HomeMy WebLinkAbout5C OCRCITY COUNCIL STAFF REPORT
DATE: December 10, 2020 NEW BUSINESS
SUBJECT: REQUEST STATE OF CALIFORNIA BUSINESS, CONSUMER
SERVICES, AND HOUSING AGENCY DEPARTMENT AMEND THE
BUDGET FOR THE CITY OF PALM SPRINGS HOMELESS HOUSING,
ASSISTANCE AND PREVENTION PROGRAM GRANT
FROM: David H. Ready, City Manager
BY: Community & Economic Development
SUMMARY
In May of 2020 the City of Palm Springs received a grant in the amount of $10 million
from the State of California Business, Consumer Services, and Housing Agency as part
of the Housing, Homeless Assistance and Prevention (HHAP) program. As new
opportunities to leverage HHAP funds to create permanent supportive housing units
have emerged, staff is recommending amending the HHAP budget transferring funds to
increase permanent supportive housing resources by $2,200,000 from $6,300,000 to
$8,500,000.
RECOMMENDATION:
1. Request the State of California Business, Consumer Services, and Housing
Agency approve an amendment to the City of Palm Springs Housing, Homeless
Assistance and Prevention Program grant funds transferring $600,000 from the
Rental Assistance and Rapid Rehousing line item, $100,000 from the Landlord
Incentives line item, $500,000 from the Outreach and Coordination line item and
$400,000 from the Prevention and Shelter Diversion to Permanent Housing line
item to increase the Delivery of Permanent Housing line item by $1,600,000 from
$6,300,000 to $7,900,000.
BACKGROUND:
In May of 2020 the City of Palm Springs received a grant in the amount of $10 million
from the State of California Business, Consumer Services, and Housing Agency as part
of the HHAP. HHAP is a $650 million one-time block grant that provides local
jurisdictions with funds to support regional coordination and expand or develop local
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2City Council Staff Report December 10, 2020 -Page 2 HHAP Budget Amendment capacity to address their immediate homelessness challenges. The HHAP grant program is authorized by AB 101 (Chapter 159, Statutes of 2019), which was signed into law by Governor Gavin Newsom on July 31, 2019. The HHAP program requires grantees to expend funds on solutions that address and prevent homelessness among eligible populations. As stated in Health and Safety Code (HSC) § 50219(c)(1-8), funds shall be expended on any of the following: 1) Rental assistance and rapid rehousing; 2) Operating subsidies in new and existing affordable or supportive housing units, emergency shelters, and navigation centers. Operating subsidies may include operating reserves; 3) Incentives to landlords, including, but not limited to, security deposits and holding fees; 4) Outreach and coordination, which may include access to job programs, to assist vulnerable populations in accessing permanent housing and to promote housing stability in supportive housing; 5) Systems support for activities necessary to create regional partnerships and maintain a homeless services and housing delivery system particularly for vulnerable populations including families and homeless youth; 6) Delivery of permanent housing and innovative housing solutions such as hotel and motel conversions; 7) Prevention and shelter diversion to permanent housing; and 8) New navigation centers and emergency shelters based on demonstrated need. Demonstrated need for new navigation centers and emergency shelters shall be based on the following: a) The number of available shelter beds in the jurisdiction; b) The shelter vacancy rate in the summer and winter months; c) The percentage of exits from emergency shelters to permanent housing solutions; and d) A plan to connect residents to permanent housing. In addition, HSC § 5021 B(b) states that grantees are required to use at least 8 percent of the program allocation for services that meet the specific needs for homeless youth populations. Furthermore, eligible applicants shall not use more than 7 percent of their program allocation for administrative costs incurred by the city, county, or Continuum of Care (CoC) to administer its program allocation. This does not include staff costs or other costs directly related to implementing or carrying out activities funded by the program allocation. To plan and prepare for use of the HHAP funds the City contracted with Barbara Poppe and Associates, a nationally known expert dealing with homelessness, affordable housing, public health, and anti-poverty strategies. Ms. Poppe served as the Executive Director of the U.S. lnteragency Council on Homelessness and oversaw the Federal response to homelessness between 2009 and 2014. Ms. Poppe's research also included conducting a focus group with individuals who had experienced, or were currently experiencing, homeless. On January 29, 2020, Ms. Poppe led a City Council
