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Home My WebLink AboutHUD PresentationCDBG PROGRAM Presented by: - t,2.5I2 Maria R. Ortiz CPD Director, Miami Field Office US H.U.D. October 25. 2012 12- Mgt 0-UD Preerrt-c1+1 (Dr\ Statutory/Regulatory Context National Objectives Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 2 CDBG PRIMARY OBJECTIVE Development of viable urban communities principally for low/mod persons through: • Decent housing • Suitable living environment • Expanded economic opportunity Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 3 CDBG MONEY FLOW • Entitlement grantees have options in funding projects HUD HUD Entitlements City/County) Subrecipient Contractor, CBD 1 Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk Beneficiary 4 SELECTING CDBG ACTIVITIES Six key questions prior to funding activities: 1. Who will manage and implement activities? 2. Is it outlined in the approved Consolidated Plan and Action plan? 3. Is the activity eligible/ineligible? 4. Will it meet a National Objective? 5. Will it help to meet the low/moderate income targeting requirements? 6. Will it comply with all "other federal requirements? Answers are critical to determine prior to assisting project Submitted into the public record in connection with item Dl.2 on 10-25-12 Dwight S. Danie City Clerk Question # 1- WHO WILL MANAGE & IMPLEMENT ACTIVITIES? Grantees have options: Grantee staff •► Units of General Local Government • Subrecipients • Community Based Development Organizations (CBDOs) • Community Development Finance Institutions (CDFIs Contractors Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 6 SUBRECIPIENT DEFINED Public or private nonprofit organization/ agency receiving CDBG funds from grantee for eligible activities: • A for -profit agency assisting microenterprises may be a subrecipient • Institutions of higher learning may be subrecipients Who is not a subrecipien 7 • CBDOs not automatically subrecipients • Procured contractors are not subrecipients • Beneficiaries of assistance • Owners of rental housing seeking rehab assistance Submitted into the public record in connection with item DI on 10-25-12 Dwight S. Danie City Clerk 7 COMMUNITY BASED DEVELOPMENT ORGANIZATIONS (CBDOs) . Regulatory cite §570.204 (not applicable for states) CBDOs carry out certain projects: • Neighborhood revitalization • Community economic development • Energy conservation . All activities they undertake must fall into one of these three areas Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 8 CONTRACTORS . Different than CBDO or subrecipient . Must be competitively procured under Part 85 • Some states use part 85 & some states use own procurement rules . Use when activity: • Is discrete • Has a defined beginning and end date • Is for a specific project Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk Question # 2- IT IS OUTLINED IN THE CON PLAN/ACTION PLAN? Consolidated Plan/Action Plan identifies activities and organizations to fund Components: • Lead agency description • Housing and homeless needs assessment • Housing market analysis • Strategic plan Submitted into the public One-year action plan record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 0 THE CONSOLIDATED PLAN (cont) Citizen participation required Con Plan reviewed and approved by HUD Submitted to field office at least 45 days prior to start of program year Amendments allowed Annual performance reporting measured against Con Plan goals and activities P 5ubmitted into the ublic record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 11 Question # 3- IS THE ACTIVITY ELIGIBLE/INELIGIBLE? Regulation cites §570.201 - §570.206 Statutory cites at Section 105 Wide variety possible : • Housing & other real property activities • Economic development • Public facilities • Public services • CBDO activities • Planning and administration • Others Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk See other web modules for more details on eligible activities 12 INELIGIBLE ACTIVITIES ♦Regulations expressly prohibits: • Buildings for conduct of government & general government expenses • Political activities • New housing construction (some exceptions) • Income payments • Purchase of equipment • Operating and maintenance expenses Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 13 HOUSING Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 14 Housing and Other Real Property Activities • HOMEOWNER REHABILITATION • HOME PURCHASE ELIGIBLE HOMEOWNERSHIP- • RENTAL HOUSING Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 15 • Public Facilities •Inter m Assistance • Public Services • Other Activities Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 6 ELIGIBLE PUBLIC FACILITIES ACTIVITIES , Infrastructure • Streets, sidewalks • Water, sewer . Neighborhood facilities • Parks, playgrounds • Recreational facilities • Facilities for special needs populations Homeless shelters Group homes Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 17 INELIGIBLE PUBLIC FACILITIES ACTIVITIES . Maintenance and repair of public facilities • Exception for handicapped accessibility . Operating costs • Exception for costs related to operating a CDBG public service activity . Buildings for general conduct of government (e.g., city hall) • Some exceptions Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 18 ELIGIBLE PUBLIC SERVICE ACTIVITIES • Wide range of public services possible Includes services related to: • Employment • Job training • Crime prevention/public safety • Child care • Health • Health services • Substance abuse services Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 19 ELIGIBLE PUBLIC SERVICE ACTIVITIES (cont) Also includes services related to: • Housing • Housing counseling • Fair Housing counseling • Energy conservation • Homebuyer downpayment assistance • Services for homeless persons • Education • Welfare services • Services for seniors • Recreational services Submitted into the public record in connection with item D1.2 on 10-25-12 Dwight S. Danie City Clerk 20 PUBLIC SERVICES COST • CDBG funds may pay for labor, supplies and materials • CDBG funds may pay for operations and maintenance of facility where service occurs . Payments must be directly related to the provision of eligible services Cannot just provide operational support to nonprofits Must document costs Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 21 PUBLIC SERVICES RESTRICTIONS The service must be: • A new service, or • A quantifiable increase in the level of an existing service that has been provided by the grantee or another entity on its behalf with local gov't funding (or funding from the state to the local gov't) in the 12 months preceding submission of the Action Plan Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 22 INELIGIBLE PUBLIC SERVICE ACTIVITIES •Income payments ineligible • Except emergency grant payments • Not to exceed three months • Payments made directly to provider Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 23 PUBLIC SERVICES CAP ■Obligations for public service activities may not exceed: • 15% of annual entitlement grant PLUS • 15% of last year's program income Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 24 Economic Development Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 25 ECONOMIC DEVELOPMENT . Economic development projects typically fall under Low/Mod Job Creation/Retention . Be sure to document: • How jobs will be created or jobs will be lost without CDBG (retained jobs) • How jobs made available to or held by LMI . Track jobs for reasonable period of time (not defined in regulations) as long as jobs are still being created Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 26 Question # 4- WILL IT MEET A NATIONAL OBJECTIVE? Regulatory cite §570.208 All CDBG activities must: • Benefit low/mod income persons • Prevent or eliminate slums and blight OR • Meet an urgent need Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 27 LOW/MOD BENEFIT AREA BENEFIT . Activities that benefit all residents of area • 51 % LMI persons . Area must be primarily residential Must determine service area of activity Typical activities: water/sewer, parks, community centers Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 28 LOW/MOD BENEFIT LIMITED CLIENTELE . Activities that benefit specific populations • Presumed eligible • Participation limited to LMI persons only • Nature and location low/mod benefit . Some activities may qualify • Removal of architectural barriers (some activities or • Microenterprise activities with LMI owners; or • Certain types of job training efforts • . Typical activities: job training, senior services, facilities for persons with special needs Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 29 LOW/MOD BENEFIT HOUSING . To meet the housing national objective, structures must be occupied by low/mod households • One unit structures occupied by LMI • One unit of duplex occupied by LMI • 51 % of 3+ units LMI occupied by LMI Note: This is the only L/M national objective for housing activities . Typical activities: homeowner unit rehab, rental acquisition and rehab, homebuyer assistance Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk O LOW/MOD BENEFIT JOB CREATION/RETENTION . In order to meet this criteria, activities must create or retain permanent jobs AND . 51 % of the jobs created/retained must be available to or held by LMI persons . Jobs counted on full time equivalent (FTE) basis . Typical activities: business loans, commercial rehabilitation, infrastructure to a business Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 31 LOW/MOD BENEFIT JOBS AVAILABLE TO LMI For jobs to be considered available to LMI Persons: • No special skills/education required • LMI persons must receive first consideration • Must have a written agreement with business Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 2 SLUM AND BLIGHT Area must meet definition of slum/blighted area under state/local law AND ■ Meet either A) or B) below: A) At least 25% of properties throughout the area experience 1 or more of the following conditions: • Physical deterioration of buildings or improvements • Abandonment of properties; • Chronic high occupancy turnover rates or chronic