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Home My WebLink About04-074B~JARD O~ SUPERVISORS CAUNTY OF BUTTE, STATE OF CAt_1FORN IA Rr~solufion i~a.04-074 A RESOLUTION OF'T'HE I3UT'I'E COUN'T'Y T30ARD OF SUPERVISORS ADOPTING AN AMENDED REUSE PLAN GOVF,RNING PRO(TRAM INCOME FROM COMMUNI'T'Y DEVELOPMEN'T' BLOCK GRAN`T'S WHEREAS, the Community Development Block Grant (CDBG) program income is defined as Bross income received by the County that has been directly generated fi-om the use of CDBG funds; and WHEREAS, program income must be substantially expended by the end of each fiscal year; and WHEREAS, per CDBG regulations, program income must either be ret~n-ned to the Department of Housing and Community Development, expended for the same activity that is funded under an open CDBG grant, or expended through an existing Revolving Loan Account; and WHEREAS, the Butte County Board of Supervisors adopted the document entitled "Reuse flan Governing Program Income from Community Development Block Grant Assisted Activities for the County of Butte" on March 23, 1999; and WHEREAS, the Butte County Board of Supervisors amended the document entitled "Reuse Plan Governing Program Income from Community Development Block Grant Assisted Activities for the Co~mty of Butte" on March I I, ?003; and WHEREAS, the County's Program Income Reuse Plan establishes the guidelines, policies, and procedures for the administration and utilization of Program Income received as a result of activities funded under the State Community Development Block Grant Program; and WHEREAS, in order for the County's Program Income Reuse Plan to be in compliance with applicable federal and state regulations and requirements, the Reuse Plan needs to be amended; and WHEREAS, the proposed amendments to the County's Reuse Plan have been reviewed and verbally approved by representatives of the State Community Development Block Grant Program. NOW, THEREFORE, HE [1' RESOLVED that the Board of Supervisors of the County of Butte does hereby adopt the document entitled "Reuse Plan Governing Program Income from Community Development Block Grant (CDBG) Assisted Activities for the County of Butte - Amended 4/27!04" and attached hereto as Attachment A. PASSED AND ADOPTED by the Butte County Board of Supervisors this 27`-' day of April 2004 by the following vote: AYES: Supervisors Dolan, you°., Jo~i~::,sen, Yn~g~zch~ and ~h~.~_r Beeler NOES: None ABSF,NT: None NO'T' VO'T'ING: None R. J. HEELER, Chair ATTEST: PAUL MCINTOSH, Chief Administrative Officer And Clerk of the Board of Supervisors By: Deputy ATTACI-Il~iENT A Ile-Use Plan Governing Program Income from Community Development Block Grant (CD$G) Assisted Activities for the County of Butte AMENDED (4/27/04} The purpose of this plan. is to establish guidelines on the policies and procedures for the administration and utilization of Program Income received as a result of activities funded under the State Community Development Block Grant Program. I. Need for Plan Governing Reuse of Program Income. This Reuse Plan is intended to satisfy the requirements specified in Federal statute and regulation at Section 104 (j) of the Housing and Community Development Act ("the Act"}, as amended in 1992 and 24 CFR 570.489 (e) (3). These statutory and regulatory sections permit a unit of local government to retain Program Income for CDBG-eligible community development activities. Under federal guidelines adopted by the State of California's CDBG program, local governments are permitted to retain Program Income so long as the local government has received advance approval from the state of a local plan that will govern the expenditure of the Program Income. This plan has been developed to meet that requirement. IL Program Income Defined. Program Income is defined in federal regulation at 24 CFR 570.489 (e), which specify that Program Income is the gross income received by the jurisdiction that has been directly generated from the use of CDBG funds. (For those Program Income- generating activities that are only partially funded with CDBG funds, such income is prorated to reflect the actual percentage of CDBG participation}. Examples of Program Income include: payments of principal and interest on housing rehabilitation or business loans made using CDBG funds; interest earned on Program Income pending its disposition, and interest earned on funds that have been placed in a revolving loan account; net proceeds from the disposition by sale or long-term lease of real property purchased or improved with CDBG funds; income (net of costs that are incidental to the generation of the income) from the use or rental of real property that has been acquired, constructed or improved with CDBG funds and that is awned {in urhole or in part) by the participating jurisdiction or subrecipient. If the total amount of income generated from the use of CDBG funds (and retained by the County) during a single program year (July 1 through June 30) is less than $25,000, then these funds shall not be deemed to be Program Income and shall not be subject to these polices and procedures. However, Quarterly and Annual Program Income Reports must be submitted regardless of whether the $25,000 threshold is reached or not. III. General Administration (GA) Cost Limitation. Up to eighteen percent (18%) of the total Program Income expended on all activities during a single program year may be used far CDBG general administration expenses. IV. Reuses of Program Income. Program Income must be: a) disbursed far an activity funded under an open grant prior to drawing down additional Federal funds; b) foz-vvarded to the State of California, Department of Housing and Community Development (Department); or c) distributed according to this Program Income Reuse Plan that has been approved by the Department. The County's Program Income will be used to fund eligible CDBG activities that reuseplan ammendment Apri]04 Pa.