+-----------+--------------------------------+----+------------------+
| **Guide   |                                |    |                  |
| for       |                                |    |                  |
| Review of |                                |    |                  |
| National  |                                |    |                  |
| Objective |                                |    |                  |
| of**      |                                |    |                  |
|           |                                |    |                  |
| **Low-    |                                |    |                  |
| and       |                                |    |                  |
| Modera    |                                |    |                  |
| te-Income |                                |    |                  |
| Area      |                                |    |                  |
| Benefit** |                                |    |                  |
+-----------+--------------------------------+----+------------------+
| **Name of |                                |    |                  |
| Program   |                                |    |                  |
| Parti     |                                |    |                  |
| cipant:** |                                |    |                  |
|           |                                |    |                  |
| **     ** |                                |    |                  |
+-----------+--------------------------------+----+------------------+
| **Staff   |                                |    |                  |
| Con       |                                |    |                  |
| sulted:** |                                |    |                  |
|           |                                |    |                  |
| **     ** |                                |    |                  |
+-----------+--------------------------------+----+------------------+
| *         |                                |    |                  |
| *Activity |                                |    |                  |
| Name,     |                                |    |                  |
| IDIS      |                                |    |                  |
| Activity  |                                |    |                  |
| Number,   |                                |    |                  |
| and Brief |                                |    |                  |
| Descr     |                                |    |                  |
| iption:** |                                |    |                  |
|           |                                |    |                  |
| **     ** |                                |    |                  |
+-----------+--------------------------------+----+------------------+
| **Name(s) |                                | ** |                  |
| of        |                                | Da |                  |
| Revi      |                                | te |                  |
| ewer(s)** |                                | ** |                  |
+-----------+--------------------------------+----+------------------+

**NOTE:** All questions that address requirements contain the citation
for the source of the requirement (statute, regulation, NOFA, or grant
agreement). If the requirement is not met, HUD must make a finding of
noncompliance. All other questions (questions that do not contain the
citation for the requirement) do not address requirements, but are
included to assist the reviewer in understanding the participant\'s
program more fully and/or to identify issues that, if not properly
addressed, could result in deficient performance. Negative conclusions
to these questions may result in a \"concern\" being raised, but not a
**\"finding.**\"

**[Instructions:]{.underline}** Use this Exhibit for activities that are
classified by the program participant as meeting the national objective
of benefit to low- and moderate-income persons on an area basis. The
Exhibit is divided into seven sections: Service Area; Low- and
Moderate-Income Composition of the Service Area; Exception Criteria;
Data and Surveys; Nature of Activity; Fees; and Record Keeping/Visual
Inspection. One Exhibit is to be completed for each activity reviewed.

**[Questions:]{.underline}**

[A. SERVICE AREA]{.underline}

1\.

+------------------------------------------------------------+---------+
| Do the program participant's records describe the          |         |
| boundaries of the service area?                            |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1) and 24 CFR 570.506(b)(2)\]          |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

2\.

+------------------------------------------------------------+---------+
| Do you agree with the basis/approach the program           |         |
| participant used in determining the service area of this   |         |
| activity?                                                  |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1)\]                                   |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

3\.

+------------------------------------------------------------+---------+
| Does the size of the service area appear reasonable given  |         |
| the nature and scope of the activity?                      |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1)\]                                   |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

4\.

+------------------------------------------------------------+---------+
| Is the service area "primarily residential?"               |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1)\]                                   |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

[B. LOW- AND MODERATE-INCOME COMPOSITION OF THE SERVICE
AREA]{.underline}

(Note: Questions 6-9 are applicable to Entitlement Communities only.)

5\.

  -----------------------------------------------------------------------
  What do the program participant's records show as the percent of low-
  and moderate-income residents in this service area?

  **Describe Basis for Conclusion:**

       
  -----------------------------------------------------------------------

6\.

+------------------------------------------------------------+---------+
| a\. Is the percent of low- and moderate-income persons at  |         |
| least 51 percent? (If "yes," go to "6.e.")                 |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1)(i), (ii), and (vii)\]               |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

+----------------------------------------------------------+-----------+
| b\. If the answer to "a." above is "no," was the program |           |
| participant authorized to qualify the activity under the |           |
| "exception criteria?" (If the answer to "a." is "yes,"   |           |
| proceed to Section C of this Exhibit, "Exception         |           |
| Criteria.")                                              |           |
|                                                          |           |
| \[24 CFR 570.208(a)(vi), (vii); 570.208(d)(5)(i); or     |           |
| 570.208(d)(6)(i)\]                                       |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
| **     **                                                |           |
+----------------------------------------------------------+-----------+

  ---------------------------------------------------------- ------------
  c\. If the answer to "b." above is "no," was the activity  
  limited to paying special assessments levied against       
  residential properties, owned and occupied by low- and     
  moderate-income persons, for a public improvement that     
  benefits all residents of a service area?\                 
  \[24 CFR 570.208(a)(1)(iv)\]                               

  **Describe Basis for Conclusion:**                         

                                                             
  ---------------------------------------------------------- ------------

  ---------------------------------------------------------- ------------
  d\. If the answer to "c." above is "yes," does the         
  activity meet the requirements of 24 CFR 570.208(a)(1)(iv) 
  and 570.506(a) and (b)? (If the answer is "no," the        
  activity does not meet the low- and moderate-income area   
  benefit national objective.)\                              
  \[24 CFR 570.208(a)(1)(iv); 570.506(a) and (b)(2)\]        

