HomeMy WebLinkAbout14 TUSTIN $3 MILLION CARES PROGRAM-RESPONSE TO COVID-19DocuSign Envelope ID: B5C75B1A-8842-4E6B-BF92-5A47125D3695
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AGENDA REPORT
MEETING DATE: JUNE 2, 2020
Agenda Item 14
Reviewed:
?' 5W
City Manager
Finance Director N/A
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: MATTHEW S. WEST, CITY MANAGER
SUBJECT: TUSTIN $3 MILLION "CARES" PROGRAM — RESPONSE TO COVID-19
SUMMARY:
The Tustin "Covid-19 Aid, Relief, and Economic Security" (CARES) Program will provide $3
Million of emergency aid to small businesses and individuals/families in need of food and/or
housing/rental assistance resulting from the economic impact associated with the COVID-19
outbreak. Components of the Tustin CARES Program includes, but are not limited to the
following initiatives:
• Small Business Grants
• Facilitation of Outdoor Dining at Restaurants/Outdoor Retail Sales
• Rental Housing Assistance (homeless prevention)
• Meal Assistance/Distribution
Funding for the Tustin CARES Program is anticipated to be released in three parts, each in
the approximate amount of $1 million:
• Part 1 — Application period begins: June 15, 2020
• Part 2 — Application period begins: August 15, 2020
• Part 3 — Application period begins: October 15, 2020
Part 2 funding may be accelerated pending evaluation of respective initiative demands. The
initial funding breakdown for these initiatives will be approximately 75% for small business
assistance and grants, and 25% for rental/housing assistance and meal distributions.
Progress reporting will be provided to the City Council regularly.
RECOMMENDATION: That the City Council:
1. Receive and file this Tustin CARES Program report; and
2. Adopt Resolution No. 20-40 Approving the Temporary Waiver of the City's Fee for a
Temporary Use Permit Application for Outdoor Dining/Outdoor Retail Sales Permit.
FISCAL IMPACT:
Funding for the Tustin CARES Program is comprised of multiple restricted funds, such as
CDBG, CDBG-CV and tentatively includes an allocation from the County's CARES ACT
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Tustin $3 Million CARES Program
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monies recently earmarked for direct use by the City. Those funds are expected to offset
the costs of the Program, so no impacts to the General Fund are anticipated.
CORRELATION TO THE STRATEGIC PLAN:
This action correlates to the City's Strategic Plan for Economic and Neighborhood Development
(Goal A).
BACKGROUND:
On March 4, 2020, Governor Newsom declared a State of Emergency due to the COVID-19
threat to protect the health and well-being of all Californians and to establish consistency
across the state to slow the spread of the virus, Governor Newsom issued Executive Order
No. 33-20 ordering all residents and businesses to stay and work from home for an
indeterminate period of time, at least through April 19, 2020, with the only exception from this
order being essential services and industries. The COVID-19 pandemic has had a significant
impact on Tustin's local economy, with many local small businesses temporarily closed,
customer rates having declined, and changes having to be made to business operations to
meet health and safety guidelines to move forward with re -opening. Governor Newsom's
Stay at Home Order directed all "non-essential" businesses to close throughout the state.
Non-essential businesses are small businesses in the City such as retail stores and
restaurants and were required to shut down operations resulting in significant revenue loss,
employee wage loss, furloughs, and layoffs. Almost all businesses will need capital to pay
their rent, insurance and other fixed expenses, while at the same time generating little to no
revenue.
On March 27, 2020, the U.S. Congress passed the Coronavirus Aid, Relief, And Economic
Security Act (CARES), which allocated $2 trillion to assist state and local responses to the
COVID-19 pandemic. It included funding and resources for small businesses, direct relief for
workers, economic stabilization for impacted industries and emergency appropriations for
public health responses. The CARES Act included $5 billion in supplemental Community
Development Block Grant (CDBG) funding for grants to respond to the coronavirus (CDBG-
CV). The CARES Act has provided the City with $498,862 in CDBG-CV funds that can be
used to support economic development efforts in response to the COVID-19 pandemic.