~e l of 5 meet a national objeetiv~. Eligible activities and national objective requirements are specified in federal statute at Section I05(a) and in federal regulations at 24 CFR 570.482 and 24 CFR 570.483. The Reuse Plan shall specify all proposed uses of these funds and the plan. shall be adopted by the local governing body after compliance with the locality's citizen participation process as specified in Federal Regulations at 24 CFR 570.486, Loca] Goverrul~ent Requirements. The County reserves the option of utilizing Program Income to fund/augment a CDBG funded activity included in a grant agreement. The County must first follow the citizen participation process, hold a public hearing, obtain a governing body resolution, and obtain approval from the State CDBG Program. V. Planning Activities. The County reserves the option of utilizing Program Income, within the 18 percent general administration annual cap, to fund planning for CDBG-eligible activities. Such planning activities may include: cash match for a State CDBG Planning and Technical Assistance Grant; environmental reviews or other studies necessary for CDBG-eligible projects or programs; or application preparation for CDBG or other grants/loans to supplement funding for CDBG-eligible activities. The Costs of such planning activities may be charged. to a Revolving Loan Account (RLA) if the planning is far the same activity as the RLA. Otherwise, Program Income may only be expended on planning activities in conjunction with an open CDBG Planning and Technical Assistance grant. VI. CDBG Re-Use Committee Membership and Role. The Committee will be made up of one (1) representative from the Department of Development Services, and one {1) from. the Chief Administrative Office. This Committee may identify ex-officio members for participation in review of specific projects, requests, and applications as ~=ould best senTe the stated interest in the CDBG Re-Use Program and Housing and Community Development (HCD) regulations. For the purposes of this plan, the County Administrative Office shall be the Lead agency for all Re- Use Conunittee activities. The CDBG Re-Use Committee will review applications and documents submitted by the respective lead agencies in request of available funds from the miscellaneous revenue as defined by HCD and,1or Program Income as defined in Section II of this plan.. Loans made under Section VIII shall be exempt from review by the Re-Use Committee. The Committee will ensure al] funds are used per the guidelines of Section N of this plan. VIi. Distribution for Reuse of Program Income. The County's Program Income that has not been committed to open grant activities will be distributed, as follows: A. All Program Income generated through grants funded from the General and Native American Allocations will be deposited into the Housing Rehabilitation RLA; and B. All Program Income generated through grants funded from the Economic Development Allocation will be deposited into the Business Expansion and Retention RLF. VIII. Revolving Loan Accounts. The purposes and allowed uses of funds under these RLAs are, as follow=s: reuseplan ammendment Apri104 Pa,~e 2 of 5 Housing Rehabilitation Re~~olving Loan Account. This fund will be principally used for the purpose of making loans to rehabilitate residential units occupied by households which have an annual income which is eighty percent (80%) or less of the county's median income. At least f fty-one percent (51 %) of the funds expended far the activity funded under this RLA during the program year shall be used on revolving activities (i.e., loans). No more than twelve percent (12%) of the Program Income funds actually expended during the program year under this RLA shall be expended for housing rehabilitation related grants. No more than nineteen percent (19%) of the funds expended from this RLA shall be used for activity delivery casts. No more than eighteen percent (18%) of the total amount of Program Income expended annually may be expended for general administrative costs related to this RLA activity. The total expended for non-revolving activities (grants, activity delivery costs, and general administration including plarming related to this RLA) shall not exceed forty-nine percent (49%) of the total funds actually expended during the program year (July 1 thru June 30). The County reserves the right to adjust these limitations consistent with existing State policy. The review and funding of requests for CDBG loan or grant assistance under this RLA shall be conducted per the attached Housing Rehabilitation Program Guidelines. All assistance provided to activities under this RLA shall be made for activities that are located within the County's jurisdiction. The County reserves the right to enter into a subrecipient agreement or contract for