Agenda 03/24/2015 Item #14B1 3/24/2015 14.B.1 .
EXECUTIVE SUMMARY
Recommendation to comply with Department of Housing and Urban Development (HUD) and
Community and Human Services Division (CHS) determinations to reimburse federal funds in the
amount of 5268,901.37 for Community Development Block Grant (CDBG) projects subawarded to
support the work of the Immokalee Business Development Center (IBDC), to authorize the
transfer of necessary funds with the requisite budget amendments, and to waive Resolution 2013-
228.
OBJECTIVE: To comply with HUD and CHS determinations to reimburse federal funds in order to
avoid a finding for non-compliance by HUD.
CONSIDERATIONS: On March 9, 2010, the Board of County Commissioners (BCC) acting as the
Community Redevelopment Agency (CRA) authorized the creation of the IBDC. (Agenda Item 14A)
The central purpose of the IBDC was to foster and encourage entrepreneurial activities through learning
and technical assistance. (Agenda Item 14A; March 9, 2010) Toward that end, various grants were
sought and approved during the existence of the IBDC. The IBDC expired as a County entity on July 31,
2014.
Two grants sought by and awarded to the IBDC from HUD did not achieve the required deliverables.
The first grant (CDBG, CD 10-06) was a $212,000 grant for operating the IBDC and job creation.
(Agenda Item 16B1; June 14, 201 1) The primary deliverable for this grant was to create five (5)jobs for
Low and Moderate Income (LMI)persons. (Agenda Item 16B1; June 14, 2011) Although assistance was
provided to several small locally-owned businesses, the five (5) LMI jobs required by the grant were not
achieved. (See Exhibit 1.)
The second grant from HUD was also for funding the IBDC and job creation (CDBG, CD 12-04). It was
approved for those purposes by the BCC acting as the CRA on March 26, 2013. (Agenda Item 16B1)
The primary deliverable for this $61,087 grant was the creation of two (2) LMI jobs. Again, assistance
was provided by the IBDC, but the two (2) LMI jobs were not created. (See Exhibit 2. Note: HUD's
deadline for BCC action to occur is no later than April 14, 2015.)
The below recommendation was reached after careful consideration and analysis of CRA records, review
of federal regulations,and communications with the Department of Housing and Urban Development.
Once reimbursement occurs, the aforementioned funds will become available for other CDBG-eligible
projects pending review and approval by the BCC.
FISCAL IMPACT: Two grant awards from the federal Department of Housing and Urban
Development in the amount of$273,087.00 were appropriated within grant funds associated with
Housing and Immokalee. Of these award amounts, a total of$268,901.37 has been expended. A
total of $192,708.02 was drawn from HUD as reimbursement for project expenses paid. The
amount drawn from HUD or $192,708.02 must be repaid to HUD from Housing Grant Fund
(705) while the remaining amount not drawn from HUD but expended or $76,193.35 must be
repaid to the Immokalee Grant Fund (715) recognizing that HUD funding is no longer a source
of revenue.
To accomplish the above, budget amendments will be required moving advance dollars from the
Unincorporated Area General Fund (111) to the appropriate grant funds stated above in the
amount of $268,901.37. This advance is necessary because the Immokalee CRA Trust Fund
(186) has insufficient resources to provide this repayment. This advance will be repaid from the
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3/24/2015 14.B.1 .
Immokalee CRA Trust Fund (186) in installments of$30,000 or more per year depending upon
the trust funds budget and cash position each year until the advance is satisfied.
LEGAL CONSIDERATIONS: This item is approved as to form and legality and requires a majority
vote for Board action. -JAB
GROWTH MANAGEMENT IMPACT: There are no impacts to the Growth Management Plan with
this action. Any future BCC-approved projects using the reprogrammed funds will need to be compliant
with the Growth Management Plan.
RECOMMENDATION: To comply with HUD and CHS determinations to reimburse federal funds in
the amount of$286,901.37 for CDBG projects subawarded to support the work of the IDBC, to authorize
the transfer of necessary funds with the requisite budget amendments, and to waive Resolution 2013-228.
Prepared By: Tim C. Durham, Executive Manager Corporate Business Operations
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3/24/2015 14.B.1 .
COLLIER COUNTY
Board of County Commissioners
Item Number: 14.14.B.14.B.1.
Item Summary: Recommendation to comply with Department of Housing and Urban
Development (HUD) and Community and Human Services Division (CHS) determinations to
reimburse federal funds in the amount of$268,901.37 for Community Development Block
Grant (CDBG) projects subawarded to support the work of the Immokalee Business
Development Center (IBDC), and to authorize the transfer of necessary funds with the requisite
budget amendments.
