The village of Oak Park will receive $980,107in federal funds from the Community Development Block Grant Coronavirus Aid, Relief, and Economic Security (CDBG CARES) Act through the U.S. Department of Housing and Urban Development (HUD).
“We have not been given official notice from HUD yet to spend the money. We just got notice of the grant award,” said Oak Park Development Services Director Tammie Grossman, who gave an overview of potential uses for the funds during a May 4 village board meeting. Grossman will return to the board at a later date with a more detailed proposal.
Grossman told the village board that staff recommends splitting the incoming financial aid in three parts. Staff also recommends keeping a small portion to pay for village administrative expenses.
The largest portion of the funds, $400,000, should go toward assisting lower income households with rent, mortgage and utility assistance for no more than three months – a CDBG requirement, under staff recommendations.
Staff recommends $300,000 go toward providing assistance to businesses to create and retain jobs for employees that are low to moderate income wage earners.
“We’re actually modeling this after several other CDBG community programs. A lot of companies have laid people off and so this would be a way for them to hire new people and bring them back to work and be able to pay their salary for a month or two,” Grossman said.
Trustees Deno Andrews and Arti Walker-Peddakotla agreed that village staff should include the newly created ad hoc small business task force in helping to distribute the recommended $300,000 sanctioned for job retention.
Staff recommends $162,107 go toward other village “traditional public services,” including funding non-profit organizations.
Grossman said she has had conversations with area non-profits who traditionally get CDBG funding.
“We believe most of their requests for funding could be funded using those additional public service dollars,” Grossman told the board.
The “traditional public services” funding could not be used to help Housing Forward pay for isolated hotel rooms for people experiencing homelessness during the COVID-19 crisis.
“That would be part of the $400,000 for the rental and mortgage assistance money. We believe that would actually allow Housing Forward to move those people from the hotels into stable rental housing for a three-month period,” Grossman said. “CDBG rules only allow for a maximum rental assistance of three months.”
After three months, Housing Forward case managers would have to find other available resources to support their clients.
“We have a flexible rental assistance program that might be of assistance to them. There’s a variety of case management services that Housing Forward can provide,” said Grossman. “The three months is an effort to get somebody on their feet.”
Per staff’s recommendation, the remaining $118,000 would go toward administrative expenses, over which Trustee Simone Boutet expressed concern. Boutet said that money should go toward the community, instead of the village’s paid staff.
“It is common for municipalities, entitlement jurisdictions to keep a certain percentage of all funds for administrative expenses,” said Grossman. “We could keep up to 20 percent but we’re recommending a lower percentage.”
Trustee Jim Taglia disagreed with Boutet’s concern, citing the extra work staff has put in while the community grapples with COVID-19.
“There’s a good amount of money to go around,” Taglia said.
HUD has not yet directed the village to start distributing the funds, nor will the village receive the CDBG CARES money upfront.
“We’re a reimbursement community which means that we have to actually spend the money and then HUD reimburses us for the expense. We’re not actually going to get $980,000 in a bank account,” said Grossman.
The village shows HUD their eligible expenses and then HUD will give the village notice when the reimbursement funds come available. Grossman hopes that will occur within the next week.
“We have reason to believe we’ll be able to retroactively reimburse non-profits for their expenses and we’ll make sure that we have a good understanding of that when we put it in the notice of funding availability.”
According to Grossman, HUD releases additional guidance regarding this program almost on daily basis.
Village staff will release a notice of funding eligibility to the community’s non-profit organizations and then bring the listed applications to the board of trustees for review. Grossman said she will also bring an overview of the job retention program to the board at that time.