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Home My WebLink About2026-032 26-27 Funding RecommendationsMay 29, 2026 Report No. 2026-032 INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: Funding recommendations from the Community Services Advisory Committee (CSAC) for the proposed activities in the 2026 Action Plan for Housing and Community Development. EXECUTIVE SUMMARY: The Community Services Advisory Committee (CSAC) has provided recommendations to the City Council for the allocation of $1,872,958.33 in federal funds for community development. Staff have included these funding recommendations in the 2026 Action Plan for Housing and Community Development (Action Plan) and public comment is now open. The draft 2026 Action Plan for the Program Year from October 1, 2026, through September 30, 2027, represents the fourth year in the City’s 2023-2027 Consolidated Plan for Housing and Community Development (Linked). Public comment lasts from May 25 through June 23 and a public hearing for the plan will be held June 16, 2026, during the regular City Council meeting. DISCUSSION: Community Development Funding Overview As a recipient of Community Development Block Grant (CDBG) and HOME Investment Partnership (HOME) program funds, the City of Denton is required to submit a five-year Consolidated Plan for Housing and Community Development (Con Plan) and a corresponding annual Action Plan to the U.S. Department of Housing and Urban Development (HUD). These federal funds are received annually to support the Con Plan and the activities outlined in the City’s annual Action Plan. In 2023, the city submitted a five-year Con Plan for the following program years. • 2023-2024 Action Plan – Year 1/Previous Year • 2024-2025 Action Plan – Year 2/Previous Year • 2025-2026 Action Plan – Year 3/Current Year • 2026-2027 Action Plan – Year 4/ Recommendations • 2027-2028 Action Plan – Year 5 The annual Action Plan is developed based on strategies outlined in the Con Plan and provides a description of how funds are allocated each Program Year. The annual Action Plan is reviewed and approved by City Council for submission to HUD. The Community Services Advisory Committee (CSAC) is a Council appointed citizen advisory committee that advises the City Council on programs, services, and use of public resources to address complex social problems such as economic instability, housing, homelessness, and meeting community service needs. The CSAC reviews applications for the Community Development Block Grant Program annually and makes funding recommendations to City Council which includes distribution of local (General Fund) and federal (CDBG and HOME) funding sources. May 29, 2026 Report No. 2026-032 Eligible Activities Eligible activities for CDBG and HOME funding include housing development, rehabilitation and preservations; improving community facilities and neighborhood infrastructure; public (human) services; economic development; planning; and program administration. CDBG HOME ▪ Acquisition ▪ Affordable Rental Housing ▪ Public Facilities and Improvements ▪ Homeownership Assistance ▪ Demolition and Clearance ▪ Tenant Based Rental Assistance ▪ Social Services (15% cap) ▪ Land Acquisition ▪ Housing Programs ▪ New Housing Construction ▪ Economic Development ▪ Historic Preservation ▪ Code Enforcement ▪ Removal of Architectural Barriers Citizen Participation To gain public input for the 2026 Action Plan, staff held a public hearing on October 28, 2025, and used an online survey requesting citizen input regarding the use of CDBG and HOME funds. A summary of online survey is included in Exhibit 1. A final Public Hearing will be held June 16, 2026, during a regular session of City Council, for feedback on the 2026 Action Plan. Community engagement activities regarding public hearings and survey distribution are outlined below. 1. Information was sent via email listserv to interested citizens, previous clients, committee members, local churches, lenders and realtors who participate in the City’s housing programs, neighborhood associations, and social services agencies. 2. Newspaper advertisements were posted in the Denton Record Chronicle. 3. Information was sent to City Council members through the Friday report. 4. Flyers were posted in City buildings. 