CDBG-CV funds are separate from regular the CDBG funds the City receives, both are
available to the City on a reimbursement basis. Additionally, certain Plan Years of the City's
traditional allocation of CDBG have also recently become eligible to support economic
development efforts in response to the COVID-19 pandemic.
The City of Tustin will attempt to make additional funding for these and related initiatives
available in the near future, pending clarification of the City's potential direct CARES ACT
funding allocations from the County and State. At this time, the City is anticipating a direct
allocation of approximately $1.9 million from the County specifically for small business
assistance. The $1.9 million from the County has tentatively been included as a funding
source for the Tustin CARES Program.
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In addition, the City anticipates the ability to apply to the County and the State for
reimbursement of certain Covid-19 related expenses, which is separate from the City's ability
to apply for Federal Emergency Management Assistance (FEMA) reimbursement of certain
Covid-19 related expenses. None of these funding sources allow for reimbursement of lost
revenue (such as sales tax revenue) to the City.
DISCUSSION:
In general terms, the Tustin CARES program will be utilized for expenses such as:
• Acquisition, construction, reconstruction, or installation of public works, facilities,
and site or other improvements
• Rehabilitation of buildings and improvements (including interim assistance)
• Provision of assistance to private, for-profit entities when appropriate to carry out
an economic development project
• Provision of assistance to microenterprises
• Provision of new or quantifiably increased public services i.e. homeless prevention,
food distribution, emergency rental assistance, etc.
Components of the Tustin CARES Program includes, but is not limited to the following
initiatives:
• Small Business Grants
• Facilitation of Outdoor Dining at Restaurants/Outdoor Retail Sales
• Rental/Housing Assistance (homeless prevention)
• Meal Assistance/Distribution
Funding for the Tustin CARES Program is anticipated to be released in three parts, each in
the approximate amount of $1 million:
• Part 1 — Funds Release Date: June 15, 2020
• Part 2 — Funds Release Date: August 15, 2020
• Part 3 — Funds Release Date: October 15, 2020
Part 2 funding may be accelerated pending evaluation of respective initiative demands. The
initial funding breakdown for these initiatives will be approximately 75% for small business
assistance and grants and 25% for rental/housing assistance and meal distributions.
For example, it is anticipated that the Tustin CARES Program will cover expenses such as
facilitating temporary outdoor dining, including insurance premiums for private use of the
public right of way and to backfill or augment these initiatives to best meet community needs.
Small Business Grants
The Tustin Small Business Emergency Grant Program, which will provide funding to small
businesses needing financial assistance in overcoming the temporary loss of revenue due to
the COVID-19 outbreak. The program is based on the availability of funds, program guidelines
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and submission of all required information and supporting documentation. Small businesses
with 20 or less employees (full or part time) may be eligible to receive a grant of up to ten
thousand dollars ($10,000). The grant may be used for working capital to cover the day-to-
day business operating expenses such as payroll expenses, rent/lease payments, mortgage
payments, utility expenses, inventory or other similar expenses that occur in the ordinary
course of operations.
The City's Economic Development Department will be responsible for oversight of the Small
Business Emergency Grant Program and disbursement of funds will take place through the
City's Finance Department. The City's program partner, the Orange County/Inland Empire
Small Business Development Center (OCIE SBDC) will be responsible for program
administration, marketing, application processing, underwriting and for review and approval
of financial and business documentation for disbursement approval.
OCIE SBDC assists several other local cities with similar programs. SBDC will charge a small
1% fee to administer the program which will be funded through the CARES Act so grant
assistance and administration services would be at no cost to both the City and small
business applicants.
Eligibility
An eligible business would meet the following requirements:
• The business must be a for-profit business and physically located in Tustin;
• The business must be located in a commercial or industrial space;
• The business must have an active Tustin business license for a minimum of six (6)
months;
• The business must have 20 or fewer employees, (full or part time) including the
owner;
• The business must be in good standing with the City (current on bills, no liens or
judgments, etc.), unless directly correlated to COVID-19 impacts.
