TO: Mayor and City Council
THROUGH: Krishna Namburi, City Manager
FROM: Kristin Retherford, Director of Community Planning and Development
SUBJECT:
title
Substantial amendment to City of Salem 2025 Annual Action Plan (AAP) with U.S. Housing and Urban Development (HUD)
Ward(s): All Wards
Councilor(s): All Councilors
Neighborhood(s): All Neighborhoods
Result Area(s): Welcoming and Livable Community.
end
SUMMARY:
summary
In July of 2025, City Council approved a 5-year consolidated plan for 2025-2029 with HUD outlining intended uses of federal funds to address a variety of needs related to affordable housing and community services. The first year of the 5-year plan is the 2025 Annual Action Plan. The 2025 AAP approved $4,287,720 to expand & preserve affordable housing and $1,455,820 to support public facilities, representing a combination of prior years’ unspent funds and projected PY25 funds. This substantial amendment proposes to shift $516,500 from the former bucket to the latter.
end
ISSUE:
Shall City Council approve a substantial amendment to the City’s 2025 Annual Action Plan with HUD moving $516,500 from “Housing Preservation” to “Public Facilities”?
RECOMMENDATION:
recommendation
Approve a substantial amendment to the City’s 2025 Annual Action Plan with HUD moving $516,500 from “Housing Preservation” to “Public Facilities”.
body
FACTS AND FINDINGS:
In late 2024, SHA approached program staff with the City regarding a $3 Million funding gap for a proposed $40M renovation of the Southview Terrace and Englewood West apartment buildings. Program staff agreed to fund this $3M gap and decided upon an initial allocation of prior year unspent funds and PY25 grant funds. Since that time, there have been significant delays in HUD awarding our PY25 grants putting us up against the annual timeliness test on May 2, 2026. With a leadership directive to prioritize passing the timeliness test, program staff decided to propose reallocating some PY25 funding towards a project that would draw down by the timeliness deadline (MPFS Warehouse) and backfilling the $3M obligation with additional anticipated PY26 grant funds.
At the activity (City project) level, the PY25 Annual Action Plan approved in July 2025 allocated $600,000 of CDBG to Marion Polk Food Share to acquire a larger distribution and food storage warehouse in an industrial part of NE Salem and $515,600 of CDBG to a multi-family rehabilitation project for Salem Housing Authority. On February 4, 2026 program staff received a memo from Marion-Polk Foodshare (MPFS) requesting additional funds in the amount of $550,000 to help make up for weaker than expected private contributions for the acquisition and to meet exponentially growing demand.
The revised allocation will substantially help a community partner with needed expansion as well as with the City’s CDBG timeliness test, as the SHA activities did not plan to spend before May 2, 2026. The funding gap in the SHA activities can be filled from the PY26 CDBG allocation or increasing the allocation from HOME as the project moves closer to commencement.
Eric Lowe
Manager of Federal Programs
Attachments:
1. MPFS Memo.docx
2. Substantial Amendment Presentation 3.9.26.ppt
3. 2025 AAP with revisions