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HomeMy WebLinkAbout28 - Response to HUD Staff Comments on 1999-2000 CAPER4 SEW P'�Rr p mm °�gcone+`r CITY OF NEWPORT BEACH COMMUNITY AND ECONOMIC DEVELOPMENT PLANNING DEPARTMENT 3300 NEWPORT BOULEVARD NEWPORT BEACH, CA 92658 (949) 644 -3200: FAX (949) 644- Hearing Date: Agenda Item No.: Staff Person: June 26, 2001 28 Daniel R. Trimble (949) 644 -3230 REPORT TO THE MAYOR AND CITY COUNCIL SUBJECT: Response to HUD Staff Comments on FY1999 -2000 CAPER SUMMARY: Staff has prepared a response to the HUD assessment of the 1999 -2000 CAPER, has made corrections to our IDIS records, and has submitted the corrected end of year reports in order to adequately comply with the CDBG reporting requirements. SUGGETED ACTION: Receive and File Discussion On June 15, 2001 staff prepared and submitted a detailed response to the April 25, 2001 assessment letter from HUD to the City regarding the 1999 -2000 CAPER. Additionally staff has, with assistance from our CDBG consultant, updated our IDIS records and prepared revised end of year reports. The correction of the IDIS records and the preparation of updated reports for the 1999 -2000 fiscal year should specifically address the concerns identified in the HUD assessment letter. On June 19, 2001, staff received a positive response via telephone from our current HUD field representative. HUD staff wanted to assure us that technical assistance would be made available to help us with our CDBG administration needs and was encouraged by our use of consultants to help meet reporting requirements in a timely fashion. Staff is also preparing to draft the FY 2000 -2001 CAPER for submission to HUD in September 2001. Submitted by: SHARON Z. WOOD Assistant City Manager Prepared by: DANIEL R. TRIMBLE Associate Planner Attachment: June 15, 2001 Response Letter F..-I UserslPLi %'ISltare&CDBGI F) 99- 20;responseltrrpl2.da June 15, 2001 CITY OF NEWPORT BEACH P.O. BOX 1768, NEWPORT BEACH, CA 92658.8915 PLANNING DEPARTMENT (949) 644 -3230 Robert Ilumin Deputy Director Office of Community Planning and Development 611 West Sixth Street Los Angeles, CA 90017 Subject: CAPER Review for the City of Newport Beach Dear Mr. llumin: In response to the April 25, 2001 letter sent by your office regarding the City's FY 1999- 2000 CAPER, we would like to offer the following information and clarification. General Response While the submission of the CAPER document was delayed due to an unanticipated staff change at the City, the reporting delay was exacerbated by a lack of response from HUD staff to the City's requests for technical assistance and access to 1DIS. The City staff member that assumed the CDBG administration responsibilities had contacted the HUD field office several times via fax, phone, and email to request technical assistance regarding the CAPER and 1DIS and to be assigned a login and password for the 1D1S system. The requested technical assistance was not provided, and it took four months to receive the 1D1S login. The field office actually had the login and password for several weeks before it was distributed to the City staff member. While we have begun to develop a positive working relationship with our current representative, the reassignment of the City to a new field office representative during our CAPER preparation did add to the communication difficulties. The current and former representatives seemed to interpret and communicate HUD policy and regulatory requirements differently. This field representative transition also seemed to contribute to 3300 Newport Boulevard, Newport Beach a lack of understanding and appreciation for the situation that the City was in with its own staff transition. We sincerely appreciate the difficulties facing the HUD staff with their increased caseloads and shifting mandates. However, we hope that this does not lead to a shift from HUD traditionally being an organization that provides a balance of both technical assistance and oversight to city grantees to one that is mainly regulatory. Consolidated Plan HUD Comment: The City of Newport Beach reports no activities or accomplishments that relate back to strategies described in its Consolidated Plan. The CAPER is incomplete and does not address any measurable progress in any particular area. CAPER summaries provide[s] vague information regarding accomplishments during the program year. The accomplishments compared to projection[s] is very poor. City's overall performance is in need of improvement. Response: While portions of IDIS reports in the CAPER were incomplete do reasons discussed previously, the narrative of the document specifically identifies the activities undertaken and accomplished. The relationship of activities and accomplishments to the Consolidated Plan is included in the narrative and was prepared in a format and level of detail based on what was previously acceptable to HUD. Updated IDIS reports have been sent under separate cover. The City does not agree with HUD's assessment of the inconsistencies between the accomplishments and the Consolidated Plan. The activities that were undertaken during the last three years have all been eligible activities and consistent with the Consolidated Plan. As the quantified objectives are only estimates. the