MEMORANDUM

Form revised December 9, 2004

FISCAL NOTE FOR NON-CAPITAL PROJECTS

Department:	Contact Person/Phone:	DOF Analyst/Phone:
Human Services	Michael Look 5-1717	Kristi Beattie 4-5266

Legislation Title:

AN ORDINANCE relating to housing and community development activities; authorizing acceptance of grant funds from the United States Department of Housing and Urban Development for programs included in the 2006 Update to the City's 2005 – 2008 Consolidated Plan for Housing and Community Development; amending the Table of Proposed Projects component of the City's 2006 Update to the Consolidated Plan; allocating unused funds from prior years; authorizing other conforming amendments to the Consolidated Plan; decreasing appropriations in the 2006 Budget for activities under the Community Development Block Grant Program, the HOME Program, the American Dream Downpayment Initiative program, and the Emergency Shelter Grant Program; increasing appropriations in the 2006 Budget for activities under the Housing Opportunities for Persons With AIDS program; increasing appropriations in the 2006 Budget for the Office of Economic Development and Human Services Department; and ratifying and confirming prior acts; all by a three-fourths vote of the City Council.

· Summary of the Legislation:

This legislation authorizes acceptance of 2006 grant funds from the United States Department of Housing and Urban Development (HUD) for four Consolidated Plan programs: Community Development Block Grant (CDBG), the HOME program including the American Dream Downpayment Initiative (ADDI), Housing Opportunities for Persons with AIDS (HOWPA), and Emergency Services Grant (ESG). The legislation also revises expenditure allowances in the 2006 budget for various funds and departments and adopts an amended 2006 Table of Proposed Projects component of the Consolidated Plan. In addition, this legislation appropriates General Fund to the Human Services Operating Fund and the Office of Economic Development to support the continuation of activities funded in the 2006 Adopted Budget, but for which there is insufficient CDBG entitlement in 2006.

Background:

The City’s 2006 Adopted Budget contains estimates for the City’s 2006 allocation of CDBG, HOME/ADDI, HOPWA and ESG funds. The City received its actual allocation amounts from HUD in March of 2006. This legislation accepts these grant funds (already appropriated to the extent of the prior estimates) and makes changes to certain appropriations to reflect the City’s actual allocations.

Actual 2006 allocations are less than what was reflected in the City’s 2006 Adopted Budget for three of the four HUD programs. The actual allocations and differences from the 2006 Adopted Budget are summarized below.

HUD Program	2006 HUD Allocation	Difference from 2006 Adopted Budget
Community Development Block Grant (CDBG)	$12,622,401	($714,543)
HOME / American Dream Downpayment Initiative (ADDI)	$4,393,559	($352,530)
Housing Opportunities for Persons With AIDS (HOPWA)	$1,615,000	$4,000
Emergency Shelter Grant (ESG)	$539,949	($1,471)
Total		(1,064,544)

This shortfall is addressed in four ways: approximately $350,000 in recaptured CDBG funds is reprogrammed from prior years to fund 2006 CDBG projects; a reduction of $37,500 is taken in the Neighborhood Business District Support program; approximately $162,000 of balance of unspent, residual interest earned on the limited tax general obligation (LTGO) bonds issued by the City in 1992 is appropriated to the Office of Housing Low Income Housing Fund (16400) through companion legislation; and $519,043 of General Fund is appropriated to the Human Services Operating Fund and the Office of Economic Development.

The City is required by HUD to amend the Table of Proposed Projects, Attachment 1 to the legislation, to incorporate any current year changes in its Consolidated Plan of $50,000 or more, or if there are changes to the use of CDBG funds from one eligible use to another. This legislation amends the 2006 Table of Proposed Projects to reflect the following major items:[P1]

2006 Shelter and Transitional Housing for Single Adults and Families Request for Proposals (Project 242 020). Reflect the 2006 allocation of $2.26 million of CDBG funds to providers of shelter and services for homeless persons, as a result of the Emergency Shelter Request for Proposals Process conducted by the Human Services Department in late 2005.

Block Grant Administration (Project 215 010). Reflect a reduction in funding of $20,000 for CDBG Administration / Departmental Indirect costs. Funding for this activity is replaced by General Fund in 2006.

Community Development Technical & Project Assistance – Technical Assistance (Project 421 020). Reflect a reduction in funding of $155,315 for the Community Development Corporation (CDC) Technical Assistance project. This program provides resources to CDCs to develop economic and community development projects. Funding for this activity is replaced by General Fund in 2006.

HOME Administration (Project 142 010). Reflect the reallocation of recaptured CDBG funds to backfill a reduction to the HOME reduction program of $25,982 for HOME Administration.

Homebuyer Programs (Project 112 020). Reflect the reallocation of CDBG recaptured CDBG funds to backfill a HOME reduction of $92,712 for the Homebuyer program.

Rental Housing Preservation & Development (HOME & CDBG Recapture) (Project 121 030). Reflect the reallocation of CDBG recaptured CDBG funds to backfill a HOME reduction of $233,836 for the Rental Housing Preservation & Development project.