• The business must provide proof of financial hardship due to COVID-19;
• The business must prove they are unable to access capital through alternative
sources (e.g. Economic Injury Disaster Loan (EIDL) or Payroll Protection Program
(PPP) Loan)
• The business must submit the application and all required supporting
documentation
Grant Disbursement
Fifty percent (50%) of the eligible grant funds will be disbursed within two weeks of approval.
The remaining fifty percent (50%) of eligible grant funds will be disbursed when the business
becomes fully operational, but no earlier than 4 weeks from the initial disbursement.
Applicants must then submit documentation supporting that the initial grant funds were used
to pay for operational expenses such as employee payroll, rent/lease, mortgage payment or
utilities.
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Staff expects the Small Business Grant Program to have an overwhelming number of
applications. If the number of applications far exceeds the amount of funding that is available
for disbursement, the City will implement a lottery system for all eligible small businesses.
Once applications have been pre- approved, they will be assigned a number and entered into
a lottery for selection. The selected businesses will then submit all required business and
financial documentation for review and verification.
Facilitation of Outdoor Dining and Retail Uses
The purpose of these guidelines is to provide criteria during the COVID-19 pandemic to
facilitate outdoor dining and outdoor retail use on private property and/or within the public
right-of-way while protecting the public interest. These guidelines, which may be amended at
any time, apply to outdoor dining and outdoor retail sales areas associated with an existing
business. New outdoor dining and outdoor retail sales areas may be located adjacent to, or
in the vicinity of, a permitted restaurant, cafe, or retail business on private property, public
property, or within the public right-of-way. Such locations include, but may not be limited to:
• Sidewalks
• Alleyways (when not used for emergency or vehicle traffic)
• Parking lots
• Plazas
The area of use identified through this process may, or may not, include fencing or other
approved means that effectively restrict or discourage the general public from using the
space. In general, the approved area will be defined by the perimeter of the outdoor
dining/retail sales area, including any path(s) of travel by the public through the designated
outdoor area. The perimeter, as defined in the approved site plan, should be clearly
delineated using barriers including, but not limited to: decorative fencing, temporary walls,
planter boxes, or K -Rail barriers.
On public property and in the public right-of-way, the Public Works Department will use
discretion in determining an approved area to account for practical considerations such as
trees and other obstructions. As needed, the Public Works Department will also consider
implementation of appropriate capital improvement type modifications to facilitate safe use of
the public right-of-way for these and other types of public uses.
Additionally, to further reduce expenses and red tape for participating businesses, the City
intends to procure insurance coverage appropriate for this type of use within the public right-
of-way and other public property, rather than require each participating business to procure
comparable coverage. The estimated premium is expected to be approximately $100,000,
depending upon the scope of activities. In the interim, businesses will be required to provide
appropriate insurance coverage documentation.
The application process and application submittal package requirements for establishment of
temporary outdoor dining and/or outdoor retail sales areas related to COVID-19 are expected
to be made available during the first week of June.
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It is recommended that the Temporary Use Permit (TUP) Application for Outdoor
Dining/Outdoor Retail Sales Permit Fee: $95.00 be waived throughout of the administration
of this program. The Program is set to conclude fourteen (14) days after the City rescinds its
emergency proclamation. Approval of the attached Resolution will implement the temporary
fee waiver.
Rent/Housing Assistance and Food Distribution
The general purpose of this initiative is to provide homelessness prevention support such as
rental/housing assistance and food distribution to mitigate the impacts of COVID-19. In order
to most effectively address the needs of the community while complying with the eligible uses
for these sources of funds, staff intends to partner with non-profit resource organizations (e.g.
Families Forward and Meals on Wheels) who are already providing these types of services
throughout Orange County and within Tustin so they can better serve the increased service
demands that have arisen due to impacts from COVID-19.
Rent/Housing assistance is intended to support those at -risk of homelessness to secure or
maintain stable housing. Typically, this is in the form of one-time, or short term, financial
assistance in addition to resource connection, supportive services, and program referrals to
facilitate long term self-sufficiency.
Food distribution and meal assistance is intended to supplement existing service providers
who have seen unprecedented increases in service requests. This will likely focus on the
senior and Covid-19 vulnerable populations but may also include children and families.
These initiatives are subject to adjustment as needed in response to shifting requirements
and priorities. For example, staff may need to change one eligible activity to another eligible
activity in the event there is insufficient funds in that activity to fully carry it out, or if there is
less need for funding in one activity relative to another activity. Staff may also need to remove
or replace an eligible activity entirely without returning to City Council for approval to most
effectively respond to the COVID-19 pandemic on behalf of the community.
Attachments:
• CDBG Program Requirements
• Resolution No. 20-40 Temporary Fee Waiver
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CITY OF TUSTIN
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
SUMMARY OF PROGRAM REQUIREMENTS
The City of Tustin contracts with agencies through the Community Development Block Grant
(CDBG) Program to provide a variety of services for Tustin residents. Those agencies contracting
with the City must agree to meet CDBG requirements and comply with applicable federal
regulations. The following summary and attachments have been prepared to help you understand
the requirements and responsibilities that are required as a recipient of federal CDBG funds.
INSURANCE
The City of Tustin requires all subrecipients to carry insurance. The Agreement with each agency
states that subrecipients shall obtain and maintain policies of worker's compensation and general
liability insurance in an insurable amount of not less than one million dollars ($1,000,000).
The contract also states that the City shall be named as an additional insured on theses policies.
Subrecipients must furnish certificates of insurance to the City before commencement of work.
FISCAL ACCOUNTING AND AUDIT DOCUMENTATION
The City of Tustin requires each agency to observe and comply with all accounting rules and audit
procedures established by HUD and outlined in your Contract. The following is a brief description
of the most prominent requirements:
Each subrecipient also agrees to keep separate accounting records of CDBG
expenditures and all funds received from the City of Tustin.
2. All accounting records, evidence pertaining to subrecipient costs, and documents
related to your Agreement, shall be retained and available for five (5) years
following the completion of the program.
3. Each subrecipient agrees to allow the City to audit the funded program as part of
the City's annual audit of all CDBG funds pursuant to federal regulations found in
Title 24 of the Code of Federal Regulations.
BILLING PROCEDURES
The City has developed a standard invoice which each subrecipient is to use when submitting a
reimbursement request (attached as Exhibit A). While CDBG regulations allow funds to be
distributed in advance for services, that is not City of Tustin policy. A request may be submitted
for reimbursement only, and written documentation of expenses must be provided (i.e., receipts,
accounting of expenditures, etc.). Requests should be submitted quarterly during the one year
period from the date of execution of the contract. The City agrees to pay all invoices within thirty
(30) days of receipt. Payment will be made only if receipts provided are for eligible expenditures
and proper documentation is provided. The City will review receipts to ensure all expenses
incurred are within the scope of the Contract and that the subrecipient continues to comply with
terms and conditions of the Contract.
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City of Tustin
CDBG Program Requirements
Page 2
REPORTING REQUIREMENTS
All subrecipients participating in the City's CDBG Program are required to provide the City with
written reports of its activities on a quarterly basis and also at the end of the program year (see
Exhibits B and C). The Quarterly and Annual Performance Report will consist of statistical
information on the number of Tustin residents served, as well as all clients participating in the
CDBG-funded activity/program and their income category, as determined by federal income limits,
ethnicity, and status as a female headed household. In addition, all reports should include
information on program activities, accomplishments, statistics on expenditures, case loads, and
activities of the period.
The Quarterly Performance Report is to be submitted no later than 15 days after the end of each
Fiscal Year quarter. Fiscal Year is from July 1 to June 30; quarterly reports are due 15 days after
the last day of September, December, March, June.
The Annual Performance Report, due 30 days after the end of the Fiscal Year, will also require a
brief narrative description of the project that includes notable objectives and achievements for the
program year. The Annual Performance Report should analyze the completion of the project's
objectives and discuss reasons for changes or delays in the project goals and state any
procedures or actions that may have increased or decreased the effectiveness of the program.
