯
of effort and to assure collaboration within Palo Alto. The CDBG and housing staff attend and
participate in the semi-annual Human Service Provider Network meetings coordinated by the
Human Services Division to promote understanding and collaboration among the local public
service agencies.
Application for Federal
Assistance
1. Type of Submission:
Application: Not Applicable "
Preapplication: Not Applicable
2. Date Submitted
05/15/02
3. Date Received by State
4. Date Received by Federal Agency
Applicant Identifier
B02MC060020
State Application Identifier
Federal Identifier
5. Applicant Information
Legal Name Organizational Unit
City of Palo Alto Dept. of Planning & Community Environment
Address Contact
250 Hamilton Avenue
Palo Alto, CA 94301
Santa Clara
6. Employer Identification Number (EIN):
94600038
8. Type of Application:
Type: Continuation
10. Catalog of Federal Domestic Assistance Number:
Catalog Number: 14218
Assistance Title: Community Development Block Grant
12. Areas Affected by Project:
The City of Palo Alto, County of Santa Clara, State of
California
Suzanne Bayiey
650 329-2428
7. Type of Applicant:
Municipal
9. Name of Federal Agency:
U.S. Dept. of Housing & Urban Development
11. Descriptive Title of Applicant’s Project:
The City of Palo Alto’s Community Development Block
Grant (CDBG) Program for Fiscal Year 2002/2003
13. Proposed Project:
Start Date End Date
07/01/02 06/30/03
15. Estimated Funding:
a. Federal $808,000
b. Applicant $o
c. State $o
d. Local $o
e. Other
$434,000
f. Program Income
$75,000
g. Total
$1,317,000
14. Congressional Districts of:
a. Applicant / b. Project
12th Congressional DistrictJ. 12th Congressional Disti’ict
16. Is Application Subject to Review by State Executive Order 12372 Process?
Review Status: Program not covered
17. Is the Applicant Delinquent on Any Federal Debt?
No
18. To the best of my knowledge and belief, all data in this application/preapplication are true and correct, the document has been duly authorized
by the governing body of the applicant and the applicant will comply with the attached assurances if the assistance is awarded.
a. Typed Name of Authorized Representative"b. Title c. Telephone Number
Frank Benest City Manager 650 329-2483
d. Signature of Authorized Representative e. Date Signed
05/14/02
Funding Sources
Entitlement Grant (includes reallocated funds)
CDBG
ESG
HOME
HOPWA
Total
$808,000
$o
$o
$o
Prior Years’ Program Income NOT previously programmed or reported
CDBG $45,000
ESG $0
HOME $0
HOPWA $0
Total
ReprogrammedPriorYeam’Funds
CDBG
ESG
HOME
HOPWA
Total
Total Estimated Program Income
Housing Improvement Program
Palo Alto Housing Corp.
Total
$434,000
$o
$o
$o
$15,000
$15,000
Section 108 Loan Guarantee Fund
$808,000
$45,000
$434,000
$30,000
$0
TOTAL FUNDING SOURCES $1,317,000
Other Funds $0
Submitted Proposed Projects Totals $1,317,000
Un-Submitted Proposed Projects Totals $0
OMB Approval (pending)
Federal Assistance Funding Matrix
The applicant must provide the funding matrix shown below, listing each program for which Federal funding is be!rig requested, and
complete the certifications.
Piogram"
CDBG
Grand Totals
Applicant
Share
Federal
Share
808,000
State
Share
Local Other
434,000"
Program
Income
75,000
Total
i, 317,000
808,000 434,000* 75,000 1,317,000
*For FHIPs, show both initiative and component
*Reprogrammed Prior Year’s Funds
Instructions for the.HUD-424-M
¯ Public reporting burden for this collection of information is estimated
to average 45 minutes per response, including the time for reviewing
instructions, searching existing data sources, gathering and main-
taining the data needed, and completing and reviewing the collection
of information. This agency may not conduct or sponsor, and a
person is not required to respond to, a collection of information
unless that collection displays a valid OMB control number.
This form is to be used by applicants requesting funding from the
Department of Housing and Urban Development for application
submissions for Federal assistance.
Enter the i’ollowing information:
Program:. The HUD funding program you are applying under.
Applicant Share: Enter the amount of funds or cash equivalent of
in-kind contributions you are contributing to your project or program
of activities.
Federal Share: Enter the amount of HUD funds you are requesting
with your application.