3City Council Staff Report December 10, 2020 -Page 3 HHAP Budget Amendment Study Session to present her findings, receive input from the community, and provide the City Council an opportunity to discuss various options for use of the HHAP funds. The Council's recommendations for use of the HHAP funds at that time were to provide: 1. New permanent supportive housing, bridge housing, crisis stabilization housing, innovative low-cost models that can be deployed quickly -to provide individuals with a place of their own, an address to provide when seeking employment, and a sense of dignity. 2. Rental assistance -to keep people in the place where they live, help individuals avoid homelessness. 3. Access points -to direct individuals to services, utilize regional resources and support. 4. Storage -to store/protect an individual's belongings while they search for assistance or look for work, so they won't have the stigma of using shopping carts to bring their belongings with them all the time. Accordingly, the initial HHAP Budget was drafted as follows: Budaet Rental Assistance and Rapid Rehousing 1,200,000 Operating Subsidies and Reserves 0 Landlord Incentives 100,000 Outreach and Coordination (including employment) 500,000 Systems Support to Create Regional Partnerships 0 Delivery of Permanent Housing 6,300,000 Prevention and Shelter Diversion to Permanent Housing 1,200,000 New Navigation Centers and Emergency Shelters 0 Strategic Homelessness Planning, Infrastructure Development, CES, and HMIS (up to 5%) 0 Administrative (up to 7%) 700,000 Total 10,000,000 This funding must also incorporate services for homeless youth in the amount of $800,000. STAFF ANALYSIS: Since that time, several developers representing approximately 212 new affordable housing units have requested financial assistance from the City. The HHAP funds could be used to provide financial assistance to those projects that include permanent supportive housing units. Permanent supportive housing units are typically for very low income individuals whose incomes are below 30% of the Area Median Income (AMI), or
4City Council Staff Report December 10, 2020-Page 4 HHAP Budget Amendment $15,840 annually and include supportive services. Below is the AMI table published by the California Department of Housing and Community Development for Riverside County. RIVERSIDE COUNTY AREA MEDIAN INCOMES Countv 1 Person 2Person 3 Person 4Person 5 Person 6 Person 7Penon 8Penon RIVERSIDE Income limits • to IDwesO 2020. 2019, 2018. 2012. 2011. 2009. 2010. 2017, 2016,, 20tl. 2015,, 2014 100%AMI $52.800 $60.300 S67.800 $75.300 $81.400 $87 400 $93400 $99.400 80%AMI $42240 $48.240 $54,240 $60240 $65.120 $69,920 $74,720 $79,520 75%AMI $39600 $45,225 SS0.850 $56,475 $61 050 $65,550 $70050 $74,550 70%AMI $36960 $42.210 S47,460 $52,710 $56980 $61180 $65380 S69.580 65%AMI $34,320 $39,195 $44,070 $48,945 $52,910 $56,810 $60,710 $64,610 60%AMI $31,630 S36,180 $40,680 $45,180 $48,840 $52,440 $56,040 $59,640 55%AMI $29040 S33165 S37.290 $41.415 $44.no $48.070 $51370 S54670 50%AMI $26400 $30150 $33900 $37.650 $40.700 $43700 $46.700 549700 45%AMI $23760 $'Zl 135 SJ0,510 $33.885 $36,630 $39,330 $42030 $44 730 40%AMI $21120 $24120 52.7.120 $30,120 $32,560 $34960 $37360 $39760 35%AMI $18480 $21105 523.730 $26,355 $28,490 $30590 $32690 $34,790 30%AMI $15840 $18090 $20.340 $22,590 $24.420 $26220 $28020 $29820 25%AMI $13200 $15075 $16950 S18825 $20.350 $21850 $23350 $24850 20%AMI $10560 $12060 $13560 S15,060 $16,280 $17 480 $18680 S19.880 15%AMI 57920 S9,045 $10.170 $11295 $12210 $13110 $14010 $14,910 Of the 212 new affordable housing units, 134 are planned as permanent supportive housing units. As noted above, creating new permanent supportive housing was the top priority for the Council. The remaining 75 units would be for low income households at or below the 80% AMI for Riverside County. Three units would be designated for property managers. Total investment in the City of Palm Springs resulting from these projects would be approximately $91 million. The City, therefore, has an opportunity to create even more affordable and permanent supportive housing than originally anticipated. To do so, however, requires amending the HHAP budget to reallocate HHAP funds as shown in the Fiscal Impact section below. Staff has discussed this with the Affordable Housing Liaisons who agree with these recommendations. FISCAL IMPACT: The proposed amendment would transfer $1,600,000 to the Delivery of Permanent Housing Category. Rental Assistance and Rapid Rehousing would be reduced from $1,200,000 by $600,000, leaving $600,000. Prevention and Shelter Diversion to Permanent Housing would be reduced from $1,200,000 by $400,000, leaving $800,000 for homeless youth programs.
5< City Council Staff Report December 10, 2020 -Page 5 HHAP Budget Amendment PROPOSED HHAP BUDGET AMENDMENT Original Revised Budget Change Budget Rental Assistance and Rapid Rehousing 1,200,000 (600,000) 600,00 Operating Subsidies and Reserves 0 0 0 Landlord Incentives 100,000 (100,000) 0 Outreach and Coordination (including employment) 500,000 (500,000) 0 Systems Support to Create Regional Partnerships 0 0 0 Delivery of Permanent Housing 6,300,000 1,600,000 7,900,000 Prevention and Shelter Diversion to Permanent Housing 1,200,000 (400,000) 800,000 New Navigation Centers and Emergency Shelters 0 0 0 Strategic Homelessness Planning, Infrastructure Development, CES, and HMIS (up to 5%) 0 0 0 Administrative (up to 7%) 700,000 0 700,000 Total 10,000,000 0 10,000,000 Furthermore, discussions with County staff confirm that that the reductions in Landlord Incentives ($100,000), Outreach and Coordination ($500,000), and Prevention and Shelter Diversion ($400,000) could be addressed with new resources that have been allocated to the County of Riverside. There is no impact to the general fund. SUBMITTED: irector & Economic Development David H. Ready, Esq., City Manager Marcus L. Fuller, MPA, P.E., P.L.S. Assistant City Manager