PROGRAM MONITORING
One of the City's responsibilities is to monitor each subrecipient at least once a year. Our
monitoring visits are intended to ensure each agency's continued compliance with the CDBG
Program requirements, and serve as an opportunity for City staff to become more knowledgeable
about the agency's program.
Listed below is typical information we will be seeking, observations that might be made, and items
that we may wish to review:
1. The accomplishments of the program to date.
2. Whether program objectives are being met.
3. That the intended client group is being served.
4. The number of people on staff.
5. The existence and maintenance of client and fiscal files.
Although the terms "monitoring" and "audit" may appear to be formidable, please be assured that
you will be notified in advance of any request for a monitoring visit. Please also be advised that
representatives from the U.S. Department of Housing and Urban Development (HUD) monitor the
City of Tustin's CDBG program each year. During their visits, they may wish to monitor one or
more of the City's subrecipients. If your agency is selected for monitoring by HUD, you will be
notified only one day in advance in order to set up a mutually convenient time.
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Agency Name:
Address:
Reporting Period: to
(Wnth/Year) (Month/Year)
CITY OF TUSTIN
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
QUARTERLY PERFORMANCE REPORT
Contact Person:
Phone No.:
NOTES
List only mdopticated program p-Wipaots Each program parlicipvot ehoold only be courted once.
ToW As Ai dd: ToW number of program participants regardless of into
Indicate whether program participant is a person (P) or household (IT).
Ethnicity: Provide dre ethnicity of the t W mnnber of Tustin residents assisted
and the t W —ber of participants, inchrdivg Tustin residents.
MFI: Median Family Income
Repro to:
CD13G Adouvistrator
Tustin Community Development Department
300 Cevtemial Way
Tustin, CA 92780
S \CW%CDBG\Conrad Dotumenfs - Subrecipients\quarterly pedormanre mpart.
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List only mdopticated program p-Wipaots Each program parlicipvot ehoold only be courted once.
ToW As Ai dd: ToW number of program participants regardless of into
Indicate whether program participant is a person (P) or household (IT).
Ethnicity: Provide dre ethnicity of the t W mnnber of Tustin residents assisted
and the t W —ber of participants, inchrdivg Tustin residents.
MFI: Median Family Income
Repro to:
CD13G Adouvistrator
Tustin Community Development Department
300 Cevtemial Way
Tustin, CA 92780
S \CW%CDBG\Conrad Dotumenfs - Subrecipients\quarterly pedormanre mpart.
DocuSign Envelope ID: B5C75B1A-8B42-4E6B-BF92-5A47125D3695
Agency Name:
Address:
Reporting Period:
(Month/Year) (Month/Year)
CITY OF TUSTIN
COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
ANNUAL PERFORMANCE REPORT
Contact Person:
Phone No.:
NOTES Retwrto: CDBGAdwnistrator
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NOTES Retwrto: CDBGAdwnistrator
LIST ONLY L:- ITLICATED PROGR I PARTRIPANTS. Bach program partiapar¢ should mly be counted tyreList all signi5cant program/project aceomplishmads darhrg the prograrn year ov a separate sheet. Them CoQnmmity Development Deparmsart
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hIFI: Mali—F ly 1— Tustin, CA 927W
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RESOLUTION NO. 20-40
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN,
CALIFORNIA, APPROVING A TEMPORARY WAIVER OF THE
CITY'S FEE FOR A TEMPORARY USE PERMIT APPLICATION
FOR OUTDOOR DINING/OUTDOOR RETAIL SALES PERMIT
WHEREAS, as of April 2, 2020, a novel coronavirus (COVID-19) had spread
globally, infecting more than 1,000,000 persons and killing more than 51,000 individuals
worldwide. As of April 3, 2020, thirteen (13) Tustin residents, 711 Orange County
residents, over 10,000 Californians, and over 238,000 Americans have been confirmed
COVID-positive.