State Share: Enter the amount of funds or cash equivalent of in-kind
services the State is contributing to your project or program of
activities.
Local Share: Enter the amount of funds or cash equivalent of in-
kind services you? local government is contributing to your project or
program of activities.
Other: Enter the amount of other sources of private, non-profit, or
other funds or cash equivalent of in-kind services being Contributed
to your project or program of activities.
Program Income: Enter the amount of program income you expect
to generate and contribute to this program over the life of your award.
Total: Please total all columns and fill in the amounts.
Authorized for local reproduction Page 1 form HUD-424-M (1/2000)
ref.OMB Circular A-102
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CERTIFICATIONS
In accordance with the applicable statutes and the regulations governing the consolidated plan regulations, the
jurisdiction certifies that:
Affirmatively Further Fair Housing - The jurisdiction will affirmatively further fair housing, which means it
will conduct an analysis of impediments to fair housing choice within the jurisdiction, take appropriate actions to
overcome the effects of any impediments identified through that analysis, and maintain records reflecting that
analysis and actions in this regard.
Anti-displacement and Relocation Plan" It will comply with the acquisition and relocation requirements of
the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended, and
implementing regulations at 49 CFR 24; and it has in effect and is following a residential antidisplacement and
relocation assistance plan required under section 104(d) of the Housing and Community Development Act of
1974, as amended, in connection with any activity assisted with funding under the CDBG or HOME programs.
Drug Free Workplace -- It will or will continue to provide a drug-free workplace by:
Publishing a statement notifying employees that the unlawful manufacture, distribution,
dispensing, possession, or use of a controlled substance is prohibited in the grantee’s workplace
and specifying the actions that will be taken against employees for violation of such prohibition;
2.¯Establishing an ongoing drug-free awareness program to inform employees about-
(a)
(b)
(c)
(d)
The dangers of drug abuse in the workplace;
The grantee’s policy of maintaining a drug-free workplace;
Any available drug counseling, rehabilitation, and employee assistance programs; and
The penalties that may be imposed upon employees for drug abuse violations occurring
in the workplace;
Making it a requirement that each employee to be engaged in the performance of the grant be
given a copy of the statement required by paragraph 1;.
Notifying the employee in the statement required by paragraph 1 that, as a condition of
employment under the grant, the employee will -
(a)Abide by the terms of the statement; and
(b)Notify the employer in writing of his or her conviction for a violation of a criminal drug
statute occurring in the workplace no. later than five calendar days after such conviction;
Notifying the agency in writing, within ten calendar days after receiving notice under
subparagraph 4(b) from an employee or otherwise receiving actual notice of such conviction.
Employers of convicted employees must provide notice, including positiol~ title, to every grant
officer or other designee on whose grant activity the convicted employee was working, unless the
Federal agency has designated a central point for the receipt of such notices. Notice shall
include the identification number(s) of each affected grant;
o Taking one of the following actions, within 30 calendar days of receiving notice under
subparagraph 4(b), with respect to any employee who is so convicted -
(a)
(b)
Taking appropriate personnel action against such an employee, up to and including
termination, consistent with the requirements of the Rehabilitation Act of 1973, as
amended; or
Requiring such employee to participate satisfactorily in a drug abuse assistance or
rehabilitation program approved for such PUrposes by a Federal, State, or local health,
law enforcement, or other appropriate agency;
Making a good faith effort to continue to maintain a drug-free workplace through
implementation of paragraphs 1, 2, 3, 4, 5 and 6.
Anti-Lobbying - To the best of the jurisdiction’s knowledge and belief:
No Federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person
for influencingor attempting to influence an officer or employee of any agency, a Member of
Congress, an officer or .employee of Congress, or an employee of a Member of Congress in
connection with the awarding of any Federal contract, the making of any Federal grant, the
making of any Federal loan, the entering into of any cooperative agreement, and the extension,
continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or
cooperative agreement;
o If any funds other than Federal appropriated funds have been paid or will be paid to any person
for influencing or attempting to influence an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or an employee of a Member of Congress in
Connection with this Federal contract, grant, loan, or cooperative agreement, it will complete and
submit Standard Form-LLL, "Disclosure Form to Report Lobbying," in accordance with its
instructions; and
o It will require that the language of paragraph 1 and 2 of this anti-lobbying certification be
included in the award documents for all subawards at all tiers (including subcontracts, subgrants,
and contracts under grants, loans, and cooperative agreements) and that all subrecipients shall
certify and disclose accordingly.
