To: Board of Supervisors
From: John Kopchik, Director, Conservation and Development
Report Title: Allocation of FY 2025/26 CDBG, HOME, and ESG Funds, and Approval of FY 2025-2030 Consolidated Plan and FY 2025/26 Action Plan
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
1. APPROVE and ADOPT the draft FY 2025-2030 Consolidated Plan (Attachment A); and
2. APPROVE and ADOPT the draft FY 2025/26 Annual Action Plan (Attachment B); and
3. APPROVE the Family and Human Services Committee recommendations for the allocation of $856,500 in FY 2025/26 Community Development Block Grant (CDBG) funds in the Public Services (PS) category (Attachment C) and $405,597 Emergency Solutions Grant (ESG) funds (Attachment F); and
4. APPROVE the Finance Committee recommendations for the allocation of $421,500 in FY 2025/26 CDBG funds in the Economic Development (ED) category (Attachment D) and the allocation of $35,000 in the Infrastructure/Public Facilities (IPF) category (Attachment E); and
5. APPROVE staff’s recommendations for the allocation of $3,576,000 in CDBG funds in the Housing category and $3,456,343 in HOME Investment Partnerships Program (HOME) funds (Attachment I); and
6. APPROVE recapture of HOME Investment Partnership Program-American Rescue (HOME-ARP) funding recommendations of $2,550,000 made to the Bella Vista Apartments project in Bay Point, developed by Alliant Strategic Development and APPROVE reallocation of HOME-ARP funds of $2,550,000 to Riveter-Supportive Housing project in Richmond; and
7. DIRECT the Department of Conservation and Development (DCD) Director to file a Notice of Exemption for the FY 2025/26 Action Plan and the FY 2025-2030 Consolidated Plan with the County Clerk; and
8. AUTHORIZE the DCD Director, or designee, to execute the program certifications applications (SF-424’s) for transmittal to the U.S. Department of Housing and Urban Development (HUD); and
9. AUTHORIZE the DCD Director, or designee, to execute CDBG and ESG program agreements in the FY 2025/26 Annual Action Plan approved and adopted by the Board of Supervisors.
FISCAL IMPACT:
There is no General Fund impact. All funds are provided to Contra Costa County on a formula basis through the U.S. Department of Housing and Urban Development.
CFDA: 14.218 (CDBG Program)
CFDA: 14.239 (HOME Program)
CFDA: 14.231 (ESG Program)
BACKGROUND:
Contra Costa County receives Community Development Block Grant (CDBG), HOME Investment Partnerships Program (HOME), and Emergency Solutions Grant (ESG) funds each year from the federal government for affordable housing and community development activities. To receive these annual awards of federal funds, the County must submit a strategic plan - the Consolidated Plan - every five years to the U.S. Department of Housing and Urban Development (HUD) that identifies local needs and how these needs will be addressed, as well as an Annual Action Plan that specifies what actions and investments will be carried out to execute the Consolidated Plan. This Board Order covers both the five-year Consolidated Plan for FY 2025-2030 and the one-year Action Plan for FY 2025/26.
The CDBG Program will be entering into its fifty-first year. The primary objective of the CDBG Program is to assist in the development of viable urban communities through the provision of decent housing, a suitable living environment, and economic opportunity. CDBG funds are allocated annually to eligible entitlement jurisdictions by HUD on a formula basis. The County's Department of Conservation and Development (DCD) administers CDBG funds on behalf of the "Urban County". The Urban County includes the unincorporated County and all cities/towns except Antioch, Concord, Pittsburg, and Walnut Creek. Those cities administer independent CDBG programs.
The purpose of the HOME Program is to increase and maintain the supply of affordable housing for lower income households. HOME funds are allocated by HUD to eligible participating jurisdictions and HOME Consortia on a formula basis. The Contra Costa HOME Consortium (Consortium) consists of the Urban County and the cities of Antioch, Concord, Pittsburg, and Walnut Creek. As the Consortium representative, DCD is responsible for the administration and management of the HOME Program for the Consortium.
The HOME-ARP program originated from The American Rescue Plan of 2021, which appropriated $5 billion to assist individuals or households who are experiencing homelessness, at risk of homelessness, and other vulnerable populations by providing rental housing, rental assistance, supportive services, and non-congregate shelter to reduce homelessness and increase housing stability. The funds were allocated by HUD on a formula basis to jurisdictions that qualified for funding through the HOME Program. HOME-ARP is a special one-time funding program. The Board of Supervisors approved the County's HOME-ARP Allocation Plan on October 11, 2022, allowing HOME-ARP funds to acquire, develop, rehabilitate, or preserve affordable rental housing and/or permanent supportive rental housing units to serve Qualifying Populations.