Meeting Date: 3/24/2015
Prepared By
Name: BrockMaryJo
Title: Executive Secretary to County Manager, County Managers Office
3/13/2015 11:02:40 AM
Submitted by
Title: Executive Secretary to County Manager, County Managers Office
Name: BrockMaryJo
3/13/2015 11:02:41 AM
Approved By
Name: DurhamTim
Title: Executive Manager of Corp Business Ops,
Date: 3/13/2015 11:08:57 AM
Name: MuckelBradley
Title: CRA Operations Manager, Immokalee County Redevelopment Agency
Date: 3/13/2015 1:10:45 PM
Name: StanleyTherese
Title: Manager-Grants Compliance, Grants Management Office
Date: 3/13/2015 3:56:21 PM
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3/24/2015 14.B.1 .
Name: MagonGeoffrey
Title: Supervisor-Grants Compliance, Community &Human Services
Date: 3/13/2015 4:01:16 PM
Name: IsacksonMark
Title: Division Director-Corp Fin &Mgmt Svc, Office of Management&Budget
Date: 3/16/2015 8:48:50 AM
Name: GrantKimberley
Title: Division Director-Cmnty &Human Svc, Community &Human Services
Date: 3/16/2015 9:19:59 AM
Name: BelpedioJennifer
Title: Assistant County Attorney, CAO General Services
Date: 3/16/2015 11:14:16 AM
Name: KlatzkowJeff
Title: County Attorney,
Date: 3/16/2015 12:59:11 PM
Name: OchsLeo
Title: County Manager, County Managers Office
Date: 3/16/2015 2:52:21 PM
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EXHIBIT 1 3/24/2015 14.B.1 .
From: Durham Tim
To: GrantKimberlev
Cc: MuckelBradley
Subject: RE:Collier Co-Economic Development Project
Date: Wednesday, February 18,2015 9:29:00 AM
Attachments: IBDC Memo.docx
Kim,
Over the weekend and Tuesday we made additional attempts to gather supporting documents and
information based on Geoffrey's memo.
Unfortunately,there simply isn't anything helpful.
Thanks,
C. L
Executive Manager of Corporate Business Operations
for Collier County, Florida
Website: www.colliergov.net
E-mail: timdurham @colliergov.net
Phone: (239)252-8383
From: GrantKimberley
Sent: Friday, February 13, 2015 12:48 PM
To: GrantKimberley; Crystal K. Kinzel; StanleyTherese; CarnellSteve; RobinsonErica
Cc: DurhamTim
Subject: RE: Collier Co - Economic Development Project
All,
Please see attached the draft recommendation/position noted below.
Geoffrey has outlined a couple of possible options for further documentation that could mitigate the
repayment. Tim, kindly advise if you are interested in pursuing. We can only give 5 days (until 2/20)
for gathering of any further documentation, as we need to comply with HUD's 30 day timeframe.
Therese and Tim—we need to address the financials involved and any required board action. I'll
send a meeting notice for us to discuss.
Please let me know if there are any questions.
Kim
From: GrantKimberley
Sent: Thursday, February 12, 2015 12:54 PM
To: Crystal K. Kinzel; StanleyTherese; CarnellSteve; RobinsonErica
Cc: DurhamTim
Subject: FW: Collier Co - Economic Development Project
All,
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3/24/2015 14.B.1 .
We received the below communication from HUD concerning the 2010 Agreement for IBDC.
Kristi, Bendisa, Geoffrey and I met this week to carefully review and determine a course of action.
We find the guidance a bit unclear and inconsistent in some regards. Geoffrey, our compliance
supervisor, is preparing a recommendation for action. I will have that within a day or two and will
let you know our recommendations are for moving forward.
Thank you.
Kim
From: Casal, Nora E [mailto:Nora.E.Ca _
Sent: Friday, February 06, 2015 1:26 PM
To: GrantKimberley
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D
Subject: Collier Co - Economic Development Project
Kimberley,
We have reviewed the County's request for further consideration in response to the County's
economic development activity discussed with HUD staff and via email below; however, the
information presented by the County does not change the previous determination made by this
office. Nevertheless, we have made a few notes in red addressing some of the County's
comments below. Please note that we have provided all the guidance necessary to justify up
to $151,000 in costs, provided that the jobs meet HUD standards as permanent and full-time.
Any amount ineligible above that figure was caused by the company's failure to create as
many jobs as claimed. Furthermore, any amount ineligible below that figure will be due to
the county's lack of overall management of the activity in question and compliance with
federal rules and regulations. Based on this information the County will have to reimburse
from non-federal funds the total amount of ineligible expenditures. Please note that this is
HUD's final decision on this activity as numerous rounds of advice and guidance were
provided to the County.
If you need further assistance on the reimbursement process you may contact our office. The
reimbursement must take place within 30 days and the County may request a plan for
repayment from non-federal funds.
