Title
Staff Report for Discussion of Vetting Procedures for Financial Support Requests from Community Organizations
Staffreport
SUMMARY AND RECOMMENDATIONS
Per City Council direction at the April 16, 2018 Council meeting, staff provides the following information for the Rules Committee’s consideration regarding the current vetting procedures that are used to evaluate requests for loans or financial support from local community-serving organizations and businesses.
BACKGROUND
Each year, the City of San Leandro manages a number of programs that provide financial support to a variety of non-profit, service organizations, and/or local businesses to support and augment the important programs or services that they provide to the public, or otherwise advance adopted city goals. Examples of such programs through which financial awards are allocated include:
Key Programs
• Community Assistance Program (CAP program)
• Community Development Block Grant (CDBG) Capital Program
• Affordable Housing Development Funding Program
• Economic Development/ Business Incentive Program
Others
• Community Investment Program
• Arts Commission - arts and culture grants program
Analysis
A brief overview of each of the above-referenced programs is provided in the subsequent pages of this staff report. As outlined in those summaries, each of the programs has incorporated a robust set of procedures and screening criteria that are used to vet applications before outcomes are rendered by the respective decision-making bodies that are charged with their implementation. As requests for support are received throughout any given year, staff attempts to connect the requesting entity to the appropriate funding program. From time to time, the City will receive requests that either do not directly align with one of these existing programs, or exceed available funding. In those instances where the request is modest in nature (e.g. typically less than $5,000), the Community Investment program referenced above offers another potential avenue for support. For other larger-scale requests or those which do not align with an existing program, staff recommends that the City Council defer consideration of the funding request so that it may be considered collectively with any other such requests as part of the annual budget process.
PREPARED BY: Eric Engelbart, Deputy City Manager, City Manager’s Office
Overview of Community Assistance Program (CAP)
The Community Assistance Grant Program (CAP) provides financial support to non-profits providing human services and programs for individuals and families living in San Leandro. CAP is funded through a combination of the City General Fund and by federal Community Development Block Grant (CDBG) funds that are allocated to the City from the U.S. Department of Housing & Urban Development (HUD). CAP funds public services on a 2-year funding cycle in alignment with the City’s biennial budget. Applications are usually made available each December and due in January.
Annual funding available:
Approximately up to $250,000 ($150K from City General Fund and $100K from CDBG). In recent years, the City has been able to fund about four nonprofit public service providers with CDBG money, and each of those organizations typically receives a new allocation of funding each year.
Eligibility for CDBG funding:
1. Service must meet a “critical basic need”, defined as: food, shelter, mental health, domestic violence or health care services
2. Service must meet CDBG Consolidated Action Plan Priorities and Eligibility Requirements:
• Benefit low/moderate-income (LMI) people
• At least 51% of the clients must have income < 80% of Area Median Income; or
• Primarily serve “presumed (to be LMI households) beneficiaries,” such as: abused children, elderly persons, battered spouses, disabled adults, homeless persons, migrant farm workers, illiterate persons, persons living with AIDS.
Eligibility for City General fund CAP grants
• Organization must be non-profit 501c3 and serve San Leandrans
Additional Funding Considerations:
• The total number of San Leandro residents served
• San Leandro-based organization providing the same service has priority over a non-San Leandro-based organization
• Avoid duplication of service, except where there is demonstrated need for multiple providers
• One grant per agency (grant may fund multiple activities)
• Does the agency have a track record of providing quality service?
• For CDBG-funded projects, does the agency have the fiscal capacity to fulfill CDBG requirements?
• Does the grant help to leverage other funds?
• Are there other sources of funding for the service?
Criteria for fund allocation
Follows CAP priorities (which in the past were basic needs like food and shelter, but will now be based on the recent Gap Analysis that the Recreation and Human Services Department commissioned last year). The application contains questions on organizational background, proposed project description, budget, and capacity/experience (including attaching a recent audit).
Decision-making process
Community Development staff make initial recommendations for CDBG funded public services for the Human Services Commission (HSC) to review as part of the 2-year CAP Funding cycle. The HSC only reviews and makes recommendation the first year of the 2-year cycle. The HSC then reviews and makes recommendations for CAP and CDBG-funded public services. The CDBG-funded public service recommendations from the HSC are then included in the Draft Annual HUD Action Plan (for CDBG funds). The City Council ultimately reviews the Draft Annual Action Plan (in March or April), and then after a 30-day public comment period, reviews and approves the Final Action Plan in April or May (including the final CDBG funded public service allocations).
