The Administration recommends approving the Resolution.

The City of Miami Beach (the “City”) is a U.S. Department of Housing and Urban Development (HUD) designated entitlement city as determined by the decennial census information on population growth lag, overcrowding, age of housing stock, and poverty. The City has been an entitlement community since 1975. As an entitlement city, Miami Beach automatically qualifies for an annual allocation of federal funding under HUD’s grant programs including the HOME Investment Partnership (HOME) Program, created in 1992 to provide funding specifically for affordable housing.

HUD requires each entitlement community to submit its One-Year Action Plan, on an annual basis, describing how it will utilize funding and resources to address priority needs identified in the city’s Consolidated Plan. The One-Year Action Plan is a component of the Five-Year Consolidated Plan required to be filed with HUD.

From time to time, it may be necessary for the City to process a “substantial amendment” to the Five-Year Consolidated Plan and the One-Year Action Plan to allow for the funding of new activities, modification of existing activities, or other program administrative actions. The City is required by HUD [24 CFR 91.505 (b)] to identify the criteria to be used in determining if a proposed action will be considered a “substantial amendment” as follows:

1.  A change in allocation priorities or a change in the method of distributing funds;

2.  Funding an activity using funds from any program covered by the Five-Year Consolidated Plan (including program income) not previously described in the One-Year Action Plan; or

3.  A change in the purpose, scope, location, or beneficiaries of an activity.

Any proposed amendment considered a substantial amendment requires approval by the City Commission. Furthermore, in accordance with Citizen Participation requirements, a thirty (30)-day public notice and public hearing is required to provide the opportunity for the public to review and comment on the proposed substantial amendment. The City will consider all comments or views received from the public concerning proposed substantial amendments in accordance with HUD [24 CFR 91.105 (c)(3)]. A summary of these comments shall be attached to the substantial amendment submitted to HUD.

The HOME Program has timeliness requirements regarding the expenditure of funds. HOME funds must be committed to a project within two (2) years of the City’s receipt and expended within five (5) years. The annual Action Plan is monitored throughout the year to ensure compliance with federal regulations and progress towards the National Objective, which stipulates that HOME-funded activities must create housing units that benefit low- and moderate-income persons who earn at or below 80% of the Area Median Income (AMI).

On January 17, 2018, the City Commission adopted Resolution No. 2017-29876, approving the One-Year Action Plan for Federal Funds for FY 2017 and allocating funds to the Madeleine Village Seawall (“Seawall Project”). On June 5, 2020, Resolution 2020-31283 allocated additional FY 2019 funds to the Seawall Project, which reached substantial completion in October 2022. No additional expenses are anticipated for Seawall Project completion. There is a remaining balance of $296,795.88. The expiration date of the remaining funds varies between September 30, 2024, through September 30, 2027, as illustrated in the table below.

On June 22, 2022, the City Commission adopted Resolution 2022-32188 allocating a total of $636,183.67 ($204,125.67 for FY 2019 and $432,058.00 for FY 2022) in Community Development Block Grant (CDBG) funds for the acquisition of units to be added to the City’s affordable housing portfolio.

On June 22, 2022, the City Commission adopted Resolution 2022-32188 allocating a total of $636,183.67 ($204,125.67 for FY 2019 and $432,058.00 for FY 2022) in Community Development Block Grant (CDBG) funds for the acquisition of units to be added to the City’s affordable housing portfolio.

To maximize and leverage resources, the $296,795.88 in HOME funds proposed for recapture will be combined with the CDBG funds for a total of $932,979.55 to increase affordable housing units and ensure timely and compliant expenditure of HUD funds.

In accordance with the Citizen Participation Plan, the City advertised a Notice of Public hearing and a 30-day Comment Period (March 13, 2023 – April 12, 2023). The Public Hearing will be held on March 27, 2023. Public comments received will be included in the amended Action Plan to be submitted to HUD for final review and approval.

The City owns and operates 89 affordable housing rental units purchased with various sources of federal funding. The Administration is currently identifying viable properties for acquisition and will present possible selections at the April 2023 City Commission meeting.

As part of the HOME Program funding requirements, the acquired property would have a thirty (30)-year affordability period. Eligible expenditures for the recaptured funds include an appraisal, property inspection, acquisition, and rehabilitation if necessary. Another potential strategy for utilization of the acquired units would be to award First-time Homebuyer funds to a prospective homebuyer for assistance to purchase the acquired property.

The Administration recommends approval of the amendment to the One-Year Action Plan, recapturing and reallocating HOME Program funds, and ensuring the timely and compliant expenditure of these HUD funds.