2016-29383 Reso RESOLUTION NO. 2016-29383
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, APPROVING AND AUTHORIZING THE CITY MANAGER TO
RECAPTURE $111,313.24 OF FY 2011/2012 COMMUNITY DEVELOPMENT BLOCK
GRANT (CDBG) FUNDS AND $46,422.76 OF FY 2014/2015 CDBG FUNDS; AND
APPROVING A SUBSTANTIAL AMENDMENT TO THE FY 2011/2012 AND FY
2014/2015 ACTION PLANS, AND AN AMENDMENT TO THE FY 2013 THROUGH
2017 CONSOLIDATED PLAN, TO REALLOCATE SAID CDBG FUNDS, IN THE
TOTAL SUM OF $157,736, TO THE LOTTIE APARTMENTS - REHABILITATION AND
RELOCATION PROJECT; AUTHORIZING THE CITY MANAGER TO SUBMIT THE
REQUISITE REVISED ACTION PLANS AND CONSOLIDATED PLAN TO THE U.S.
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD); AND FURTHER
AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AGREEMENT(S) FOR
SUB-RECIPIENT(S) AND THE CITY MANAGER TO EXECUTE CITY
INTERDEPARTMENTAL AGREEMENTS.
WHEREAS, the City is an entitlement recipient of HUD formula grant programs as follows:
Community Development Block Grant (CDBG) fund, and HOME Investments Partnership (HOME)
funds; and
WHEREAS, CDBG funds are used to provide vital public services, housing activities, and
improvement to public facilities and HOME funds are used for affordable housing activities including
multi-family rentals; and
WHEREAS, the Action Plan for federal funds is a requirement under HUD's formula grant
programs, which include the CDBG and HOME programs; and
WHEREAS, CDBG and HOME stipulate that funds be expended within guidelines as delineated
in 24 CFR Part 570 and 24 CFR Part 92, among others; and
WHEREAS, the City Commission approved the FY 2011/2012 Action Plan via Resolution No.
2011-27694, adopted on July 13, 2011, and awarded $120,000 to the Office of Tourism, Culture and
Economic Development to provide façade improvements funds to businesses in the North Beach Area
as a means of incentivizing economic development and revitalizing the area ("North Beach Façade
Improvement Program"); and
WHEREAS, the City Commission approved the FY 2014/2015 Action Plan via Resolution No.
2014-28635, adopted on June 11, 2014, and awarded an additional $120,000 to the Office of Tourism,
Culture and Economic Development for the Façade Improvement Program; and
WHEREAS, the City Commission approved the reallocation of$73,577.24 for FY 2011/2012 via
Resolution No. 2014-28877, adopted on December 17, 2014, from the Façade Improvement Program;
and
WHEREAS, the City Commission amended the previously approved reallocation of $73,577.24
from FY 2011/2012 to FY 2014/2015 via Resolution No. 2016-29316, adopted on March 9, 2016, for
the Façade Improvement Program; and
WHEREAS, CDBG funds in the amount of$111,313,24from FY 2011/2012 and 46,422.76 from
FY 2014/2015, for a total of $157,736, remain unspent and the Administration recommends that said
CDBG funds be recaptured and reallocated in order to meet HUD's expenditure and timeliness
guidelines; and
WHEREAS, as per the Citizen Participation Plan, a change in the use of funds of 50% or more
from one eligible activity to another triggers a Substantial Amendment to the Action Plan; and
WHEREAS, the CDBG funds to be recaptured constitute 100% of the balances of each activity;
and
WHEREAS, the Administration recommends approving a Substantial Amendment to the FY
2011/2012 and FY 2014/2015 Action Plans and an amendment to the 2013 through 2017 Consolidated
Plan, to include the reallocation of the recaptured CDBG funds; and
WHEREAS, the Administration recommends the reallocation of these CDBG funds to the Lottie
Apartments — Rehabilitation and Relocation Project by the Office of Housing and Community Services;
and
WHEREAS, the City provided a thirty (30) day public comment period from April 1, 2016 to May
2, 2016 and a public meeting on April 19, 2016 to comment on the proposed Substantial Amendments
to the Action Plans and the amendment to the Consolidated Plan; and
WHEREAS, the City Manager is the designated agent for all HUD formula grants, and executes
the grant applications, grant agreements, and other applicable HUD documents on behalf of the City.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND THE CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission
hereby approve and authorize the City Manager to recapture $111,313.24 of FY 2011/2012 Community
Development Block Grant (CDBG) funds and $46,422.76 of FY 2014/2015 CDBG funds; and approve a
Substantial Amendment to the FY 2011/2012 and FY 2014/2015 Action Plans, and an amendment to
the FY 2013 through 2017 Consolidated Plan to reallocate said CDBG funds, in the total sum of
$157,736, to the Lottie Apartments - rehabilitation and relocation project; authorize the City Manager to
submit the requisite revised action plans and consolidated plan to the U.S. Department of Housing and
Urban Development (HUD); and further authorize the Mayor and City Clerk to execute agreement(s) for
sub-recipient(s) and the City Manager to execute City interdepartmental agreements.