Authority of Jurisdiction -- The consolidated plan is authorized under State and local law (as applicable) and
the jurisdiction possesses the legal authority to carry out the programs for which it is seeking funding, in
accordance with applicable HUD regulations.
Consistency with plan -- The housing activities to be undertaken with CDBG, HOME, ESG, and HOPWA funds
are consistent with the strategic plan.
Section 3 -- It will comply with section 3 of the Housing and Urban Development Act of 1968, and
implementing regulations at 24 CFR Part 135.
Signature/Authorized Official
Date
Name: Frank Benest
Title: City Manager
Specific CDBG Certifications
The Entitlement Community certifies that:
Citizen Participation - It is in full compliance and following a detailed citizen participation plan that satisfies
the requirements of 24 CFR 91.105.
Community Development Plan - Its consolidatedhousing and community development plan identifies
community development and housing needs and specifies both short-term and long-term community development
objectives that provide decent housing, expand economic opportunities primarily for persons of low and
moderate income. (See CFR 24 570.2 and CFR 24 part 570)
Following a Plan
It is following a current consolidated plan (or Comprehensive Housing Affordability Strategy) that has been
approved by HUD.
Use of Funds - It has complied with the following criteria:
1.Maximum Feasible PrioriW. With respect to activities expectedto be assisted with CDBG funds,
it certifies that it has developed its Action Plan so as to give maximum feasible priority to
activities which benefit low and moderate income families or aid in the prevention or elimination
of slums or blight. The Action Plan may also include activities which the grantee certifies are
designed to meet other community development needs having a particular urgency because
existing conditions pose a serious and immediate threat to the health or welfare of the
community, and other financial resources are not available);
o Overall Benefit. The aggregate use of CDBG funds including section 108 guaranteed loans
during program year(s) 2002 - 2003 (a period specified by the grantee consisting of one, two, or
three specific consecutive program years), shall principally benefit persons of low and moderate
income in a manner that ensures that at least 70 percent of the amount is expended for activities
that benefit such pei’sons during the designated period;
Special Assessments. It will not attempt to recover any capital costs of public improvements
assisted with CDBG funds including Section 108 loan guaranteed funds by assessing any amount
against properties owned and occupied by persons of low and moderate income, including any
fee charged or assess.ment made as a condition of obtaining access to such public improvements.
However, if CDBG funds are used to pay the proportion of a fee or assessment that relates to the
capital costs of public improvements (assisted in part with.CDBG funds) financed from other
revenue sources, an assessment or charge may be made against the prop.erty with respect to the
public improvements financed by a source other than CDBG funds.
The jurisdiction will not attemptto recover any capital costs of public improvements assisted
with CDBG funds, including Section 108, unless CDBG funds are used to pay the proportion of
fee or assessment attributableto the capital costs of public improvements financed from other
revenue sources. In this case, an assessment or charge may be made against the property with
respect to the public improvements financed by a source other than CDBG funds. Also, in the
case of properties owned and occupied bymoderate-income (not low-income) families, an
assessment or charge may be made against the property for public improvements financed by a
source other than CDBG funds if the jurisdiction certifies that it lacks CDBG funds to cover the
assessment.
Excessive Force -- It has adopted and is enforcing:
1.A policy prohibiting the use of excessive force by law enforcement agencies within its
jurisdiction against any individuals engaged in non-violent civil rights demonstrations; .and
A policy of enforcing applicable State and local laws against physically barring entrance to or
exit from a facility or location which is the subject of such non-violent civil rights demonstrations
within its jurisdiction;
Compliance With Anti-discrimination laws -- The grant will be conducted and administered in conformity with
title VI of the Civil Rights Act of 1964 (42 USC 2000d), the Fair Housing Act (42 USC 3601-3619), and
implementing regulations.
Lead-Based Paint -- Its notification, inspection, testing and abatement procedures concerning lead-based paint
will comply with the requirements of 24 CFR. §570.608;
Compliance with Laws - It will comply with applicable laws.
Signature/Authorized Official
Date
Name: Frank Benest
Title: City Manager
APPENDIX TO CERTIFICATIONS
INSTRUCTIONS CONCERNING LOBBYING AND DRUG-FREE WORKPLACE REQUIREMENTS:
A. Lobbying Certification
This certification is a material representation of fact upon which reliance was placed when this
transaction was made or entered into. Submission of this certification is a prerequisite for making or
entering into this transaction imposed by section 1352, title 31, U.S. Code. Any person who fails to file
the required certification shall be subject to a civil penalty of not less than $10,000 and not more than
$100,000 for each such failure.
