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Home My WebLink About6.k. Resolution of Approval for CDBG Application t f ROSEMOUNT s. EXECUTIVE SUMMARY CITY COUNCIL City Council Regular Meeting: December 20, 2011 AGENDA ITEM: Resolution of Approval for CDBG AGENDA SECTION: Application Consent ! R PREPARED BY: Kim Lindquist, Community Development AGENDA NO. �Q• Imo• Director ATTACHMENTS: Resolution; Winterization Plus Proposal APPROVED BY: RECOMMENDED`ACTION: Motion to Approve Draft Resolution. BACKGROUND Every year the City is required to apply for CDBG funds. The allocation is set by a formula that was adopted by the County and is subject to the budget set at the Federal level. In past years, the City has used funds to rehabilitate the Rosemount Family Resource Center and the surrounding park and Y gp code improvements at the Steeple Center. Part of the application requirement is a resolution of support for the application from the City Council. The application this year is to provide winterization and energy efficiency loans to Rosemount residents between 50% and 80% of the area median income. The Dakota County Community Development Agency (CDA) has a winterization grant program for residents less than , 50% of the area income. Attached to this executive summary is a memorandum from the CDA describing the winterization plus program they will be initiating in 2012. The program is something that they have been discussing for some time as a partnership for Eagan. Similarly, Rosemount } funding would be used for Rosemount residents only. The program specifics are the same in both communities. The projected allocation for the City is approximately $42,874. CONCLUSION Motion to approve the attached resolution. CITY OF,ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 2011 - A RESOLUTION APPROVING THE APPLICATION OF THE CITY OF ROSEMOUNT FOR FISCAL YEAR 2012 DAKOTA COUNTY COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUNDING } WHEREAS, the City of Rosemount is a participating jurisdiction with the Dakota County CDBG Entitlement Program for Fiscal Year 2011 (ending June 30, 2012); and WHEREAS, the Dakota County Community Development Agency (CDA) is a Subgrantee of Dakota County for the administration of the CDBG Program; and - WHEREAS, the Dakota County CDA has requested fiscal year 2011 CDBG applications to be submitted by January :15, 2012, based on a district formula allocation of funds approved in the 1984 Community Development Implementation Plan. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Rosemount hereby approves the following: 1. The Fiscal Year 2011 CDBG application is approved for submission to the Dakota County CDA. 2. The Mayor for the City of Rosemount is authorized to execute the application and all agreements and documents related to receiving and using the awarded CDBG funds. 3. The Dakota County CDA is designated, as the administrative entity to carry out the CDBG program on behalf of the City of Rosemount, subject to future Subrecipient Agreements that may be required for specific CDBG - funded activities. ADOPTED this 20th day of December, 2011, by the City Council of the City of Rosemount. William H. Droste, Mayor ATTEST: Amy Domeier, City Clerk fi { t { { Memo To: Jon Hohenstein, Eagan Director of Community Development Erik Slettedahl, Community Development/GIS Specialist From: Lisa Henning, Asst. Director of Community & Economic Development Date: 12/14/2011 Re: Weatherization Plus Proposal The City of Eagan has expressed interest in expanding the CDA Weatherization Program to assist a broader range, of homeowners beyond the households currently eligible for weatherization services. Weatherization is an eligible activity under the Community Development Block Grant (CDBG) program. For the purposes of this discussion, the proposed pilot program has been identified as the Weatherization Plus Program. Below is a brief description of the Weatherization and Housing Rehabilitation Loan Programs currently administered by the CDA, followed by a summary of the Weatherization Plus Program proposal. Weatherization Program Dakota County CDA has administered a Weatherization Program since 1977. The purpose of the weatherization program is to use energy conservation techniques to reduce the cost of home energy to low income households. This grant program is only available for homeowners and renters with household income at or below 200% of the federal poverty income guidelines, which is roughly equivalent to 50% area median income (AMI'). Households must apply and be approved for energy assistance through the Scott Carver Dakota CAP ( "CAP Agency ") Agency's Energy Assistance Program (EAP) to be eligible for theNWeatherization Program. Approximately $7,500 is spent on each weatherized home, with eligible work including: minor and major air sealing; attic insulation; sidewall insulation; diagnostics, pressure balancing, and ductwork sealing; general repairs and furnace replacement. The weatherization program is funded through the U.S. Department of Energy, MN Department of Commerce, and local utility companies. Administration and coordination of the CDA Weatherization Program is conducted by CDA staff, with the exception of income eligibility determination, which is performed by CAP Agency. Initial audits of households and all weatherization work is conducted by contractors that are pre- approved by the CDA. Housing Rehabilitation Loan Program The purpose of the Housing Rehabilitation Loan Program is to provide financing to low and moderate income households to maintain the safety and integrity of existing homes, to remove architectural barriers in homes to allow independent living for persons with physical disabilities, and to reduce lead -based paint hazards. Funds are commonly used for roof replacement, furnace replacement, electrical and plumbing repairs, insulation and special needs improvements (such as ramps, bathroom and kitchen modifications). This program is available for homeowners with household income at or below 80% of AMI. Homeowners apply directly to the CDA. The Housing Rehabilitation Loan program offers assistance in the form of three types of loans, including deferred loan, emergency loan, and accessibility loan. The deferred loan is the most commonly used loan. The maximum deferred loan amount secured by a single property at any given time is $25,000 for real property and 1 4 $5,000 for emergency loans. Deferred loans must be paid back in their entirety when the property is sold, transferred, or. no longer the principal residence of the original applicant. Deferred loans may include an interest charge between 0% - 3 %, as determined by the CDA, and are secured with a mortgage against the property. This program is funded by CDBG. i Coordination and administration including the application process and eligibility determination, developing the scope of work and preparing specifications, working with the homeowners throughout the process, assistance with contractors, loan closing, loan proceed disbursements, and rehab work inspections is completed by the CDA Rehabilitation staff. Weatherization Plus Proposal The Weatherization Plus pilot program combines the focus on energy efficiency of the Weatherization Program with the expanded income limits and repayment component of the Home Improvement Loan program. The Weatherization Plus pilot program ,will be offered to households with an annual income of 50% - 80% AMI ". Another difference is that Weatherization Plus will only be available to homeowners. The loan option will benefit the City by generating program income, or repayment from previously issued loans, that would go directly to the 1 City of Eagan Weatherization Plus program to assist additional homes in the future. The CDA proposes the City of Eagan fund the Weatherization Plus pilot program with CDBG funding. The specific amount of funding per home for weatherization has yet to be determined. A percentage of the CDBG funding dedicated to the Weatherization Plus Program will need to be allocated to project administration to cover the CDA coordination and administrative costs. Details of Weatherization Plus Program are not finalized, but the CDA is excited to work with the City of Eagan on the development of a weatherization program that assists a broader range of homeowners than can be served with the traditional weatherization program. � I 1 a j k 4i i 50% AMI for a household of four is $43,050, based on 2011 HUD Income Limits. 80% AMI for a household of four is $64,200, based on 2011 HUD Incorne,Limits. 2