minor discrepancies between them and the actual accomplishments do not constitute inconsistencies with the Consolidated plan to the degree that you are stating. Your recommendation of technical assistance is much appreciated; however we are still waiting on a response to our previous written requests for aid. We have also hired a consultant to assist with program administration and report preparation, as mentioned in our previously letters to your staff regarding this matter. Continuum of Care HUD Comment: City of Newport Beach allocated 543,909 for Homeless Services in its Action Plan for program year 1999 -2000. However, none of the allocated funds were used to provide services for the homeless or those at risk of becoming homeless. The CAPER describes the City's participation with non - profit and interest groups but did not provide any information regarding activities related to the continuum of care. 1 Unfortunately, the City also did not provide specific information about its homeless activities. Response: Part 1, Section C, paragraph 3 of the CAPER clearly identifies the allocation and use of the funds mentioned in your comment. "An additional 225 persons were assisted with CDBG funds during 1999 -2000 as reported by non- prof-it Homeless Support Services, which included homeless shelters, shelters for abused women and children, shelters for persons with HIV, and rental assistance for "at risk" households. Funding resources assisted all Number I High Priorities contained in the Listing of Priority Needs for the overall five year strategy objectives and priorities." "A total of 543.909 was allocated and used for Homeless Support Services. including housing for the homeless and nvo (2) guaranteed apartment programs for "at risk" homeless. Two of the homeless assistance programs are located within the City of Newport Beach and provided assistance to residents throughout the City. The remaining homeless assistance programs and shelters are located outside city boundaries, but provide assistance to Newport Beach residents." Part 1. Sections A, D and H(a) also discuss the program activities that related to homeless seriices and the continuum of care specifically in Newport Beach and in the County. It appears that the review may have been based entirely on the incomplete information provided in the IDIS reports and did not include consideration of the information provided in the narrative. The City's objectives and high priority needs are clearly identified in the Consolidated Plan and in Part 1, Section A of the CAPER. l) "preserve the availability of housing for persons and families in need of emergency shelter and transitional housing 2) "assist homeless persons and to prevent those "at risk" of becoming homeless from becoming homeless," and 3) "assist battered and homeless women and children ". Decent Housing HUD Comment: The City of Newport Beach did not allocate any funding toward affordable housing. The narrative provides information as reported by non - profit organizations but it is not substantiated by any other source of information since no funds were used for homeless housing activities during program year 1999 -2000. The City reported currently holding $2 million in non- federal funds available for the development and/or preservation of affordable housing units, which was negotiated by the City as part of [a] major residential development. However, there is no mention about who the City negotiated with and/or if the funding is from redevelopment or other sources. 3 1.1 [The] City provided information about Section 8 rental assistance totaling $558,600, but did not provide the number of persons assisted. The only assistance information identified in the CAPER indicates that 90 families were assisted with Section 8 vouchers distributed by the Orange County Housing Authority. The City also reported having no public housing units located within its jurisdiction. Response: The comment regarding homeless housing activities has been addressed in the previous response. The $2 million in affordable housing funds were acquired during the development of the One Ford Road project developed by Pacific Bay Homes. The project was developed on land previously used for commercial and industrial purposes. The funds were acquired through a development agreement. These were not redevelopment funds, as the City does not have a Redevelopment Agency. The OCHA distributed the City of Newport Beach's Section 8 vouchers. Economic Opportunity HUD Comment: The City projected the use of 52146.750 in economic development/neighborhood revitalization in its proposed budget. No money was reported to be expended in its action plan, and no money was expended in any activity related to economic development. The City needs to establish a feasible economic development program. In July 1997, the City allocated $168,921 toward an economic development program for public improvements as part of the City's targeted neighborhood revitalization strategy. The amount expended so far is $395.006 with unexpended funds of $73,916. No funds were used during program year 1999 -2000. Response: As discussed in Section A and specifically in Part 2 (a) of the CAPER, the City used $339,902.50 for public facilities improvements in the