Nora E. Casal, Senior CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casal car hud.gov
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P3l
* 11II
From: GrantKimberley [mailto:KimberleyGrantCa�colliergov.net]
Sent: Friday, October 24, 2014 3:54 PM
To: Casal, Nora E
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D; MagonGeoffrey; GrantKimberley
Subject: RE: Collier Co
Thank you very much for the reply to our questions on the economic development project discussed
with Gloria Coates and yourself during our recent 1:1 technical assistance visit. We understand the
complexity of the situation and the time limited visit may not have afforded a complete and
thorough vugl l e1 LI lal lge of information and details. I I ICrelore we are taking the uppol Luiiity t0 clarify a
few items below in hopes of finalizing this, whichever direction it goes, and respectfully ask for
further consideration. We respect and appreciate your time and that of other HUD staff in bringing
this to conclusion.
Please be aware or reminded that Collier has not yet closed this grant, nor made its own
determination on the creation of jobs, therefore, the funds have not been fully distributed.
Depending on the outcome, Collier is prepared to ask the subrecipient for a return of funds
disbursed, should that be required. As such, we ask for the opportunity to reach final conclusions
on the matter of job creation in advance of discussions on a potential repayment.
The below can be deciphered as follows:
Blue font—Collier initial questions
Black font with or without underline and red font— HUD response
Black font with bold. italic and underline and preceded by CC—Collier comments to HUD response
Please note I deleted two items from your email that did not warrant any further communication.
Thank you very much for your time and attention.
Kim
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3/24/2015 14.B.1 .
Director, Community and Human Services
(Please note department name change)
Collier County
239-252-6287
Our mission is to enhance the quality of life for the citizens of Collier
County through community development and social services programs
that are compliant, efficient,and meet our customer needs with
compassion and dedication.
From: GrantKimberley
Sent: Wednesday, October 15, 2014 6:25 PM
To: 'Casal, Nora E'
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE: Collier Co
Nora,
We are very appreciative of your reply. In reading your reply, we note that there may be some
misunderstandings that may or may not impact the responses or outcomes.
In order to keep this moving and bring this to final resolution, by early next week we will send you a
reply with more details.
Once again, we appreciate your time and effort and that of your office in assisting us in
administering a compliant program.
Kim
'efirt q'tiVite
Director, Community and Human Services
(Please note department name change)
Collier County
239-252-6287
Our mission is to enhance the quality of life for the citizens of Collier
County through community development and social services programs
that are compliant,efficient. and meet our customer needs with
compassion and dedication.
From: Casal, Nora E [mailto:Nora.E.Casalt hud.gov]
Sent: Wednesday, October 15, 2014 4:58 PM
To: GrantKimberley
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE: Collier Co
Kimberley,
As a follow up to our meeting we have reviewed the county's questions listed below and determined
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3/24/2015 14.B.1 .
that it appears from the information provided below and at the meeting, that the activity cited
below did not meet the low/moderate income jobs national objective. To meet the low/moderate
income jobs national objective, 51 percent of permanent, FTE jobs must be held by or made
available to low and moderate income persons. It appears that the county is using faulty
methodology to count permanent full-time equivalent (FTE)jobs. A FTE usually means eight hours
of work per day; half of a FTE is generally four hours.
CC- Where is this definition of fte in the regulations,please? While the definition of full-time
equivalent is not in the regulations, longstanding policy guidance states that a FTE is generally 40
hours per week. The regulations at 24 CFR 570.208 state that the jobs must also be permanent.
None of the information presented by the county demonstrates that permanent jobs were
created by Mr. Padilla's construction company.
In addition, if a job is only temporary or seasonal, it would not count as a permanent FTE and meet
the low/moderate income jobs national objective. Construction jobs only count if the business
assisted is a construction company.
CC-The business assisted is a construction company.Also,please see the second attachment to
this email with guidance on counting construction jobs. Does this pertain to our situation? Yes,
this guidance may be applied. However, please note that the next to the last paragraph on page 2
of the memorandum states that for construction jobs to be counted as permanent jobs for the
purposes of meeting the national objective, the business and the grantee or subrecipient must have
a reasonable expectation of the continuity of employment for the low and moderate income
persons employed. None of the information presented by the county demonstrates that this
requirement was met.
The regulations at 24 CFR 570.208(a)(4) state the following:
"(4)Job creation or retention activities. An activity designed to create or retain permanent jobs
where at least 51 percent of the jobs, computed on a full time equivalent basis, involve the
employment of low- and moderate-income persons."
During the meeting your office asked if four construction jobs for two hours each would count as a
FTE job. As previously mentioned above the County's methodology is faulty and cannot count jobs
in this manner. This is not considered stable, permanent employment, and the employee would not
be earning a living wage.