PASSED AND ADOPTED day of 1W' , 2016.
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COMMISSION ITEM SUMMARY
Condensed Title:
A RESOLUTION TO RECAPTURE $111,313.24 OF FY11/12 .AND $46,422.76 OF FY14/15 COMMUNITY
DEVELOPMENT BLOCK GRANT (CDBG) FUNDS AND REALLOCATE SAID CDBG FUNDS TO THE LOTTIE
APARTMENTS - REHABILITATION AND RELOCATION PROJECT; AMEND THE FY11/12 AND FY14/15 ACTION
PLANS; AMEND THE FY 2013 THROUGH 2017 CONSOLIDATED PLAN; AUTHORIZING CITY MANAGER TO
SUBMIT CHANGES TO HUD;AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AGREEMENT(S);AND
CITY MANAGER TO EXECUTE CITY INTERDEPARTMENTAL AGREEMENTS.
Key Intended Outcome Supported:
N/A
Supporting Data (Surveys, Environmental Scan, etc.):
Item Summary/Recommendation:
The City is a U.S. Department of Housing and Urban Development(HUD)-designated entitlement community receiving an
annual allocation of funding through the Community Development Block Grant (CDBG) and HOME Investments
Partnership (HOME) programs.
The City awarded a total of$240,000 of CDBG funds: ($120,000 in FY11/12 and $120,000 in FY 14/15)to the Office of
Tourism, Culture And Economic Development to provide façade improvements funds to businesses in the North Beach
Area as a way to incentivize economic development and revitalize the area.
The Program has had problems in its implementation including:
1. Business owners in the area normally do not carry flood insurance-a mandatory element under CDBG rules
2. Only census tracts 39.09 and 39.11 in the North Beach area qualify for CDBG fund investment
3. Staff continues to wait on HUD's determination regarding the Area Benefit interpretation to be able to expand the
Program's reach outside census tracts 39.09 and 39.11.
The City is seeking to recapture and reallocate the following balances to comply with expenditure and timeliness
guidelines:
Fiscal Year Amount to be Recaptured
FY2011/2012 $ 111,313.24
FY 2014/2015 $ 46,422.76 �.
Total $ 157,736.00
The recaptured balances will be reallocated to the Lottie Apartments—Rehabilitation and Relocation Project to help cover
a budget gap in the rehabilitation of this City-owned residential property.
These recaptures trigger the amendment of the Action Plans for FY11/12 and FY14/15 and the substantial amendment of
the FY13-17 Consolidated Plan which will be completed by staff upon approval by the Mayor and Commission.
