ITEM #: 2.
DATE: 02/10/2025
AI #:2482
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CITY COUNCIL ACTION REPORT
| SUBJECT: |
FY2026 COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG)
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| STAFF PRESENTER(S): |
Christina Panaitescu, Community Partnerships Program Manager |
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| Summary |
| Council to receive a report on the Community Development Block Grant (CDBG) program and provide direction regarding eligible activities for the investment of FY2026 CDBG entitlement funds. (Christina Panaitescu, Community Partnerships Program Manager) |
| FISCAL IMPACT |
| The Annual Action Plan, to be submitted to the federal department of Housing and Urban Development (HUD) for acceptance, will define how Goodyear intends to invest its FY2026 CDBG entitlement funds. The anticipated expenses and offsetting revenue will be included in the FY2026 budget as appropriate. Future budget amendments may be necessary upon final approval from HUD. |
| BACKGROUND AND PREVIOUS ACTIONS |
In May 2021, the City submitted a five-year consolidated plan and first year action plan to HUD, establishing the priorities for investing CDBG entitlement funds from the federal government. Each May, the City is required to submit an annual action plan, specifying how it intends to allocate CDBG funds in the upcoming fiscal year.
Goodyear is entering its fifth year as an Entitlement Community.
In FY2022, the City leveraged CDBG funds to replace existing streetlights with improved LED fixtures and add bollard lighting along a neighborhood pathway to improve safety in North Subdivisions; in FY2023, the City utilized its CDBG funds to assist the local domestic violence shelter, New Life Center, with renovating their onsite child development center; in FY2024, the City's entitlement was applied to park improvements at Palmateer Park in the Historic Goodyear community; and, in the current fiscal year funds are being used to install up to 17 streetlights along Litchfield Road, in front of the Historic Goodyear neighborhood.
Projects (called activities) must benefit low-to-moderate-income (LMI) Goodyear households or neighborhoods, or serve specific populations who are presumed to be LMI, and must also fit in one of the following eligible priority areas which were prioritized in the consolidated plan: program administration, community facilities and improvements, and public services. Activities identified as low priority, attainable and sustainable housing or eligible economic development projects, are also eligible if an exceptional opportunity were to present itself.
To prepare for this work session, staff hosted a public meeting (12/03/24) and consulted city department directors, local broadband providers, and members of the Faith & Community Roundtable (11/12/24), seeking suggestions for eligible projects.
A variety of project suggestions emerged; however, most suggestions did not meet the national objective of serving low- and moderate income individuals, were too small to maximize the available resources, putting future entitlements at risk, or fell into the category of maintenance and would not be eligible. One viable and exciting opportunity to help meet an objective from phase I of the Community and Neighborhood Services Master Plan: childcare during non-traditional hours did emerge. |
| STAFF ANALYSIS |
Although specific award amounts have not yet been communicated by HUD, best practice dictates using the previous year's award for planning purposes. Goodyear's FY2024 entitlement was $397,718. As the actual allocation could be greater or less than the FY2024 entitlement, any activity selected should be able to accommodate a shortfall or be adapted to a surplus.
CDBG is a complex grant program and requires administration and oversight. Examples of administrative expenses include: those related to compliance with federal regulations, promoting the principles of fair housing, assessing neighborhood and housing conditions, and the need for human and public services, and establishing application and monitoring systems. Staff recommends we continue to reserve the full 20% allowable for administration, as we have done in the past.
Staff’s further recommendation is to allocate the balance (80% of the entitlement) as a pass-through to the YMCA as a subrecipient for construction and equipment to expand the Southwest Valley YMCA (SWV Y) early learning center program with up to 15% of the city’s total entitlement available for use on public services such as teacher salaries.
The SWV Y, located on Litchfield Rd & Thomas, in Goodyear, has been a community gathering place since 2004 and serves a unique cross-sector of families in the community. In 2019, the SWV Y created an early learning center using available spaces in the building, to meet a growing community need for quality and affordable childcare. Many of the children enrolled in the early learning and school-age childcare programs are foster children or attend using Arizona Department of Economic Security (DES) Childcare Reimbursement authorizations. As was identified in community assessments conducted by the City, the YMCA also recognizes the need to have an affordable childcare option for working families.
Currently, the early learning classrooms are located in large spaces original to the building that were retrofitted to serve as early learning classrooms. To be able to serve all ages (6 weeks – 5 years), they operate one infant room, a combination toddler room (1-2 years), and a combination preschool room (ages 3-5 years). The mixed-age group classrooms make it difficult to deliver age- and developmentally-appropriate instruction and care to each child. The proposed FY2026 CDBG project is to construct dedicated classrooms for each age group. In addition to providing high-quality spaces designed to meet the developmental and safety needs of young children, this activity will result in increased licensed capacity for the SWV Y’s early learning program, from 57 to 98 -- more than a 70% increase.
To further accommodate the expansion, additional teachers will need to be recruited and retained. This project presents an excellent opportunity to invest in an important resource for Goodyear’s working families and conforms with the city's guiding principals for economic vitality and a safe and vibrant community. A more detailed description of proposed activities may be found in the YMCA proposal included as Attachment A.
Pending Council direction this evening, the suggested activities will be part of the draft plan that will be available for public comment beginning March 10 and concluding April 10, with a public hearing on March 24, 2025.
The final plan will be brought to Council for authorization on May 5, 2025, in order to be prepared to meet HUD’s deadline.
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