City Council

(14) 26-0619\nEXEMPTIONS and CIVIL RIGHTS, EQUITY, IMMIGRATION, AGING,\nAND DISABILITY COMMITTEE REPORT relative to the 52nd Program\nYear (PY) of the Housing and Community Development Consolidated\nPlan (2026-2027) (Action Plan).\nRecommendations for Council action, SUBJECT TO THE APPROVAL\nOF THE MAYOR:\n1. NOTE and FILE the Mayor report dated April 24, 2026, attached\nto the Council file.\n2. DETERMINE that, (a) pursuant to CEQA Guideline section,\n15378(b)(4), the 2023- 2027 Housing and Community\nDevelopment Consolidated Plan PY 52 (2026-2027) Action Plan\n(Action Plan) is not a project subject to the California\nEnvironmental Quality Act (CEQA) and not subject to CEQA\nbecause it is the creation of a funding mechanism or other fiscal\nactivity that does not involve any commitment to a specific\nproject which may result in a potentially significant physical\nimpact to the environment; (b) the Action Plan is not a CEQA\nproject pursuant to CEQA Guidelines 15378(b)(4) and 15353(a)\nbecause it does not commit the City to a definite course of\naction the City intends to carry out and the City will comply with\nCEQA if applicable before any Action Plan funds are committed\nto a definite course of use; and/or ( c) the Action Plan is exempt\nfrom the requirements of CEQA because, pursuant to Guideline\n150601(b)(3), the common sense exemption applies because it\ncan be seen with certainty that the Action Plan application for\nfunding does not have the potential to cause a significant effect\non the environment. The above determination is documented in\nthe CEQA Notice of Exemption, attached to the Chief\nLegislative Analyst (CLA) report dated June 2, 2026, attached to\nthe Council file.\n3. FIND that all new federally funded projects are subject to\nenvironmental review under the National Environmental Policy\nAct (NEPA) requirements and per the Department of Housing\nand Urban Developments (HUD) regulations before any\ncommitment of federal funds for expenditure, unless they are\nexempt from such review. The City has determined that some\naction is programmatically exempted per CFR 58.34 and\ncategorically excluded per 24 Code of Federal Regulations\n(CFR) Part 58.35(a)(b) from this annual environmental\nrequirement. Those projects that are not exempted or not yet\ndefined are approved, subject to the following: (1) confirmation\nthat the project to be funded is categorically excluded under\nNEPA per 24 CFR 58 and exempt under CEQA per the\nGuidelines before project implementation; or (2) appropriate\nenvironmental review before project implementation.\n4. AMEND Recommendation 17 of the CLA report dated June 2,\n2026, attached to the Council file, to read as follows:\n17. Instruct LAHD, with the assistance of the CLA, to report\nwithin 120 days, and/or prior to the acquisition of a property, on\nthe use of HOME and/or CDBG funding allocated for the\npurpose of creating Interim/Transitional Housing, including\nacquisition and rehabilitation costs and timeline, operating and\nservices costs related to the proposed acquisition, as well as\nsources of funds for such purposes; and include an analysis\nof compliance with Alliance settlement requirements and\nobligations, the projected cost per unit, cost of supportive\nservices, and the proposed location of each housing site,\nacross the City.\n5. APPROVE the CLA report dated June 2, 2026, attached to the\nCouncil file, as amended.\nFiscal Impact Statement: The CLA report states that PY 52\nCommunity Development Block Grant (CDBG) will provide\napproximately $19.0 million to support positions (direct salaries: $14.5\nmillion; expenses including contracts: $1.9 million; and related costs\nreimbursement: $2.6 million). For PY 52, the total related cost is\napproximately $11.1 million, of which only approximately $2.6 million\ncan be funded with CDBG funds. This leaves $8.5 million in unfunded\nrelated costs that the Council may consider funding with the General\nFund. For reference, the Council and Mayor approved an estimated\n$5.8 million in related costs for PY 51 to be funded by the General\nFund. The City's Financial Policies state that the City will pursue\nprogram grants, but will limit financial support of these programs to\navoid commitments beyond available funding. The CAO further\nreports that Cost Allocation Plan (CAP) 48 is used to calculate the\n2026-27 related costs. In most cases, CAP 48 is higher than CAP 47,\nwhich was used to calculate related costs in PY 51. The amount of\nCity resources, specifically the General Fund, to be dedicated to\nleverage CDBG grant program activities is a policy decision for the\nCouncil and Mayor.