Grant Monitoring: Quarterly Reports, CDBG Monitoring and Site Visit
• Agencies receiving grant funds are required to submit quarterly or biannual reports (depending on the funding source) in the format provided by the City
• Agencies receiving funding are required to report statistical information and performance data.
• Members of the Human Services Commission and staff will conduct at least one site visit per year
• CDBG-funded agencies receive an annual monitoring visit by CDBG staff for compliance with federal HUD requirements
Overview of CDBG Capital Improvement Program (CDBG CIP):
Program Summary:
The City typically prioritizes funding for city-led projects through its annual CDBG allocation. However, if additional unallocated CDBG funds remain for eligible CIP projects, then Housing Services staff evaluate CDBG awards to eligible non-profits for their capital needs. Examples of projects that have been funded through this program in recent years include the: Senior Community Center, Americans with Disabilities Act (ADA) improvements to City facilities such as parks and City Hall, and ADA curb cut ramps throughout the City.
Annual funding available:
Varies from year to year based on HUD CDBG allocation to entitlement cities like San Leandro.
Eligibility
Same as CBDG CAP Program eligibility summarized above.
Application deadlines
Ideally follows the HUD Annual Action Plan cycle summarized in the CDBG CAP Program, but may vary throughout the year (see “Other comments” below).
Decision-making authority
City Council
Other comments
For past CDBG funded capital improvement grants for nonprofits, Housing Services staff would hear from interested nonprofits in Summer/Fall prior to the new fiscal year. If more than one nonprofit expressed interest in CDBG funds for capital improvements to their facilities, then staff would issue a CDBG Nonprofit CIP Request for Proposals (RFP). If there was a RFP, the application was similar to the CAP application described above. The Nonprofit CIP RFP rarely happened, as the City would not receive any nonprofit requests due to lack of CDBG funds or the City would simply receive one request so no RFP was necessary.
If there were CDBG CIP applications, staff reviewed them for eligibility (including vetting with the City Manager and appropriate department heads) and included them in the Draft and Final HUD Annual Action Plans for City Council review. CDBG CIP funding recommendations are not forwarded to the Human Services Commission. Past CDBG CIP funding amounts to nonprofits ranged from $5,000 to $300,000.
Overview of Affordable Housing Development Funding Program
Program Summary:
The City receives funding requests from developers, usually nonprofits, that are seeking to construct new affordable housing or rehabilitate existing housing and converting them to affordable units. These requests occur on a case-by-case basis depending on the real estate market and do not occur every year.
Annual funding available
Varies based on affordable housing funding source (e.g., former Redevelopment Housing Set-Aside Funds, City Affordable Housing Trust Fund, federal CDBG and HOME Programs)
Eligibility
Depends on the federal, state, or local funding source but typically the proposed affordable housing project must serve a majority of lower income households. The projects must also advance housing goals in the City‘s Housing Element (under the General Plan), and the Five-Year Consolidated and Annual HUD Action Plans if applicable.
Application deadlines
Historically, the City has had to compile its available affordable housing funding over time as most affordable housing projects seeking City subsidy required from $1 million to $5 million. Given scarcity of vacant land and high costs of land, the City has typically entertained one affordable housing development proposal every two to three years, so no RFP has been needed.
Criteria for fund allocation
See explanation for eligibility above.
Decision-making authority
All City loan funding for affordable housing projects must be approved by the City Council.
Overview of Economic Development/ Business Incentive Program
Program Summary
The programs outlined below provide funding to assist in achieving the city’s economic development goals. Funding is used to off-set capital expenditures and is awarded in the form of forgivable loans, with improvements required to be maintained for up to 10 years, based on the amount of incentive. The loan is secured through an Owner Participation Agreement, with a Deed of Trust recorded for larger loans.
Total funding available
$175,000 per fiscal year
Eligibility by Program
Commercial Rehabilitation & Awning, Sign and Paint Program
The Program is intended to stimulate investment and improve the appearance of businesses in order to improve the vitality and appearance of commercial districts. Applications are evaluated and ranked by the following five criteria: location, contribution to other positive actions in the immediate area, building/size utilization, entrepreneurial business activity, and design.