HOME-ARP funds must primarily benefit individuals and households in the following Qualifying Populations:
• Experiencing homelessness (as defined in 24 CFR 91.5 "Homeless" (1), (2), or (3))
• At risk of homelessness (as defined in 24 CFR 91.5 "At Risk of Homelessness")
• Fleeing domestic violence, dating violence, sexual assault, stalking, or human trafficking (as defined in 24 CFR 5.2003)
• Other populations with a high risk of housing instability (including highly cost-burdened low-income households, households who have moved two or more times in the last 60 days, and households living in a hotel/motel.
The County receives ESG Program funds on an entitlement basis for use in funding renovation, major rehabilitation, or conversion of building for use as emergency shelters for the homeless; provision of essential services for the homeless; emergency shelter operations and related services; and homelessness prevention and rapid-rehousing activities. DCD administers ESG funds on behalf of the Urban County.
FY 2025-2030 CONSOLIDATED PLAN
The County must submit a strategic plan - the Consolidated Plan - every five years to HUD that identifies local needs and how these needs will be addressed. The Consolidated Plan must also demonstrate how the Consortium will meet national statutory goals to develop viable communities by providing decent housing, a suitable living environment, and economic opportunities, principally for persons of extremely-low, very-low, and low incomes.
The preparation of the FY 2025-2030 Consolidated Plan began with holding six public community meetings and three service provider (housing, non-housing and homelessness) group meetings from March 2024 through July 2024. Individuals and representatives of various public agencies, community organizations, and service providers throughout the County were invited to attend these meetings. These meetings covered various topics, including but not limited to:
• Affordable housing
• Persons with Disabilities
• Single parents/female-headed households
• Homelessness
• Economic development (business assistance and job creation/retention)
• Seniors
• Youth and families
The Consortium also solicited input from community organizations, public agencies, and the general public through a pair of online surveys that were accessible beginning in the month of February 2024 through the end of July 2024. A copy of each of the surveys is attached (Attachment A and Attachment B). Consortium staff compiled and analyzed the survey data to come to the following observations:
1. There continues to be a high need for services that assist unhoused populations, or those at imminent risk of homelessness.
2. Affordable Housing activities are also a high priority. Of the eligible activities for affordable housing, the following were the highest ranking; 1) Construction of new affordable rental housing; 2) Preservation of existing affordable rental housing at risk of converting to market-rate housing; 3) Rehabilitation of existing affordable rental housing developments; and 4) New construction of work-force housing (e.g. teachers, firefighters, etc.)
3. Job training/development and pollution/property cleanup ranked the highest of the economic development services.
4. General infrastructure and public facilities continue to be a high priority, with the following category rankings requiring improvement or construction: 1) Youth centers; 2) Childcare centers; 3) Community centers; and 4) Parks and recreational centers.
The draft 2025-2030 Consolidated Plan proposes the following priorities for the use of CDBG, HOME, and ESG funds: Affordable Housing (AH-1 through AH-4), Homelessness (H-1 through H-2), Non-Housing Community Development and Administration (CD-1 through CD-7).
FY 2025/26 ACTION PLAN
In addition to the five-year Consolidated Plan, the County must submit an Annual Action Plan that specifies what actions and investments will be carried out in the coming program year to implement the Consolidated Plan.
On November 4, 2014, the Board of Supervisors (Board) adopted funding guidelines for use of CDBG funds as follows:
• Housing 45%
• Public Services (PS) 17%
• Economic Development (ED) 10%
• Infrastructure/Public Facilities (IPF) 8%
• Program Administration 20%
The following subcommittees or advisory committees of the Board consider County staff’s funding recommendations prior to final approval by the Board:
• Family and Human Services (FHS) Committee - CDBG PS and ESG categories
• Finance Committee - CDBG ED and IPF categories
• Affordable Housing Finance Committee - HOME and CDBG Housing category
On October 9, 2024, County staff held the annual "Kick-Off" Meeting, a meeting to announce the County's CDBG/HOME/ESG Notice of Funding Availability (NOFA) and to meet with various private/public non-profit organizations and agencies. The County's CDBG/HOME/ESG applications also became available that day and were due by December 5, 2024. County staff reviewed applications from December 2024 through March 2025.
The Finance Committee met and approved County staff recommendations for the ED and IPF CDBG categories on April 7, 2025.
The FHS Committee met and approved County staff recommendations for the PS CDBG and the ESG categories on April 14, 2025.
The Affordable Housing Finance Committee (AHFC) is a Board-appointed advisory committee that makes funding recommendations for the Board concerning the allocation of HOME and CDBG Housing category for affordable housing development.
