For the past few years the funding available for social service agencies has decreased. In response, City Council prioritized a Study Issue paper on a review of funding criteria and the process for allocating funding to social service agencies in the City. This report examines trends in the community that may affect both the type and delivery of services in the community and reviews other agencies’ criteria for funding human services. Social service agencies in the City are funded primarily by the Federal Community Development Block Grant Program (CDBG) with approximately 25% of the total funding provided by the General Fund.

Due to the increasing number of requests for funding of social services and the decreasing availability of funds, the City Council prioritized a Study Issue paper on a review of funding criteria and the process for allocating funding to social service agencies. As part of the review, this report examines trends in the community that may affect both the type and delivery of services in the community and reviews other agencies’ criteria for funding human services.

Social service agencies in the City are funded primarily by the federal Community Development Block Grant program (CDBG) with approximately 25% of the total funding provided by the General Fund. CDBG funding has decreased over the past few years which has meant that it has been difficult to continue to support all the ongoing programs or be able to address new needs in the community. Currently, the City does not solicit specific agencies to provide programs in the community. An invitation to submit an application is published each year and funding decisions are based on the applications received and funding available.

The following is a summary of needs in the community as identified by various agencies and organizations. These findings are derived from the information presented by the United Way of Santa Clara County 1997 Trends Report, which focus on the needs for human services. Information was also utilized from: Columbia Neighborhood Center 1996 Needs Assessment, United Way 1994 Human Care Needs Assessment, and Joint Venture's 1999 Index of Silicon Valley. In addition, information was solicited from agencies that currently apply for CDBG and General Fund money, and from a strategic planning session held by Sunnyvale Community Services last year.

Population growth continues in the County but primarily in the Latino and Asian groups. Also, the proportional share of the populations is increasing among the very old and the very young. Joint Venture's 1999 Index of Silicon Valley suggests that during the 1990s the standard of living has declined for the poorest households. Language barriers and cultural insensitivity may keep recent immigrants and other special groups from accessing the assistance they need. This factor will affect the type of program and type of service delivery that will be needed in the community.

Despite the increased growth of subsidized child care slots, the supply still does not meet the needed demand. A major problem for all families, but specifically for those that are low income, is finding affordable, high quality, and convenient child care. In 1996 the Columbia Neighborhood Center Needs Assessment identified child care as a need by many of the respondents.

In 1994, the Santa Clara County Collaborative on Housing and Homelessness Issues estimated that between 7,500 and 16,300 people experience an episode of homelessness in a given year. A survey conducted in 1999 does not show any decrease in this population.

As the population of our community ages, a corresponding increase in the need for supportive and health services will occur. Over the next 25 years, the county's senior population is expected to increase by 170%. This will increase demand for in-home supportive services, long-term care, respite care services, supported housing, transportation, (especially paratransit), and health care. Seniors can have serious health issues, mobility limitation or a self-care limitation, which make it difficult for them to live independently. In 1990, the California Department of Aging estimated that 11.9% of residents age 65 or over had severe dementia. In addition, almost 12% of the population had either a mobility limitation or a self-care limitation or both. Seniors with limited fixed incomes often experience the highest level of needs for services, and may also be the most seriously isolated and underserved.

According to elder advocates and service providers, older adults are most vulnerable to economic downturns because many rely on low, fixed incomes. The economic pressures are often greatest on the very old (persons aged 85 and older). Many of them are women whose Social Security and other retirement incomes drop significantly with the death of their spouses.

The public schools within the county are serving a more diverse population every year with a higher proportion of students with limited English proficiency. With 25% of the county's population being immigrants or refugees, English as a Second Language (ESL) classes have been in high demand. Furthermore, with welfare reform, there is an increasing need for adult education opportunities such as vocational education, as well as apprentice-ships.

The Columbia Neighborhood Center Needs Assessment of 1996 identified a high priority on adult education services with a heavy emphasis on computer training and vocational training. The needs assessment identified legal services, bilingual information and referral and housing assistance, food for low income families, basic needs assistance, child care and counseling, and volunteers to assist with filling out forms and documents as critical elements to help and stabilize families in the community.

Although overall job growth is projected, many individuals may experience barriers to obtaining and retaining employment, such as: child care, physical disabilities, transportation issues, lack of education or necessary skills for self-sufficiency wage jobs, health insurance issues, mental health, and affordable housing among others.

Overwhelmingly, the primary need in the community is affordable housing. The lack of affordable housing means that families are moving fairly often to find housing they can continue to afford. This affects children’s success in school as they move from one school or district to another. In the Sunnyvale School District there is an annual 40% mobility rate which is increasing. This mobility also has an impact on long-term community stability as residents do not become involved in a neighborhood because of their short tenancy.

In 1993, 7% of county residents had no evidence of health insurance coverage. 62,244 people over the age of sixteen were identified with a mobility and/or self-care limitation. The critical needs for persons with disabilities are: medical and long-term care, caregiver support, transportation and affordable housing.

The City currently has an Outside Groups Funding Policy and a Human Services Policy (Attachment A). The Outside Group Funding Policy establishes guidelines for funding programs that may be provided to the City by outside agencies. The Human Services Policy was established to insure that Human Services are identified and provided in the most efficient and effective manner. Areas in which the City can fund programs include but are not limited to: transit, nutrition, law enforcement, training, special recreational programs and housing facilities. The City's role under this policy is as an advocate for coordinated and available services. The following criteria are those outlined in the existing policies.

