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REQUEST FOR <br />COUNCIL ACTION <br /> <br />CITY COUNCIL MEETING DATE: <br /> <br />JANUARY 5, 2004, <br /> <br />TITLE: <br /> <br />AMENDMENT TO EMPOWERMENT ZONE <br />GRANT AGREEmeNT WITH HUD AND <br />THE STATE OF CALIFORNIA <br /> <br />CLERK OF COUNCIL USE ONLY: <br /> <br />APPROVED <br /> <br />[] As Recommended <br />[] As Amended <br />[] Ordinance on 1st Reading <br />[] Ordinance on 2"d Reading <br />[] Implementing Resolution <br />[] Set Public Hearing For_ <br /> <br />CONTINUEDTO <br /> <br />FILENUMBER <br /> <br />RECOMMENDED ACTION <br /> <br /> Direct the City Attorney to prepare and authorize <br /> Clerk of the Council to execute an amendment to <br />OAgreement with the United States Department of <br /> Development, the State of California and the City of <br /> the designation of the City of Santa Aha as a <br /> Empowerment Zone. <br /> <br />the City Manager and <br />the Memorandum of <br />Housing and Urban <br />Santa Aha regarding <br />Round II Federal <br /> <br />DISCUSSION <br /> <br />In January of 1999, the City of Santa Aha was awarded a Round II Urban <br />Empowerment Zone designation by the United States Department of Housing <br />and Urban Development (HUD). The current Grant Agreement between the <br />City of Santa Ana and HUD obligates the City to conform to the <br />requirements of 24 CFR 85.25 (g) regarding program income as set forth in <br />our Memorandum of Agreement (MOA). Specifically, under provision 24 CFR <br />85.25 (g) (1) program income is required to be used for program costs <br />~unless the Federal agency authorizes otherwise." <br /> <br />Currently the City has an agreement with the Santa Aha Empowerment <br />Corporation (SAEC) that transfers these obligations to the SAEC. The <br />SAEC is currently generating program income from the repayment of loans. <br />Further, the SAEC will continue to generate program income through <br />investments as part of the "Investment Component" of the SAEC Business <br />Plan. Without amending the existing Grant Agreement and the MOA, the <br />SAEC is limited in its use of these funds (Exhibit A). <br /> <br /> November 19, 2003, the SAEC Board of Directors approved a <br />recommendation that the Santa Aha City Council approve the subject <br />amendment as presented in this report. <br /> <br />Page 41 25.D. <br /> <br /> <br />