Lorain staff outline CDBG/HOME reallocations and plan to apply for $6.3M Section 108 loan

City of Lorain planning staff on Thursday held a public hearing to present a proposed substantial amendment to the city’s consolidated plan that would reallocate previously budgeted but unspent Community Development Block Grant (CDBG) and HOME funds and to discuss an application for a U.S. Department of Housing and Urban Development (HUD) Section 108 loan.

“My name is Matt Kuzner. I’m the director of building, housing, and planning for the City of Lorain,” Kuzner said, opening the hearing and explaining that the amendment is required under HUD rules whenever the city reassigns more than 10% of funds or changes a project’s purpose. He said staff has identified $135,049.89 in balances to reallocate and that detailed packets are available at the front of the room.

The staff presentation listed specific reallocations and larger capital set‑asides. Kuzner said the plan would allocate funds including a line for Longfellow Skatepark (listed in the transcript as $53,530 and an additional unclear $362 figure), $10,000 for a fair housing program to cover administration and complaint processing, and $70,000 for the public service program, with staff expressing interest in funding an Urban League youth-violence-intervention program. Larger capital and housing items described in the hearing included $1.2 million for infill new construction (with Habitat for Humanity named as a subrecipient in the transcript), unspecified funds for rental new construction, $1,000,000 for development at the Stoberg site, $580,000 for homeowner-occupied rehabilitation (the transcript references assistance up to $75,000 per household), and $75,000 for a down-payment assistance program planned to launch late this year or early next.

An unidentified staff member summarized the approach as a two-step process: reconcile past allocations with the amounts actually received from HUD (including program income such as loan repayments), then reallocate remaining balances to programs staff considers higher priority now. The staff presentation said the amendment is intended to “clean up” allocations dating back to 2016 when award amounts and program income did not match budgets.

Kuzner also described the Section 108 loan program and the city’s application status. He said entitlement communities may borrow up to five times their annual CDBG allocation and stated that Lorain is eligible to borrow up to $6,300,000; staff has completed a Section 108 application and plans to submit it to HUD when offices reopen. “One thing I should note and the most important thing about the 108 program is that this is not a grant,” Kuzner said. “These funds have to be repaid back to HUD at the treasury rate,” which he identified in the hearing as about 4.9% at the time of application.

When an attendee asked how soon such a loan would need to be repaid, Kuzner replied that project-level Section 108 loans are typically structured for 20 years. Kuzner said the city would prioritize economic development lending, job creation/retention activities and public facility improvements if the Section 108 loan is approved.

The hearing was a presentation and solicitation of public feedback; staff did not take formal action or a vote during the session. Kuzner closed by thanking attendees and announcing a council committee meeting at 5:30 p.m. on the Welcome Ohio program.

What the record does and does not show: the transcript provides detailed dollar figures for several line items but includes some unclear figures (for example, an apparent additional $362 next to the Longfellow Skatepark line) and one reference that the city “does not have an active recognized CHDO” in the jurisdiction as stated in the record. Where the transcript is ambiguous, the article notes the ambiguity rather than asserting corrected numeric values or unrecorded approvals.