Owensboro proposes Monarch NRSA and a draft CDBG/HOME plan to boost affordable housing and rehab projects

Abby Shelton, community development director for the City of Owensboro, told the Citizens Advisory Committee on March 4 that the city is advancing a draft five-year consolidated plan and a proposed Monarch Neighborhood Revitalization Strategy Area (NRSA) and will open a 30-day public comment period beginning March 4.

Shelton said the consolidated plan and the accompanying annual action plan are being prepared for submission to the U.S. Department of Housing and Urban Development (HUD) and that the Louisville HUD field office has instructed the city to continue operations “as normal.” She cautioned the committee that the city cannot submit the annual action plan until it receives its federal allocation and that budget figures in the draft will be adjusted when HUD announces final amounts.

The draft plan recommends designating the Monarch NRSA (the city presented proposed boundaries that run from the east side of Clay Street north to Ninth Street and to the river) and prioritizes a mix of exterior rehabilitation, targeted new construction and rental development intended to increase affordable housing and reduce cost burden for low- and moderate-income households.

According to material presented by Shelton and staff, Bowen National Research provided a market analysis used in the plan. The presentation summarized property and demographic findings for the proposed NRSA: roughly 2,000 residents in the area; about 60.34% of households are classified as low- to moderate-income (the NRSA requirement is at least 51%); a median household income of about $36,000; and a poverty rate of roughly 34.2%. A property review using PVA records showed an estimated 529 parcels in fair condition, 227 parcels in average condition and 51 parcels in very poor condition; the city reported that more than 72% of parcels need some level of rehabilitation.

Shelton gave the committee draft need estimates and proposed program targets drawn from the market analysis and engagement work: an estimated need for about 224 rental units for households earning less than 30% of area median income (AMI) and about 145 for-sale units targeted at buyers earning less than 50% of AMI. The presentation said 62% of renters in the area are cost-burdened (paying more than 30% of income for housing) and 47% are severely cost-burdened (paying over 50% of income for housing).

Draft budgets and program targets presented in the meeting materials (final allocations not yet available) included: - Community Development Block Grant (CDBG) draft: administration and program delivery over five years (administration budget shown about $550,000); exterior rehabilitation (53 projects, roughly $1,000,000 in the draft); a downspout removal partnership with the regional water authority; 22 commercial façade projects; and a total CDBG project count presented as about 166 projects with a draft federal investment subtotal shown around $2,700,000. Shelton said exterior rehab grants likely will not require a local match for the Monarch NRSA because of household income levels in the area. - HOME program draft: a CHDO (community housing development organization) 15% set-aside (presented at approximately $260,000) and home-ownership supports including down-payment assistance (about 30 projects budgeted at roughly $260,000 total); Shelton estimated roughly 34 HOME projects (city home builds, CHDO projects and down-payment assists) and a placeholder federal HOME subtotal near $1.5 million with private match estimates shown in the materials.

Shelton described proposed nonhousing initiatives and infrastructure work: downspout removal and smoke testing in partnership with the Regional Water Resource Agency (RWRA) to reduce combined-sewer flooding; investigation of lighting needs with Owensboro Municipal Utilities (OMU); targeted street and public-utility upgrades where septic tanks remain in pockets of the NRSA; and grants/technical support for small businesses and façade improvements to support a mixed-use, walkable environment.

Shelton said outcomes the city hopes to see from the NRSA work include increasing homeownership above 45% in the area, reducing housing cost burden, supporting small business and decreasing crime rates. She presented a projected PVA value increase for the area from about $71.0 million (2024 baseline in the packet) to a projected $74.1 million by the plan horizon (an increase the packet estimated at about $2.8 million); Shelton said the estimate does not include new tax-base impacts beyond current values.

Committee members asked several clarifying questions. Titus Willis, a committee member, asked why the plan’s market-study stakeholders cited a $150,000 price point; Shelton said experts initially identified that price as a local “sweet spot” but acknowledged the city also needs more units at lower price points and said a $120,000–$130,000 target may be more realistic for some products given current financing conditions. Willis also asked about developer grants; Shelton described the city’s existing community catalyst grant structure (rental rehab, single-family rehab, new-build, and demolition grants), matching formulas the city uses in past rounds, and that exact dollar amounts will be set when the city’s final allocations are known.

Daisy James, an attendee, asked about people sleeping on the street. Shelton said the city’s recent study estimated the number of shelter beds needed for unsheltered people was about 20 and that a larger population of “precariously housed” residents — people who are cost-burdened or at risk of homelessness — exceeds that count. Shelton said addressing street homelessness involves coordination with social-service agencies and public-safety contacts and that the city’s current approach focuses on creating more sustainable affordable housing opportunities and connecting residents to existing services.

Sean Smith, owner of Monarch Inc., a tattoo business in the proposed NRSA, spoke during public comment in support of revitalization and offered mural and public-art work to help neighborhood beautification. “I would love to decorate my hometown,” Smith said; he and his business partner, Ashley Monarch, said they would participate in neighborhood clean-ups and visual improvement projects.

Shelton closed the presentation by noting the immediate process steps and deadlines in the packet: the March 4 hearing (this meeting) opened a 30-day public comment period; a second public hearing of the Citizens Advisory Committee is scheduled for March 27; staff plan to present a municipal order for City Commission approval on April 15; and the city intends to submit the annual action plan to HUD after the commission approval and when allocations are available (Shelton called a May 2 submission date “ambitious” given pending federal developments).

Votes at a glance - Motion to approve minutes of the April 10, 2024 Citizens Advisory Committee meeting: motion made by Bruce Powell, seconded by Rafe Buckner; outcome: approved (voice vote; tally not specified in the meeting transcript). - Motion to adjourn: motion made by Bruce Powell, seconded by Bobby McCormick; outcome: approved (voice vote; tally not specified in the meeting transcript).

The city will accept written comments during the 30-day public comment period and Shelton said staff will collect input from local service providers and other stakeholders before finalizing the annual action plan and presenting it to the City Commission for consideration.