The Santa Ana City Council Tuesday night approved a community development block grant budget that includes very little for the nonprofit sector — the traditional recipient of such revenue — with nearly all the money going instead to city services.
The allocation shows that while Santa Ana has pulled through the darkest moments of a historic budget crisis and even built a healthy reserve fund, the city’s finances are still in recovery mode.
For years, Santa Ana used money from the decades-old federal program to fund nonprofit community services in this widely underserved city. Some 50 organizations at one point received the funds, Councilwoman Michele Martinez said in 2010.
However, revenues at all levels of government dropped dramatically during the Great Recession, and Santa Ana was hit harder than most cities. With few choices before them, city officials decided to divert the grant funds to city services, such as code enforcement and street repairs.
It’s the same story this year. Police Department services, youth training, legal services, park and street improvements, code enforcement, a new business pilot program and housing rehab will receive the majority of the $5.5 million in revenue.
Only one nonprofit, the Fair Housing Council of Orange County, which ensures equal opportunities for access to housing, will receive funds from the grant — $67,517, according to council agenda documents.
The grant fund allocations have been a contentious issue between city staff and some council members. Last year, the tension bubbled over at a City Council meeting, with council members Martinez and Sal Tinajero angry because they were only informed of the requested budget allocation shortly before the council was scheduled to approve it.
“Every year for whatever reason something happens and staff overlooks this,” Martinez said at Tuesday’s council meeting, adding that “for the record,” nonprofits will receive a percentage of the grant funds next year.
The agenda staff report also makes that clear. Up to 10 percent of the funds will be eligible for nonprofit funding in the 2014-15 fiscal year, according to the report. City officials said the maximum nonprofit funding cap under the grant is 15 percent.
It wasn’t all frustration. Martinez said the grant budget includes more than $1 million for Pacific Electric Park, which will mean new open space for the park-poor city.
“This is something we truly value, and I know our community has asked for in the past,” Martinez said. “I’m excited about that item.”