high vacancy rates in commercial/industrial buildings; • Significant declines in property values or abnormally low property values relative to other areas in community; or • Known or suspected environmental contamination. B) The public improvements in the area are in a general state of deterioration Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 33 URGENT NEED NATIONAL OBJECTIVE ■To meet the urgent need test: • Existing conditions pose serious & immediate threat to health/welfare of community as declared by the County • Existing conditions are recent or recently became urgent - Generally 18 months Submitted into the public record in connection with • Recipient cannot finance on its own item Dl.2on io-is-iz Dwight S. Danie • Other funding sources not available City Clerk Typical activities: infrastructure, interim assistance, rehab of community facilities 34 Question # 5 - WILL IT HELP MEET THE LOW/MO INCOME TARGETING REQUIREME CDBG Program requires that 70% of all CDBG expenditures during a program year benefit low/mod persons (i.e., meet LMI national objective) • Cumulative expenditures, not budgeted • Certification period of 1-3 ears grantee's Choice Section 108 is a CDBG expenditure • Planning/admin not included Reported in the CAPER Submitted into the public record in connection with item DI on 10-25-12 Dwight 5. Danie City Clerk 35 Question # 6 - Will it comply with all "OTHER FEDERAL REGULATIONS" Myriad of other Federal regulations may apply to CDBG-funded activities. List includes regulations about • Fair housing and equal opportunity • Handicapped accessibility • Financial management • Environmental review • Lead paint hazard reduction • Relocation/acquisition and one -for -one replacement • Davis Bacon labor standards and related acts • Conflict of Interest • Excluded parties (debarred/suspended) • Others, as applicable Refer to other regulations for applicability Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 36 Administration/Planning •Financial Management Including Program Income Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 7 CDBG TIMELINESS RULES -ENTITLEMENTS Cannot have more than 1.5 times current program year grant in line of credit as per: (24 CFR 570.902(a)) Calculated 60 days prior to end of current program year Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 38 ADMINISTRATIVE CAP Obligations for planning and administration may not exceed: • 20% of annual entitlement grant PLUS • Current year program income Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 39 USE OF PROGRAM INCOME CDBG program income subject to CDBG rules . Program income: • Must be used for immediate cash needs prior to drawing down additional funds from CDBG line of Credit Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 40 UNDERWRITING GUIDELINES Grantees should ensure that: • Project costs are reasonable • All sources of financing are committed • CDBG not substituted for non-federal • Project is financially feasible • Return on investment is reasonable • CDBG funds distributed on a pro-rata Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 41 Performance Measurements Reporting Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 42 REPORTING REQUIREMENTS Annual report called: Consolidated Annual Performance and Evaluation Report (CAPER) Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 43 SUBMISSION & REVIE OF THE CAPER . Grantee must submit annual report to HUD within 90 days of close of program year . Prior to submission, grantee must make report available to public for at least 15 days . Grantee must summarize comments and make final report available to the public Submitted into the public record in connection with item DI on 10-25-12 Dwight 5. Danie City Clerk 44 RECORDKEEPING REQUIREMENTS Appropriate activity documentation maintained to ensure compliance Major categories of records to be kept • General administrative • Financial • Project/activity • National objectives • Income documentation • Subrecipients Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 45 MONITORING Grantees are responsible for compliance CDBG and other Federal rules & requirements h Monitoring of projects and programs helps to ensure compliance and evaluate performance Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight 5. Danie City Clerk 46 MORE INFORMATION . For more information on CDBG, go to: • HUD Field Offices • http://www.hud.gov/local/ • HUD CDBG website • http://www.hud.gov/offices/cpd/communitydevelopm ent/programs/index.cfm • CDBG laws and regulations • http://www.hud.gov/offices/cpd/communitydevelopm ent/programs/index.cfm Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 47 MORE INFORMATION (cont) . For more information on CDBG, go to: • Guide to Eligible Activities and National Objectives for Entitlements • http://www.hud.gov/offices/cpd/communitydevelopm ent/library/deskguid.cfm • Guide to Eligible Activities and National Objectives for States • http://www.hud.gov/offices/cpd/communitydevelopm ent/library/stateguide/ Submitted into the public record in connection with item DI.2 on 10-25-12 Dwight S. Danie City Clerk 48