Loan & Portfolio Management (Project 422 015). Reflect the elimination of all CDBG funding to the Loan Portfolio Management project. Most of these costs support staffing for the Section 108 and float loan activities. The net change of this action is a reduction of to the CDBG program of $113,954. Funding for this activity is replaced by General Fund in 2006.

Neighborhood Business District Support (Project 423 030). Reflect a reduction in funding of $37,500 of CDBG funds to the Neighborhood Business District Support program. This program provides façade improvements to qualifying business districts.

Rental Housing Preservation & Development (CDBG) (Project 121 040). Reflect an appropriation of unspent, residual interest earned on the limited tax general obligation (LTGO) bonds issued by the City in 1992 to the Office of Housing. These funds offset a CDBG reduction of approximately $162,000 to the Rental Housing Preservation & Development project.

The proposed amended Table of Proposed Projects allocates $229,774 less in public services that the original Table. Because of CDBG expenditure rules, there is a maximum limit on the amount of CDBG funds that can be used for public services. Because of reductions to the City’s 2006 CDBG entitlement, the original Table exceeds that limit by $229,774. Therefore, General Fund resources will be used to backfill the excess amount.

Please check one of the following:

____ This legislation does not have any financial implications. (Stop here and delete the remainder of this document prior to saving and printing.)

__X_ This legislation has financial implications. (Please complete all relevant sections that follow.)

Appropriations:

Fund Name and Number	Department	Budget Control Level*	2006 Appropriation	2007 Anticipated Appropriation
CDBG Main Fund (17810)	Human Services	HSD CDBG Main Fund (H17810)	($714,543) CDBG
HOME/ADDI Fund (16490)	Office of Housing	Low-Income Housing Fund 16400 (XZR1) - Multifamily	(233,836) HOME
HOME/ADDI Fund (16490)	Office of Housing	Office of Housing Operating Fund (XZ600) – HOME Admin	($25,982) HOME
HOME/ADDI Fund (16490)	Office of Housing	Low-Income Housing Fund 16400 (XZR1) – Homewise and Homebuyer	($92,712) ADDI
Human Services Operating Fund (16200)	Human Services	Emergency & Transitional Services (H30ET)	($1,471) ESG
Human Services Operating Fund (16200)	Human Services	Emergency & Transitional Services (H30ET)	$4,000 HOPWA
General Subfund (00100)	Office of Economic Development	Office of Economic Development (X1D00)	$269,269
Human Services Operating Fund (16200)	Human Services Department	Leadership and Administration (H50LA)	$20,000
Human Services Operating Fund (16200)	Human Services Department	Emergency and Transitional Services (H30ET)	$229,774
TOTAL			($545,501)

*See budget book to obtain the appropriate Budget Control Level for your department.

Notes to Appropriations Table: N/A

Anticipated Revenue/Reimbursement: Resulting From This Legislation:

	Fund Name and Number	Department	Revenue Source	2006 Revenue	2007 Revenue
CDBG Main Fund (17810)		Human Services	CDBG	($714,543)
HOME/ADDI Fund (16490)		Office of Housing	HOME	($259,818)
HOME/ADDI Fund (16490)		Office of Housing	ADDI	($92,712)
Human Services Operating Fund (16200)		Human Services	ESG	($1,471)
Human Services Operating Fund (16200)		Human Services	HOPWA	$4,000
TOTAL				(1,064,544)

Notes to Revenue/Reimbursement Table: N/A

Total Regular Positions Created Or Abrogated Through This Legislation, Including FTE Impact:

Position Title and Department*

Fund Name

Fund Number

Part-Time/ Full Time

2006

Positions

2006 FTE

2007 Positions**

2007 FTE**

N/A

TOTAL

* List each position separately

** 2006 positions and FTE are total 2006 position changes resulting from this legislation, not incremental changes. Therefore, under 2006, please be sure to include any continuing positions from 2005

Notes: N/A

· Do positions sunset in the future? (If yes, identify sunset date):

Spending/Cash Flow:

Fund Name and Number	Department	Budget Control Level*	2006 Expenditures	2007 Anticipated Expenditures


TOTAL

* See budget book to obtain the appropriate Budget Control Level for your department.

Notes to Spending Table: N/A

· What is the financial cost of not implementing the legislation?

If this legislation were not implemented, these funds could not be used as effectively as possible to meet the needs of low- and moderate-income persons.

· What are the possible alternatives to the legislation that could achieve the same or similar objectives? None. The City is required by HUD to amend the Table of Proposed Projects if there are changes to the use if CDBG funds from one eligible use to another. In addition, the City of Seattle policy requires an amendment to the Annual Action plan if changes in an allocation exceed $50,000.

· Is the legislation subject to public hearing requirements:

Yes. The City is required to publish a “Notice of Substantial Amendment” in the Daily Journal of Commerce advising citizens that they have a period of 30 days to comment on any changes to the Consolidated Plan. A public hearing is required at the end of the public comment period. A public hearing is scheduled for June 20, 2006.

· Other Issues (including long-term implications of the legislation):

Please list attachments to the fiscal note below: