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CDBG PROJECT UPDATE • SHIP Funds As part of the CDBG application, Indian River County pledged $200,000 from County SHIP funds to be used by households in the CDBG project area. These funds will be distributed as deferred payment, low interest loans (0% annual interest rate for very low income households and 3% annual interest rate for low income persons). With the SHIP loan$, qualified applicants have the option of paying back the loans through a monthly payme schedule that is appropriate for their budget. The SHIP loans are available to qualified applicants to pay water impact fees and any needed plumbing system repairs. All other costs (line extension, fire hydrants, meters, service lines, road paving, and drainage improvements) will be paid with CDBG funds. In the past six months, County staff have organized and attended two community meetings (04/29/97 and 07/28/97) and three application workshops (06/20/97, 07/30/97, and 09/16/97) to inform residents of the project and to assist residents with the various application forms. Despite this effort, there has been a low response rate for completing CDBG water connection forms and applying for SHIP loans. To date, the County's consultant has received only 57 completed CDBG water connection forms from the 83 residences in the community. Out of those 57 residences, 30 have expressed interest in al�plying for a SHIP loan. However, the County has received only 25 SHIP applications. These 25 applicants represent approximately $32,500 in SHIP funds, leaving $167,500 in CDBG project allocated SHIP funds uncommitted. One requirement of the CDBG program is that all matching funds (in this case SHIP funds) allocated to the project must be spent before the project can be closed out. In this case, however, the Department of Community Affairs (DCA) has informed the County's consultant that the County may amend its CDBG application and reduce the amount of SHIP funds allocated to the project. Originally, the County pledged $200,000 in SHIP funds to gain the necessary points to ensure that the County would be in the funding range for CDBG funds. In reviewing point totals for all CDBG applicants, the DCA has determined that, even without the points attributable to the SHIP match, Indian River County would still receive $750,000 in CDBG funds. Consequently, the County's consultant will amend the CDBG application to reduce the amount of matching SHIP funds to a level that reflects the actual demand for SHIP loans. • Mandatory Hook -Up One of the principal CDBG program requirements is that the maximum number of low and moderate income households benefit from CDBG funds. This requirement ensures that CDBG funds are used efficiently. In the Whitfield/Colored School project area, all residents will benefit from the road improvements, drainage improvements, and fire hydrant installations that will be completed as part of the project scope of work. In regard to the potable water improvements, however, only those households that physically connect to the County water system will benefit from the project. In order to comply with CDBG program requirements, it will be necessary for the County to enforce Ordinance No. 91-9. Section 201.02 of that ordinance states that the owner of every lot or parcel of land within the County shall connect, or cause the plumbing of any building to be connected, with the water system of the County, and use such facilities within 60 days following notification to do so by the County Utilities Department. Additionally, section 201.33 of this ordinance states that any person who shall violate or fail to comply with any provisions of Ordinance No. 91-9 shall, upon conviction, be OCTOBER 14, 1997 57 60 1-03 PnE 63