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Refresher on State CDBG Timely Distribution and Expenditure of Funds

Refresher on State CDBG Timely Distribution and Expenditure of Funds. Housing and Community Development Act of 1974. Requires that HUD determine “whether the State has distributed funds to Units of General Local Government in a timely manner.” [HCDA as amended, Section 104(e)(2)].

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Refresher on State CDBG Timely Distribution and Expenditure of Funds

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  1. Refresher on State CDBGTimely Distribution and Expenditure of Funds

  2. Housing and Community Development Act of 1974 • Requires that HUD determine “whether the State has distributed funds to Units of General Local Government in a timely manner.” [HCDA as amended, Section 104(e)(2)]

  3. Code of Federal Regulations HUD will review, at least annually, whether the state has distributed CDBG funds to Units of General Local Government in a timely manner. [24 CFR 570.493(a)(1)]

  4. Code of Federal Regulations • State is timely if “All of the state’s annual grant (excluding administration) has been obligated and announced to Units of General Local Government within 15 months of the state signing its grant agreement with HUD.” [24 CFR 570.494]

  5. “Obligated and Announced” The term “obligated and announced to” means the date on which a state officially announces the selection and awards of grants to its Units of General Local Government.

  6. CPD Monitoring Handbook • HUD is required to make findings when there is evidence that a program statute, regulation or requirement has been violated.

  7. Timely Expenditure of Funds

  8. There is currently no timely expenditure regulatory requirement for the State CDBG program in either statute or regulation.

  9. The Expenditure Report • Monthly listing of states ranked by unexpended ratio • Chart showing individual state’s ratios over 24 months • Chart showing national average over 24 months • Tracked by HUD via LOCCS (Line of Credit Control System) data

  10. The Rankings HUD does not use relative rankings for program evaluation. The Expenditure report and rankings are provided as a program management tool for states. States may consider the rankings as a performance incentive.

  11. The Monthly List

  12. The State Chart • The chart tracks two ratios: • the unexpended balance ratio is a bar-graph • the spending rate is a line across the bars • The chart displays the current and prior year data • The unexpended balance decreases as draw-downs are made and increases with each new annual allocation of funds

  13. Steady Expenditure Performance

  14. Troublesome Expenditure Performance

  15. Improving Expenditure Performance

  16. The National Chart • The chart tracks a dollar balance and two ratios: • the dollar balance is a bar graph • the unexpended balance ratio is a bar-graph • the spending rate is a line across the bars • The chart displays the current and prior year data • Goal return to 1.0 or greater, ratio of funds expended the last 12 months to yearly grant award

  17. Expenditure Trend – National Average FY

  18. Moving Money Faster(Things to Consider) • Review and streamline the funding process • Establish a multistage application process • Identify ways to start the application cycle at an earlier point in time • Fund large or lengthy projects in phases • Implement State and UGLG staff performance requirements

  19. CDBG Timeliness

  20. Helpful HUD Website www.hud.gov/offices/cpd/ communitydevelopment/ library/statetimeliness.pdf Google: HUD CDBG timeliness

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