Arcata City Council Delays Decision on State Grant Spending, Hears CDBG Pitches

Arcata city leaders paused a decision Wednesday on how to spend roughly $3 million in Community Development Block Grant and state community development funds, leaving a choice between a roughly $2.9 million repair to The Grove affordable-housing complex and a roughly $2.9 million program to replace aging water meters.

City staff told the council the CDBG application can include one large project plus smaller projects and that the city could seek $2.9 million for a single major ask while scoping roughly $3 million overall. Community Development Director David Loya said both large-project options “score equally on California’s scoring rubric, although Loya said because Arcata has more experience completing past projects similar to the water meter replacement with CDBG funds, they’d probably have a better shot of getting that funded.”

The Grove was presented as a housing priority: the complex has 60 units and “16 of the 60 units at The Grove are currently unusable for one reason or another,” city coverage said, and the Arcata House Partnership does not have the funds to complete repairs. Officials discussed whether CDBG dollars should target those rehabilitation needs to return units to service for low- and moderate-income residents.

City finance staff framed the alternative as a systemwide infrastructure need. Finance Director Tabatha Miller reported “about 700 of them, are slowly going out… and it’s draining the city’s coffers,” referring to aging water meters that the city could replace with a large CDBG request and accompanying smaller projects.

Deputy Community Development Director Jennifer Dart outlined Arcata’s CDBG track record to the council, noting the city has used the program for “a wide variety of activities.” Dart listed those activities as “(a) business loan program, multiple different planning efforts, … rehabilitation of existing affordable housing and then supports for new housing, as well as wastewater upgrades and, previously, kind of going back into the past, homebuyer assistance.”

Only three of Arcata’s five councilmembers were present for the hearing, with Vice-Mayor Stacy Atkins-Salazar presiding alongside Councilmembers Alexandra Stillman and Meredith Matthews. Because a full council was not in attendance, members voted to delay a final recommendation to staff and scheduled a special session for Feb. 26 to deliberate and identify which option city staff should apply for.

The Feb. 18 hearing was the third CDBG scoping meeting of 2026 and included public comment on where the city might best use funds that extend as far back as 2025. At the same meeting councilors also voted to extend the city’s emergency declaration beyond 40 days as Arcata continues cleanup and recovery from a Jan. 2 fire that razed half a city block.

A separate item circulating with an overlapping headline, “Arcadia council delays $500,000 match for Reconnect Arcata planning after fiscal questions” and referencing a Reconnect Arcata contract with SmithGroup and a Sept. 17 date, contains internal inconsistencies naming Arcadia while discussing Arcata projects; city staff need to confirm whether that item pertains to Arcata and to clarify the figures and dates cited. Councilors will reconvene Feb. 26 to make a formal recommendation to staff on the CDBG application.