Downey council cancels four HUD subrecipient programs, redirects funds to housing rehab and approves amendments unanimously

Downey — The City Council on Tuesday approved substantial amendments to its federal HUD action plans that cancel four subrecipient programs and redirect the funding to the city’s housing rehabilitation program.

Homeless Solutions and Housing Manager Sergio Corrias told the council the amendments would cancel CDBG-funded Los Angeles Center for Alcohol and Drug Abuse behavioral-health programming and a veteran employment support program for FY 2024–25, and in FY 2025–26 would cancel an additional behavioral-health program and a HOME-funded tenant-based rental assistance program. “These subrecipients ultimately did not have the administrative capacity or operational infrastructure necessary to meet HUD compliance requirements,” Corrias said, and continued funding could expose the city to audit findings that jeopardize future federal allocations.

Corrias outlined that the city plans to reallocate approximately $45,000 from the identified public-service and HOME line items into the housing rehabilitation program, which provides repairs for low- and moderate-income homeowners (roofing, accessibility modifications, plumbing, electrical and structural work). Staff estimated the funding increase could shorten the program’s current waitlist of about three years by roughly six months under present capacity and staffing.

Public commenters raised oversight questions about long-term subrecipient relationships and whether previous compliance had been adequately checked. One commenter asked how LA CADA had met criteria historically if it now failed compliance checks; staff responded that La CADA had been funded for roughly 10 years while the VEST program had only one year of prior funding.

After questions from council members and public comment, Council moved and voted to approve staff recommendations to receive the publication, accept the public hearing record, and authorize city staff to submit the amendments and implement related agreements. The motion passed unanimously.

The amendments also authorize the city manager or designee to file the approved substantial amendments and execute any implementing agreements with HUD as required; staff said the reallocations preserve the city’s federal funding eligibility while targeting funds to a program with demonstrated demand.

The council’s action closes the public hearing and implements the staff plan to move remaining federal dollars to housing rehabilitation for the coming fiscal year.