On March 27, 2020, the U.S. President signed into law the Coronavirus Aid, Relief and Economic Security (CARES) Act, which made available a total of $5 billion in Community Development Block Grant (CDBG-CV) funds. A portion of these relief funds were allocated to HUD entitlement cities over the course of three “rounds”. As a result, a supplemental third-round allocation of $1,612,275 in CDBG-CV3 funds to assist low/moderate-income Garden Grove residents affected by COVID-19 were allocated to the City. The Substantial Amendment No. 5 to the FY 2019-20 AAP is required to program the $1,612,275 in CDBG-CV3 funds.

On March 26, 2019, the City Council approved the FY 2019-2020 Annual Action Plan, which included the use of $1.7M in CDBG Entitlement (CDBG-EN) funds toward Public Improvements. One of the projects, Beach/Trask Sewer Improvements, was completed under budget, thus approximately $400,000 in prior-year CDBG-EN funds may be reallocated to provide services to the homeless and those at risk of becoming homeless.

On August 11, 2020, the City Council approved Substantial Amendment #4 to the FY 2019-20 AAP, which included the appropriation of $3,635,163 in ESG-CV2 funds for homeless services. Per HUD regulations, 10% of the total grant amount ($363,515) was allocated for Administration of the ESG Program. Upon further review, staff has determined that $50,000 in ESG-CV2 funds are necessary to administer the ESG Program, and that $313,515 in ESG-CV2 funds may be reallocated to provide services to the homeless and those at risk of becoming homeless. Additionally, the original appropriation of ESG-CV2 funds by Council left $100,000 unallocated in anticipation of funding a future activity, which has yet to come to fruition. Combined, this total of $413,515 in ESG-CV2 funds may be allocated to provide services to the homeless and those at risk of becoming homeless.

California Health and Safety Code 34176.1(a)(2) states the Housing Authority as Housing Successor may expend up to $250,000 per year from the Low/Moderate-Income Housing Asset Fund (LMIHAF) on homeless services. Currently, the Housing Authority has approved the use of $100,000 per year to provide the services needed to administer the Homeless Emergency Assistance Rental Transition (HEART) Program, which leaves an additional $150,000 per year in LMIHAF funds available to be allocated to provide services to the homeless and those at risk of becoming homeless.

At the January 26, 2021 Council meeting, staff presented the Draft Comprehensive Strategic Plan to Address Homelessness (CSPAH) in which a framework of goals and strategic actions were identified to address homelessness in Garden Grove.  Concurrently with the community engagement process to share homeless resource information and the Draft CSPAH that is now underway, staff is further recommending allocation of certain resources towards additional homeless services.  The funds described above, and detailed below, are eligible to be programmed for the provision of services to the homeless and those at risk of becoming homeless.

Addressing the needs of the homeless and those at-risk of becoming homeless has been identified as a Priority Goal in both the previous (2015-2020) and current (2020-2025) 5-Year Consolidated Plans for the use of HUD funds. Allocation of the funding described above takes into consideration data collected by 211 Orange County (211-OC), as well as the need to expand homeless resources and services to Garden Grove’s diverse population. During 2020, 211-OC data indicates a 48.9% increase in calls for service received from Garden Grove residents, with the greatest needs being identified as housing, food, and shelter services.

As uncertainty of the short and long term impacts of COVID-19 continue, staff will be exploring opportunities to expand homeless services in the areas of:

1.   Deployment of a Mobile Mental Health Services Unit;

2.   Evaluation of homeless shelter bed resources;

3.   Creation of Crisis Stabilization Units; and,

4.   Partnerships for Workforce Development and Training.

As recommendations for selection of a Subrecipient(s) to provide additional homeless services are made, the funding agreement(s) will be agendized at a future meeting for Council consideration.

There is no impact to the General Fund.  The additional appropriations will be funded by CARES Act and prior year entitlement funding, which are one-time distributions of funds.

It is recommended that the City Council:

•  Conduct a Public Hearing to receive comments regarding Substantial Amendment #5 to the Fiscal Year 2019-20 AAP;

•  Appropriate $1,612,275 in CDBG-CV3 funds (Fund 225) for homeless services.  Any unused appropriation will be carried over to Fiscal Year 2021-22 up to the timeline for use established by the CARES Act to be used for the same programs;

• Appropriate $400,000 in CDBG-EN (Fund 225) for homeless services.  Any unused appropriation will be carried over to Fiscal Year 2021-22 up to the timeline for use established by HUD to be used for the same programs;

• Reallocate $413,515 in ESG-CV2 (Fund 227) for homeless services.  Any unused appropriation will be carried over to FY 2021-22 up to the timeline for use established by the CARES Act to be used for the same programs;

•  Direct staff to submit Substantial Amendment #5 to HUD; and

• Authorize the City Manager to execute agreements, and make modifications as appropriate thereto, on behalf of the City.

It is recommended that the Housing Authority:

•  Appropriate $150,000 in LMIHAF (Fund 501) for homeless services.  Any unused appropriation will be carried over to FY 2021-22 to be used for the same programs.