The City of Malibu has decided not to trade a Community Development Block Grant (CDBG) of $384,000 for a General Fund Grant at approximately 60 cents on the dollar.
Instead, the city has been granted an extension of their March 31 deadline to come up with a plan on how to spend existing grant funds.
However, one problem faced by the city is the restrictiveness of the grant, which allocates CDBG funds to cities with populations under 50,000 or unincorporated areas in Los Angeles County. The grants are for the purpose of improving the quality of life for people of low and moderate incomes, which Malibu qualifies for because of its high population of senior citizens.
“Senior citizens are presumed to be low- and moderate-income according to HUD [Department of Housing and Urban Development], based on [the fact] that many are on a limited income,” said Linda Jenkins, a manager with the Community Development Commission that administers the grants.
However, only 15 percent of CDBG funding can be spent on community services, such as senior meal programs, family violence intervention services or youth recreation programs. The majority of funding can be used for infrastructure improvements, which include construction of community centers or modifications of public spaces to make them handicap accessible.
The city is hoping to apply the funds toward building a senior citizen center, according to Julia James, city administrative service director.
But, “[the] problem is that property is very expensive,” said James. “[And] building a new facility is time-consuming; the city had not had enough resources, staff and time to devote to this project.”
Councilmember Jeff Jennings, who also sits on the administration and finance subcommittee, said that the funds have not been spent yet because the city has been “accumulating the money against the tide of the time needed to construct the senior center.”
On an annual basis, Malibu receives $84,000 under the CDBG program. The city can borrow up to approximately 16 times against the annual allocation on a variable interest rate, around 5.5 percent, said Jenkins.
Jenkins said they have not received a formal application from the City of Malibu for a request to borrow extra funds. She did say that city staff did meet with the commission two years ago, but has not heard back from the city since.
One issue the city was contending with then, as now, was where to find the property to purchase, said Terry Gonzalez, director of CDBG programs.