Restaurant Incentive Program
The Program is intended to support the ongoing development of the San Leandro retail sector, the activation of the Downtown area, and to provide opportunities to introduce dining options to the industrial areas. Applications are evaluated and ranked by the extent to which a project attracts and assists in the establishment or expansion of quality restaurants within Downtown San Leandro or the top priority industrial zones, pursuant to the Next Generation Workplace District Study
Craft Beverage Program
The Program is intended to support the ongoing development of the San Leandro Craft Beer cluster and the revitalization of the industrial areas more generally. Applications are evaluated and ranked by the extent to which a project attracts and assists in the establishment quality breweries within the top priority industrial zones, pursuant to the Next Generation Workplace District Study.
Energy Efficiency Program
The Program is intended to stimulate investment in energy projects in order to increase economic viability, achieve energy cost reductions, and to reduce greenhouse gas emissions. Applications are evaluated and ranked by the following four criteria: projected energy reduction and energy cost savings, payback period, likelihood to strengthen the long-term viability of the business venture, and project design.
Broadband Connection Program
The Program is intended to reduce the cost of connecting a commercial or industrial building to broadband infrastructure, with the goal of stimulating innovation and high tech business activity in order to make commercial and industrial districts more competitive. Applications are evaluated and ranked by the following three criteria: ability to stimulate high-tech business activity, foster innovation, and encourage job creation.
Application deadlines
Applications are accepted on a first-come, first served basis.
Decision-making authority:
Up to $50,000 - City Manager (with recommendation by Economic Development Manager)
In excess of $50,000 - City Council
Additional details on the program are available at: <http://sanleandro.org/depts/cd/econdev/incentives.asp>
Overview of Community Investment Program
Program Summary:
This program is designed to provide a source of funds for projects or programs that benefit the visual appearance of neighborhoods, or to support programs or community events that which may benefit the public at large or particular at-risk populations. Examples of activities that have received support through this program include: City sponsorship of the annual Moon Festival, City-led installation of new neighborhood monument signs or street trees, and support for collaborative efforts with local school districts such as the youth summer trades camp. The fund has also been used to support City-led projects that benefit the community such as unanticipated lighting, landscaping, and tree maintenance.
Annual funding available:
$100,000 in total funding is available each fiscal year, subject to appropriation renewal by the City Council as part of the annual budget process, a portion of which is made available to third-party organizations. Typical awards are less than $5,000 per project, activity, or event.
Eligibility
Varies. Generally speaking, allocations are limited to local non-profit and community service organizations, in addition to City-led projects that are identified during the course of the year. Sponsorship of non-profit events is typically restricted to San Leandro-based organizations and events that take place within the City.
Application deadlines
Rolling
Criteria for fund allocation
The City Manager’s Office evaluates each request on a case-by-case basis and makes a determination based on a number of factors including:
• Confirmation that the event or program provides general public benefits or otherwise benefits a particular neighborhood, population or under-served group
• Ensuring that the event or program is open to and advertised to the public
• Confirmation of specific public services or other public benefits that are offered by the group seeking support
• Confirmation that the program, event or services align with adopted City Council annual goals
Decision-making authority
City Manager
Overview of Arts and Culture Grants
Program Summary:
Emerging from the Public Art Master Plan that was created in 2017, the San Leandro Arts Commission oversees this civic mini-grants program to support local arts organizations and individual artists in their efforts to create a more vibrant cultural environment. This is a pilot program that was launched for the first time in 2018.
Annual funding available:
$40,000 in total funding is available during this pilot year phase. Non-profit organization-led projects will be supported with grants of up to $4,000 and individual-led artist projects will be supported with grants of up to $2,000.
Eligibility
Visual, performing, media, literary, and multidisciplinary arts activities are eligible for grant funding through this program.
Application deadlines
Application window launched on September 13, 2018, with applications due no later than October 29, 2018.
Criteria for fund allocation
• Overview and mission (for non-profit organization grants)
• Artistic quality and excellence
• History of programming or activity in San Leandro or the Bay Area
• Management and fiscal capability (non-profit organizations)
• Public benefit
• Promotion and outreach plan / program
• Accessibility or visibility to the public
• Decision-making authority
Decision-making authority
City Manager, based on arts commission recommendations