US Department of Housing and Urban Development

1. US Department of Housing and Urban Development Office of Block Grant Assistance (OBGA) State and Small Cities Division (SSCD)

2. CDBG Appropriations: FY09 – FY11

3. CDBG Now, and What to Expect • Reduction in CDBG allocation from FY10 to FY11 • With anticipated Federal budget cuts, it is very likely that future CDBG allocations may be smaller. We shall see!!

4. CDBG-R • Nationally, 78.5% of CDBG-R funds have been • drawn as of 09/06/11 • Four states have drawn down 100% of funds • Three states have drawn down less than 50% • September 30, 2012, is deadline to draw down and expend all CDBG-R funds

5. Section 108 Loan Program • Historically, limited to units of general local governments (UGLGs) and their grantees. States support loan applications from UGLGs by pledging their CDBG funds to secure the loans. • Section 222 of the 2009 Appropriations Act, authorized HUD, to the extent allowed under FY 2009 loan guarantee authority, to provide Section 108 loan guarantees to States borrowing on behalf of UGLGs. • The July 22, 2009 interim rule expanded section 108 loan guarantee authority provided by the 2009 Appropriations Act.

6. Section 108 Loan Program Cont’d • HUD’s authority to issue loan guarantee commitments under Section 222 expired on September 30, 2010. • The July 22, 2009 interim rule, however, contained language that will continue the applicability of the provisions implementing this new authority, in the event that provisions equivalent to the Section 222 are included in future appropriations acts. (See Federal Register Vol. 75, No. 65, April 6, 2010).

7. Policy Matters • New Admin Rule is in Departmental Clearance Specific items addressed: • Interest on Federal Grant Payments to States • Program Income (PI) Requirements • Flexibility for States to Allocate Funds for Administrative Expenses and Technical Assistance • Determining Compliance with Administrative Expense Cap • State Revolving Funds • Spending Funds Outside the Jurisdiction of the Recipient

8. Items on New Admin Rule Cont’d • PI Exclusion for Activities Financed by Section 108 Loan Guarantees in Areas that Are EZ eligible • State Authority to Impose Additional Provisions • Pre-Agreement Costs • Audits: Corrects an Outdated Regulatory Citation within 24 CFR 570.489(m). • Grant-Making • Cost Principles and Prior Approval of Certain Costs by HUD • Fiscal Controls and Administrative Procedures • Reporting Data in IDIS

9. Closeout Notice • Notice is in Departmental Clearance • Purpose of the notice is to help grantees through the process of closing out grants so to avoid the administrative burden of continuing to manage and monitor grants that have been fully expended. • The notice will provide guidance and instructions on how to close out the following grants: CDBG, CDBG-R, and Disaster Recovery (DR).

10. In general, a grant is ready for closeout when: • All eligible activities meet a national objective and are completed • All grant funds are expended, or all remaining funds are to be returned to HUD • All reporting requirements are complete and submitted • All audit issues are resolved • All monitoring issues are resolved

11. Timely Distribution and Expenditure of State CDBG Funds • Section 104(e)(2) of the Housing and Community Development Act (HCDA) of 1974 (as amended) require the states to obligate and announce their annual grant to UGLGs within 15 months of signing the grant agreement with HUD. • Pursuant to Section 104(e)(1) of the HCDA of 1974, HUD tracks the extent to which states distribute their CDBG funds and provides a monthly report as a management tool. • As a goal, states should reduced unexpended balances to between 2.0-2.5 years of funds on hand and have an average spending rate of 1.0. • Beginning in 2010, HUD Field Offices started making findings for states that are untimely in distributing funds. • Findings will be made for not meeting timely distribution regulatory requirements irrespective of any findings made during monitoring visits.

12. Performance and Evaluation Report (PER) • Notice CPD-11-03 provides guidance for submission of the PER for State CDBG grantees • The change to the PER submission process enables states to submit the PER through IDIS report PR-28 in addition to the required narrative component of the report. • Beginning with the 2011 PER, states will not submit the PER to HUD in hard-copy paper format. • Formal transmission of the PER will be included in the state’s Consolidated Annual Performance and Evaluation Report (CAPER) submission as required by the HUD Field Office. • States have the option to generate the entire report from their own systems as long as it includes all of the data necessary to meet CDBG program requirements.

13. The Timely Distribution and PER Notices can be downloaded from: • http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/notices/cpd

14. HUD’s Low/Mod Income Summary Data (LMISD), American Community Survey (ACS), and a New Survey Notice • HUD’s current LMISD is a dataset which shows the estimated percentage of low- and moderate-income (LMI) residents in each block group, census tract, and unit of local government.  • This Census-derived data will no longer come from the decennial census but will be produced using the 2005-2009 ACS • HUD will compute these percentages by obtaining special data tabulation from the Census Bureau and matching household level ACS data to the Section 8 Income Limits.  The new LMISD tabulation will be available in the Spring of 2012.

15. LMISD, ACS, and a New Survey Notice Cont’d • Before issuing the new LMISD, HUD must work through several important policy considerations regarding implementation: For example, (i) LMISD will no longer be available below the Census Tract level therefore grantees will have to conduct surveys at the block level. (ii) The ACS data will be updated every year, therefore, the computed percent of LMI persons for a given geography could change every year. • Due to the change in the manner which the LMISD will be calculated, SSCD is working on a new Survey Methodology Notice

16. Effects of Policy Changes Due to the new LMISD and other several policy changes (such as statutory and regulatory amendments), SSCD will soon be updating the State Guide to Eligibility and National Objectives.

17. Disaster Waivers • All requests should be sent to the Field Offices for review, recommendations, and submission to Headquarters. Headquarters will work with the Field Offices to grant ASAP. •  Conference calls may be are held (involving HUD staff at Headquarters and Field Offices, and state officials) to discuss sticking issues before waivers are granted. • Under Section 122 of the HCDA of 1974 (as amended), a presidential declaration allows the Secretary to suspend program requirements except for public notice of funding availability, nondiscrimination, fair housing, labor standards, environmental standards and low/mod benefit.  The State must send in a request to the field office asking that specific requirements be suspended.

18. Form SF 425 States may use HUD SF-425 or any form that meets the criteria stipulated at 24 CFR 570.489(d) to implement fiscal and administrative requirements applicable to the use of its own funds; adopt new fiscal and administrative requirements; or apply the provisions of 24 CFR Part 85 (Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments).

19. One-CPD What is One-CPD? • Is a system for managing all CPD Technical Assistance (TA) awards • Was introduced in 2010 to fundamentally change CPD’s TA System • Intended to capture the impact of all TA investments • Will award $23 million to TA providers in CDBG, CHDO, HOME, HOPWA, ESG, and competitive Homeless Assistance Programs • Eligible Activities include needs assessment, tool/product development, and capacity building

20. Current Status of One-CPD Building One-CPD infrastructure: training GTMs/GTRs, setting frameworks, and holding provider conference calls

21. CDBG Trainings (see schedules distributed as part of conference handouts) • Section 3 • ED Toolbox • Basically CDBG (Session in Philly for States) • IDIS training possibly in October or November. Will have taping of 2-day sessions on line on Com-Con website. • Financial Management • ED Training, and other recent trainings

22. The End