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HomeMy WebLinkAboutExhibit CPost -Deadline Amendment Compliance Checklist Use this checklist to evaluate whether a post -deadline amendment or replacement contract complies with Treasury's SLFRF guidance. Original Project Summary Project Title New Construction Homeownership Project No. (e-Builder) 91-A2-15-80874 Total Project Cost $2,751,618.98 Subgrantee or Contractor Contract Proposed ARPA Funding The department is currently hiring contractors to develop single-family homes in Districts 5, 4, and 1, with the potential to add more than 10 additional homes. The funds related to single-family homes can be quickly spent due to fewer complications involved in constructing single-family homes. Using a design/build concept, condominiums can also be built within the required 3 years. This funding will provide construction and permanent financing for the development of affordable single- family units, townhomes, twin -homes, and condominium units. These units will be sold to eligible individuals or families, allowing a broader reach in household incomes served by the construction of affordable housing. Project Type • Capital Expenditure Project Estimated Completion 2026 Eligible Use Support the COVID-19 public health and economic response by addressing COVID-19 and its impact on public health as well as addressing economic harms to households, small businesses, nonprofits, impacted industries, and the public sector. Project Expenditure Category 2.15 - Negative Economic Impacts: Assistance to Households: Long-term Housing Security: Affordable Housing Proposed Project Amendment ❑ Amendment to an existing contract or agreement 0 Replacement of an existing agreement Narrative The department is advancing the development of affordable single-family homes, townhomes, twin -homes, and condominium units in Districts 5, 4, and 1, with the capacity to deliver more than ten additional homes using ARPA funds. Consistent with the updated Exhibit B, the program utilizes a unit -level budgeting structure that accounts for actual construction costs, distributed contingencies, and anticipated sales -proceed offsets, ensuring accurate and transparent ARPA allocations for both single-family and twin -home units across all development sites. Leveraging design/build efficiencies, the program is positioned to complete both single-family and multifamily units within federally required timelines while providing construction and permanent financing needed to deliver income -restricted homes to eligible households. The strengthened budgeting reflected in the updated Exhibit B supports rapid expenditure of ARPA funds, particularly for single-family homes, while ensuring long-term affordability and expanding the reach of homeownership opportunities for a broader range of qualifying families. Proposed Amendment Summary Project New Construction Homeownership Total Cost $2,959,685.18 Subgrantee or Contractor Contract ARPA Funding $2,751,618.98 Project Type • Capital Expenditure Project Status • In progress Project Estimated Completion Project anticipated completion date is September 2026 Eligible Use Support the COVID-19 public health and economic response by addressing COVID-19 and its impact on public health as well as addressing economic harms to households, small businesses, nonprofits, impacted industries, and the public sector. Project Expenditure Category 2.15 - Negative Economic Impacts: Assistance to Households: Long-term Housing Security: Affordable Housing 1. Original Contract or Agreement Review ❑ Was the original contract or agreement obligated by December 31, 2024? YES ❑ If amendment is a change order or cost increase, does the original contract include provisions for change orders or contingencies? Yes, No or N/A 2. Requirements for Replacement of Existing Agreement or Contract Is the replacement of the existing agreement of contract due to one of the following circumstances, explain response: 1. Contract or agreement terminated due to business default, closure, or inability to perform 2. Mutual agreement to termination 3. Recipient termination for convenience when contract was not properly awarded Response: N/A. This is an amendment to update the project budget exhibit. 3. Scope Consistency ❑ Does the amendment/replacement maintain the same core deliverables (e.g., same project type, same services)? Yes or No and briefly explain response: A more detailed project budget has been provided. The updated exhibit outlines per -unit allocations, including individual Unit A/B funding for twin homes, the distribution of construction contingencies, and anticipated offsets from sales proceeds and program -income recovery, consistent with the established accounting structure ❑ Are the geographic area, beneficiaries, and intended outcomes unchanged? Yes or No There are no changes to the target population. ❑ Are any changes minor or administrative (e.g., cost adjustments, timeline extensions) rather than introducing new activities? Yes or No and briefly explain response: The updated exhibit B provides a more accurate, transparent, and federally compliant representation of the ARPA New Homeownership Program's budget By reconciling actual unit -level costs, integrating sales proceeds and program income, and redistributing contingency appropriately, the updated exhibit ensures that ARPA funding levels match true eligible expenditures and reflect real project conditions 4. Purpose Alignment ❑ Does the amendment/replacement serve the same overall purpose as the original (e.g., housing project remains housing, not converted to unrelated infrastructure)? Yes or No and briefly explain response: The updated exhibit strengthens the program's accountability, supports continued affordability outcomes, and establishes a clear financial foundation for future reporting, oversight, and public communication. ❑ Is the funding still directed toward the original program goals? Yes or No and briefly explain response: Accurate ARPA allocations ensure homes remain affordably priced for target -income households while preserving the program's financial sustainability and ability to replicate future units. 