A meeting of the AFHC was scheduled for Tuesday May 20, 2025; however, the meeting was unable to be held due to lack of quorum of committee members. There was not another day that was available for all AHFC members to reschedule an additional meeting prior to the Board meeting on Tuesday, June 24, 2025, where all federal and local funding are being considered for approval. HUD’s deadline to submit the FY 2025-2030 Consolidated Plan and FY 2025/26 Annual Action Plan, which must include all CDBG and HOME funded activities, is July 11, 2025. Therefore, staff’s recommendations for CDBG and HOME housing activities are being forwarded to the Board, as recommended by the Conservation and Development Director, to meet HUD’s July 11, 2025 submittal deadline.
In addition, the following attachments are included to summarize the housing applications received and staff’s recommendations:
• Attachment G: Summary of Housing Applications Received with Amount of Funds Requested
• Attachment H: Staff Funding Recommendations - Housing
HOME-ARP Recapture and Reallocation of Funds
Bella Vista Apartments: On May 9, 2023, the Board of Supervisors approved an allocation of $2,550,000 of HOME-ARP funds to Alliant Strategic Development for the Bella Vista Apartments project located in Bay Point. The project proposed the new construction of 122 affordable multifamily rental units which included a combination of 1-, 2-, and 3-bedroom units. The affordability mix proposed included 49 units at 30% Area Median Income (AMI) and 73 units at 80% AMI. Seven of the 30% AMI units were proposed to be HOME-ARP units set aside victims of domestic violence (a HOME-ARP qualifying population).
The HOME-ARP allocation had three contingencies:
• All other financing commitments secured by December 31, 2024, and FY 2023/24 HOME-ARP funds committed, as evidenced by an executed loan, by August 31, 2025. HOME-ARP funds will be recaptured by January 2025, if significant progress is not made to meet the August 31, 2025, loan execution deadline.
• Confirmation that the project meets all HOME-ARP occupancy requirements, including targeting HOME-ARP units for qualifying households, rent limits restricted not to exceed 30% of the HOME-ARP household’s income, and use of Coordinated Entry and Project Specific Waitlists.
• Confirmation that the project’s financials are compliant with the County’s Affordable Housing Program Guidelines.
Unfortunately, Alliant Strategic Development (Alliant) has not been successful in securing additional financing commitments and was unable to meet the contingency on December 31, 2024. Additionally, Alliant has proposed to increase the affordability of the units at the Bella Vista Apartments project and no longer proposes to include 30% AMI units that will target and meet the requirements of the HOME-ARP funds. Staff recommends recapturing the HOME-ARP funds previously awarded to the Bella Vista Apartments project. Approval of this recommendation would make the recaptured funds available to be reprogrammed to another affordable housing rental project that proposes to include units that meet the HOME-ARP occupancy requirements.
DCD staff recommends reprogramming the HOME-ARP funds to The Riveter-Supportive Housing project in Richmond. The Riveter-Supportive Housing project is an adaptive reuse and acquisition project comprising of 58 affordable permanent supportive housing rental units. The project’s primary objective is to house individuals at the lowest income levels who need additional supportive services not offered in traditional affordable housing developments. Staff’s recommendation of HOME-ARP funds to this project is reflected in Attachment H.
The HOME-ARP regulations require the HOME-ARP grant to the County be fully expended and closed out by September 30, 2030. New construction rental housing projects typically take 18 months to two years to complete construction plus an additional 3-6 months to lease up and fully occupy. The Riveter-Supportive Housing project proposes to apply for 4 percent federal tax credits and tax-exempt bonds in September 2025. An award of $2,550,000 in HOME-ARP funds sets up the projects to secure the tax credits in 2025. If awarded, construction would commence by summer 2026.
Environmental Requirements
CEQA: The Action Plan is exempt from CEQA review. However, individual projects may be subject to further determination and study, which the project's lead agency will undertake. Depending on the location of recommended projects, the County may be the responsible agency for some housing projects. CEQA determinations will be made and approved by the responsible agency for the respective housing projects before executing project agreements or other legal documents for each respective housing project.
National Environmental Policy Act (NEPA): All CDBG, HOME, and ESG projects/programs are subject to a NEPA environmental review in accordance with HUD NEPA regulations (24 CFR Part 58). The NEPA review for each project will be completed prior to executing project agreements or other legal documents for each respective project.
CONSEQUENCE OF NEGATIVE ACTION:
Negative action will prevent the Consolidated Plan and Action Plan from being submitted by the deadline and will jeopardize the County’s receipt of its allocation of FY 2025/26 CDBG, HOME, and ESG funds.