CC-Here are the facts on which we asked the question. Our situation does not involve asking for
four construction jobs at two hours each to count as an FTE. We understand that would not
come near the requirement. However. we were asking about an aggregation approach on the
jobs to come to an FTE calculation. The details of our circumstance are summarized in the
attached file(IBDC...)and are further summarized as follows:
CC-Mr. Padilla owns a construction company. After being assisted by our subrecipient, he was
awarded several jobs. One of the more common position types is General Labor. Due to the
nature of the General Labor role, they may work certain days on a particular job, move to
another job site, etc.:but may not work the more traditional 40 hour week. Our fundamental
question is: can we aggregate multiple people performing the same job function (General Labor)
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3/24/2015 14.B.1 .
to calculate FTE's? You can only aagreaate two people working half-time to equal afull-time
equivalent job. In addition, the job must be permanent. Again, the details are in the attached
Spreadsheet. Please note we have payroll backup for this information. In summary,2 of the
workers worked 9 months and we have the payroll to support that these are each 1 FTE(total 2
FTE)and we have payroll to support 6 people in 1 general labor position(.5 FTE)and 8 people
who make up 1 additional general labor position (1 FTE). Our research on counting FTE's has led
us to believe that this is permissible for us to count FTE's in this manner. We have also
researched the seasonality issue and believe that it does not apply as this is construction and a
job was created and filled. Please see the second attachment in order to see what guidance we
are referring to—perhaps this is not current? There is no information presented that shows that
the people hired by Mr. Padilla's company worked consistently for his company over more than one
construction season. For example, according to the spreadsheet, Mr. Morales worked at the
construction company from 8/12 to 10/12 and 10/13 to 11/13. While the CDBG regulations do not
define "permanent job", policy guidance states that a permanent job is employment on a regular,
continuing basis as opposed to temporary employment or employment on a contract basis.
CC-In addition, we understand the overall intent is to create jobs that will continue. Mr. Padilla
has been awarded many contracts after receiving this assistance. His is an on-going concern,
employing over 60 individuals during the course of 2012 and 2013 on various projects.
Additional documentation can be provided if helpful in any way. The 60 individuals hired by Mr.
Padilla would have had to work for his company on a full-time or part-time basis (here two people
may share one position) consistently, not a few hours every few months or so, to show that the jobs
created were permanent,full-time equivalent jobs.
CC-Collier has been unable to locate any CDBG regulations that specify the methodology for how
to calculate a full time equivalent basis, therefore we don't see how we could have used a faulty
methodology in arriving at this number. We used guidance from the IRS as well as HUD guidance
from the ARRA program in devising a methodology for calculating fte jobs. The CDBG
regulations do not give a methodology for calculating full-time equivalent. However, in reviewing
the IRS information provided below, it was noted that its calculations are based on a 2,080 hour
work year. There are 52 weeks in a year. Multiply 52 (weeks) by 40 (hours per week) = 2,080.
Therefore, the IRS definition of full-time equivalent shows a 40 hour work week. This may be split
between two persons sharing a job (the definition of job sharing is two people voluntarily sharing
one full-time job). The ARRA guidance is no longer accessible and never applied to the CDBG
program.
Read more: htto://www.businessdictionarv.com/definition/permanent-
emplovment.html#ixzz3LgzCItmF
IRS guidance on calculating fte.
http://www.irs.gov/uac/Small-Business-Health-Care-Tax-Credit-Questions-and-Answers:-
Determining-FTEs-and-Average-Annual-Wages
ARRA guidance used for reference.
http://www.whitehouse.gov/sites/default/files/omb/assets/memoranda`2010/m10-08.pd
We made further comments which have been highlighted in red next to the County's questions
listed below:
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3/24/2015 14.B.1 .
We have a 2010 project that would like close. The project was for economic development,
specifically the project was for the creation of 5 jobs in an LMA. The subrecipient is the Immokalee
CRA, we had a subrecipient agreement with the CRAforjob creation to assist for-profit business.
The agreement total was 212,000 of CDBG funds.
1. We are able to substantiate 3.5 construction jobs: 2 of the workers worked 9 months and we
have the payroll to support that these are each 1 FTE (total 2 FTE) and we have payroll to support 6
people in 1 general labor position(.5 FTE ) and 8 people who make up 1 additional general labor
position(1 FTE). Our research on counting FTE's has led us to believe that this is permissible for us
to count FTE's in this manner. We have also researched the seasonality issue and believe that it
does not apply as this is construction and a job was created and filled. Do you agree?
(a) We do not believe there is any standard on the amount of time the person fills
the position to count as an FTE created( we were unable to locate any
regulation that states to count an FTE they have to hold for X amount), do you
agree? See above.
CC—Please see our reply above. We are not trying to count each individual person
working 2hrs as an fte, we are aggregating people who filled a single position into an fte
calculation basis.