all or part of the Business Expansion and Retention RLA as needed to ensure compliance and management of this RLA. If the activities funded under the RLA are for the same activities as those funded under an open State CDBG grant agreement, then the funds available in this RLA shall be expended prior to drawing down funds from the State CDBG program. Business Expansion and Retention RLA. This fund will be used to provide "gap" financing for businesses that can document the need for CDBG assistance and that will create or retain qualifying permanent jobs that will be principally filled by members of households which have an annual income that is eighty percent (80°l0) or less than the county's median household income, adjusted for size. At least fifty-one percent (51%) of the funds actually expended for the activity funded under this RLA during the program year shall be used on revolving activities (i.e., loans). No more than twelve percent (12°l0) of the Program Income funds expended during the program year under this RLA shall be for grants for public infrastructure improvements that are needed to accommodate a specific business expansion or retention project. No more than nineteen percent (19°l0) of the total funds expended for business assistance activities shall be used for activity delivery costs. No more than eighteen percent (18%) reuseplan ammendment Apri104 Pale 3 of 5 of the total amount of Program Income actually expended annually may be expended for general administrative costs related to this RLA activity. The total expended for non- revolving activities (grants, activity delivery costs, and general administration including planning related to this RLA) shall not exceed forty-nine percent (49%) of the total funds expended during the program year (July 1 thru June 30). The County reserves the right to adjust these limitations consistent with existing State policy. The County reserves the right to enter into a subrecipient agreement or contract for all or part of the Business Expansion and Retention RLA as needed to ensure compliance and management of this RLA. If the activities funded under the RLA are for the same activities as those funded under an open State CDBG grant agreement, then the funds available in this RLA shall be expended prior to drawing down funds from the State CDBG program. The review anal funding of requests for CDBG loan or grant assistance under this RLA shall be conducted under the federal underwriting guidelines specified at 24 CFR 570.482 (e) that have been incorporated into the County's adopted Business Revolving Loan Fund Pragram Guidelines (Attachment B) and include the project review procedures. These guidelines will ensure that the amount and terms of the CDBG assistance are appropriate given the documented needs of the business and given the amount of public benefit (job creationlretention) that will result from the CDBG-assisted project. In addition, any activity requesting funding under this RLA shall be deemed to be eligible under Section 570.482 and Section 105 (a) of the Act and shall be determined to provide sufficient public benefit as specified under Section 570.482 (fj. Any CDBG assistance for infrastructure shall meet the requirements of Section X70.483 (b) (4) (F} which requires ongoing job tracking for all businesses that initially benefit from an infrastructure project as well as any subsequent busines(s) benefiting from these improvements. All assistance provided to activities under this RLA shall be made for activities that are located within the County's jurisdiction. 9. Reporting and Federal Overlay Compliance. The County shall comply with all State CDBG reporting requirements, including submittal of an annual Grantee Performance Report for each RLA and submittal of the required Quarterly and Annual Program Income Reports, which shows combined receipts and actual. expenditures from all RLAs on one report (due by August 15). The County shall ensure that the use of Program Income under this Reuse Plan complies with all CDBG program requirements, including citizen participation, environmental review, equal opportunity, Section 3 employment, lead-based paint, labor standards, procurement and property management, and maintenance of adequate accounting and recardkeeping systems. To ensure ongoing compliance with CDBG requirements, the County shall utilize the latest available State CDBG Program Grant Management Manual for guidance on compliance procedures and polices. The County shall obtain the Department's written approval before proceeding with any Program Income funded activity. 10. Maximum Funds in Revolving Loan Accounts. Program Income received by the RLAs during the program year (July 1 through June 30} shall be substantially expended by the end of the program year (June 30}. At any given time, the funding balance for either of the RLAs reuseplan ammendment.4pri104 Pale 4 of 5 should not exceed the typical. cost of a single RLA project, plus reasonable administration costs (up to 18 percent of total expended costs). Transfers of funds between RLA's must be preceded by a properly noticed public hearing. 11. Revising this plan. The Board of Supervisors has the authority to amend this document with a properly noticed $oard meeting and approval by the State Department of Housing and Community Development (HCD). reuseplen ammendment Apn104 Page 5 of 5