PURPOSE

This resolution requests the City Council to approve capital project uses funded with CDBG and include them in the FY 2005-06 Annual Plan and Final Statement of Community Development Objectives and Projected Use of Funds.

BACKGROUND

Burbank submits an Annual Plan and applications for federal funds, including CDBG, pursuant to regulations dated January 5, 1995, covering 24 Code of Federal Regulations Part 91, Consolidated Submissions for Community Planning and Development Programs.  Both the Annual Plan and the Final Statement describe activities/projects planned to accomplish goals and objectives stated in the Consolidated Plan (FY 2003-08).  Activities eligible under the CDBG program must principally benefit persons of low and moderate income, aid in the prevention or elimination of slums and blight, or address community development needs having a particular urgency.  For Burbank, CDBG funds are used for capital improvement projects, public services and program administration.

The Annual Plan and Final Statement of Community Development Objectives and Projected Use of Funds are scheduled for formal submission in May 2005.  Capital project requests are accepted earlier for City approval to allow sufficient lead time to complete pre-development tasks such as project design, preparation of specifications and bid scheduling.  This advanced implementation process permits projects to go forward immediately when federal applications are approved and funds are budgeted by the U.S. Department of Housing & Urban Development (HUD).

ANALYSIS

Burbank�s CDBG entitlement allocation for FY 2005-06 is $1,350,501.  When the Annual Plan and Final Statement are approved in April 2005, capital project approvals will coincide with the amount stated below ($1,176,498).  At that time, appropriations for program administration and public services will be approved at the statutory limits of 20 percent and 15 percent, respectively.

FY 2005 CDBG FUND RESOURCES

FY 2005 CDBG FUNDS By CATEGORY

Capital project fund availability and a request for proposals was advertised and noticed to departments/agencies on September 15 and 18, 2004, with proposals accepted until October 15, 2004.  Five City departments/organizations submitted 11 projects totaling $1.87 million in requests, creating a gap of $694,852 compared with available funding (Exhibit A).  For specific proposals, additional information is provided as follows:

Code Enforcement:  In the past year, City staff surveyed 12 cities with CDBG entitlement dollars similar to the City of Burbank to determine if and how they fund code enforcement activities (Exhibit B).  Of the 10 cities that responded to the survey, seven conduct their code enforcement programs the same as Burbank.

Secondly, during HUD�s audit of the CDBG program in August 2004, the auditor commented that the City operates its code enforcement program exactly as HUD wants it.  Therefore, in terms of program use and eligibility, Burbank conforms to cities with similar entitlements and is within HUD/CDBG eligibility guidelines.  Additionally, as shown in Exhibit B, the Code Enforcement program not only serves CDBG eligible areas but also overlaps Redevelopment Project areas and helps support the efforts of other City departments and projects.

To have the majority of staff share the responsibility for CDBG areas, License & Code Services proposes to increase the number of staff partially CDBG funded (2.75 to 8.5 staff) but not proportionately increase the amount requested.  This shift is expected to enhance the effectiveness of code enforcement as all inspection staff will be able to respond to issues in these specific areas.

Public Works: The Department�s primary request for 2005 includes reconstruction of Olive Avenue from Third Street to Sixth Street.  Part of their 2004 proposal, approved for $255,108 in CDBG funds, entailed the reconstruction of Olive Avenue from Third Street to Glenoaks Boulevard.  To clarify, Public Works recently completed the 2003 CDBG project to improve Olive Avenue (Olive Bridge to Third Street) at a cost savings of approximately $133,000.  The Department now proposes to combine these funds with the 2004 funds ($255,108), but change the project to reconstructing Third Street between Olive Avenue and Verdugo.  Public Works estimates the Third Street reconstruction at $620,000, leaving a gap of approximately $232,000 that may be met with prior year funds if the project change is approved.  This proposed change requires the City to publicly notice an amendment (Exhibit C) to its Consolidated Plan and present it during City Council deliberations this year.