revitalization target areas. Again, it appears that the review of this section may have been based entirely on the incomplete information provided in the IDIS reports and did not include consideration of the information provided in the narrative. The City has presented a feasible economic development program as shown in our Consolidated Plan and proposed One -Year Action Plan. The City plans to expend approximately $2 million towards public facility improvements in the next three years. A consultant has been retained to submit a Section 108 loan on the City's behalf to fund these improvements. Program Requirements HUD Comment: The City's CAPER narratives appear to be credible, but again there is no substantial information to create an analysis and measure productivity. It is impossible to provide a rating in this area. 4 /� Based on data submitted, the City of Newport Beach reported a CDBG expenditure of.4% with no public services, no economic development and no housing accomplishments. The City used 1% for program administration and it is included in the calculated expenditure of 4 %. Based on the limited information provided in IDIS report, the City expenditures of $15,917 (facilities and improvement.) toward low- moderate credit is measured at 100% since there was no other expenditures reported. Program Administration was reported at I% or $7,083. City timeliness ratio was 1.41 as of April 30, 2000 or 60 days before the reporting date deadline. Response: The information needed to review this section was clearly provided for in Part 2 (a) of the narrative. The figures in your analysis do not reflect this information. "During Fiscal Year 1999 -2000, the following expenditures were made: 524,803 was used for housing which assisted extremely low, very low and low income persons from Newport Beach; $19,106 was used for substance abuse counseling which assisted extremely low, very low and low income persons from Newport Beach; $30,341 was used to provide meals to disabled and senior homebound persons which assisted extremely low, very low and low income persons from Newport Beach; 5339,902.50 was used for public facilities, which assisted low and moderate income persons; 525,000 was used for code enforcement which assisted low and moderate income persons; 513,992 was used to provide fair housing services and to affirmatively further fair housing; and 585,008 was used for program administration. All activities are consistent with the City's 1995 -1999 CPD goals and objectives." IDIS Reportin¢ HUD Comment: The IDIS reports were incomplete[.] lacking information about national objectives, expenditures, beneficiaries and financial summary. Substantial information is missing from the report. The financial summary report provided expenses totaling $538,152 but there is no data in IDIS reports or in narratives of the CAPER to substantiate the information. Response: City staff agrees that the IDIS reporting is the major deficiency with the CAPER document. As mentioned previously, the lack of technical support and access to the IDIS system for several months severely impacted the ability of staff to maintain IDIS records and generate reports. Corrections to the IDIS records have been made and corrected reports have been submitted to the field office under separate cover. This seems to be the source of most of the issues addressed in these comments. The reliance on the IDIS reports exclusively during the HUD review without consideration of the detailed information provided in the narrative seems to have also contributed to several of the negative comments. For example, your comment above regarding the lack of data to substantiate the reported expenses is inaccurate as specific information was provided in Part 2 (a) of the narrative. 5 U Suitable Living Environment HUD Comment: The City budget proposal presented in the CAPER informs the public of a projected allocation of $43,909 for homeless services and $30,341 for low- income elderly in public services. No money was expended toward those projects considered first and second priority. [The] "Other Projects" allocation of $321,750 for ADA improvements, economic development/neighborhood revitalization and code enforcement [was] never utilized. City used no funds as proposed in the 1999 -2000 action plan. Response: Once more, it appears that the review of this section may have been based entirely on the incomplete information provided in the IDIS reports and did not include consideration of the information provided in the narrative. We recognize that the incomplete information in the IDIS reports made it more difficult to review the CAPER and hope that these responses in conjunction with the corrected IDIS information will adequately address your concerns. As mentioned above, the City has retained a consultant to assist with program administration and a consultant to assist with a Section 108 Loan application. We believe that this has already had a positive impact on the program as shown by our timely submittal of the 2001 -2002 One -Year Action Plan. If you have any questions, please call me at (949) 644 -3230. Very truly yours, Daniel Trimble Associate Planner /CDBG Program Manager CC: Maria L. Richardson, HUD — CPD Representative Sharon Wood, Assistant City Manager 6 1