These guidelines also apply to activities carried out under the authority of 570.204 that would otherwise be eligible under 570.203, were it not for the involvement of a Community-Based Development Organization (CBDO). "Published Edition". The recipient must ensure that the appropriate level of public benefit will be derived pursuant to those guidelines before obligating funds under this authority. The recipient shall establish definitions of the conditions listed at 570.208(b)(1)(ii)(A), and maintain records to substantiate how the area met the slums or blighted criteria. For this purpose, the recipient must submit a statement explaining whether the lack of funds is due to the insufficiency of the amount of the available funds, restrictions on the use of such funds, or the prior commitment of funds by the recipient for other purposes; and. site when drafting amendatory language for Federal regulations: (ii) A job is considered to be lost due to the provision of CDBG assistance if the job is relocated within three years of the provision of assistance to the business; or the time period within which jobs are to be created as specified by the agreement between the business and the recipient if it is longer than three years. Expenditures of program income for planning and program administrative costs are excluded from this calculation. Such costs include, but are not necessarily limited to, necessary expenditures for the following: (1) Salaries, wages, and related costs of the recipient's staff, the staff of local public agencies, or other staff engaged in program administration. Facing local budget shortfalls, CDBG funding remains a crucial source of funding that helps communities leverage funds for key infrastructure and economic development projects. Please click here for GFOA's analysis of ARPA. (B) The public improvements throughout the area are in a general state of deterioration. Assistance to microenterprises as defined by Section 102(a)(22) of the Housing and Community Development Act of 1974; and. The request for approval must include a list of the emergency services that will participate in the emergency telephone number system; (B) Submit information that serves as a basis for HUD to determine whether at least 51 percent of the use of the system will be by low- and moderate-income persons. Therefore, CDBG funds may be used to pay special assessments provided: (i) The installation of the public improvements was carried out in compliance with requirements applicable to activities assisted under this part including environmental, citizen participation and Davis-Bacon requirements; (ii) The installation of the public improvement meets a criterion for national objectives in 570.208(a)(1), (b), or (c); and. (c) Economic development services in connection with activities eligible under this section, including, but not limited to, outreach efforts to market available forms of assistance; screening of applicants; reviewing and underwriting applications for assistance; preparation of all necessary agreements; management of assisted activities; and the screening, referral, and placement of applicants for employment opportunities generated by CDBG-eligible economic development activities, including the costs of providing necessary training for persons filling those positions. Assistance to a business that purchases business equipment, inventory, or other physical assets in an arms-length transaction, including the assets of an existing business, provided that the purchase does not result in the relocation of the sellers' business operation (including customer base or list, goodwill, product lines, or trade names) from one LMA to another LMA and does not produce a significant loss of jobs in the LMA from which the relocation occurs. Such an area need not be coterminous with census tracts or other officially recognized boundaries but must be the entire area served by the activity. (E) Where CDBG funds are used by a Community Development Financial Institution to carry out activities for the purpose of creating or retaining jobs, this requirement may be met by aggregating the jobs created or retained by all businesses for which CDBG assistance is obligated for such activities during the program year, except as provided at paragraph (d)(7) of this section. (F) Where CDBG funds are used for public facilities or improvements which will result in the creation or retention of jobs by more than one business, this requirement may be met by aggregating the jobs created or retained by all such businesses as a result of the public facility or improvement. (2) determined by the grantee to be appropriate under the provisions of 570.606(d). <<
CDBG funds shall not be used to finance the use of facilities or equipment for political purposes or to engage in other partisan political activities, such as candidate forums, voter transportation, or voter registration. HUD's Office of Community Planning and Development (CPD) has been posting "Quick Guides" regarding potential uses of the $5 billion Congress appropriated for Community Development Block Grant supplemental funding (CDBG-CV) under the CARES Act. The purchase of equipment with CDBG funds is generally ineligible. (D) Be of such nature and be in such location that it may be concluded that the activity's clientele will primarily be low and moderate income persons. Activities meeting the criteria in paragraph (a) (1), (2), (3), or (4) of this section as applicable, will be considered to benefit low and moderate income persons unless there is substantial evidence to the contrary. (iv) An activity designed to provide job training and placement and/or other employment support services, including, but not limited to, peer support programs, counseling, child care, transportation, and other similar services, in which the percentage of low- and moderate-income persons assisted is less than 51 percent may qualify under this paragraph in the following limited circumstance: (A) In such cases where such training or provision of supportive services assists business(es), the only use of CDBG assistance for the project is to provide the job training and/or supportive services; and. <<
