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Council reallocates CDBG and HOME funds to meet HUD timeliness and fund demolition for proposed Habitat project
Summary
Council approved reprogramming $749,254 in CDBG funds and $340,000 in HOME funds to avoid HUD timeliness sanctions, including $225,000 proposed for demolition of a PHA property intended for a 14‑unit Habitat for Humanity for‑sale project. Residents urged more transparency and asked that some funds be retained for small businesses and park projects.
City staff told the council the city faces a HUD timeliness test that requires jurisdictions to spend down CDBG balances to avoid heightened oversight or loss of future funding.
"Our current balance is $2.8 million; we are exceeding the 1.5 [times allocation] and we need to spend a little over a million dollars very quickly in order to meet this particular goal," consultant Anna Lenu said, explaining the IDIS timeliness rule and the risk of a HUD workout plan if the city remains over the cap.
To comply, staff proposed a package of reprogramming across several fiscal years that would reallocate $749,254 in Community Development Block Grant funds and $340,000 in HOME Investment…
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