CDBG Redesign & SB 106 Report Summary
Community Development
Block Grant (CDBG) Redesign
Senate Bill (SB) 106 Report
Summary
Department of Housing and Community Development
Division of Financial Assistance
June 2018
CDBG—Who Benefits?
•
Federal program operated by the State of
California
•
Funds to eligible jurisdictions that do not
receive CDBG funds directly from the U.S.
Department of Housing and Urban
Development (HUD)
•
Annual competition for grants
CDBG—What Does it Do?
•
CDBG provides grants to local jurisdictions for:
–
Housing assistance
•
Housing rehabilitation
•
Homebuyer assistance
•
Infrastructure in support of housing
–
Economic development
•
Programs and projects in support of job creation
–
Public infrastructure improvement or construction
–
Public Services
–
Public Facilities
–
Planning
Why Need for Change?
•
California has lowest rate of expenditure of
CDBG funds in nation.
•
Program Income is not being expended on
eligible activities as required.
•
HUD has called for significant changes to the
program.
•
Resources and capacity at both state and
local levels limit ability to both grant funds
and spend funds.
•
Use of funds must align with state priorities.
SB 106 (2017 Budget Trailer Bill)
•
Directed the Department of Housing and Community
Development (HCD) to:
–
Convene a group of stakeholders to assist in process of
improving program through redesign.
–
Analyze and report on HCD award process, contract
management processes and policies, and fiscal processes.
–
Analyze requirements of state program that are in excess
of federal requirements that would, if eliminated,
facilitate greater use of funds and reduce workload.
–
Revise and update Chapter 21 of the Grant Management
Manual: Economic Development—Business Development.
–
Train staff on Economic Development (ED) and provide
additional ED resources on HCD website.
Purpose of Redesign
•
To better serve local jurisdictions while
streamlining HCD’s workload and
complying with federal requirements.
•
Increase rate of expenditures.
•
Ensure Program Income expended
appropriately.
•
Address program deficiencies identified by
HUD in recent Monitoring Report.
How do we get there?
•
Held several listening sessions throughout
the state.
•
Published the CDBG Redesign Framing Paper
in July 2017.
•
Convened the Redesign Working Group
starting in August 2017 and meeting monthly.
(Visit
http://www.hcd.ca.gov/grants-
funding/active-funding/cdbg/cdbg-program-
redesign.shtml
for list of members and
meetings of Working Group.)
How do we get there cont’d
•
Chapter 21 of the Grant Management
Manual was revised.
•
Guidelines are being drafted to replace
current state CDBG regulations to be used
in combination with federal regulations.
•
Continuing to work with Redesign Working
Group in areas of Increasing Expenditures,
Expending Program Income, and Economic
Development.
Some Considerations for Increasing
Expenditures
•
Change timing of Notice of Funding
Availability (NOFA) so funds are available
earlier in the process.
•
Refine readiness criteria at application.
•
Encourage planning grants to prepare for
following year’s application.
•
Consider narrowing eligible activities as
appropriate.
•
Monitor contracts in order to both provide
technical assistance and ensure compliance.
Some Considerations for Reducing
Unspent Program Income
•
Revise and require execution of Program
Income Reuse Agreement.
•
Allow balances as long as funds used
within certain period.
•
Eliminate Supplemental Activities and
incorporate existing Supplemental
Activities into the Program Income Reuse
Agreement.
Some Considerations for Economic
Development
•
Consider reducing the period funds are held
out for over-the-counter Economic
Development applications.
•
Continue discussions about improvement of
Economic Development component through:
–
Providing boilerplate documents for ease of use,
–
Additional training of both HCD staff and local
jurisdictions,
–
Exploring partnering with U.S. Department of
Agriculture or other funding entities to provide
additional resources.
Other States’ and Los Angeles County’s
Programs
•
Reviewed other successful jurisdictions’
management of CDBG:
–
Ohio
–
Vermont
–
Connecticut
–
Louisiana
–
Nevada
–
Iowa
–
Los Angeles County
•
California is considering many of these other
jurisdictions’ method of implementing CDBG.
Organizational Changes
•
Organizational Restructuring:
–
Creation of separate federal NOFA unit to
improve customer service, build subject matter
expertise, and better meet CDBG program
requirements.
–
Two operations sections merged into one to
eliminate duplication of effort, streamline
approval processes, build internal staff capacity,
and provide grantees greater continuity with
fewer changes in staff overseeing a single grant.
Operational Changes
•
Business Process Improvements
–
Self-scoring applications
–
Streamlined contracting process
–
Appeals process
–
Early review of organizational documents
•
Technology
–
Track issuance of standard agreements within 60 days of
award
–
Convert application to electronic submittal
•
Data Clean-up
•
Training
•
Addressing HUD Monitoring Report
•
Improving Communications with Local Jurisdictions
Timing of Redesign through Completion
•
By June 2019
–
Guidelines developed and approved.
–
Training on redesigned program.
–
Complete work of Redesign Working Group and reinstitute
CDBG Advisory Committee.
–
Complete HCD improvements.
–
Training on redesigned program.
–
2019 NOFA release April 2019.
•
July 2019 to June 2020
–
Revise Grant Management Manual.
–
Award funds for 2019 NOFA applications.
–
Make adjustments to the guidelines as necessary.
–
Complete required actions in response to HUD Monitoring.
How will we know we have succeeded?
•
Increased participation by local jurisdictions,
•
Decrease in unspent funds,
•
Increased use of Program Income,
•
Reductions in disencumbrances and extension
requests from past years,
•
Lower administrative costs for HCD and local
jurisdictions,
•
Increased new and rehabilitated affordable housing,
•
Increased services provided to most vulnerable
residents, and
•
Increased number of jobs for lower-income residents.