In applying this exception, HUD will determine the lowest proportion a recipient may use to qualify an area for this purpose, as follows: (A) All census block groups in the recipient's jurisdiction shall be rank ordered from the block group of highest proportion of low and moderate income persons to the block group with the lowest. >>
Such facilities include shelters for the homeless; convalescent homes; hospitals, nursing homes; battered spouse shelters; halfway houses for run-away children, drug offenders or parolees; group homes for mentally retarded persons and temporary housing for disaster victims. The general rule is that CDBG funds may not be used for income payments. Where there is substantial evidence that provides a clear basis to believe that the use of the decennial census data would substantially overstate the proportion of persons residing there that are low and moderate income, HUD may require that the recipient rebut such evidence in order to demonstrate compliance with section 105(c)(2) of the Act. Notwithstanding the aforementioned, a loss of 25 jobs or fewer does not constitute a significant loss of jobs. If you work for a Federal agency, use this drafting (i) Relocation. Remediation may include project-specific environmental assessment costs not otherwise eligible under 570.205. American Rescue Plan Spending: Recommended Guiding Principles. (j) Equal participation of faith-based organizations. (v) Funds expended for any other activities qualifying under 570.208(a) shall be counted for this purpose in their entirety. (i) An activity, the benefits of which are available to all the residents in a particular area, where at least 51 percent of the residents are low and moderate income persons. (D) If block group data are not available for the entire jurisdiction, other data acceptable to the Secretary may be used in the above calculations. (3) Public improvements not initially assisted with CDBG funds. You are using an unsupported browser. (b) Disposition. formatting. Where the acquisition is for the purpose of clearance which will eliminate specific conditions of blight or physical decay, the clearance activity shall be considered the actual use of the property. fDM:tE3nj>H3H)2*#/rAAKk8 *
K1A lH8. A public facility otherwise eligible for assistance under the CDBG program may be provided with CDBG funds even if it is part of a multiple use building containing ineligible uses, if: (i) The facility which is otherwise eligible and proposed for assistance will occupy a designated and discrete area within the larger facility; and. HUD will accept information obtained through such surveys, to be used in lieu of the decennial census data, where it determines that the survey was conducted in such a manner that the results meet standards of statistical reliability that are comparable to that of the decennial census data for areas of similar size. (ii) An activity that serves to remove material or architectural barriers to the mobility or accessibility of elderly persons or of adults meeting the Bureau of the Census' Current Population Reports definition of severely disabled will be presumed to qualify under this criterion if it is restricted, to the extent practicable, to the removal of such barriers by assisting: (A) The reconstruction of a public facility or improvement, or portion thereof, that does not qualify under paragraph (a)(1) of this section; (B) The rehabilitation of a privately owned nonresidential building or improvement that does not qualify under paragraph (a)(1) or (4) of this section; or. HUD will notify eligible States, cities and counties if they are eligible to receive CDBG-DR grants. !>\@ @j! (b) Public information. No person providing consultant services in an employer-employee type of relationship shall receive more than a reasonable rate of compensation for personal services paid with CDBG funds. Reasonable costs equivalent to those described in paragraphs (a), (b), (e) and (f) of this section for overall program management of the Rental Rehabilitation and Housing Development programs authorized under section 17 of the United States Housing Act of 1937, whether or not such activities are otherwise assisted with funds provided under this part. The objectives of the underwriting guidelines are to ensure: (2) That all sources of project financing are committed; (3) That to the extent practicable, CDBG funds are not substituted for non-Federal financial support; (4) That the project is financially feasible; (5) That to the extent practicable, the return on the owner's equity investment will not be unreasonably high; and. 570.209 Guidelines for evaluating and selecting economic development projects. [53 FR 34439, Sept. 6, 1988, as amended at 54 FR 47031, Nov. 8, 1989; 57 FR 27119, June 17, 1992; 60 FR 1943, Jan. 5, 1995; 60 FR 17445, Apr. Acquisition, construction, reconstruction, rehabilitation or installation of public facilities and improvements, except as provided in 570.207(a), carried out by the recipient or other public or private nonprofit entities. 