Supporting Document Item 4. Presentation regarding the FY25-26 City of Austin Housing Action Plan — original pdf

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M E M O R A N D U M TO: Mayor and City Council THROUGH: Jon Fortune, Deputy City Manager FROM: Carrie Rogers, Intergovernmental Relations Officer DATE: February 25, 2025 SUBJECT: Federal Legislative Update / Potential Reductions at the Department of Housing and Urban Development As a follow up to memorandums issued on January 29, 2025, February 11, 2025, and February 17, 2025, the Intergovernmental Relations Office (IGRO), along with partner departments, continues to review federal administration actions relating to direct and discretionary funding awarded to the City of Austin. On Thursday, February 20, 2025, public reports began circulating of a planned 50% reduction in staff across the entire workforce at the Department of Housing and Urban Development (HUD). In some HUD divisions, the cuts could be deeper – up to 84% at HUD’s Office of Community Planning and Development (CPD) – according to reports. Such a drastic reduction would likely have a significant impact on efforts across the nation to address homelessness and make housing more affordable. CPD includes many programs critically important to the City of Austin, such as HOME Investments Partnerships Program (HOME), Community Development Block Grant (CDBG), Emergency Solutions Grant (ESG), Housing Opportunities for Persons with AIDS (HOPWA), and Continuum of Care (CoC) programming. The City of Austin receives approximately $14 million per year in HUD block grants. An additional $14 million was awarded this January for CoC programs, which primarily support services to address homelessness in Austin through non-profit partners. City of Austin HUD Community Programming Based on the information we have today, and in reviewing the City’s Consolidated Annual Performance and Evaluation Report (CAPER) with the Housing Department, the Homeless Strategy Office and Austin Public Health, staff identified the following areas where drastic reductions to HUD personnel and/or a reduction in funding would impact the City of Austin’s community programming: Page 1 of 3 HOME Program ($3,073,266) • HOME provides Tenant Based Rental Assistance to 65 families/individuals experiencing homelessness. The contract is administered through the Housing Authority of the City of Austin (HACA) and coordinated with our Continuum of Care (ECHO). • HOME provides funding for Down Payment Assistance (DPA) for 25 low- to moderate- income homebuyers who are first-time homebuyers. Community Development Block Grant (CDBG) - $7,223,444 • Currently, CDBG funding provides programs or services to more than 14,000 Austinites. • CDBG provides critical mental health services, childcare services, and services to low- • • income seniors (totaling $1,083,539) to 476 families and individuals. In addition, CDBG provides funding for home repairs for 148 vulnerable senior households, ranging from minor home repair grants to major home rehabilitation loans. These home repairs enable seniors to stay in their homes safely and to avoid expensive nursing care. The City of Austin is investing CDBG funding in infrastructure for the Colony Park development, which is located in a low-income, disinvested area in Northeast Austin. The City and County have collaborated to reinvest in the area, resulting in a planned community (on 208 acres of city-owned property) that will include a range of housing types, transportation access, health care, parks, and recreation opportunities. The City of Austin committed $2.5 million per year in CDBG funding for early infrastructure (e.g., roads and utilities), which will be leveraged with private investment to develop the planned community. Housing Opportunity for Persons with AIDS (HOPWA) - $2,762,259 • HOPWA provides crucial funding for four community-based nonprofit organizations (AIDS Services of Austin, Project Transitions, Integral Care, and ASHwell) and partially funds staff administering the funding. Emergency Solutions Grant (ESG) - $647,073 • ESG serves 425 individuals and families experiencing homelessness. ESG provides funding for shelter operations, rapid rehousing and partially funds staff administering the funding. ESG is a crucial part of our homelessness response system. HUD Funds in City Departments • The Housing Department receives approximately $1.75 million each year to fund administrative costs, including personnel, rent, and other operating expenses. Within the Housing Department, 15 FTEs (out of 84 FTEs) are funded wholly or partially with federal HUD funds. • Austin Public Health receives approximately $130,000 each year to pay for administrative costs, including personnel, rent, and other operating expenses. Within APH, two FTEs (out of 647 FTEs) are funded wholly or partially with federal HUD funds. Page 2 of 3 • Downtown Austin Community Court receives funding from ESG in the amount of $285,000 for one staff member and housing assistance for the rapid rehousing program. Impact of Grants on Local Non-Governmental Organizations Over the last four years, with Congressional and legislative support, the City of Austin received approximately $1.2 billion through direct and discretionary grants, many of these with and in partnership with local non-governmental organizations (NGOs). The City is distributing a survey to non-profit organizations with whom the City collaborates to better understand the impact of dramatic cuts to HUD staffing and/or potential federal grant funding reductions. Survey responses are due Thursday, February 27, 2025, by 5 p.m. City staff will analyze results and provide an after-action report to the Mayor and City Council with staff recommendations. Next Steps City staff continue to assess daily actions out of Washington, D.C. that may impact the City of Austin’s community programming. Unless a department receives a direct notification from its federal funding agency to cease work and/or reimbursements, departments should continue to draw down reimbursements, maintain grant-required activities, and work towards finalizing grant agreements where applicable. Given the recent questions and uncertainty regarding federal funding, staff has been compiling a full list of federal grants by department and expects to share that list with Mayor and City Council as quickly as possible. Should you have any questions, please contact Carrie Rogers, Intergovernmental Relations Officer, at carrie.rogers@austintexas.gov or 512.923.7577. cc: T.C. Broadnax, City Manager Myrna Rios, City Clerk Corrie Stokes, City Auditor Judge Sherry Statman, Presiding Judge Mary Jane Grubb, Municipal Court Clerk CMO Executive Team Kerri Lang, Budget Director Directors and Assistant Directors Page 3 of 3