On December 13, 2010, the City Council held a public hearing and approved grants totaling $300,000 to further a Business Consortium Project: $100,000 to The Salvation Army for equipment purchase to implement a social-enterprise business; and $200,000 to Rimrock Foundation to acquire and rehabilitate housing to serve the homeless (Council memo attached). Funding was awarded to the City via the U.S. Department of Housing and Urban Development (HUD) for an Economic Development Initiative (EDI).

On June 14, 2011, City staff became aware of issues regarding the final execution of The Salvation Army’s Subrecipient Agreement and began working with the involved organizations toward resolution. On June 28, 2011, the Community Development Division received an official letter from The Salvation Army (attached) explaining a delay encountered by the organization to process a necessary 501c3 sub-incorporation status change in order to accept the funding to purchase equipment to utilize the grant.

The Salvation Army is not able to accept the grant as approved by the City Council and recommends the $100,000 grant be transferred to Rimrock Foundation to purchase a bobcat and grinder to implement the project.

On July 18, 2011, the Community Development Division received a Letter of Agreement (attached) executed between The Salvation Army and Rimrock Foundation outlining the continued partnership as established in a submitted Request for Proposals response to implement the project in light of a proposed transfer of grant funds to Rimrock Foundation for equipment purchase.

The HUD EDI funding can only be used to acquire / rehabilitate housing units for the homeless and to purchase needed large equipment, specifically a bobcat and grinder, as proposed in the City’s grant application and executed grant agreements with HUD. Rimrock Foundation has purchased a housing unit as proposed.

1) Transfer award of $100,000 to Rimrock Foundation to purchase equipment to provide training and economic opportunities for the homeless. This transfer will not adversely affect the City’s grant agreement with HUD.

2) Not award funding to Rimrock Foundation and return the HUD Economic Development Initiative funding.

The City of Billings is not required to provide match funding for this project, but is required to implement the project as proposed to HUD.

Staff recommends the City Council approve a grant award of $100,000 to Rimrock Foundation for equipment purchase to support the Bokashi Composting Processing Center at The Salvation Army.