5. Documentation ❑ Documentation of the justification for the amendment/replacement ❑ Documentation showing the change is within substantially the same scope and purpose 6. Compliance Confirmation ❑Does the change comply with SLFRF FAQs (Section 17) and Obligation IFR requirements? Yes or No and briefly explain response: The updated budget allocations ensure that ARPA funds are limited to eligible, documented project costs and that sales proceeds are appropriately netted against subsidy needs. This supports compliance with SLFRF requirements that ARPA funds must address pandemic -related negative economic impacts while avoiding over subsidization. ❑ The introduction of no new or unrelated objectives has been confirmed. Yes or No AtkinsRoalis ARPA SLFRF Program Income Requirements Definition of Program Income and Summary of Requirements under 2 CFR 200 and US Treasury SLFRF Final Rule What is Program Income in the context of ARPA State and Local Fiscal Recovery Funds (SLFRF)? As defined in 2 CFR 200.1 and in the context of ARPA SLFRF, Program income means gross income earned by the recipient or subrecipient directly generated by a supported activity or earned with ARPA funds during the period of performance, which ends December 31, 2026. Program income includes but is not limited to income from fees for services performed, the use or rental of real or personal property acquired with ARPA funds, the sale of commodities or items fabricated with ARPA funds, license fees, and royalties on patents and copyrights, and principal and interest on loans made with ARPA funds. Interest earned on advances of ARPA SLFRF is not program income. (FAQ 10.1) Additionally, such income generated by obligations or expenditures under the revenue loss eligible use category, Revenue Replacement (EC 6) is not considered program income for purposes of complying with 2 CFR 200 or Treasury requirements for management, use and reporting of program income. This includes income from loan interest and repayments. (FAQ 13.15). How can program income from ARPA SLFRF be used by recipients or subrecipients? Program income can be added to the ARPA SLFRF award or obligation. The funds must be used for the same purpose as the original obligation. (FAQ 13.11) This includes any program income earned between the deadline for obligation (December 31, 2024) and the end of the ARPA SLFRF period of performance (December 31, 2026). Program income can only be used to cover an obligation that was incurred by December 31, 2024. The funding can be used in one of four ways: 1. Program income can be used to cover the cost of eligible uses of SLFRF funds for which the recipient incurred an obligation by December 31, 2024, such as a workforce training program that the recipient had been funding with local funds 2. Program income can be used to pay for permissible upward cost adjustments in contracts or subawards, including replacement contracts and subawards, as described in FAQs 17.16 and 17.17. 3. Program income can be used cover expenses that are necessary to meet certain legal and administrative requirements, as described in the Obligation Interim Final Rule and FAQ 17.10, even if this causes a change in initial estimated expenses. 4. Program income can be cover personnel costs obligated by December 31, 2024, as described in FAQ 17.7. (FAQ 17.21). File ID 18757-Exhibit C AtkinsRealis - Baseline / Reference 1/6 Must program income from ARPA SLFRF be tracked and reported to US Treasury? Yes. Treasury requires recipients to: • Identify and calculate program income generated by SLFRF-funded activities. • Record and document how program income was used. • Report program income through the Project & Expenditure (P&E) Report in the Treasury Portal. • Treasury will use this data to verify total allowable costs and obligations. This requirement applies only to program income generated or earned during the SLFRF period of performance, which ends December 31, 2026. Specific guidance and direction for reporting program income is provided in the Project and Expenditure Report User Guide updated October 1, 2025. Reporting requirements and fields are provided for income earned, obligated and expended before the obligation deadline of December 31, 2024 and after the obligation deadline. As noted, reporting program income is not required for Revenue Replacement (EC 6). {rAtkinsRealis 2/6 AtkinsRealis - Baseline / Reference ARPA Program Income Compliance Checklist This checklist guides Subrecipients receiving ARPA State and Local Fiscal Recovery Funds (SLFRF) to ensure proper management, tracking, and reporting of program income. Subrecipient information Responsible Party Project ID Subaward Number Expenditure Category (EC) 1. Determine Whether Recipient has Program Income Verify income meets Treasury definition of program income, which is defined as money earned as a direct result of an ARPA-funded activity, for example: • Rental income from ARPA-funded equipment or facilities • Fees for services supported by ARPA funds • Sales of items developed under the project Note: Note that income earned on obligations or activities under Expenditure Category 6 Revenue Replacement is not considered program income. Additionally, interest earned on advances of SLFRF does not count as program income. Exclude interest earned on advances of federal funds Does the Recipient have program income? ❑Yes ❑No If yes, populate the following: Program Income Amount Program Income Expended Date Earned Note that where SLFRF funds are used to make loans or other extensions of credit, the Recipient is subject to additional tracking and reporting requirements including those provided in Appendix 1. 