B. Drug-Free Workplace Certification
1. By signing and/or submitting this application or grant agreement, the grantee
is providing the certification.
2. The certification is a material representation of fact upon which reliance is placed when the
agency awards the grant. If it is later determined that the grantee knowingly rendered a false
certification, or otherwise violates the requirements of the Drug-Free Workplace Act, HUD, in
addition to any other remedies available to the Federal Government, may take action authorized
under the Drug-Free Workplace Act.
3. Workplaces under grants, for grantees other than individuals, need not be
identified on the certification. If known, they may be identified in the grant application.
If the grantee does not identify the workplaces at the time of application,, or upon award,
if there is no application, the grantee must keep the identity of the workplace(s) on file in
its office and make the information available for Federal inspection. Failure to identify
all known workplaces constitutes a violation of the grantee’s drug-free workplace
requirements.
4. Workplace identifications must include the actual address of buildings (or parts of
buildings) or other sites where work under the grant takes place. Categorical
descriptions may be used (e.g., all vehicles of a mass transit authority or State highway
department while in operation, State employees in each local unemployment office,¯performers in concert halls or radio stations).
5. If the workplace identified to the agency changes during the performance of the
grant, the grantee shall inform the agencyof the change(s), if it previously identified the
workplaces in question (see paragraph three).
6. -The grantee may insert in the space provided below the site(s) for the performance of
work done in connection with the specific grant:
Place of Performance (Street address, city, county, state, zip code)
250 Hamilton Avenue, Palo Alto, CA 94301
Check __ if there are workplaces on file that are not identified here.
The certification with regard to the drug-free workplace is required by 24 CFR part 24, subpart F.
7. Definitions of terms in the Nonprocurement Suspension and Debarment common rule
and.Drug-Free Workplace c6mmon rule apply to this certification. Grantees’ attention is
called, in particular, to the following definitions from these rules:
"Controlled substance" means a controlled substance in Schedules I through V of the
Controlled Substances Act (21 U.S.C. 812) and as further defined by regulation (2.1 CFR
1308.11 through 1308.15);
"Conviction" means a finding of guilt (including a plea of nolo contendere) or imposition
of sentence; or both, by any judicial body charged with the responsibility to determine
violations of the Federal or State criminal drug statutes;
"Criminal drug statute" means a Federal or non-Federal criminal statute involving the
manufacture, distribution, dispensing, use, or possession of any controlled substance;
"Employee’; means the employee of a grantee directly engaged in the performance of
work under a grant, including: (i) All "direct charge" employees; (ii) all "indirect charge"
employees unless their impact or involvement is insignificant to the performance of the
grant; and (iii) temporary personnel and consultants who are directly engaged in the
performance of work under the grant and who are on the grantee’s payroll. This
definition does not include workers not on the payroll of the grantee (e.g., volunteers,
even if used to meet a matching requirement; consultants or independent contractors not
on the grantee’s payroll; or employees of subrecipients or subcontractors in covered
workplaces).
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PORTOLA VALLE~"LOS ALTOS HILL~ L(~S ALTOS_
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~) HUD Offices
¯ Proposed Projects
Proposed Projects
¯Anti-Crime Programs
,4 Economic Development
-. Homeless & HIVIAIDS Programs
f~ Housing
¯Infrastructure
¯Other
v Planning and Administration
,,Public Facilities
¯Public Services
~Senior Programs
*Youth Programs
85/88/2882 89:4~ 6587257531 PHILIP R LEE MD
ATTACHMENT D
May 7, 2002
Julie Caporgno
Plannin8 Division
City of Palo Alto
The Community Workin8 Group has developed a collaborative relationship
with the Housing Authority of the County of Santa Clara for joint development
of the Opportunity Center of Rte Mid-Peninsula. As part of our arrange .rnent
with the Housing Authority, we have agreed to shift to the Housin8 Authority
all CDBG fundin8 approved by the City of Falo Alto for development of the
Opportunity Center. At its meeting on April 25, the Boaxd of Direct.ors of the
Community Working Group approved a resolution to that effect. Therefore I
request that all CDBG funding for use in the Opportunity Center approved by
the City of Palo Alto as part of the 2001-02 and 2002-03 fi~ndh~ cycles be shifted
to the Housing Authority of the County of Santa Clara,
Thank you very much
Donald A, Barr, President