City Council Meeting Date: November 17, 2020
To: Mayor and City Council
City Administrator
From: Melissa Hanson, Housing Coordinator
Title
Consideration of Subrecipient Agreement for the Dakota County Community Development Block Grant (CDBG) Program.
Body
Action Requested:
The Northfield City Council approves the Subrecipient Agreement for the Dakota County Community Development Block Grant (CDBG) Program.
Summary Report:
Dakota County is qualified as an urban county and is entitled to receive an annual allocation of CDBG funds. Although only a portion of the City of Northfield is located within Dakota County, the entire City of Northfield is eligible for a small portion of the annual Dakota County CDBG allocation. The Dakota County Community Development Agency (CDA) serves as the program administrator for CDBG funds dispersed to the City of Northfield. The City has been allocated $65,312 in CDBG funds for FY 2020.
CDBG funds have been utilized to assist low- and moderate-income families with 1st time Home Buyers Down Payment Assistance, Residential Rehabilitation for owner occupied homes, Rental Rehabilitation, and Manufactured Housing Demolition and Site Clearance. In addition, CDBG funds have been used to assist Three Rivers Community Action Agency in the rehabilitation of Northern Oaks Townhomes.
Staff recently received notification from the CDA regarding fiscal year (FY) 2020 CDBG funding. Dakota County will receive $1,928,343, which is a 2.2% increase from FY 2019. The Northfield allocation for FY 2019 was $61,591. Funds are currently available for 1st Time Homebuyers down payment assistance, residential rehab for owner occupied properties, as well as rehab for owner-occupied manufactured homes at Viking Terrace Manufactured Home Park.
Every three years, the U.S. Department of Housing & Urban Development (HUD) requires urban counties to requalify their entitlement status and participating communities must renew their cooperation agreements for the purpose of awarding CDBG funds since 1984. The CDA would like to continue their partnership with the City of Northfield. The Northfield Housing & Redevelopment Authority (HRA) supports a renewed Recipient Agreement between the CDA and the City of Northfield.
Alternative Options:
Currently, because of the CDBG entitlement status with the CDA, the City is not eligible to apply for the state Small Cities CDBG program for use in the portion of the City that is in Dakota County while receiving entitlement CDBG funds through the CDA. The City of Northfield may decide to discontinue receiving entitlement funds through the CDA. However, applications for Small Cities CDBG program are very competitive. The City of Northfield would have to make funding application to HUD each year for each individual CDBG program, which may, or may not, be funded due to competition with all other small cities nationally.
Financial Impacts:
CDBG funds do not have a direct budget impact. However, there is a positive financial impact within the City. Allocated funds are only received by the City as reimbursement for expenditures on designated and approved programs and projects.
Tentative Timelines:
CDA has requested the attached Subrecipient Agreement be returned as soon as possible.