DEPARTMENT: Physical Development Administration
FILE TYPE: Consent Information
TITLE
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Review Of Fiscal Year 2024 Countywide Community Development Block Grant Allocation Request
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PURPOSE/ACTION REQUESTED
Review potential Countywide Community Development Block Grant (CDBG) activity requests for Fiscal Year (FY) 2024.
SUMMARY
The CDBG program is a federal entitlement program that provides funds to communities to address community development needs that meet at least one of three National Objectives: benefit to low- and moderate-income persons; prevention or elimination of slums or blight; or meeting an urgent need. Congress determines CDBG program funding, and the Department of Housing and Urban Development (HUD) administers the program. HUD requires a Five-Year Consolidated Plan and subsequent Annual Action Plans. The CDA administers the CDBG program on behalf of Dakota County (the County).
The County’s CDBG allocation for FY 2023 was $1,961,800. Because HUD has not released the grant amount for FY 2024, the FY 2023 allocation is used for planning purposes. Per the approved 2020-2024 Consolidated Plan, CDBG funds are distributed so that approximately 75 percent goes directly to Dakota County cities and townships, and 25 percent goes to the County. The CDA incurs costs to administer the CDBG program, and the costs can be reimbursed by CDBG funds. These costs include CDA staff time, compliance requirements, and HUD-mandated programmatic responsibilities. The CDA proposes 12 percent or $235,416 to cover general grant administration costs, which will be deducted from the total grant amount, and the remaining portion will be distributed using the 75/25 split. Staff believes it is fairer to distribute the general grant administration costs among all CDBG recipients because the CDA must provide significant time overseeing and monitoring the municipal subrecipients. The amount to be split between the cities and the County totals $1,726,384, with $1,294,788 going to the cities and townships and $431,596 going to the County. CDBG funds are allocated to Dakota County cities and townships (including Northfield) based on a HUD formula that uses population, overcrowding (more than one person per room in a residential structure), and poverty levels. Cities with populations over 10,000 receive about 97 percent of the amount allocated to the cities and townships, or $1,255,457. Approximately three percent, or $39,331, is allocated to the smaller cities and townships in a competitive pool. The CDA did not receive any applications from the small cities and townships for FY 2024. The CDBG funds reserved for these communities have been added to the Countywide Home Improvement Loan activity.
The Countywide requests this year are for existing programs: $290,649 for the existing CDA-administered Home Improvement Loan program; $87,278 for the CDA-administered housing counseling program; $3,000 for fair housing compliance; $60,000 for the County’s septic system and replacement program; and $30,000 for the County’s well-sealing program. If the County’s CDBG allocation is decreased, the Home Improvement Loan program will be reduced. If County’s CDBG allocation is increased all other Countywide activities will be increased proportionally and the Home Improvement Loan activity will remain as is.
Staff expects to bring the draft Dakota County FY 2024 Annual Action Plan (the Action Plan) to the Physical Development Committee of the Whole for review on March 19, 2024. The Countywide CDBG activities will be included in the Action Plan. A public hearing is anticipated for the County Board meeting on April 23, 2024, with final approval at the County Board meeting on May 7, 2024, if HUD has provided the FY 2024 allocation by that time.
RECOMMENDATION
recommendation
None. Staff is providing information to the Board to use FY 2024 CDBG funds for the following Countywide activities: $290,649 for the existing CDA-administered Home Improvement Loan program; $87,278 for the CDA-administered housing counseling program; $3,000 for fair housing compliance; $60,000 for the County’s septic system and replacement program; and $30,000 for the County’s well-sealing program.
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EXPLANATION OF FISCAL/FTE IMPACTS
Dakota County’s FY 2024 CDBG allocation has not been released. The final allocations for activities may be modified depending on the final CDBG amount appropriated by Congress. This will be brought to the County Board as part of the 2024 Annual Action Plan review.
☐ None ☐ Current budget ☒ Other
☐ Amendment Requested ☐ New FTE(s) requested
RESOLUTION
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Information only; no action requested.
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PREVIOUS BOARD ACTION
None.
ATTACHMENTS
Attachment: Proposed FY 2024 Countywide CDBG Activities
Attachment: Five-Year History of County CDBG Allocations
BOARD GOALS
☒ A Great Place to Live ☐ A Healthy Environment
☐ A Successful Place for Business and Jobs ☐ Excellence in Public Service
CONTACT
Department Head: Erin Stwora
Author: Maggie Dykes