570.210 Prohibition on use of assistance for employment relocation activities. (ix) Managing or supervising persons whose primary responsibilities with regard to the program include such assignments as those described in paragraph (a)(1)(i) through (viii) of this section. (B) In any case where the total number of a recipient's block groups does not divide evenly by four, the block group which would be fractionally divided between the highest and second quartiles shall be considered to be part of the highest quartile. Resource Links CDBG Memorandum: Using CDBG Funds to Pay off an Outstanding Debt (PDF) (ii) Special assessments to recover the non-CDBG portion may be made provided that CDBG funds are used to pay the special assessment in behalf of all properties owned and occupied by low and moderate income persons; except that CDBG funds need not be used to pay the special assessments in behalf of properties owned and occupied by moderate income persons if the grant recipient certifies that it does not have sufficient CDBG funds to pay the assessments in behalf of all of the low and moderate income owner-occupant persons. Housing. 4, 2016]. Where two or more rental buildings being assisted are or will be located on the same or contiguous properties, and the buildings will be under common ownership and management, the grouped buildings may be considered for this purpose as a single structure. CDBG funds may be used to renovate closed buildings, such as closed school buildings, for use as an eligible public facility or to rehabilitate such buildings for housing. 21 0 obj
Displaying title 24, up to date as of 6/29/2023. Preparation of documents required for submission to HUD to receive funds under the CDBG and UDAG programs. The eCFR is displayed with paragraphs split and indented to follow #a[ The projected use of funds may also include activities that the recipient certifies are designed to meet other community development needs having a particular urgency because existing conditions pose a serious and immediate threat to the health or welfare of the community where other financial resources are not available to meet such needs. A separate drafting site endstream
NpP& "8! (4) Carrying out an activity that would otherwise be eligible under 570.205 or 570.206, but that would result in the recipient's exceeding the spending limitation in 570.200(g). If HUD can conclude that the users have primarily consisted of low- and moderate-income persons, no further submission is needed by the recipient. (1) Purchase of equipment. A statement from the assisted business as to whether the assisted activity will result in the relocation of any industrial or commercial plant, facility, or operation from one LMA to another, and, if so, the number of jobs that will be relocated from each LMA; (2) Required information. The purchase of construction equipment is ineligible, but compensation for the use of such equipment through leasing or depreciation pursuant to 2 CFR part 200, subpart E, as applicable for an otherwise eligible activity is an eligible use of CDBG funds. 15, 2007; 72 FR 46370, Aug. 17, 2007]. CDBG-DR funds available have imposed additional requirements and authorized the U.S. Department of Housing and Urban Development or (HUD) to modify the rules that apply to the annual CDBG . (ii) For metropolitan cities and urban counties, an activity that would otherwise qualify under 570.208(a)(1)(i), except that the area served contains less than 51 percent low- and moderate-income residents, will also be considered to meet the objective of benefiting low- and moderate-income persons where the proportion of such persons in the area is within the highest quartile of all areas in the recipient's jurisdiction in terms of the degree of concentration of such persons. (ii) All housing activities for which the Community Development Financial Institution obligates CDBG assistance during the program year may be considered to be a single structure for purposes of applying the criteria at paragraph (a)(3) of this section. Eyy 0aevnKy fq9R3r/:G;AW7_)~ZnN Ic*et`Re* p*9L iI3syB!AZBRi IHq~;~Xi?O1O75>'0etWq?tPx$rv4:ApYrq Cy!=2`;C1\,h3 Consultant services provided under an independent contractor relationship are governed by the procurement requirements in 2 CFR part 200, subpart D, and are not subject to the compensation limitation of Level IV of the Executive Schedule. Payment of reasonable program administrative costs and carrying charges related to the planning and execution of community development activities assisted in whole or in part with funds provided under this part and, where applicable, housing activities (described in paragraph (g) of this section) covered in the recipient's housing assistance plan. Allowable costs are limited to those attributable to the eligible portion of the building or facility. (The following kinds of activities may not qualify under paragraph (a)(2) of this section: activities, the benefits of which are available to all the residents of an area; activities involving the acquisition, construction or rehabilitation of property for housing; or activities where the benefit to low- and moderate-income persons to be considered is the creation or retention of jobs, except as provided in paragraph (a)(2)(iv) of this section.) (eg: In no event, however, shall such compensation exceed the equivalent of the daily rate paid for Level IV of the Executive Schedule. The purpose of the chapter is to help ensure that grantees will: (1) use CDBG funds only for activities that fall under an authorized category of basic eligibility; (2) properly classify the activity; and (3) provide adequate documentation as required by the category it selects for each such activity. /Contents 18 0 R