Advisory Board Recommendation:
N/A
Financial Information:
Source of Amount Account
Fund 1 $ 111,313.24 135-5612-000346
2 $ 46,422.76 132-5612-000346
3
Q=PI Total $157,736.00
Financial Impact Summary:
City Clerk's Office Legislative Tracking:
Maria L. Ruiz, Housing & Community Services
Sign-Offs:
Department Director Assis nt City Manager City Manager
MLR KGB JLM
MIAMI B EAC H AGE ITEM
C7C
DATE /—Ito
MIAMI B EAC H
City of Miami Beach, 1700 Convention Center Drive,Miami Beach, Florida 33139,www.miamibeachfl.gov
COMMISSION . EMORANDUM
TO: Philip Levine and Members of the City C mission
FROM: Jimmy L. Morales, City Manager
DATE: May 11, 2016
SUBJECT: A RESOLUTION APPROVING AND UTHORIZING THE CITY MANAGER TO
RECAPTURE $111,313.24 OF FY11/12 AND $46,422.76 OF FY14/15 COMMUNITY
DEVELOPMENT BLOCK GRANT (CDBG) FUNDS AND REALLOCATE SAID CDBG
FUNDS TO THE LOTTIE APARTMENTS - REHABILITATION AND RELOCATION
PROJECT; AMEND THE FY11/12 AND FY14/15 ACTION PLANS; AMEND THE FY
2013 THROUGH 2017 CONSOLIDATED PLAN; AUTHORIZING CITY MANAGER
TO SUBMIT THE REQUISITE REVISED ACTION PLANS AND CONSOLIDATED
PLAN TO HUD; AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE
AGREEMENT(S) FOR SUB-RECIPIENT(S); AND FURTHER AUTHORIZING THE
CITY MANAGER TO EXECUTE CITY INTERDEPARTMENTAL AGREEMENTS.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution.
BACKGROUND
The City is a U.S. Department of Housing and Urban Development (HUD)-designated
entitlement community as determined by the decennial census information on population growth
lag, age of housing stock, and poverty. As an entitlement community, the City receives an
annual allocation of HUD funding through the Community Development Block Grant (CDBG)
and HOME Investments Partnership (HOME) programs. HUD requires entitlement jurisdictions
to submit a Five-Year Consolidated Plan which establishes the strategic framework upon which
the City utilizes its funds. The Consolidated Plan is augmented and refined by the City's annual
submission of its One-Year Action Plan which delineates the specific projects and activities
funded by each year's HUD allocation.
The CDBG Program has timeliness requirements regarding the expenditure of funds. CDBG
funds must be expended so that the total amount of funds in the City's allocation account never
exceeds 1.5 times its annual allocation. HUD further requires its entitlement jurisdictions to
ensure that funded activities are carried out in the defined project scope and within the
timeframe allowed. The City's Action Plan is monitored throughout the year to ensure
compliance with federal regulations and progress towards the National Objective, which
requires providing persons of low and moderate income with decent housing, a suitable living
environment and/or expanded economic opportunities.
City Commissioners Memorandum—CDBG FIP Funds Recapture
May 11,2016
(4 pages)
From time-to-time, it may be necessary for the City to process a "Substantial Amendment" to its
Five-Year Consolidated Plan or its One-Year Action Plan to allow for the funding of new
activities, modification of existing activities, or other program administrative actions. The City is
required by HUD [24 CFR 91.505 (b)] to identify the criteria to be used in determining if a
proposed action will be considered a "Substantial Amendment" in its Citizen Participation Plan.
The City amended its Citizen Participation Plan at the February 10, 2016 City Commission
meeting and established the following criterion for an amendment to be considered
"Substantial":
A change in the use of funds from one eligible activity to another which results in a
substantial alteration of the purpose, scope, location, or beneficiaries of an eligible
activity. A substantial alteration is understood to affect 50% of more of the activity as
proposed.
Any proposed amendment considered a "Substantial Amendment" is subject to the Citizen
Participation process. This process includes a thirty (30) day public notice to provide the
opportunity for the public to review and comment on the proposed substantial amendments to
the City's FY11/12 and FY14/15 Action Plans and to the FY 2013 through 2017 Consolidated
Plan prior to their implementation by formal action of the City Commission. The Substantial
Amendment is then transferred to HUD for final approval. The City issued a 30-day notice of
public comment welcoming public input to the proposed substantial amendments. The public
comment period was from April 1, 2016 through May 2, 2016. No comments were received.
