County staff plans to submit proposed Resilient SRQ plans to HUD in September, as HUD has final approval on funding proposals
Following an approximately hour-long discussion, the Sarasota County commissioners on July 11 approved shifts in proposed uses of a new federal grant that county received to cover unmet needs in the wake of Hurricane Ian’s strike in September 2022.
At the behest of Commissioner Michael Moran, an extra $10 million was shifted to construction of affordable housing units, and $15 million was allocated for career and trades training. To help account for those changes, Moran called for a $5-million reduction in the amount staff had recommended for improvements to South River Road, which is a major hurricane evacuation route; a $15-million drop in the proposed funding for homeowners’ rehabilitation or reconstruction of homes; and a $5-million decrease in reimbursements to homeowners for damage repairs.
As The Sarasota News Leader reported in late May, the county received $201,535,000 from the U.S. Department of Housing and Urban Development (HUD) in the form of a Community Development Block Grant for Disaster Recovery (CDBG-DR). Sarasota County was one of only four Florida counties to receive such a direct award from HUD, staff has noted.
Laurel Varnell, who is managing what has been christened the Resilient SRQprogram, pointed out to the commissioners on May 24 that 70% of the funding must be used to benefit low- and moderate-income residents. Those are defined as persons in households making 80% or less of the Area Median Income (AMI). For the North Port-Sarasota-Bradenton Metropolitan Statistical Area (MSA) this year, the AMI for a family of four, as set by HUD, is $98,700. A HUD chart shows that 80% of that for a family of four would be $73,100.
On July 11, Varnell and Steve Hyatt, a member of the county’s Office of Financial Management who also is helping oversee the initiative, reminded the commissioners that the county will have six years to disburse all of the money. Their timeline, as dictated by federal guidelines for use of this grant, calls for the draft Action Plan to be posted for public comments late this month or in early August. The public will have 30 days to offer any responses, Varnell said.
Then, in September, the commissioners once again will review the proposed plan and approve it for submission to HUD.
Varnell added that staff anticipates receiving HUD’s approval of the plan in November, which would enable staff to start putting the money to work.
During her July 11 remarks, Varnell also stressed that HUD calls for the grant to be used for needs that cannot be met through another means.
Hyatt noted that the county was required to undertake a needs assessment. Staff looked at data available from the Federal Emergency Management Agency (FEMA) and the Small Business Administration (SBA), both of which helped county residents and businesses affected by Hurricane Ian. Additionally, Hyatt said, staff members contacted nonprofit organizations in the county, to obtain information on damage they suffered to their facilities, especially in South County, which was hit much harder by the hurricane.
Moreover, staff invited both members of the public and organizations to participate in surveys about their unmet needs, Varnell noted, and staff conducted three meetings in various areas of the county, to explain the program and receive comments.
Altogether, a slide showed, 895 individuals completed the survey, along with 175 organizations and 98 private businesses.
Based on the surveys and staff research, Hyatt told the commissioners, the total unmet needs figure at which staff arrived was $792,524,278. Of that amount, 66.2% was estimated to be related to housing, a chart showed.
The top priorities for individuals were Infrastructure, as noted by 646 responses, and mitigation, with 572 responses. Housing rehabilitation and general rehabilitation came in third, with 316 responses.
For organizations, housing rehabilitation and general rehabilitation was the top answer, with 96 responses. Infrastructure was in second place, with 92, while new housing and/or affordable housing construction was in third, with 88 responses.
Therefore, staff recommended allocating $111,458,250 to housing needs through four initiatives:
- Voluntary buyouts and acquisitions involving residential structures in floodplains — $6,458,250. Hyatt explained that the focus would be on properties with repetitive storm damage because of their locations. The land left vacant, he said, “must be used for green space,” according to HUD regulations.
- Homeowner reimbursement for repairs of damage — $20 million. With regard to that proposal, Hyatt pointed out that homeowners would have to provide documentation to prove that they had to borrow money, for example, or use savings for repairs.
- New affordable, multi-family housing units — $30 million.
- Homeowner rehabilitation and reconstruction — $55 million. Hyatt noted that some property owners may be working with FEMA, the SBA or their insurance companies on such a process, but they might not be able to obtain all of the money they need. Income verification would be a necessary step before the award of any funds, he continued. Further, the county likely would establish a specific group of contractors approved to handle the rehabilitation.
Next, staff recommended $75 million be split as follows:
- $45 million for the county, the municipalities and not-for-profit organizations to deal with public facilities and infrastructure damaged by Ian.
- $30 million for improvements to South River Road, which is a major hurricane evacuation route for South County residents and even some Charlotte County residents, as the county’s Public Works Department staff has explained. “We recognize the importance of this roadway,” Hyatt told the commissioners.
Finally, Hyatt noted, 5% of the HUD grant funds — $10,076,750 — was recommended for administration of the program, and $5 million would go to planning efforts to improve the county’s resiliency in the face of future storms.
