City to Consider Eliminating Nonprofit Grants

A year ago,committed to helping the community’s most economically disadvantaged residents. But with the city taking a drastic cut in CDBG funds, the future of city grants to local community groups is uncertain.

In its peak in 1997, the city received $454,000 in federal CDBG funds, which is awarded to benefit low-income residents, remove blight and fund major emergencies or disasters.

Traditionally, the city had used CDBG funds for housing rehabilitation, first-time home-buying programs, fair housing programs, code enforcement and to award grants to local nonprofit organizations.

Groups that benefited from the grants included Cory’s Kitchen Food Bank, Citrus College Orfalea Family Children’s Center, the East San Gabriel Valley Coalition for the Homeless, EYE-DAS, YWCA San Gabriel, Valley Meals on Wheels, Glendora Welfare Association, Shepherd’s Pantry and YWCA San Gabriel Valley WINGS.

Last year, funding had fallen to $304,000. About $57,00 of that number had gone to nonprofit organizations, with each group receiving about $3,000 to $5,000.

But this year, CDBG funding is taking a 35 percent hit, with $197,000 going to Glendora.

With residuals from cancelled projects and other areas of funding, the city expects $282,845 in CDBG funds for the 2012-2013 fiscal year.

But that won’t be nearly enough to cover all the programs the city had been previously able to fund, said Planning Director Jeff Kugel.

Kugel presented the council with two options in preparing for the new CDBBG budget – 1) use the funds to create an economic development program, eliminate code enforcement funding under CDBG, and keep nonprofit funding, or 2) eliminate nonprofit grants altogether.

Kugel recommended the latter, indicating with the , there would be limited staff to administer the grant.

“I think these are all good programs and worthy of the community’s support,” said Kugel. “But because of the HUD regulations, they are very costly in terms of time to administer it.”

Kugel said the funds would be better put to use focused on an economic development program, offering loans to businesses to hire low-income employees.

For groups like the East San Gabriel Valley Coalition for the Homeless, the loss of the CDBG funds would be significant.

Connie Brehm of the Coaltion said the grant would be used to assist in immediate assistance for the region’s homeless, including offering motel and food vouchers, and clothing.

“We’d like to do more for the homeless and get them off the streets,” said Brehm. “The needs are dire.”

The council suggested either consolidating the list of nonprofit award recipients or eliminating the grant program altogether.

Councilman Joe Santoro said assisting the local economically disadvantaged should be high on the city's priority list.

“The money is drying up and the money is going to go away, well these people are not going away, they’re going to be here,” said Santoro. “I think that is a high priority.”

Other council members expressed concern over using a potentially long-term and critical business development program with unstable funding such as the CDBG grant.

“To fund it with CDBG money which will not last for very long is not a serious way of funding it,” said Council Member Judy Nelson.

The city will further discuss and decide on the new CDBG budget at the March 26 city council meeting.