AGENDA ITEM EXECUTIVE SUMMARY
ITEM TITLE*
title
Public Hearing: 2025-26 Community Development Block Grant Program Plan Amendments
presenter
RESPONSIBLE STAFF, TITLE, DEPARTMENT*
Loryn Clark, Interim Director, Housing and Community Development (HCD) Department
Emily Holt, Interim Assistant Director for Affordable Housing, HCD Department
Melissa Peters, Funding Programs Coordinator, HCD Department
STAFF RECOMMENDATION*
Staff recommends that the Council receive comments on the amended 2022-2023, 2023-2024, 2024-2025, and 2025-2026 CDBG Annual Action Plans and 2025-2029 5-Year Consolidated Plan.
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ACTION/DECISION POINTS*
Open the public hearing to receive comments. No formal Council action required.
LEGISLATIVE CONTEXT*
The Town of Chapel Hill receives an annual allocation of Community Development Block Grant (CDBG) funds from the U.S. Department of Housing and Urban Development (HUD) to address community development and affordable housing needs.
HUD requires communities that are substantially amending their Consolidated Plans to hold a public hearing before the substantial amendment is finalized to receive community feedback on the amendments. The Town’s Citizen Participation Plan (CPP) also requires substantial amendments of Annual Action Plans to receive a public hearing. The amendments that the Town is proposing meet the CPP criteria for a substantial amendment because the reallocation amount is above 25% of the Town’s 2025-2026 CDBG program year grant amount.
The Town is part of the HOME Consortium called the Local Government Affordable Housing Collaborative (LGAHC) alongside Orange County and the Towns of Carrboro and Hillsborough. Orange County administers the HOME funding on behalf of the LGAHC, including the funding allocation process and the creation of the 5-Year Consolidated Plan.
The Annual Action Plan describes how the Town will use CDBG funding during the next program year. The 5-Year Consolidated Plan will determine County and Town priorities for federal funding over the next five years of funding. The final amended Annual Action Plans and Consolidated Plan submitted to HUD will include all comments received in writing and at public hearings.
BACKGROUND AND CONTEXT*
On June 11, 2025, Council approved a funding plan for 2025-26 CDBG funding, the 2025-2026 Annual Action Plan, and the 2025-29 5-Year Consolidated Plan. Staff now propose to reallocate $176,615 from that approval.
Staff typically recommend reallocations when:
• Unspent funds from an activity remain after the activity’s agreement expires
• A need is identified for neighborhood revitalization funding
o Neighborhood revitalization funding is a portion of CDBG funding that is not currently dedicated to a specific activity and is held for future eligible projects.
• Activities are moved to local funding
Staff recommend reallocating $76,615 in past available CDBG funding to support Refugee Community Partnership and IFC case management programs and Transplanting Traditions microenterprise assistance from the 2025-2026 approved funding plan. This funding comes from the combination of a past affordable housing activity with an expired agreement, a past affordable housing activity that does not need its funding immediately, and past neighborhood revitalization funding that is not currently committed to an activity.
The $76,614 in 2025-2026 CDBG funding that is currently allocated to these three activities will be reallocated to a 2025-2026 affordable housing activity and 2025-2026 neighborhood revitalization funding. In addition, staff have determined that local funding is a better fit for an organization that was previously awarded $100,000 in 2025-2026 CDBG funding. Staff recommend reallocating this amount to 2025-2026 neighborhood revitalization funding.
The proposed amendments would reallocate a total of $253,229 in CDBG funding from various years. Details on the proposed plan amendments are found in the Summary of Amendments to 2025-2026 CDBG Annual Program Plan attachment.
FINANCIAL IMPACT
By reallocating $253,229 in CDBG funding, the Town will be able to spend reallocated CDBG funds during the 2025-2026 CDBG program year. Funding reallocated to 2025-2026 neighborhood revitalization funding will be incorporated into the 2026-2027 CDBG funding plan that Council will consider in April 2026.
Community Impact
CDBG funding is intended to develop viable urban communities primarily for low- and moderate-income people by providing decent housing, suitable living environments, and economic opportunities. Except for program administration, the Town intends to allocate 100% of program funds to benefit low- and moderate-income individuals and households in Chapel Hill.
COMMUNITY ENGAGEMENT
The Town held an initial public hearing on the 2025-2029 housing and community development needs assessment on November 13, 2024. The Town then held a more than 30-day public comment period beginning on April 1, 2025 and second public hearing on the 2025-2026 funding plan, Annual Action Plan, and 2025-2029 5-Year Consolidated Plan on April 9, 2025.
The Town opened a 30-day public comment period on the amended 2022-2023, 2023-2024, 2024-2025, and 2025-2026 CDBG Annual Action Plan and 2025-2029 5-Year Consolidated Plan on December 22, 2025. The comment period will end on January 22, 2026.
ATTACHMENTS
Summary of Original 2025-26 CDBG Annual Program Plan <https://www.townofchapelhill.org/home/showpublisheddocument/57024/638791169426965352>
Summary of Amendments to 2025-2026 CDBG Annual Program Plan <https://www.townofchapelhill.org/home/showdocument?id=57836>
2025-2026 CDBG Annual Action Plan <https://www.townofchapelhill.org/home/showpublisheddocument/57022/638791168653533754>
2025-2029 CDBG Quick Reference <https://www.townofchapelhill.org/home/showpublisheddocument/55671/638472260022070000>
CDBG Public Hearing #1 2026
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