2. The construction company was in business prior to the ED assistance. We have reviewed tax
returns from 2009, 2010 that indicate the company made approximately 1M and 500K
respectively and in 2011 when they came to the Subrecipient for assistance their income
was 79,000 and the business was struggling. We have an affidavit from the LMA business
owner that he and his wife were the only employees at the time he sought assistance. is this
sufficient to show a baseline and adequate documentation to prove the creation of the 3 .5
jobs in the above #1 question? The county must be able to show that the construction
company assisted hired persons to fill 3 permanent FTE positions and 1/2 of a FTE position.
CC- We believe we can show that based on the methodology that we are using from the IRS and
the ARRA program—references above. Please note that per the attached spreadsheet, one
position under this agreement is coming from another business assisted.
5. The original agreement was for 8 jobs to be created for$221,000 and we through
amendment and substantial amendment to the action plan reduced to 4.5 jobs created, we
believe that 4.5 jobs still supports the $221,000 in reimbursement pursuant to 24 CFR
570.209(b)(2)(v)(E) , do you agree?
CC-Based on the methodology used and the information provided, we believe we have met a
national objective and the public benefit standard based on the amount of funds expended up to
157,500(35k a job). However, we understand it all comes down to whether we may count FTE's
as we have outlined.
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3/24/2015 14.B.1 .
CC-Please be reminded Collier County has reached out because we do not want to close this
agreement unless we are certain it is in compliance.
Based on this information the County did not meet a national objective and funds would have to be
reimbursed back from non-federal funds. Please provide our office with the county's proposed
plan to reimburse funds back.
cc—As noted above Collier respectfully asks to suspend discussion on this element pending a
final conclusion on the core matter. At that time we will fully address.
If you have any further questions please let us know.
Regards,
Nora E. Casal, Senior CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casalnal�ud.gov
* if ij il
,
From: GrantKimberley [mailto:KimberleyGrantnacolliergov.net]
Sent: Sunday, October 12, 2014 2:31 PM
To: Casal, Nora E
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE: Collier Co
Hello Nora,
Just checking in again on these items.
Kindly advise status and approximate timeframe for responses. If it would at all be helpful, we can
prioritize our listing, as we understand there were many items.
Many thanks.
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3/24/2015 14.B.1 .
Kim
From: GrantKimberley
Sent: Wednesday, October 01, 2014 9:51 AM
To: 'Casal, Nora E'
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE: Collier Co
Hi Nora,
Can you please provide a timeframe for the expected response, and/or follow up with her on our
behalf? We are anxious to move these items along to conclusion. Please let us know whether we
can provide any further information.
Many thanks.
Kim
From: Casal, Nora E [mailto:Nora.E.CasalCa�hud.gov]
Sent: Tuesday, September 30, 2014 7:34 PM
To: GrantKimberley
Cc: SonntagKristi; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE: Collier Co
Hi Kimberley,
Grantees should follow protocol by contacting our office prior to HQ staff. The field office will follow
up with Gloria if necessary on this matter, and we will provide the County a response.
Thanks,
Nora E. Casal, Senior CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casal @hud.gov
r , is
�lu
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3/24/2015 14.B.1 .
From: GrantKimberley [mailto:KimberleyGrantcolliergov.net]
Sent: Monday, September 29, 2014 9:26 PM
To: Casal, Nora E; SonntagKristi
Cc: MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Hi Nora,
Hope all is well. You may recall that Gloria offered to send us replies to the below and other
questions after our 1:1 session a couple of weeks ago. Would it be OK if we followed up directly
with her? She previously assisted us with some questions a year or two ago, so we have her contact
information.
Thanks.
Kim
From: Casal, Nora E [mailto:Nora E.Casal(hud gov]
Sent: Monday, September 08, 2014 11:07 AM
To: GrantKimberley; SonntagKristi
Cc: MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Kim
We are still reviewing the Economic Development question. As soon as we receive a response we
will advise
Thank you.
Nora E. Casal, Senior CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casalkaud.gov
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From: GrantKimberley [mailto:KimberleyGrantTcolliergov.net]
Sent: Sunday, September 07, 2014 3:51 PM
To: SonntagKristi; Casal, Nora E
Cc: MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Nora,
Just checking in on whether there is any update on this matter?
Many thanks.
Kim
From: SonntagKristi
Sent: Wednesday, August 27, 2014 12:54 PM
To: Casal, Nora E
Cc: GrantKimberley; MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Thanks Nora..as an FYI, we have a flag for this project in IDIS thus another reason for our urgency for
resolution since we need to submit a remediation plan and we would like to have an accurate and
complete plan for your approval.
Z-leae 56,44-ea
Manager Federal/State Grants
Collier County Government
239-252-2486 (office)
K ristiSonntag an colliergov.net
From: Casal, Nora E [mailto:Nora.E.CasalC�hud.gov]
Sent: Tuesday, August 26, 2014 2:14 PM
To: SonntagKristi
Cc: GrantKimberley; MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Kristi,
We are reviewing this and will reply back to you once the review is complete.
