HomeMy WebLinkAboutMINUTES - 12141993 - FC.4 Contra
Costa
TO: BOARD OF SUPERVISORS
County
11 c ung J
FROM: Finance Committee
DATE: December 14, 1993
SUBJECT: Use of Community Development Block Grant (CDBG) Funds for Economic
Development
SPECIFIC REQUEST(S) OR RECOMMENDATIONS) & BACKGROUND AND JUSTIFICATION
RECOMMENDATIONS
ACCEPT report from the Deputy Director - Redevelopment regarding the
use of Community Development Block Grant funds for Economic
Development.
FISCAL IMPACT
None.
BACKGROUND/REASONS FOR RECOMMENDATIONS
The Board of Supervisors' September 30, 1993 Economic Summit resulted
in Board members desiring to have additional insight into the possible
uses of CDBG funds for economic development. The attached report
responds to. this.
CONTINUED ON ATTACHMENT: YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
APPROVE OTHER
SIGNATURE(S) :
ACTION OF BOARD ON / / 9 3 APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A
UNANIMOUS (ABSENT TRUE AND CORRECT COPY OF AN
AYES: NOES: ACTION TAKEN AND ENTERED ON THE
ABSENT:—* ABSTAIN: MINUTES OF .THE BOARD OF
SUPERVISORS ON THE DATE SHOWN.
Jim Kennedy
646-4076
cc: Community Development
County Administrator ATTESTED
County Counsel PHIL BATCHELOR, CLERK OF
GMEDA THE BOARD OF SUPERVISORS
Redevelopment AND COUNTY ADMINISTRATOR
JK:Ih BY , DEPUTY
sra l l/c ftec.bos
CONTRA COSTA COUNTY
COMMUNITY DEVELOPMENT DEPARTMENT
DATE: December 13, 1993
TO: Finance Committee
FROM: Jim K
De ity Dire edevelopment
11
SUBJECT: Th se of Community Development Block Grant Funds for Economic
evelopment
This memorandum serves two purposes:
1. Provides information regarding the eligible uses of Community Development Block Grant
(CDBG) funds for economic development activities;
2. Describes limitations on funding certain types of economic development activities because
of a federal regulatory limit of using 20% of the grant for "Administration"; and
I. Eligible Economic Development Activities
CDBG funds may be used to fund two distinct types of activities related to economic
development:
A. Special Economic Development Activities
Eligible Activities: financial assistance (grants, loans, loan guarantees, technical
assistance) for commercial or industrial improvements including acquisition,
construction, renovation of structures, other real property, and infrastructure';
Examples: construction of a business incumbator; loans to improve/expand a
factory or business district; technical assistance to a business facing bankruptcy.
Eligible Recipients: public, non-profit, or for-profit entities'.
' Neighborhood revitalization, or community economic development strategies have
additional flexibility in terms of eligible uses.
' Assistance to for-profit entities is subject to a "necessary or appropriate" determination to
ensure assistance is not excessive.
B. Planning and Capacity Building
Eligible Activities: Studies, analyses, community development plans, CIP's, and
functional plans (housing, economic development) designed to improve capacity
to plan and manage program activities. Implementing the plans are not eligible
(e.g., developing a County economic development strategy is eligible while
printing/distributing promotional brochures of the county would not be eligible).
Examples: economic development strategy; small area revitalization plans.
II. Relationship to "Administration Cap"
The CDBG program is subject to a cap on "planning and administrative costs." No more
than 20% of the annual CDBG grant, plus program income, can be used for "planning
and administrative costs." Such costs are defined to include general program
administration, planning-and capacity building activities (such as the development of an
economic development strategy - paragraph B above), and fair housing activities.
Funding such a capacity building activity is proposed in Section III.
In 1993-94 the County funded approximately $500,000 in activities that were "planning
and administrative" in nature. The 1994-95 estimated annual grant plus program income
of $3.3-3.5 million would provide approximately $660,000-700,000 in capacity to fund
such activities, well above the current levels.
Mjblfmance.mem