City presents CAPER to commission, details spending, programs and federal compliance challenges

Neighborhood Services staff presented the city’s FY25 Consolidated Annual Performance and Evaluation Report (CAPER) to the Housing and Community Development Commission on Sept. 15, outlining how Community Development Block Grant (CDBG) and HOME funds were used, program outcomes and regulatory challenges in administering federal funds. The commission recommended that staff submit the CAPER to the U.S. Department of Housing and Urban Development.

“This is an annual report that we do for the Department of Housing and Urban Development,” said Bree, a Neighborhood Services staff member, describing the CAPER as a prescribed, structured HUD report used to record completed activities and measure progress toward the city’s five-year goals.

Staff summarized FY25 outcomes and ongoing activities. Reported FY25 accomplishments included 13 households assisted with down payment assistance, two rental units rehabilitated (completed projects), 10 intersections with curb ramps constructed in partnership with engineering and parks, and public service assistance reaching more than 3,000 individuals through funded agencies. The city said shelter facility improvements expanded survivor shelter beds from 35 to 70 by layering CDBG with Home ARP funds. Staff also reported that to date the down payment assistance program has deployed about $580,000 to help roughly 25 households with homeownership since the program began in 2022.

Staff described new and ongoing programs funded or supported by federal dollars: a down payment assistance program that offers roughly $25,000 loans forgiven after a typical 10-year compliance period; a tenant-based rental assistance (TBRA) initiative funded with HOME dollars to shorten the Iowa City Housing Authority voucher waitlist (TBRA funds are intended to serve up to two years per household); and a security deposit and rent assistance program for elderly and disabled households under 30% area median income (eight households assisted so far). Staff said HOME-ARP funds (a one-time federal allocation to address homelessness) of about $1.8 million are committed and were used, in part, to support shelter improvements.

Staff highlighted compliance and administrative challenges tied to changing federal rules. They noted a new HOME rule issued in 2025 and limited HUD guidance, delayed implementation questions around the 2016 HOTMA income verification rule, and the cost and bidding impacts of Davis-Bacon prevailing-wage reporting (which triggers for public facility projects above certain amounts). Bree said the city met HUD’s timeliness test in May — a required spending threshold HUD uses to evaluate entitlement grantees — and described timeliness as important to avoid reductions in future entitlements.

Commissioners asked for clarification on CAPER tables that report contractor demographics, contract locality and multi-year goals. Staff explained some tables reflect only completed activities in FY25 and do not show projects still underway (for example, TBRA activity will appear in a future CAPER when the activity is completed). Staff also said the federal CAPER format can be confusing and that the department supplements the federally required tables with appendices and a more user-friendly annual department report for public communication.

The commission opened a public comment period on the CAPER from Sept. 4 through Sept. 20 and held a motion recommending staff transmit the CAPER to HUD; the motion passed by voice vote with no recorded opposition. Staff noted the CAPER is submitted directly to HUD and does not require City Council approval.

Staff identified next steps: continue administering programs (down payment assistance, homeowner rehab, TBRA, security deposit/rent assistance), monitor HUD guidance on new rules, and incorporate public comments received by Sept. 20 before final submission to HUD.