STRATEGIC PRIORITY: Government Performance & Financial Management
AGENDA DATE: February 26, 2025
COUNCIL DISTRICT(S): N/A
DEPARTMENT: Budget and Management Services
EXECUTIVE: Jack Ireland
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SUBJECT
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(1) A public hearing to receive comments on the adoption of Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan to use unspent Community Development Block Grant (CDBG) in the amount of $1,335,555.00 on repairs and renovations at public facilities; and (2) at the close of the public hearing, authorize final adoption of Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan - Financing: This action has no cost consideration to the City (see Fiscal Information)
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BACKGROUND
On August 18, 1993, the City Council authorized establishing specific timeframes for the obligation and expenditure of Community Development Block Grant (CDBG) Funds. Funds are to be obligated within 12 months and expended within 24 months of budget adoption by Resolution No. 93-3001.
On March 28, 2007, the City Council authorized to enhance the City’s existing expenditure policy with additional benchmarks by Resolution No. 07-0992. Additional time to obligate and expend funds may be granted by City Council.
Timely expenditure of CDBG Funds by entitlement cities continues to be a primary concern of the U.S. Department of Housing and Urban Development (HUD). HUD requires that cities expend CDBG Funds so that, at least 60 days prior to the start of a new program year, the unexpended balance of CDBG Funds should be less than 1.5 times the cities’ CDBG allocation amount for the current year.
For fiscal year (FY) 2024-25, a review of the projects based on the timely expenditure policy (including the benchmarks), identified unspent CDBG Funds remaining in 13 projects recommended for extension for a total of $3,634,013 and unspent funds remaining in 10 projects recommended for reprogramming for a total of $1,335,555.
The City Council has authority to extend the use of funds and allow additional time for projects that are not in compliance with the City’s expenditure policy.
On December 16, 2024, the Community Development Commission (CDC) Financial Monitoring/Performance Standards Committee met to review and made recommendations to the City Manager’s proposed extensions and reprogramming of CDBG Funds. Following discussions with staff, no amendments were recommended. The CDC Financial Monitoring/Performance Standards Committee voted to recommend approval to the full CDC.
On January 13, 2025, upon recommendation by the CDC Financial Monitoring/ Performance Standards Committee, the CDC reviewed and approved the proposed extensions and reprogramming of CDBG Funds.
On January 22, 2025, the City Council authorized (1) an extension through September 30, 2025 for Community Development Block Grant (CDBG) Funds in the amount of $3,634,013 in the CDBG funded projects that have not met the City’s twelve-month obligation or twenty-four-month expenditure requirement; (2) preliminary adoption of Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan to use unspent prior year CDBG Funds in the amount of $1,335,555 for one-time use for repairs and renovations at public facilities; and (3) a public hearing to be held on February 26, 2025, to receive comments on the proposed use of funds for Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan, by Resolution No. 25-0184.
On January 28, 2025, the Government Performance and Financial Management Committee (GPFM) was briefed by memorandum on the need to maintain ongoing compliance with HUD’s timely expenditure policy and the FY 2024-25 CDBG extensions and reprogramming recommendations.
Approval of the CDBG Extensions, Preliminary adoption of the Reprogramming Budget and calling a public hearing on February 26, 2025, was approved by the City Council on January 22, 2025. Sufficient time is available to inform City Council and incorporate CDC feedback prior to final adoption scheduled for City Council consideration on February 26, 2025.
A summary of the proposed Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan will be published in the Dallas Morning News on or about February 9, 2025 to provide an opportunity to submit written comments through February 26, 2025.
Federal regulations require that a public hearing be held on proposed Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan. Holding a public hearing on February 26, 2025, it will satisfy the requirements set forth in HUD regulations and the City’s Citizen Participation Plan.
This action authorizes the final adoption of proposed Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On August 18, 1993, the City Council authorized establishing specific timeframes for the obligation and expenditure of CDBG Funds by Resolution No. 93-3001.
On March 28, 2007, the City Council authorized enhancing the City’s existing expenditure policy with additional benchmarks by Resolution No. 07-0992.
On January 13, 2025, the Community Development Commission recommended extending and reprogramming CDBG project funds.
The City Council was briefed by memorandum on the need to maintain ongoing compliance with HUDs timely expenditure policy and the FY 2024-25 CDBG extensions and reprogramming recommendations on January 17, 2025. <https://dallascityhall.com/government/citymanager/Documents/FY24-25%20Memos/January%2022,%202025%20Upcoming%20Agenda%20Item%2025-171A.pdf>
On January 22, 2025, the City Council authorized a one-year extension for the period of September 30, 2024 through September 30, 2025 for Community Development Block Grant (CDBG) Funds in the amount of $3,634,013 in CDBG funded projects that have not met the City’s twelve-month obligation or twenty-four-month expenditure requirement; preliminary adoption of Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan to use unspent CDBG Funds in the amount of $1,335,555 for one time use of repairs and/or renovations for public facilities; and a public hearing to receive comments on the proposed use of funds, by Resolution No. 25-0184.
On January 28, 2025, the Government Performance and Financial Management Committee was briefed by memorandum Information was provided to the Government Performance and Financial Management Committee on the need to maintain ongoing compliance with HUD’s timely expenditure policy and the proposed Reprogramming Budget No. 1 (Substantial Amendment No. 1) to the FY 2024-25 Action Plan. CDBG extensions and reprogramming recommendations on January 28, 2025.
FISCAL INFORMATION
This action has no cost consideration to the City.
CDBG - Source of Funds:
Reprogramming Budget No. 1 (Substantial Amendment No. 1)
• Unspent Prior Year CDBG Funds - $1,335,555.00
CDBG - Use of Funds:
• Public facilities repair and/or renovations - $1,335,555.00