REPORT TO THE CITY COUNCIL February 4, 2021 FROM: THOMAS ESQUEDA, City Manager Office of the City Manager SUBJECT ..Title Actions pertaining to extension of rental assistance service contracts: 1. ***RESOLUTION - 63rd Amendment to the Annual Appropriation Resolution (AAR) appropriating $5,473,200 to fund amendments to existing rental assistance service contracts. (Requires 5 affirmative votes) (Subject to Mayor's Veto) 2. Approve First Amendment to Amended and Restated Agreements with the following City of Fresno Housing Retention Grant Program administrators amending the fee, extending the term, and expanding the scope to include distribution of federal Emergency Rental Assistance program funds: 1. Reading and Beyond 2. The Fresno Center 3. Centro La Familia 4. Education and Leadership Foundation 5. Jakara Fresno 6. West Fresno Family Resource Center ..Body RECOMMENDATION Staff recommends the City Council (1) approve an AAR Amendment to appropriate $5,473,200 from the City's allocation of federal Emergency Rental Assistance program funding and (2) authorize the City Manager or designee to execute amendments to the City's six existing Housing Retention Grant (HRG) Program administration agreements (Grant Administration Agreements), subject to approval as to form by the City Attorney's Office. The proposed actions will provide additional funding for rental assistance service and extend the term of existing Grant Administration Agreements to December 31, 2021. EXECUTIVE SUMMARY The City Manager is seeking approval to amend existing Grant Administration Agreements with six Community Based Organizations (CBOs) for a total of $5,473,200. The CBOs will provide additional rental assistance services to be funded by the City's $15.8 million allocation of Emergency Rental Assistance (ERA) Program funds. BACKGROUND On Wednesday, January 20, 2021, the City of Fresno received a $15.8 million grant from via the federal Emergency Rental Assistance (ERA) Program, initiated pursuant to Section 501 of Division N of the Consolidated Appropriations Act, 2021, Pub. L. No. 116-260 (Dec. 27, 2020). ERA Program funds are to be used to provide rental assistance services for eligible residents in the City of Fresno. The City Administration proposes to allocate $5,473,200 of the City's ERA funding to bolster existing rental assistance services being administered via existing Grant Administration Agreements; the balance of the City's ERA funding is planned to be distributed to eligible households through a City-operated rental assistance program. The City Council approved the HRG Program in April 2020, and has funded the program thus far with a combination of CARES Act funds and General Fund monies, $2.4MM and $2.6MM, respectively. The program has been administered by the six CBOs via the Grant Administration Agreements. The proposed amendment to the existing six Grant Administration Agreements will accomplish the following: 1. Remit a Portion of CARES Act Funding. HRG administrators will return to the City a portion of their original CARES Act allocation, to be used for other eligible City CARES Act COVID19-related expenses. 2. Modify Administrative Fee from the General Fund. The City will pay a higher administrative fee from existing General Fund allocations to account for costs associated with gearing up for administration of the HRG Program and to increase application processing. The authorized expenditure rate from the General Fund allocation and the estimated application processing rate is specified in each amendment. 3. Extend Term. The term of the Grant Administration Agreements shall be extended to December 31, 2021, in line with the expiration of ERA funds. 4. Expand Scope to Include Emergency Rental Assistance Funding. HRG administrators will receive a proportionate share of $5,473,200 in federal ERA funds to distribute to eligible households in the City. ERA funds must be distributed in accordance with guidance and regulation (including award criteria and recordkeeping) provided by the federal government for use of such funds. ENVIRONMENTAL FINDINGS Pursuant to the definition provided in the California Environmental Quality Act (CEQA) Guidelines Section 15378 these Amendments are not "projects." LOCAL PREFERENCE Local preference was not considered because these amendments do not include a bid or award of a construction or service contract and involve grant agreements. FISCAL IMPACT This item will not further impact the General Fund. Additional funding for the HRG Program is being provided via $5,473,200 in federally earmarked ERA funds. Attachments: 63rd AAR No. 2020-159 Amendment to Agreement - Reading and Beyond Amendment to Agreement - The Fresno Center Amendment to Agreement - Centro La Familia Amendment to Agreement - ELF (Education and Leadership Foundation) Amendment to Agreement - Jakara Fresno Amendment to Agreement - West Fresno Family Resource Center Table of Rental Assistance Grants - Reallocation to CBOs