Agenda - Parks and Recreation Commission - 02/10/2000

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CASE # CONSIDER ALLOCATION OF COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDS By: Community Development Director Sylvia Frolik Background: The County receives CDBG funds from the Department of Housing and Urban Development (HUD). Since 1981, the County has retained about 28% of the funds for County-wide housing rehabilitation and economic development planning. Anoka County has opted to distribute the remaining 72% of these funds to cities and townships based on a formula using population, age of housing, and percentage of poverty. Basically, CDBG funds are limited to being used for projects that benefit low and moderate income persons (handicapped persons and senior citizens are presumed to be iow to moderate income persons), planning projects; .economic development activities; and historical preservation. Under HUD guidelines, there is a 15% cap on the total amount of the County's allocation that can be used for public service agencies and a 20% cap on planning projects. Therefore, a general rule of thumb for cities and townships to use when considering public service or planning projects, is 15% and 20% respectively. However, there is some flexibility in the 15%/20% generality because not all communities in the County may be proposing contributions to public service agencies or planing projects. Observations: The City of Ramsey's total unallocated fund balance for 1999 and 2000 is $57,134. From that total we must deduct $1,000.00 for County administration fees; therefore, Ramsey's current year allocation amount is $56,I34.00. In addition, Ramsey must reallocate $63,988.00' in 1998 CDBG funds that were diverted from the senior apartment building project. Ramsey should be pursuing projects totaling $120,122.00. The fiscal year for CDBG funds is from July 1 to June 30. Approved projects for current year funds may not be initiated until July 1. When there is a reallocation of funds (i.e. $63,988 from senior housing project), the City must publish a 30 day comment period identifying the new use of the funds before the project can be submitted to the County for approval. Upon County and HUD approval, the funds are available for spending. A chart of Ramsey's past CDBG projects is enclosed for your information. The following requests for CDBG funds were received from public service agencies.