No money would be allocated to economic development, Hyatt added. “We recognize that there have been impacts to private businesses,”, but HUD’s focus is on housing-related initiatives, especially for low- and moderate-income individuals and families, he reminded the commissioners. Moreover, he pointed out, economic development programs “are typically pretty difficult to manage. … They come with financial risk,” so more staff would have to be hired to track the grants to ensure the funds were used appropriately.
In response to questioning by Commissioner Moran, Varnell said staff believed, based on the survey comments from private businesses, that it would be more important to provide attainable housing, which would make it easier for companies to hire and retain workers, than to allocate funds to economic development.
“The No. 1 thing I hear from every business owner,” Chair Ron Cutsinger pointed out, is about the difficulty of hiring workers, because housing costs are so high in the county. He called for more money to be dedicated to construction of affordable housing.
Infrastructure, insurance and nonprofits
Commissioner Neil Rainford was the first board member to respond to the presentation, stressing the need to award the infrastructure funds as quickly as possible.
Further, he said he wanted to be certain that any money provided to nonprofit organizations went to those that could demonstrate their needs. For example, he said, the Boys & Girls Clubs and the Salvation Army had provided considerable assistance to county residents affected by Ian.
Commissioner Joe Neunder agreed with Rainford in regard to the Boys & Girls Clubs. He also sought assurance from Hyatt and Varnell that the commissioners would have the final say on the distribution of funds.
“The program design can be set up to do exactly that,” Hyatt replied. “Staff can come back with those projects and applications for the board’s final decision …”
Neunder also expressed his appreciation to Rainford for mentioning the Boys & Girls Clubs, especially because of that organization’s work in South County. (The Gene Matthews Club in North Port was destroyed by Ian, as the Gulf Coast Community Foundation has emphasized in allocating $1 million to the organization.)
Neunder did question the amounts staff recommended for administration of the federal funds and planning. “Those seem a little high.”
HUD sets the 5% for administration as a cap, Hyatt responded. “That’s ironically, actually a low amount,” he added, noting that, typically, federal programs allow for 7% to 10% of the money to be used for that purpose.
Hyatt stressed of the CDBG-DR initiative, “It’s going to be a very administratively heavy program,” requiring extensive staff time and the hiring of contractors to assist with program delivery. Still, Hyatt acknowledged the potential that not all of the funding would be used; in that event, money could be shifted to other initiatives.
Commissioner Rainford emphasized that the faster the money can be disbursed, the more likely that the county would not need to use all of the allocation for administrative work.
Commissioner Moran noted that, as a person who has been in the insurance business for 36 years, he did not support providing funding to people who had failed to purchase an adequate amount of insurance for their properties. “We’ve got to be careful we’re not rewarding bad behavior here. … It hurts me to my core that somebody wouldn’t be properly insured …”
However, he acknowledged that it “can be tough” for some people to pay their insurance deductibles.
Commissioner Mark Smith did point out that Ian “damaged a lot of area we didn’t think was going to get damaged,” because the heavy rainfall the hurricane produced flooded communities that normally do not see high water. “I’m sure a lot of those folks didn’t have proper insurance because they didn’t think they were vulnerable to flooding.”
Rainford pointed out that nonprofits such as the Boys & Girls Clubs and the Salvation Army might have been carrying what they felt was sufficient insurance, but it might not have proven to be enough. “This was a 1,000-year storm event,” Rainford emphasized. Someone — the News Leader was unable to determine who — responded, “Hopefully” to Rainford’s last point.
A renewed push for economic development funding
“What I would be very much into,” Moran said, would be a proposal he made during the May 24 discussion about Resilient SRQ: using some of the funding to rehabilitate several buildings in a depressed area of the county so a facility could be established to train young people in trades. “Teach ’em HVAC, teach ’em plumbing, teach ’em roofing, teach ’em framing.” (HVAC stands for heating, ventilation and air conditioning.) He pointed out that the commissioners routinely hear complaints from constituents who are having difficulty finding tradesmen who can handle specific types of work.
“I think anything related to economic development is where we should be pushing money,” he added.
Moran conceded, “The feds put a strange filter on [use of the grant funds for economic development].” Nonetheless, he added, “So what. Then make sure you get the filter right. If you can’t, don’t take the money.”
Chair Cutsinger said, “I’d like to see us get something big done with these dollars that we normally wouldn’t be able to accomplish.”
Finally, Moran asked Hyatt to put up the spreadsheet with the funding allocations staff had proposed. Then Moran proceeded to direct Hyatt to shift some of the amounts, as follows:
- Instead of $30 million for affordable housing, Moran called for $40 million.
- Place $15 million in a “bucket” for economic development, for trades and career training. “That would be a very significant and monumental investment in the future of our community,” Neunder responded to that suggestion.
- Reduce the amount for homeowner rehabilitation/reconstruction from $55 million to $40 million.
- Reduce the funding for homeowner reimbursement for damage repair from $20 million to $15 million.
- Reduce the amount for South River Road from $30 million to $25 million. Moran did acknowledge, “This one might be painful …”
After the rest of the board members voiced support for Moran’s proposal, he made a motion to authorize the projects and allocations at those funding levels, and Rainford seconded the motion. It passed 5-0.