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3/24/2015 14.B.1.
Nora E. Casal, CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casal@hud.gov
al *
II
From: SonntagKristi [mailto:KristiSonntag(acolliergov.net]
Sent: Monday, August 25, 2014 5:33 PM
To: Casal, Nora E
Cc: GrantKimberley; MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Nora: I understand is there anyone else who can assist in answering these questions? We have this
item on our BCC agenda for 9/9 and I would like to resolve before that meeting as we have
outstanding payments to make that is effecting our expenditure rate. Thank You
u.'Q .Safiuti
Manager Federal/State Grants
Collier County Government
239-252-2486 (office)
KristiSonntag(Dcolliergov.net
From: Casal, Nora E [mailto:Nora.E.Casal(Thud.gov]
Sent: Monday, August 25, 2014 5:19 PM
To: SonntagKristi
Cc: GrantKimberley; MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Kristi,
We are out for most of the week. I'll get back to you as soon as I can.
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Nora E. Casal, CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora,E.Casal(aahud.gov
hill -, _
-' Hi ! :.'''
.,
From: SonntagKristi [mailto:KristiSonntaanacollieraov.net]
Sent: Monday, August 25, 2014 8:11 AM
To: Casal, Nora E
Cc: GrantKimberley; MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: RE: Collier Co
Nora: Are you able to schedule a call for this week? We would like to resolve this issue and move
forward with the subrecipient. Thank You
"krie.te Saieimea9
Manager Federal/State Grants
Collier County Government
239-252-2486 (office)
KristiSonntagPcolliergov.net
From: SonntagKristi
Sent: Thursday, August 14, 2014 6:01 PM
To: 'Casal, Nora E'
Cc: GrantKimberley; MarkuBendisa; Chavis, Ann D; Bustamante, Fiordaliza
Subject: FW: Collier Co
Nora: Yes we did speak with Kathy but she said that of course you are our rep and we would need to
go over this with you for a final decision, therefore our request for a conference call. Please note
that I have added additional information for you to review to add further clarification and one
additional question at the request of the Clerk Finance Office. Please let us know what date and
time will work.
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3/24/2015 14.B.1 .
rCu Seta y
Manager Federal/State Grants
Collier County Government
239-252-2486 (office)
KristiSonntag(@colliergov.net
From: Casal, Nora E [mailto:Nora.E.Casal(ahud.gov]
Sent: Thursday, August 14, 2014 5:13 PM
To: SonntagKristi
Cc: MarkuBendisa; Bustamante, Fiordaliza; Chavis, Ann D; GrantKimberley
Subject: RE: Collier Co
Hi Kristi,
You mention below that you spoke with Kathy with the HUD Jacksonville office, and it appears she
was o.k. with it. Are there any unresolved items that you feel need to be discussed in addition to
the items mentioned below?
Nora E. Casal, CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casal @hud.gov
� h
i
From: SonntagKristi [mailto:KristiSonntag(acolliergov.net]
Sent: Wednesday, August 13, 2014 7:37 PM
To: Casal, Nora E; GrantKimberley
Cc: MarkuBendisa; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE: Collier Co
Nora: Kim and I would like to discuss the following:
We have a 2010 project that we would like close. The project was for economic development,
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specifically our project was for the creation of 5 jobs in an LMA.The subrecipient is the Immokalee
CRA, we had a subrecipient agreement with the CRA for job creation to assist for-profit business.
The agreement total was 212,000 of CDBG funds.
1. We are able to substantiate 3.5 construction jobs: 2 of the workers worked 9 months and
we have the payroll to support that these are each 1 FTE (total 2 FTE) and we have payroll
to support 6 people in 1 general labor position(.5 FTE ) and 8 people who make up 1
additional general labor position(1 FTE). Our research on counting FTE's has led us to
believe that this is permissible for us to count FTE's in this manner. We have also researched
the seasonality issue and believe that it does not apply as this is construction and a job was
created and filled. Do you agree?
(a) We do not believe there is any standard on the amount of time the person fills
the position to count as an FTE created( we were unable to locate any
regulation that states to count an FTE they have to hold for X amount), do you
agree?
2. The construction company was in business prior to the ED assistance. We have reviewed
tax returns from 2009, 2010 that indicate the company made approximately 1M and 500K
respectively and in 2011 when they name to the SI uhrecipient for assistance their income
was 79,000 and the business was struggling. We have an affidavit from the LMA business
owner that he and his wife were the only employees at the time he sought assistance. Is this
sufficient to show a baseline and adequate documentation to prove the creation of the 3 .5
jobs in the above#1 question?
