TO: Honorable Mayor and Members of the City Council
THRU: Jarad Hildenbrand, City Manager
FROM: Russell Bunim, Community Development Director
1. Subject
title
Revise the adopted budget for the Fiscal Year 2025-2026 Community Development Block Grant and HOME Investment Partnerships Program from the Department of Housing and Urban Development and appropriate to respective expenditure accounts for each program.
body
2. Summary
Revise the adopted budget for the Fiscal Year 2025-2026 Community Development Block Grant in the amount of $1,010,888 and HOME Investment Partnerships Program in the amount of $338,366.50 to reflect the final amounts allocated by the Department of Housing and Urban Development and appropriate the funds to the designated expenditure accounts for each program.
3. Recommended Action
recommendation
1. Reduce the City’s adopted Fiscal Year 2025-2026 revenue budget for the Community Development Block Grant funds by 23,556, to a revised budget of $1,010,888.
2. Reduce the City’s adopted Fiscal Year 2025-2026 revenue budget for the HOME Investment Partnerships Program funds by $93,864.50, to a revised budget of $338,366.50.
3. Reduce adopted budget for 2025-2026 ADA Ramps Project (CIP 266003) by $2,277.
4. Reduce adopted budget for 2025-2026 CDBG Street Improvements (CIP 255086) by $83,774.
5. Appropriate an additional $346,135 in Community Development Block Grant funds to the following expenditure accounts:
a. $53,747 in salaries and benefits
b. $183,625 in contract services
c. $90,463 in other professional and contract services
d. $1,500 in publicity and advertising
e. $800 in dues and memberships
f. $10,000 in software capitalization
g. $6,000 in travel and conferences
6. Appropriate an additional $319,177.50 in HOME Investment Partnerships funds to the following expenditure accounts:
a. $3,000 in other professional/technical services
b. $2,000 in contract services
c. $2,880 to software capitalization
d. $800 in dues and memberships
e. $5,966.65 in travel and conferences
f. $50,754.98 in CHDO set-aside
g. $253,775.87 in HOME Developer Projects
7. Authorize the City Manager or their designee to make any non-substantial changes, if needed, and execute all forms and agreements, and any other documents required by the Department of Housing and Urban Development for receipt of the funds.
end
4. Fiscal Impact
There is no direct fiscal impact to the City. The additional revenue received from the Department of Housing and Urban Development will fund the expenses for these activities, programs, and projects.
5. Strategic Plan Goals
Goal 3: Enhance Public Communication Strategy and Quality of Life
6. Discussion and Background
The City receives annual federal funds from the U.S. Department of Housing and Urban Development (HUD) under the Community Development Block Grant (CDBG) and the HOME Investment Partnerships (HOME) programs for the benefit of primarily low- and moderate-income residents. The funds are allocated to projects and programs that include, but are not limited to street improvements, handicap accessibility improvements, after school programs, and supportive services.
2025-2029 Consolidated Plan and 2025-2026 Annual Action Plan
On June 24, 2025, the City approved the 2025-2029 Consolidated Plan (Con Plan), mandated by HUD to establish the City’s housing and community development priorities. The Con Plan enabled the City to assess its affordable housing and community development needs, evaluate market conditions, and make informed decisions based on data analysis.
The Con Plan is implemented through Annual Action Plans (AAP) which provide a comprehensive summary of the strategies, activities, and federal and non-federal resources allocated each year to address the specific needs and objectives outlined in the Con Plan. The 2025-2029 Con Plan includes the first year of the AAP, the 2025-2026 AAP.
After adoption of the Con Plan, the City was informed that the rules under CDBG stated that awards must be whole dollar amounts. The 2025-2026 Action Plan awards for the approved activities, programs, and projects were adjusted to comply with HUD guidelines.
Acceptance of Award and Appropriation
On May 14, 2025, the City received official notification of the final award amounts for the CDBG and HOME Programs. Unlike previous years, when these allocations were incorporated during the budget adoption process, this year’s notification was received after the budget adoption was in process. As a result of the delayed notification, the acceptance of the entitlement funds for both CDBG and HOME, along with their corresponding approved expenditures, is now being formally presented for recording and integration into the City’s financial system.
The amounts reflected in the recommended action are in line with approved expenditures for the entitlement funds in both programs based on the Consolidated Plan and broken down into more detail for administration. The expenses for City staff personnel time and General Liability in both CDBG (310) and HOME (317) are already reflected in the City’s financial software and are therefore not listed in the requested expense account appropriations.
Additionally, during the City’s Budget Process, the Capital Improvement Projects (CIPs) for ADA Ramps and the 2025-2026 Street Improvements were formally adopted at the City Council meeting held on June 24,2025 for CDBG. Upon notification of the lower-than-anticipated final allocation of CDBG funds, adjustments were made to both projects. The ADA Ramps Project (CIP 266003) was reduced by $2,277, resulting in a revised total of $97,723. Similarly, the 2025 CDBG Street Improvements Project (CIP 255086) was reduced by $83,774, bringing its total to $488,616. The revised funding amounts align with the final approved figures approved in the 2025-2026 AAP.
Staff recommends the approval of the acceptance of the entitlement funds from HUD and their corresponding expenditure accounts to be formally adopted.
7. ATTACHMENTS
• Attachment 1 - Final 2025-2029 Consolidated Plan (includes 2025-2026 AAP)
• Attachment 2 - Award Letter