BILL ANALYSIS Ó
AB 325
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Date of Hearing: May 13, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
325 (Wood) - As Amended April 16, 2015
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|Policy |Housing and Community |Vote:|6 - 0 |
|Committee: |Development | | |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill makes specified changes to the Community Development
Block Grant (CDBG) Program application process. Specifically,
this bill:
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1)Provides that, no later than 60 days after the Department of
Housing and Community Development (HCD) notifies an applicant
that their CDBG application has been approved, HCD must enter
into a grant agreement with the applicant.
2)Requires HCD, when it enters into a grant agreement with an
applicant, to provide the applicant with a complete and final
list of all of the activities the applicant must complete in
order to receive a disbursement of funds pursuant to the
agreement.
3)Requires HCD to do either of the following, no later than 30
days after it receives a request for the disbursement of funds
from a grantee:
a) Notify the grantee that HCD has approved
disbursement of the funds.
b) Provide the applicant with a complete and final list
of all of the remaining activities the applicant must
complete in order for HCD to approve disbursement of the
funds.
FISCAL EFFECT:
On-going costs to HCD of up to $176,000 (GF) for up to one
position to provide additional information to grant applicants.
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HCD administers approximately 200 CDGB contracts each year. Each
contract can have eight or more activities, and each activity
can have several individual disbursements.
COMMENTS:
1)Purpose. The author contends that certain CDBG grantees are
facing obstacles when applying for fund disbursements with
HCD, leading to confusion about what steps need to be taken in
order for the application to be acceptable. According to the
author, "the small cities and counties that stand to gain the
most from this program do not have the expertise or the
resources to navigate this unnecessarily complicated and drawn
out process. In order to make the program more accessible to
some of our most underserved constituencies, we need to
approve these efficiencies."
2)Background. The CDBG program was established by the United
States Housing & Community Development Act of 1974 (HCD Act)
and is administered at the federal level by the U.S.
Department of Housing and Urban Development (HUD). The
primary federal objective of the CDBG program is to develop
viable urban communities by providing decent housing and a
suitable living environment and by expanding economic
opportunities, principally for persons of low and
moderate-income.
Since 1983, HCD has administered the state CDBG program in
California. Under the state CDBG Program, the state award
grants to smaller cities and counties to develop and preserve
decent affordable housing, to provide services to the most
vulnerable in our communities, and to create and retain jobs.
Annually, each state develops funding priorities and criteria
for selecting projects. Eligible applicants include counties
with fewer than 200,000 residents in unincorporated areas and
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cities with fewer than 50,000 residents that do not
participate in the HUD CDBG entitlement program. These are
known as "non-entitlement" areas.
Each year, generally in January, HCD releases one combined
Notice of Funding Availability (NOFA) encompassing all
CDBG-eligible activities, including Community Development,
Economic Development, and the Native American and Colonia
Set-Asides. The most recent NOFA was issued in January 2015,
and announced the availability of almost $25 million in
state-administered federal CDBG funds.
3)Prior Legislation.
a) AB 232 (V. Manuel Pérez), Chapter 386, Statutes of 2012,
regarding the economic development portion of the CDBG
Program, eliminated the dollar-per-job test and the
requirement that benefit to low- and moderate-income
persons be a scoring factor in ranking applications.
b) AB 2188 (Arambula), Chapter 95, Statutes of 2008,
deleted the sunset on provisions allowing HCD to annually
establish the maximum grant amounts under the General
Program and Economic Development Allocations of the CDBG
program and to determine the amount of funding that will be
set aside for technical assistance and planning grants.
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081
AB 325
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