Staff warns city could forfeit HUD money unless Community Housing Development Organization formed

A city staff member briefed the workshop on federal grant rules and program caps tied to community development funds. The presenter said the city must set aside 15% of a $313,000 program allocation for a Community Housing Development Organization (CHDO) and that the CHDO requirement applies over a multi-year period.

The staff member said the program funds include a cap that allows up to 20% of the total to cover administrative costs, which can be used for salaries, office equipment, training, advertising and legal notices. She warned that if a CHDO is not formed the city could lose the 15% set-aside and that staff has a meeting planned to explore forming a CHDO.

The presenter said the funds are spread over a six-year period and cautioned that HUD could reclaim funds if deadlines are not met; staff noted an October deadline as a risk date for losing HUD money if required steps are not completed.

No formal action was taken during the workshop; staff framed the briefing as an operational and compliance update and said they would pursue next steps to convene stakeholders about CHDO formation.