3. The CRA employee who was responsible for the administration of the economic
development program was also working on creating a 501c(3), with Board of County
Commissioner knowledge, during the time of the agreement. The intent of the not for
profit was to provide economic development activities. As a note the agreement was
paying for her salary. Since the BCC had knowledge and the development of the not for
profit was related to Economic development we do not see this as a conflict, do you?
*the CRA employee salary was paid under the 2010 and 2012 agreement while the
not-for-profit was being established, this employee no longer is employed by Collier
CRA but now is the executive director of the not—for- profit economic development
agency
4. This project had initially been identified to create a business incubator. The agreement was
amended, however, to what is noted in the introduction. Prior to the amendment,the CRA
employee attended various economic development incubator trainings and the CRA
(subrecipient) was reimbursed. We believe the incubator trainings/seminars furthered the
overall intent to provide economic development services and are therefore an allowable
expenditure under the grant agreement. Do you agree?
5. The original agreement was for 8 jobs to be created for$221,000 and we through
amendment and substantial amendment to the action plan reduced to 4.5 jobs created, we
believe that 4.5 jobs still supports the $221,000 in reimbursement pursuant to 24 CFR
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570.209(b)(2)(v)(E) , do you agree?
We would like to have a call to discuss this to include the Clerk of Courts staff. We are working
together as a team to ensure compliance and get this long standing agreement closed out and we
want to be sure that we all can hear your responses at the same time and resolve these final
questions. Please let us know what day and time will work for all of you in the next week.
We are currently at the FCDA conference and we have run this by Kathy from the HUD Jacksonville
Field Office and she felt that our documentation was solid and actually may be in excess of what is
required.(FYI)
We look forward to hearing from you.
%—zidti Scomeet9
Manager Federal/State Grants
Collier County Government
239-252-2486 (office)
KristiSonntagPcolliergov.net
From: Casal, Nora E [mailto:Nora.E.Casat hud.gov]
Sent: Monday, August 11, 2014 11:59 AM
To: GrantKimberley
Cc: SonntagKristi; MarkuBendisa; Bustamante, Fiordaliza; Chavis, Ann D
Subject: RE:
Kimberley,
Please send me the specifics on what you need to go over so that we can set up call.
Nora E. Casal, CPD Representative
Community Planning and Development Division
Miami Field Office
Brickell Plaza Federal Building
909 SE First Avenue, Rm. 500
Miami, FL 33131-3042
Office Telephone: (305) 520-5009
Office Fax: (305) 536-4781
E-mail Address: Nora.E.Casal(ahud.gov
µ
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From: GrantKimberley [mailto:KimberleyGrantl&colliergov.net]
Sent: Monday, August 11, 2014 11:40 AM
To: Casal, Nora E
Cc: SonntagKristi; MarkuBendisa
Subject:
Nora,
We have an issue that we would like to discuss with you, along with our Finance department. We
had hoped to take some time with you all on the 18th, but since you are not coming that day, can
you please provide a couple of days/times when we can set up a conference call?
Thank you.
Kim
Director, Housing and Human Services
Collier County
239-252-6287
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Under Reeds?,Law. a ddre:ses are public records.if pou do not..on+you e-mail ail addr ss released to e:to a public records
request.do not trend electronic rn_.il to f n 0 entity.Instead. _ei itan Mi. , t.ce inity telephone er ■n writing.
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EXHIBIT 2 ---- :a
t - r COMITLY
za
Pudic Services Division
Housing, Human & Veteran Services
May 8, 2014
Bradley Muckel, Executive Director
Collier County
Immokalee CRA
750 South Fifth St.
Immokalee,FL 34142
Re: Monitoring Visit
CDBG IBDC Economic Development(CD12-04)
Dear Mr. Muckel,
Monitoring staff from Collier County's Housing,Human,and Veteran Services (HHVS)Department visited the
Immokalee Business Development Center(IBDC)on January 22, 23&28,2014 for the purpose of reviewing
program areas of your Department's CDBG FY2010 and FY2012 Economic Development Grants(CD12-04).
Program reviews may result in the identification of Findings or Concerns. A Finding is a deficiency in program
performance based on a statutory,regulatory or program requirement for which sanctions or other corrective
actions are authorized. A Concern is a deficiency in program performance not based on a statutory,regulatory or
other program requirement. The County issues a Concern about program design or operations when, in the
County's judgment,the practice could result in noncompliance with a statutory, regulatory or other program
requirement if not properly corrected.
SCOPE OF WORK
During the visit, a comprehensive review was conducted in the following areas:
• Program Management
• Reporting
PROGRAM MANAGEMENT
A review of your program design and implementation was conducted to determine whether the program was in
compliance as set forth by the Subrecipient Agreement and with the requirements of the CDBG program.
Our review of your department's records indicates that the IBDC does not appear to substantially meet the
documentation requirements of 24 CFR 570.506 (b)(5). Staff noted the following finding:
Finding#1: The documentation provided was not sufficient to support the creation of two (2)Full Time
Equivalent(FTE)jobs for the CD12-04 grant agreement.