The service must:

• address a significant community need
• must be cost effective
• cannot duplicate an existing service
• must be consistent with a recognized City need, policy or goal.
• The program is a needed enhancement to an existing City program or program direction.
• The organization must meet both service delivery and financial criteria, including having a diverse funding base.

Funding may be approved under four categories:

* Seed money for a new program
* Project funding for a one-time project
* Emergency funding to offset a short-term funding crisis, or
* Funding for on-going projects.

Other funding agencies use various criteria to determine their funding allocations.

Palo Alto sets two types of priorities: one for multi-year funding and one for annual funding. The multi-year funding is based on:

The annual priority is set every year by the Human Relations Commission.

The County of Santa Clara has set priorities for its public service projects. All the priorities are centered on the direct provision of housing or support services that will help people find or keep housing.

United Way sets priorities by Needs Area. The needs areas for 1998-2000 are listed below:

1. Persons with Disabilities
2. Senior Care
3. Mental Health
4. Community Education and Awareness
5. Community Building
6. Children and Youth
7. Child Care
8. Adult and Family Support Services
9. Housing Homeless/Emergency Assistance and Employment
10. Health

Within each needs area, the United Way tries to fund a broad range of agencies. For example, the Housing Homeless area covers food, housing and job training.

The City of Sunnyvale’s outside group funding is reviewed within five general categories; emergency, senior, disabled, youth, and advocacy services.

This chart compares Sunnyvale with other cities on the percentage of CDBG funds allocated to need areas.

Sunnyvale’s distribution of funds is consistent with priorities set in the Consolidated Plan. Housing and emergency services are seen as the highest priority.

Over the past few years the majority of CDBG funding has concentrated on emergency services. As outlined above, 45% of the funding has gone to emergency shelter and crisis intervention services such as food, rent deposits, or utility shut-offs. With the cutback in social service funding, the focus has been on crisis intervention. There are not many safety nets in the community to help families in crisis.

The funding of social services should strengthen neighborhood and community and achieve diversity and balance. There is always a competition for funding between the immediate needs of families in crisis and incorporating the ideas of sustainability. If a goal is sustainability, then priority and emphasis should be given prevention and early intervention programs. The City's efforts through Columbia Neighborhood Center, the leisure services program, the senior center, and neighborhood outreach through Neighborhood Preservation place an emphasis on prevention and early intervention. If one examines the full spectrum of services provided by the City, the current balance between these prevention and intervention programs coupled with the focus on crisis intervention through outside group funding may be appropriate.

There are a number of options that have been suggested that could change the process. One is a two-year funding process to match the City's budget system. HUD's regulations do not encourage this but it could be possible with the understanding that there would still be an annual public hearing and that funding would be subject to change and adjustments are possible for non-performance issues. It would limit the ability for a new group to apply on the off-budget year, but there could be a limited process to allow for this possibility if there were uncommitted CDBG funds or if Council decided to increase the General Fund commitment. The Commission could take the off budget year to review agencies' performance in greater depth, determine whether there are needs in the community not being addressed and seeking applications for these specific services for the following year. Another possibility might be to limit the amount any one agency could receive. However, this may complicate and limit the decision making process rather than enhancing it.

Currently there is a Human Services Policy and an Outside Groups Funding Policy (Attachment A) which have been in existence since 1981, with some amendments made in 1992. Attachment C combines and updates the two policies into one Human Services Policy. Also the current funding criteria that are used in the Existing Policy section are general criteria that can apply to broad areas of human services. Areas in which the City can fund programs include but are not limited to: transit, nutrition, law enforcement, training, special recreational programs and housing facilities. However, they do not reflect the current focus of funding. The revised policy reflects the current emphases that are: emergency services, senior services, disabled services, youth services, and advocacy services.

A number of changes have already been incorporated in the existing process. At one time Housing and Human Services Commission was to review the agencies' applications and make a funding recommendation irrespective of the budget. The theory was that once all the CDBG funds were committed, the General Fund would step in and Council would decide the level of General Fund commitment. There was also an automatic cost of living added each contract year. However, over the years the General Fund commitment has remained constant while available CDBG has decreased. HHSC had requested and it was implemented this year that HHSC would make funding recommendations based on a balanced budget to Council. The recommendations are then reviewed by the City Manager for the budget recommendation to Council. Rather than add the cost of living at the end, the Commission felt it was important to take the funds and distribute them based on agencies’ programs and service delivery. HHSC would also have the option of making extraordinary requests to Council at the time the Outside Group budget is approved.

Each year the City spends approximately $300,000 on social service agencies. $250,000 is from CDBG and the $60,000 is from the General Fund. CDBG funds available for social services are limited to 15% of the CDBG grant plus program income. The City uses the maximum amount of CDBG for social service agencies. This report does not have any fiscal impact on the General Fund.

This report was reviewed by the Housing and Human Services Commission at its meeting of August 25, 1999 and September 22, 1999. HHSC concurred with the staff recommendation to move to a two-year process. However, the Commission recommended that this begin in next year’s cycle. As the initial reviewers, they would like to make changes to the application form and spend time re-examining the review process to insure that the two-year review is a meaningful process and will provide them sufficient information to make their recommendations. Attachment E includes the minutes from the Housing and Human Services Commission meeting reviewing the process. The report was sent to all the agencies that are currently funded through the program.

Staff is recommending Alternatives 1 and 2.

Prepared by:

Dyane Matas
Housing & Neighborhood Preservation Officer

Reviewed by:

David S. Boesch, Jr.
Director, Community Development

Approved by:

Robert S. LaSala
City Manager