2. Required Compliance Actions Advise Recipient to implement internal controls for program income Subrecipients who anticipate or have earned program income should implement internal controls for managing tracking, use and reporting of program income. This could include adopting policies detailing how program income will be: • Identified • Recorded {('AtkinsRealis 3/6 AtkinsRealis - Baseline / Reference ■ Used ■ Reported Supported by consistent procedures for receipt, tracking, and expenditure of program income Subrecipients should also be aware that program income is subject to the same oversight and financial management requirements as other SLFRF funding and should consider the following ■ Measures for prevention of waste, fraud, and abuse ■ Compliance with the subaward agreement and federal regulations ■ Preparation for audits and maintenance of all records for potential audit ■ Documentation of site visits to ensure monitoring and compliance Add Program Income to the Recipient's Total Award Under 2 CFR 200.307, recipients of federal awards have three options for usage of program income: deduction (which reduces the federal share of the award), use the funds for required cost sharing or matching, or add the funds to the federal award. Treasury requires SLFRF Recipients to add program income to the total award and expend it on eligible ARPA uses during the SLFRF period of performance (through Dec. 31, 2026). Treasury uses required program -income reporting in the Project and Expenditure Report to determine total obligations and expenditures, with program income, and whether any unexpended funds must be returned at closeout. Has the Program Income been added into the Project and Expenditure Report for the project? ❑Yes ❑No What is the total project funding with program income? Ensure updated Obligations and Expenditures align with eligible ARPA categories Track obligation and expenditure deadlines 1. Funds must be obligated by Dec 31, 2024 2. Funds must be expended by Dec 31, 2026 Is the subrecipient tracking obligation and expenditure deadlines? ❑Yes ❑ No Provide details of tracking mechanisms: Document and report total program income earned as part of ongoing P&E reporting Subrecipients must provide: ■ Total program income earned during the reporting period ■ How program income was used ■ Supporting financial records {rAtkinsRealis 4/6 AtkinsRealis - Baseline / Reference If earned prior to December 31, 2024 • How much Program income was earned prior to December 31, 2024? • Program income obligated by December 31, 2024 of the amount earned prior to December 31, 2024? • Program income expended of the amount earned prior to December 31, 2024. • Program income obligation total amount remaining? If earned on project after December 31, 2024 • How much Program income was earned on project after December 31, 2024? • Program income obligated on project of the amount earned after December 31, 2024. • Program income expended of the amount earned after December 31, 2024. • Program income obligation total amount remaining? Provide date program income was earned? Explain how program income was spent on eligible uses. What is the remaining program income balance? Reporting Documentation to Maintain • Maintain copies of all Treasury Reports submitted. • Maintain required financial documentation • Maintain required procurement/compliance documentation • Maintain required reporting documentation • Maintain administrative/legal documentation {rAtkinsRealis 5/6 AtkinsRealis - Baseline / Reference Appendix 1 FAQ 4.9 Loan tracking and reporting methods For loans that mature or are forgiven on or before December 31, 2026 (or September 30, 2026, for Title I protects) the recipient must account for the use of funds on a cash flow basis, consistent with the approach to loans taken in the Coronavirus Relief Fund. • Recipients may use SLFRF funds to fund the principal of the loan and in that case must track repayment of outstanding principal and interest amounts (i.e., "program income" as defined in 2 CFR 200.1). • When the loan is made, recipients must report the principal of the loan as an expense. Repayment of principal may be re -used only for eligible uses and subject to restrictions on timing of use of funds. Interest payments received prior to the end of the period of performance will be considered an addition to the total SLFRF award and may be used for any purpose that is an eligible use of SLFRF funds. Recipients are not subject to restrictions under 2 CFR 200.307(e)(1) with respect to such payments. For loans with maturities longer than December 31, 2026 (or September 30, 2026, for Title I projects), the recipient may use funds for only the projected cost of the loan. Recipients can project the cost of the loan by estimating the subsidy cost. The subsidy cost is the estimated present value of the cash flows from the recipient (excluding administrative expenses) less the estimated present value of the cash flows to the recipient resulting from a loan, discounted at the recipient's cost of funding and discounted to the time when the loan is disbursed. The cash flows are the contractual cash flows adjusted for expected deviations from the contract terms (delinquencies, defaults, prepayments, and other factors). A recipient's cost of funding can be determined based on the interest rates of securities with a similar maturity to the cash flow being discounted that were either (i) recently issued by the recipient or (ii) recently issued by a unit of state, local, or Tribal government similar to the recipient. • Alternatively, recipients may treat the cost of the loan as equal to the expected credit losses over the life of the loan based on the Current Expected Credit Loss (CECL) standard. Recipients may measure projected losses either once, at the time the loan is extended, or annually over the period of performance. Under either approach for measuring the amount of funds used to make loans with maturities longer than December 31, 2026 (or September 30, 2026, for Title I projects), recipients would not be subject to restrictions under 2 CFR 200.307(e)(1) and need not separately track repayment of principal or interest amounts. Additionally, recipients may use funds for eligible administrative expenses incurred in the period of performance, which include the reasonable administrative expenses associated with a loan made in whole, or in part, with SLFRF funds. See section IV.E of the 2022 final rule. crAtkinsRealis 6/6 AtkinsRealis - Baseline / Reference