Burbank School District (Washington Elementary School): The School District has CDBG funds remaining from previous years and has requested that Washington school funds for fiscal 2002 ($111,616) and 2003 ($100,000) be combined ($211,616) to provide for the 2002 window installation project while foregoing the 2003 playground project.  Additionally, the District proposes holding the savings ($43,306) from the recently completed grass playground project at Disney Elementary to provide for contingencies on the window project.  Currently this project is in the design/specification and planning stage.  Fiscal 2004 projects for school lighting, public address system, fencing and security gate would only be undertaken if funds are left-over.

Burbank School District (Disney Elementary School): Of the 2003 appropriation ($125,000) originally approved, $43,306 is left as explained above.  For projects approved for 2004, the $50,000 approved will be earmarked for the lighting and public address system.  If approved, proposed changes in applicable School District projects (Exhibit C) will be publicly noticed as an amendment to the Consolidated Plan.

In consideration of the proposed changes and the time/planning required to complete the projects, the School District has withdrawn its 2005 capital project proposals.

Burbank Temporary Aid Center (BTAC): Phase II funding is requested at $459,900 with total project costs now estimated at $1,149,428, of which CDBG�s total share is $1,034,900, with the balance ($114,528) provided by BTAC.  The increased costs are attributed to higher costs for materials and labor.  Phase I approved last year ($575,000) entails demolishing the existing rear structure and constructing a new 2-story addition, with the core elements (certificate of occupancy) completed by July-August 2005.  BTAC received bids on December 14, 2004 ranging from $1.1 to $1.3 million that include both phases of the project.  These bids are currently under review.

Build Rehabilitation Industries: Build�s 2003 CDBG project ($31,000) to convert two bathrooms in compliance with Americans with Disabilities Act (ADA) provisions generated only one bid which was over-budget.  Build now plans to combine the bathroom project with the projects approved for 2004 ($60,000) and be done by July 2005.  The completion of these projects will clear the way for newly planned training rooms, which is entailed in Build�s proposal for 2005.   

The Community Development Goals Committee met on November 18, 2004, to review proposals and make recommendations.  The Committee�s rationale for project approvals is predicated on creating a direct/visual impact, benefiting the appropriate citizenry, or providing funds where resources are limited or non-existent.

Consistent with this methodology and in keeping with the Committee�s traditional view to not fund City staff costs with CDBG funding is a zero recommendation for License & Code Services Code Enforcement program.  The Committee recommends partial funding for Public Works projects to be utilized by the Department on priority projects at their discretion.

[Note: The original Committee recommendation for Public Works was

$618,573 based on estimated CDBG funds totaling $1,216,473 and $578,598

prior to the withdrawal of School District projects originally recommended

at $60,000]

Executive Staff met on December 8, 2004 to review proposals and finalize their recommendation listed below.  Compared with the Goals Committee, the difference is in its recommendation for Code Enforcement ($133,450), where staff feels this service maintains the viability and integrity of neighborhoods in CDBG areas, and cannot be presently funded with other resources.  To fund the Code Enforcement program, Public Works is recommended at $505,148, which is to be used at the discretion of the Department.

[Note: The original Executive Staff recommendation for Public Works was

$545,123 based on estimated CDBG funds totaling $1,216,473]

All projects as recommended by the Community Development Goals Committee and the Executive Staff are reflected on Exhibit A, CDBG Capital Projects (Fiscal Year 2005-06).

FISCAL IMPACT

CDBG funds total $1.8 million and compared with 2004, this year�s funding is $140,164 higher (8%) due to an increase in Program Income.  Capital project requests for 2005 total $1,871,350 resulting in a gap of $694,852, and a capital project funding recommendation of $1,176,498.

RECOMMENDATION

Staff recommends that the City Council adopt the proposed resolution.

Enclosures:

▪ Exhibit A � CDBG Capital Projects (FY 2005-06)

▪ Exhibit B � Code Enforcement Survey (2004)

▪ Exhibit C � CDBG Proposed Amendment to Final Statement

▪ Exhibit D - Public Works Department Memorandum (November 12, 2004)

▪ Exhibit E - Burbank Unified School District Letter (November 16, 2004)

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