(c) Special assessments under the CDBG program. Acquisition in whole or in part by the recipient, or other public or private nonprofit entity, by purchase, long-term lease, donation, or otherwise, of real property (including air rights, water rights, rights-of-way, easements, and other interests therein) for any public purpose, subject to the limitations of 570.207. At a minimum, the local definition for this purpose must be such that buildings that it would render substandard would also fail to meet the housing quality standards for the Section 8 Housing Assistance Payments Program-Existing Housing (24 CFR 882.109). CDBG funds may be used for community development activities (such as real estate acquisition, relocation, demolition, rehabilitation of housing and commercial buildings), construction of public facilities and improvements (such as water, sewer, and other utilities, street paving, and sidewalks), construction and maintenance of neighborhood . The property must support an eligible use and meet a national objective. FAR). 12 U.S.C. is available with paragraph structure matching the official CFR (iii) Where an activity is expected both to create or retain jobs and to provide goods or services to residents of an area, the grantee may elect to count the activity under either the jobs standard or the area residents standard, but not both. Note: This material is based upon work supported by funding under an award with the U.S. Department of Housing and Urban Development. (2) Compliance with national objectives. A Texas Army National Guard Blackhawk deposits a 6,000 pound-plus bag of sand and gravel on target, Sunday, Sept. 4, 2005 as work progresses to close the . The following definitions apply to this section: (1) Directly assist. Facilities designed for use in providing shelter for persons having special needs are considered public facilities and not subject to the prohibition of new housing construction described in 570.207(b)(3). (The recipient must determine, prior to the provision of the assistance, that the activity for which it is attempting to build capacity would be eligible for assistance under this subpart C, and that the national objective claimed by the grantee for this assistance can reasonably be expected to be met once the entity has received the technical assistance and undertakes the activity.) (g) Payment of non-Federal share. /Length 22 0 R
Recipients are encouraged, when they develop their own programs and underwriting criteria, to also take these factors into account. (C) Where CDBG funds are used by a recipient or subrecipient to provide technical assistance to businesses, this requirement may be met by aggregating the jobs created or retained by all of the businesses receiving technical assistance during each program year. How are CDBG-MIT funds being used? The HUD program requirements in 5.109 of this title apply to the CDBG program, including the requirements regarding disposition and change in use of real property by a faith-based organization. (3) In any case where the activity undertaken for the purpose of creating or retaining jobs is a public improvement and the area served is primarily residential, the activity must meet the requirements of paragraph (a)(1) of this section as well as those of paragraph (a)(4) of this section in order to qualify as benefiting low and moderate income persons. <<
The funded project activities may include those listed as eligible under this subpart, and, except as described in paragraph (b) of this section, activities not otherwise listed as eligible under this subpart. will also bring you to search results. (l) Privately owned utilities. 12701 note). (2) Independent contractor relationship. (D) Demonstrate that the percentage of the total costs of the system paid for by CDBG funds does not exceed the percentage of low- and moderate-income persons in the service area of the system. 3535(d) and 53015320. The standards set forth below identify the types of public benefit that will be recognized for this purpose and the minimum level of each that must be obtained for the amount of CDBG funds used. As a (5) Manufactured housing when such housing constitutes part of the community's permanent housing stock. The Community Development Block Grant (CDBG) program is funded by the federal Department of Housing and Urban Development (HUD). For origin year 2015 grants and subsequent grants, recipients must apply this test consistent with paragraph (g)(1) of this section. (d) Documentation. (h) Section 17 of the United States Housing Act of 1937. If the structure contains two dwelling units, at least one must be so occupied, and if the structure contains more than two dwelling units, at least 51 percent of the units must be so occupied. (n) Homeownership assistance. (b) The provision of assistance to a private for-profit business, including, but not limited to, grants, loans, loan guarantees, interest supplements, technical assistance, and other forms of support, for any activity where the assistance is appropriate to carry out an economic development project, excluding those described as ineligible in 570.207(a). >>
CDBG funds may be used to provide direct homeownership assistance to LMI households in two ways.