ANALYSIS
The City Commission approved the FY 2011/2012 Action Plan for via Resolution No. 2011-
27694 adopted on July 13, 2011 and awarded $120,000 to the Office of Tourism, Culture and
Economic Development ("Office") to provide façade improvements funds to businesses in the
North Beach Area as a means of incentivizing economic development and revitalizing the area.
In addition, the City Commission approved the FY 2014/2015 Action Plan via Resolution No.
2014-28635 adopted on June 11, 2014 and awarded an additional $120,000 to the Office for the
same purpose.
The City Commission adopted Resolution No. 2014-28877 approving and authorizing the City
Manager to reallocate $73,577.24 of CDBG funds from FY 11/12. However, the funds were
reallocated from FY 14/15. The City Commission amended the previously approved reallocation
of $73,577.24 from FY 2011/2012 to FY 2014/2015 via Resolution No. 2016-29316 adopted on
March 9, 2016 to match the amendment reported to HUD and the allocation of funds between
City accounts.
In addition, and as a result of a programmatic monitoring visit, the Office of Housing and
Community Development, a Division of the Office of Housing and Community Services,
requested the repayment of $37,736 from the Office for assistance previously provided to the
following businesses:
Address CDBG Funds Invested
7309 Collins Avenue $ 7,882.00 _
7331 Collins Avenue $ 11,947.00
7440 Collins Avenue _ $ 17,907.00 -
TOTAL $ 37,736.00
City Commissioners Memorandum—CDBG FIP Funds Recapture
May 11,2016
(4 pages)
The repayment was required as these businesses were unable or unwilling to provide proof of
flood insurance coverage. Unfortunately, US Department of Housing and Community
Development (HUD) rules and regulations make flood insurance a mandatory requirement. The
repayment took place in January 2016 and is included in the $111,313.24 balance from
FY11/12 to be recaptured.
The intent of the North Beach Façade Improvements Program (FIP) was to incentivize
economic development in the North Beach area and provide assistance to low-and moderate-
income persons by providing an area benefit as a National Objective. FIP offered minor exterior
improvements including awnings replacement and/or installation, painting, window upgrades
and sign replacement to businesses located in the commercial district. However, FIP was
difficult to implement for the following reasons:
1. Building owners in this area normally do not carry flood insurance. Having paid the buildings
in full, they stopped carrying flood insurance due to its high cost. Although the small
business owners who lease the space would greatly benefit from FIP by making their
businesses more attractive to customers, there is no short term benefit for the building
owner who is leasing to them. Unfortunately, flood insurance is a mandatory requirement for
all CDBG-funded projects.
2. Although, the City requested HUD's authorization to increase the target area from 73rd to
75th Streets on Collins Avenue to include the entire District (from 63rd Street to 87th Terrace,
Atlantic Ocean to Biscayne Bay), only census tracts 39.11 and 39.09 qualify for CDBG fund
investments. However, those two tracts do not have a commercial district.
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2 Official Zoning Map of the City of Miami Beach http://miamibeachfl.gov/planning/scroll.asox?id=25704
City Commissioners Memorandum—CDBG FIP Funds Recapture
May 11,2016
(4 pages)
3. Staff requested HUD's guidance with regard to the interpretation of "Area Benefit" stating
that the businesses in the area will benefit from the investment of CDBG funds. However,
that question was posted a while ago and, to this date, staff has not received an
determination of HUD's "Area Benefit" interpretation.
For the reasons stated above, staff recommends the recapture of the funds previously allocated
to the Façade Improvement Program and proposes they be reallocated to the rehabilitation of
the Lottie Apartments located at 530 75 Street, a low-to moderate-income rental building owned
by the City and managed by the Office of Housing and Community Development. This funding
will help cover the cost of structural repairs needed to provide decent, safe and sanitary
affordable housing. This project was originally funded with CDBG funds in Fiscal Year
2015/2016. However, the amount allocated was deemed insufficient for the extent of repairs
identified.
CONCLUSION
The Administration recommends approval for the recapture of CDBG funds; amending the
Action Plans and Consolidated Plan and submitting them for approval as required by HUD;
reallocating the funds as noted; and subsequently executing the required agreement.
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