TO: Mayor and Members of City Council
THRU: Jeffrey Yates, Assistant City Manager
FROM: Christopher Cauley, Economic and Community Development Director
DATE: January, 26, 2026
RE:Title
Authorization to Apply for Fiscal Year 2025 Choice Neighborhood Implementation Grant and Appropriate Additional Funding for the Application
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COUNCIL DISTRICT(S):
Council District(s)
District 2,3, & 4
b
Relationship To Strategic Plan:
Goal II: Responsive City Government supporting a diverse and viable economy
2.2: Community Revitalization - Invest in community places to ensure revitalization and increase quality of life
Goal III: City Investment in Today & Tomorrow
3.2 Manage the City’s future growth and strategic land use
Goal IV: Desirable Place to Live, Work and Recreate
4.5 Neighborhood Vitality - Ensure a place to live in great neighborhoods
Executive Summary:
Council is asked to authorize staff to apply for the Fiscal Year 2025 Choice Neighborhood Grant for the Murchison Road area and adopt Budget Ordinance Amendment 2026-5 and Special Revenue Project Ordinance Amendment 2024-11 to fund activities required to best prepare the City and Fayetteville Metropolitan Housing Authority (FMHA) to successfully apply and win the grant.
Background:
In December of 2020, the City of Fayetteville, in partnership with the FMHA, was awarded a HUD Choice Neighborhoods Planning Grant for the Murchison neighborhood. Through the Grant, the City and FMHA have worked with local residents and a variety of community stakeholders - including nonprofits, faith-based organizations, anchor institutions, supportive services agencies, businesses, and others - to create a forward-looking Transformation Plan. The Plan is centered on redevelopment of FMHA’s Murchison Townhouses, which includes 60 units of low-income public housing. The Transformation Plan seeks to replace 100% of those housing units within the neighborhood as part of new mixed-income developments.
In February of 2024 the City applied for the Choice Implementation Grant and was shortlisted as a finalist and was slated for a site visit where HUD staff toured the community for further insight. Staff was notified on July 16, 2024, the City was not awarded a Fiscal Year 2023 Choice Implementation Grant. HUD scheduled a debrief with staff on September 19, 2024, where staff received feedback on areas to improve for the next funding round. On November 14, 2024, City staff held a meeting with the community to update them on HUD’s decision and next steps.
The Choice Implementation Grant was announced on December 9, 2025, and is due by March 9, 2026. The Choice Neighborhood Initiative is the Department of Housing and Urban Development’s signature affordable housing program that seeks to rebuild distressed public housing while simultaneously investing in the neighborhood, people, and housing at various income levels. From their website:
The Choice Neighborhoods program leverages significant public and private dollars to support locally driven strategies that address struggling neighborhoods with distressed public or HUD-assisted housing through a comprehensive approach to neighborhood transformation. Local leaders, residents, and stakeholders, such as public housing authorities, cities, schools, police, business owners, nonprofits, and private developers, come together to create and implement a plan that revitalizes distressed HUD housing and addresses the challenges in the surrounding neighborhood. The program helps communities transform neighborhoods by revitalizing severely distressed public and/or assisted housing and catalyzing critical improvements in the neighborhood, including vacant property, housing, businesses, services and schools.
Issues/Analysis:
In Fayetteville, the grant will propose to use approximately $20M to redevelop Elliot Circle into 200+ units of mixed income housing. This grant will also provide resources to ensure funding to create jobs skills training, educational opportunities, and health benefits for the residents of both Elliot Circle and Murchison Townhomes. Elliot Circle was chosen as the primary site for redevelopment due to its proximity to Fayetteville State University and the City’s neighborhood parks and trails. The project team believes this site is incredibly impactful to spur the revitalization of this neighborhood and address housing quality, public safety, and economic opportunity for FMHA residents and the current residents of Elliot Circle, all of which have the right to return to the new development and will benefit from the Uniform Relocation Act requirements.
Multiple People and Neighborhood enhancements will also be funded by approximately $3M and $2M respectively. These funds will be used to develop and implement the following strategies:
• People: Creating economically stable and self-sufficient households.
• People: Improving mental and physical health.
• People: Preparing children to enter kindergarten.
• People: Ensuring children are proficient in core academic subjects.
• Neighborhood: Improve access to healthy foods and lifestyles.
• Neighborhood: Create access to trails and multi-use paths.
• Neighborhood: Develop place making and neighborhood branding.
• Neighborhood: Improve access to public parks and housing quality.
Urban Strategies, Inc. was brought on board to assist with the development and execution of the People plan and grant writing in partnership with Community Development Strategies, Inc. while FMHA and the City are currently evaluating Requests for Qualifications from housing developers with Choice Neighborhoods experience
Budget Impact:
On April 26, 2021, Council adopted Special Revenue Ordinance 2021-16 to provide $500,000 of General Fund funding to FMHA to partner in the planning, development, and execution of a rehabilitation program for FMHA-owned single family properties to support the transition of qualified FMHA residents from rental to homeownership. City staff later confirmed with FMHA that they are not able to use the funds for this purpose due to HUD restrictions on the homes. On October 23, 2023, Council adopted Special Revenue Project Ordinance Amendment 2024-9 and Special Revenue Project Ordinance 2024-11 to move funds from the Housing Authority Homeownership Program to the Choice Neighborhood Implementation Grant Program. Approximately $330k was spent on the first grant application leaving $170k remaining. An additional $100k from the General Fund’s fund balance is necessary to apply for the Fiscal Year 2025 Choice Neighborhood Implementation Grant.
Options:
1. Authorize Staff to apply for the Fiscal Year 2025 Choice Neighborhood Implementation Grant for the Murchison Road area and adopt Budget Ordinance Amendment 2026-5 and Special Revenue Project Ordinance Amendment 2024-11.
2. Do not authorize Staff to apply for the Fiscal Year 2025 Choice Neighborhood Implementation Grant for the Murchison Road area and do not adopt Budget Ordinance Amendment 2026-5 and Special Revenue Project Ordinance Amendment 2024-11. Direct Staff to some other option.
Recommended Action::Recommended Action
Authorize Staff to apply for the Fiscal Year 2025 Choice Neighborhood Implementation Grant for the Murchison Road area and adopt Budget Ordinance Amendment 2026-5 and Special Revenue Project Ordinance Amendment 2024-11
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Attachments:
Budget Ordinance Amendment 2026-5
Special Revenue Project Ordinance Amendment 2024-11