CDBG Working Group — Portland, ME
Date: 2013-03-07

CDBG Working Group

DRAFT Meeting 5 Summary: March 7, 2013
Members: Chris Hall, Karma O’Connor, Tae Chong, Beth Campbell, Joni
Boissonneault, Rob Wood, John Shoos, Mike Rolland, Julie Chase

Staff: Amy Pulaski, Maeve Wachowicz (note taker)

Welcome:

Amy goes over the packet, which includes input on LMI from Greg Mitchell and CDBG
allocation data.

Meeting Summary:

John moves to accept the summary, Tae seconds. All approve.

Review of target populations and desired outcomes:

Amy reviews some of the discussion from last week, such as the threshold populations
and priority populations. Numbers of the foreign born population in Portland based on the
American Community Survey is 7,000 (Portland total population is about 66,000).
According to the Director of Social Services, Bob Duranleau, the number of homeless in
Portland is 4,000, with 30% being chronically homeless (those who spend 200-300 days a
year in the shelter system). Nightly homeless population counts are 500. Amy suspects
that the 30% of chronically homeless is of 500 nightly (not the 4,000 yearly). The group
discusses that this chronically homeless group will probably not be a target for this
program.

Amy presents an email from Greg Mitchell, the City’s Economic Development Division
Director about the required LMI percentage. HUD guidelines are 51%, and the priority
task force recommended to increase it to 66%. In his email Greg advocates for 51%, as it
is less restrictive on the business community. He also recommends a two year monitoring
period of programs, as opposed to five years. On the other hand, Doug Gardner, Health
and Human Services director, advocated for 100% LMI served. Rob comments that he
would like to see the group go with the 66% number.

The group discusses capping the income of individuals participating in the program, so
that those with high incomes are not able to participate. Amy confirms that HUD defines
LMI as 80% of area median income. For Portland, area median income for a family of
four is $76,400, making the 80% LMI income $61,100 for a family of four and $42,800
for a single person.



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Beth moves to have a requirement of 66% LMI served. Rob seconds. The group discusses
whether this is too limiting for business choice, and the benefits of keeping the program
more flexible for appropriate candidates. Amy reminds the group that the requirement
would only apply to the net new jobs/or to the particular scope of work defined by the
applicant, not necessarily to an entire business’s hiring practices.

Amy also explains that funding for net new jobs can pay for working capital or salary,
but those jobs need to be self sustaining at some point since the funding is not permanent.
Or it can pay for improvements that would enable an employer to have funds to create a
new position etc. The group discusses getting feedback about percentage requirements in
the public input session. Chris also indicates that he could reach out to those in the
hospitality industry for feedback.

Tae says he would like the requirement that enables us to help the most people and
advocates for 100% LMI. He comments that for the jobs the program is likely to create,
the LMI number is relatively high anyway, so he does not think a higher LMI
requirement would be overly burdensome for businesses to reach. The group talks about
setting a lower threshold, and giving preference to those that have a higher percentage of
LMI served.

The group votes on Beth’s motion (to have a requirement of 66% LMI served) ; 8 vote in
favor, 1 opposed.

Tae moves to give preference to higher percentages of LMI Portland residents people
and/or preference to programs that provide more jobs to LMI Portland residents. The
motion is seconded. The group discusses whether the jobs should only be for Portland
residents, or whether these preferences are too prescriptive overall. All vote in favor.


Discussion of metrics and time frames:

The group then discusses metrics for success in the program. Some options include
percentage change in income, length of time off of subsidies, percent increase in
employment (i.e. half time to full time, increase in benefits). The group discusses how
specific metrics should be as long as the applicant can show a return on investment
(ROI). The group then discusses the definition of ROI. One suggestion is that the RFP
could say the applicant must prove how you would accomplish one of these metrics
(off/decrease subsidies, change in income, % of employment).

Mike suggests measuring an individual’s income after leaving the program, at
employment, and after some determined period of time. The group discusses how these
calculations would be made for self-employment. Amy mentions that CEI has a
definition of when they consider a business to be in existence. The group then discusses
microenterprises, their definition and how the LMI requirements would work for them.




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Discussion of conditions and limits:

The group talks about the need to have a vetting process for microenterprises to check on
the validity of their business plan and their chances for success. Microenterprises could
work with SMCC/other partners for technical assistance/vetting, then those partners
would be the applicant, not the start-up/microenterprise.

Julie moves that only organizations that provide business incubator/assistance programs
would be eligible for CDBG’s microenterprise development funds, not individual start-
ups. Jon seconds. All approve.

Discussion of time frames:

The group looks at past years funding allocations. The federal funding has decreased
significantly over the years. Economic Development/Job Creation funding is a more
recent category in recent funding cycles. When taking money out of the Development
category for this program, it will come out of the pot that provides funds for non-profits
that apply for building, public infrastructure projects, and residential rehabilitation.

Mike asks whether success in this new program should come with an expectation of
getting funding again. Amy talks about multi-year grants, but says that success is not a
guarantee of getting funded again. The group talks about appropriate time frames in this
context and that 2 years is a short time frame for this kind of initiative, but at the same
time, funding less frequently would exclude applicants or projects getting started in a
non-funding year.

The group then talks about funding allocations and whether it should be a “winner take
all” scenario, or if projects should define their funding requests, or if there should be
several smaller allocations available. Tae suggests since this program is in its pilot stages,
it would be beneficial to start off with a funding model that would allow several
programs to get started and see what is successful. Then after that, the funding can
become more competitive. Karma comments that smaller funding allocations can be less
effective. Beth talks about having a range of possibilities so that the RFP would state a
minimum or maximum possible and say that there is potential for 3 awards to be given,
for example.

Amy explains how much funding might actually be available. Since 2010, the Social
Services program has received a 33% cut and there are certain key services funded that
the Council would not want to see go away. Amy goes over the charts provided by staff.
Based on funding trends, $400,000 would need to stay for Social Services, so the group
could recommend taking between $100,000 - $150,000 from the Social Services pot for
this program. A reasonable recommendation from the Development pot would be
$300,000 - $450,000. The group discusses how flexible allocations and time frames
should be and the benefits/drawback of funding over several years as opposed to a lump
sum one year.




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Amy suggests recommending a pot of $100,000 from Social Services and $300,000 from
Development for this program, to allow for growth in future years. Not funding every
year could mean missing funding certain projects. Jon comments that 3 years seems too
limiting, while two years (every other year) seems better.

Chris moves for funding the whole pot to one program ever two years. Jon seconds. All
vote in favor.

Beth moves to have a minimum allocation of $100,000 and a maximum of $400,000 with
the potential for 1 to 3 proposals funded and the funding coming from $300,000 of
Development and $100,000 from Social Services. Rob comments that one program
should not be able to receive the whole pot. Tae asks about taking more money from the
Development pot. Karma says there are many ADA projects that would not get funded in
that case and it would be better to be conservative for the first year. Beth amends her
motion to be a potential for 2-3 proposals. Mike seconds the amendment. Rob calls the
question. 8 vote in favor, 1 opposed.

Next meeting:

March 28th 2:00 -4:00 pm, room 209. The group will solidify draft recommendations
for the public input session.
Public Input session: Wednesday April 3rd at 7pm. The group will meet following the
session on April 4th at 2:00pm in room 209.




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