5. Information was posted on social media via the Nextdoor app. Available Funding The City of Denton’s 2026 Action Plan reflects local (General Fund), and federal (CDBG and HOME) funding. The City’s general fund allocation for the Community Development Grant Program is included in the Action Plan to reflect the City’s investment to leverage with federal funds. However, the General Fund recommendations will be considered for approval by City Council during the normal budgeting cycle for FY 2026-27. May 29, 2026 Report No. 2026-032 The total grant funding proposed for the FY 2026-27 program year is $1,872,958.33, as outlined in Figure 1. Figure 1: Funding Summary by Funding Source FUNDING SOURCE FUNDING AMOUNT SET-ASIDES 26/27 CSAC ALLOCATION Community Development Block Grant – Final 1,140,961.00 1,020,012.28 Community Development Block Grant - Program Income1 4,000.00 Community Development Reallocated Funds3 103,243.28 Community Development Block Grant – Administration2 228,192.00 CDBG TOTAL 1,248,204.28 228,192.00 1,020,012.28 HOME Investment Partnership Grant - Final 486,606.05 437,946.05 HOME Investment Partnership Grant – Administration2 46,8,660.00 HOME TOTAL 486,606.05 46,8,66000 437,946.05 General Funds 1,345,526.00 415,000.00 General Funds – Homeless Initiatives 930,526.00 GENERAL FUNDS TOTAL 1345,526.00 1307,378.00 415,000.00 TOTAL 3,080,336.33 1,207,3780.00 1,637,440.32 1CDBG Estimated Program Income will be adjusted based on actual program income at the end of the program year. 2HUD allows a maximum percentage of the grant for administration (CDBG 20%/ HOME 10%). Set- aside is based on costs for 2 FTE. 3The reallocated funds are residual balances from completed projects/programs. 2026-27 Grant Application Process & Applications Received Funding allocations reported in the Action Plan are determined by an annual application process conducted by the CSAC concluding with funding award recommendations made to City Council. A summary of the 2026-27 Community Development Grant Program application process and committee timeline to date is outlined below. ▪ November 24, 2025, Housing Projects, Public Facilities, and Human Services Applications were released. ▪ December 9, 2025: Staff conducted application training. ▪ January 16, 2026: All applications closed. ▪ February 2026: CSAC reviewed submitted applications. ▪ April and May 2026: CSAC developed a set of funding recommendations for the 2026- 2027 program year. ▪ May 2026: The draft 2026 Action Plan was prepared based on the CSAC funding recommendations for the CDBG and HOME funds. May 29, 2026 Report No. 2026-032 Twenty-eight (28) eligible applications were received, totaling $3,001,166.00, and an overview of applications received is included below (Figure 2). Figure 2: Summary of Applications Received for the 2025-26 Community Development Grant Program Application Type # Applications Received Total Funding Requested Total Funding Available Human Services 20 $1,145,936.00 $586,144.00 Housing Projects 5 $1,205,000.00 $1,286,814.33 Public Facilities 3 $650,230.00 Total 28 $3,001,166.00 $1,872,958.33 2026-27 Grant Application Funding Recommendation The CSAC met Friday, May 8, 2026, to consider the 2026-2027 Community Development Grant Program recommendations. The committee reviewed the cumulative results of committee member scoring and funding recommendations to make final funding recommendations as a group. A summary of the funding recommendations and project descriptions is included in Exhibit 2. Below is a summary of the total funds recommended by application type (Figure 3). Figure 3: 26-27 Funding Recommendations by Project Type Application Type Total Funding Recommended Human Services $586,144.00 Housing Projects $703,822.28 Public Facilities $395,046.00 Total $1,685,012.28 The committee recommended leaving $187,946.05 of HOME funding remains unallocated for now with plans to assess how they can be best used to support housing affordability after Council’s consideration of the affordable housing bond program. Staff will review options for allocating the remaining funds in the next year with the committee. The CSAC funding recommendations are based on final funding available in Community Development Block Grant (CDBG), HOME Investment Partnership Program (HOME), CDBG reallocated funds, and local program income are $1,872,958.33. Funding recommendations will be proportionally adjusted based on the approved 26-27 General Fund budget from City, anticipated in September. CONCLUSION: The public comment period for the 2026 Action Plan will begin May 25 and end June 23, 2026. A public hearing for the plan will be held June 16, 2026, during the regular City Council meeting. Additional updates and actions will occur according to the timeline below (Figure 4). May 29, 2026 Report No. 2026-032 Figure 4: 2026 Action Plan Timeline Proposed Activity Date 30-day Comment Period on 2026 Action Plan May 25 to June 23, 2026 City Council and Public Hearing June 16, 2026 City Council considers approval of 2026 Action Plan July 21, 2026 Submission of 2026 Action Plan to HUD August 15, 2026 Approval of the 2026-2027 Community Development Grant Program contracts September 30, 2026 Start of 2026-2027 Community Development Grant Program Contracts October 1, 2026 ATTACHMENTS: Exhibit 1 – 2026-27 Funding Priority Survey Results Exhibit 2 – CSAC 2026-27 Community Development Grant Funding Recommendation and Project Descriptions STAFF CONTACT: Tamara Jones, Grants Program Coordinator Luisa Garcia, Community Development Manager REQUESTOR: Staff Initiated PARTICIPATING DEPARTMENTS: Community Services Department STAFF TIME TO COMPLETE REPORT: 3 hours