During the on-site monitoring visit, the information and files provided for review appeared substantially
incomplete based on the requirements for documentation as required by the respective grant regulations. An email
was sent on.January 29,2014 requesting additional documentation be supplied for the seven(7) outcomes listed
in your 12-04 Economic Development Grant Agreement. .,
IThusincr
Human and
V(}teran,Ser\ ices; .,. ... ,.�____.
or Cohl.2r,,,only
39 i a i mi T Packet Page -273 FL 34112-536
23 -252-CARE
( 27 ) 29 25L-H3::E 0E63).23 23� U rC 42 2 i J)'239-252-RSVP 77E ) 239-252-VETS 8 8 j•VAN.G;i l.ergo:J; .hu 1^ser it.`zs
3/24/2015 14.B.1 .
On February 12,2014 your staff met with members of HHVS to review documentation in order to determine the
number of jobs created by IBDC through the economic development grant programs. Technical assistance was
provided to your organization regarding the criteria needed to meet a national objective and the level of
documentation required to support the job creation national objective. A request was made of IBBDC to provide
additional documentation in the manner required to support the creation of jobs.
On March 21,2014 members of HHVS met again with members of IBDC to review the documentation gathered
on businesses that were assisted by IBDC. We reviewed the documentation that your office was able to gather
from On the Spot Printing and found it unable to support job creation requirements of your grant agreement.
On March 31,2014 members of HHVS met with IBDC staff and members from the County Clerk's Office to
review job creation documentation. HHVS was still unable to find documentation to support the creation of 2 jobs
for the CD 12-04 agreement. During the meeting the project and financial files for On the Spot Printing were
reviewed. There does not appear to be any documentation to support any jobs created. IBDC left the program
files and documentation with the HHVS Monitoring Staff in order for staff to determine the number of jobs that
were in fact created. During the meeting it was agreed that pursuant to 24 CFR 570.208(a)(4)(v)the census tract
qualifies for the presumption based on the poverty rate to consider the job available to and the job holder to be a
low or moderate income person. Based on the most recent decennial census the poverty rate is 39.1%.
The documentation reviewed by HHVS Monitoring Staff is unable to support the creation of two(2)FTE jobs for
the CD12-04 grant agreement. The documentation is not presented in a manner that allows for HHVS to
adequately substantiate any jobs; zero(0) FTE jobs are considered to have been created at this point. Attached to
this letter is a sample format of how job creation should be documented. We ask that this format and
documentation related to financial support of the jobs be provided.
REPORTING
A review of your program design and implementation was conducted to determine whether the program was in
compliance as set forth by the Subrecipient Agreement and with the requirements of the CDBG program.
A review of your program reporting requirements was conducted to determine if reporting was timely and
properly completed. Our review of your department's records indicates that you do not appear to substantially be
meeting the reporting requirements as set forth by the CD12-04 grant agreement. Staff noted the following
Finding:
Finding#2: The project deliverables provided were not sufficient to meet the outcomes as described by the
CD12-04 grant agreement.
The project deliverables provided by IBDC did not meet the outcomes listed in the CD12-04 grant agreement.
Workshop and training schedules were not provided per Outcome 2 and 5, only flyers were provided. Classes and
surveys were not completed in accordance with the project schedule listed in Outcome 3 and 4.
SUMMARY OF RESULTS AND CONCLUSIONS
Our review indicated that, based on the materials reviewed and the staff interviewed; it appears that your
department does not have the continuing capacity to carry out program activities in a timely manner.
This monitoring was completed to review program compliance and to function as the CDBG IBDC Economic
Development project in-progress monitoring.At this time HHVS requires the following corrective action.
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• A final opportunity is provided for IBDC to document evidence of job creation in the format attached.A
pro-rated amount may be established based on the public benefit standard guidance below.
• If IBDC is unable to provide the documentation in the above manner, IBDC shall return the total amount
of Thirty-Eight Thousand Sixty-Three and 15/100 dollars($38,063.15)as provided by grant agreement
CD 12-04.
The IBDC Economic Development projects were funded to address the special economic development eligible
activity by meeting the job creation national objective.For job creation for activities in the aggregate, the CDBG
program requires that at least one permanent FTE job be created per$35,000 of CDBG funds used. At this time
your project has not met the public benefit standard and therefore cannot be considered to meet an eligible
activity.
Sincerely,
f ,
Geoffrey Magon
Housing, Human &Veteran Services
Collier County Government
CC: Kimberley Grant,Director, Housing, Human and Veteran Services
Kristi Sonntag, Manager Federal/State Grants, Housing Human and Veteran Services
Rosa Munoz, Grant Coordinator, HHVS
File
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