•
Report is available to download at
http://www.hcd.ca.gov/grants-
funding/active-funding/cdbg/cdbg-
program-redesign.shtml
.
•
Questions? E-mail to
CDBGRedesign@hcd.ca.gov.
The Community Development Block Grant (CDBG) Redesign, as directed by Senate Bill (SB) 106, aims to improve the utilization of funds in California, aligning with state priorities and addressing program deficiencies identified by HUD. The purpose of the redesign is to better serve local jurisdictions, increase expenditure rates, and ensure program income is appropriately utilized. Various steps have been taken, including stakeholder consultations, analysis of award processes, and training staff on economic development. Visit the link for more details.
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Presentation Transcript
Community Development Block Grant (CDBG) Redesign Senate Bill (SB) 106 Report Summary Department of Housing and Community Development Division of Financial Assistance June 2018
CDBGWho Benefits? Federal program operated by the State of California Funds to eligible jurisdictions that do not receive CDBG funds directly from the U.S. Department of Housing and Urban Development (HUD) Annual competition for grants
CDBGWhat Does it Do? CDBG provides grants to local jurisdictions for: Housing assistance Housing rehabilitation Homebuyer assistance Infrastructure in support of housing Economic development Programs and projects in support of job creation Public infrastructure improvement or construction Public Services Public Facilities Planning
Why Need for Change? California has lowest rate of expenditure of CDBG funds in nation. Program Income is not being expended on eligible activities as required. HUD has called for significant changes to the program. Resources and capacity at both state and local levels limit ability to both grant funds and spend funds. Use of funds must align with state priorities.
SB 106 (2017 Budget Trailer Bill) Directed the Department of Housing and Community Development (HCD) to: Convene a group of stakeholders to assist in process of improving program through redesign. Analyze and report on HCD award process, contract management processes and policies, and fiscal processes. Analyze requirements of state program that are in excess of federal requirements that would, if eliminated, facilitate greater use of funds and reduce workload. Revise and update Chapter 21 of the Grant Management Manual: Economic Development Business Development. Train staff on Economic Development (ED) and provide additional ED resources on HCD website.
Purpose of Redesign To better serve local jurisdictions while streamlining HCD s workload and complying with federal requirements. Increase rate of expenditures. Ensure Program Income expended appropriately. Address program deficiencies identified by HUD in recent Monitoring Report.
How do we get there? Held several listening sessions throughout the state. Published the CDBG Redesign Framing Paper in July 2017. Convened the Redesign Working Group starting in August 2017 and meeting monthly. (Visit http://www.hcd.ca.gov/grants- funding/active-funding/cdbg/cdbg-program- redesign.shtml for list of members and meetings of Working Group.)
How do we get there contd Chapter 21 of the Grant Management Manual was revised. Guidelines are being drafted to replace current state CDBG regulations to be used in combination with federal regulations. Continuing to work with Redesign Working Group in areas of Increasing Expenditures, Expending Program Income, and Economic Development.
Some Considerations for Increasing Expenditures Change timing of Notice of Funding Availability (NOFA) so funds are available earlier in the process. Refine readiness criteria at application. Encourage planning grants to prepare for following year s application. Consider narrowing eligible activities as appropriate. Monitor contracts in order to both provide technical assistance and ensure compliance.
Some Considerations for Reducing Unspent Program Income Revise and require execution of Program Income Reuse Agreement. Allow balances as long as funds used within certain period. Eliminate Supplemental Activities and incorporate existing Supplemental Activities into the Program Income Reuse Agreement.
Some Considerations for Economic Development Consider reducing the period funds are held out for over-the-counter Economic Development applications. Continue discussions about improvement of Economic Development component through: Providing boilerplate documents for ease of use, Additional training of both HCD staff and local jurisdictions, Exploring partnering with U.S. Department of Agriculture or other funding entities to provide additional resources.
Other States and Los Angeles Countys Programs Reviewed other successful jurisdictions management of CDBG: Ohio Vermont Connecticut Louisiana Nevada Iowa Los Angeles County California is considering many of these other jurisdictions method of implementing CDBG.
Organizational Changes Organizational Restructuring: Creation of separate federal NOFA unit to improve customer service, build subject matter expertise, and better meet CDBG program requirements. Two operations sections merged into one to eliminate duplication of effort, streamline approval processes, build internal staff capacity, and provide grantees greater continuity with fewer changes in staff overseeing a single grant.
Operational Changes Business Process Improvements Self-scoring applications Streamlined contracting process Appeals process Early review of organizational documents Technology Track issuance of standard agreements within 60 days of award Convert application to electronic submittal Data Clean-up Training Addressing HUD Monitoring Report Improving Communications with Local Jurisdictions
Timing of Redesign through Completion By June 2019 Guidelines developed and approved. Training on redesigned program. Complete work of Redesign Working Group and reinstitute CDBG Advisory Committee. Complete HCD improvements. Training on redesigned program. 2019 NOFA release April 2019. July 2019 to June 2020 Revise Grant Management Manual. Award funds for 2019 NOFA applications. Make adjustments to the guidelines as necessary. Complete required actions in response to HUD Monitoring.
How will we know we have succeeded? Increased participation by local jurisdictions, Decrease in unspent funds, Increased use of Program Income, Reductions in disencumbrances and extension requests from past years, Lower administrative costs for HCD and local jurisdictions, Increased new and rehabilitated affordable housing, Increased services provided to most vulnerable residents, and Increased number of jobs for lower-income residents.
Report is available to download at http://www.hcd.ca.gov/grants- funding/active-funding/cdbg/cdbg- program-redesign.shtml. Questions? E-mail to CDBGRedesign@hcd.ca.gov.