WHEREAS, the World Health Organization, the President of the United States, the
Governor of the State of California, the County of Orange, and the City of Tustin have all
declared states of emergency as a result of COVID-19; and
WHEREAS, despite sustained efforts, the virus remains a threat, and further efforts
to control the spread of the virus to reduce and minimize the risk of infection and otherwise
mitigate the effects of COVID-19 are being implemented; and
WHEREAS, Tustin's dining and retail economy has been hard hit by the economic
consequences of the State and County health measures adopted to date, including but
not limited to measures that limited restaurants to take-out and delivery options only, and
temporarily prohibited the operation of retail establishments or limited retail stores to
curbside -pickup only;
WHEREAS, it is in the interest of Tustin's local economy, the welfare of Tustin's
dining and retail establishments and their many employees, and the welfare of the
community to be able to dine and shop at their favorite local restaurants and retail stores
when it is safe and healthy to do so, and the dining and retail establishments operate in
a manner consistent with evolving State and County health directives;
WHEREAS, recent orders and guidance issued by the State of California and the
County of Orange are allowing restaurants to reopen on-site dining subject to significant
physical distancing and other restrictions on the occupant capacity of restaurant space;
WHEREAS, recent orders and guidance issued by the State of California and the
County of Orange are allowing retail establishments to reopen subject to significant
physical distancing and other restrictions on the occupant capacity of restaurant space;
WHEREAS, the adverse fiscal impacts of the constraints on indoor dining and on
the normal indoor operations of retail shops can be significantly reduced by permitting
existing dining and retail establishments to temporarily expand their operation into
Resolution No. 20-40
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adjacent outdoor spaces subject to reasonable conditions established to ensure the
health and safety of the establishments' employees and customers;
WHEREAS, to those ends the Council wishes to facilitate outdoor dining and outdoor
retail use on private property and/or within the public right-of-way while protecting the
public interest through the use of guidelines approved by City staff, which may be
amended at any time, that will apply to outdoor dining and outdoor retail sales areas
associated with an existing business.
WHEREAS, such new outdoor dining and outdoor retail sales areas may be located
adjacent to, or in the vicinity of, a permitted restaurant, cafe, or retail business on private
property, public property, or within the public right-of-way. Such locations include, but may
not be limited to sidewalks, alleyways (when not used for emergency or vehicle traffic),
parking lots, and plazas;
WHEREAS, dining and retail establishments that are already struggling under the
restrictions of the temporary health measures that restrict their normal operations should
not be further burdened with permitting fees to serve food outdoors during the local
emergency;
NOW, THEREFORE, the City Council of the City of Tustin DOES HEREBY
RESOLVE as follows:
SECTION 1. The fee for a Temporary Use Permit (TUP) Application for Outdoor
Dining/Outdoor Retail Sales Permit is hereby waived while this Resolution remains in
effect.
SECTION 2. This Resolution shall go into effect immediately upon its adoption and
shall continue in effect until 11:59 p.m. on the 14th calendar day after the date on which
the City's local emergency expires or is terminated.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Tustin held on the 2nd day of June, 2020.
Dr. ALLAN BERNSTEIN,
Mayor
ATTEST:
ERICA N. YASUDA,
Resolution No. 20-40
DocuSign Envelope ID: B5C75B1A-8842-4E6B-BF92-5A47125D3695
City Clerk
Resolution No. 20-40
DocuSign Envelope ID: B5C75B1A-8842-4E6B-BF92-5A47125D3695
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF TUSTIN )
I, Erica N. Yasuda, City Clerk and ex -officio Clerk of the City Council of the City of Tustin,
California, do hereby certify that the whole number of the members of the City Council is five;
that the above and foregoing Resolution No. 20-40 was duly and regularly passed and
adopted at a special meeting of the City Council held on the 2nd day of June, 2020 by the
following vote:
COUNCILPERSONS AYES:
COUNCILPERSONS NOES:
COUNCILPERSONS ABSTAINED:
COUNCILPERSONS ABSENT:
ERICA N. YASUDA,
City Clerk
Resolution No. 20-40