  **Describe Basis for Conclusion:**                         

                                                             
  ---------------------------------------------------------- ------------

+------------------------------------------------------------+---------+
| e\. Does the program participant's documentation show that |         |
| the correct census data were used [and]{.underline} the    |         |
| calculations correctly computed?                           |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1)(i) and (ii)\]                       |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

+----------------------------------------------------------+-----------+
| f\. If the answer to "e." is "no," was the program       |           |
| participant authorized to use a survey to qualify the    |           |
| activity? (If the answer is "yes," proceed to Section D  |           |
| of this Exhibit, "Data and Surveys.")                    |           |
|                                                          |           |
| \[24 CFR 570.208(a)(1)\]                                 |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[C. EXCEPTION CRITERIA]{.underline}

Section 105(c)(2)(A)(ii) of the HCD Act of 1974, as amended, states than
an activity shall be considered to principally benefit low- and
moderate-income persons when "the area served by such activity is within
the highest quartile of all areas within the jurisdiction of such city
or county in terms of the degree of concentration of persons of low and
moderate income." The CDBG regulations at 24 CFR 570.208(a)(1)(ii)
implement section 105(c)(2)(A)(ii) and describe the methodology for
calculating the exception percentage. For exception-qualified program
participants, HUD will post on the internet the exception percentages
for program participant area benefit activities (see
<http://www.hud.gov/offices/cpd/systems/census/lowmod/exception.cfm>).
The Integrated Disbursements and Information System (IDIS) will also
track projects for exception program participants. The reviewer is
required to review these percentages as calculated by HUD, unless a
HUD-approved survey has been conducted by the program participant.

7\.

  -----------------------------------------------------------------------
  If applicable, what is the program participant's exception percentage
  for low- and moderate-income area benefit activities?

  **Describe Basis for Conclusion:**

       
  -----------------------------------------------------------------------

8\.

+----------------------------------------------------------+-----------+
| If the program participant qualified this activity under |           |
| the exception criteria, does the percentage of low- and  |           |
| moderate-income residents residing in the activity       |           |
| service area equal or exceed the percentage in question  |           |
| 7 above? (If "no," the activity does not quality under   |           |
| this criterion.)                                         |           |
|                                                          |           |
| \[24 CFR 570.208(a)(1)(ii)\]                             |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[D. DATA AND SURVEYS]{.underline}

Note: For "exception rule" program participants, survey data may be used
to show that the service area contains at least 51 percent low- and
moderate-income residents. However, survey data that show a service area
exceeding the program participant's authorized upper quartile percentage
as shown in C.7 above, but are less than 51 percent low- and
moderate-income, can only be accepted if all of the program
participant's block groups were also surveyed, using a methodology
acceptable to HUD, and a new upper quartile properly calculated based on
that data.

**9.**

+----------------------------------------------------------+-----------+
| If the program participant used a survey rather than the |           |
| HUD-supplied Census data to determine if a service area  |           |
| qualifies, answer the following:                         |           |
+----------------------------------------------------------+-----------+
| a.  The period for which the income survey of residents  |           |
|     of the service area was determined:                  |           |
|                                                          |           |
|           N/A                                            |           |
+----------------------------------------------------------+-----------+
| b\. The year used for HUD income limits:                 |           |
|                                                          |           |
|       N/A                                                |           |
+----------------------------------------------------------+-----------+
| c.  Did the survey show the service area was at least 51 |           |
|     percent low- and moderate-income?                    |           |
|                                                          |           |
|     \[24 CFR 570.208(a)(1)(vi)\]                         |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

+----------------------------------------------------------+-----------+
| d.  If "no" to c., did the program participant survey    |           |
|     one or more whole block groups?                      |           |
|                                                          |           |
|     \[24 CFR 570.208(a)(1)(vi)\]                         |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

+----------------------------------------------------------+-----------+
| e.  If "yes" to d., did the program participant survey   |           |
|     all block groups and re-rank them to determine if    |           |
|     there was a change in the exception percentage? (If  |           |
|     "no," use of the survey is not acceptable.)          |           |
|                                                          |           |
|     \[24 CFR 570.208(a)(1)(vi)\]                         |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

+----------------------------------------------------------+-----------+
| f.  If "no" to d., did the survey show that the          |           |
|     percentage of low- and moderate-income residents was |           |
|     at least equal to or greater than the program        |           |
|     participant's exception percent, but less than 51    |           |
|     percent low- and moderate-income? (If "no", the      |           |
|     activity does not meet the National Objective.)      |           |
|                                                          |           |
|     \[24 CFR 570.208(a)(1)(vi)\]                         |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

10\.

+----------------------------------------------------------+-----------+
| If a survey was used to determine the percent of low-    |           |
| and moderate-income residents in the service area, did   |           |
| the CPD Field Office review the survey instrument and    |           |
| methodology and conclude "that the results meet the      |           |
| standards of statistical reliability that are comparable |           |
| to that of the decennial census for areas of similar     |           |
| size?"                                                   |           |
|                                                          |           |
| \[24 CFR 570.208(a)(1)(vi)\]                             |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[E. NATURE OF ACTIVITY]{.underline}

11\.

+------------------------------------------------------------+---------+
| Does the activity appear to benefit the residents located  |         |
| within the service area, where at least 51 percent are     |         |
| low- and moderate-income persons, or within the program    |         |
| participant's exception percentage, as identified in       |         |
| question 7 above?                                          |         |
|                                                            |         |
| \[24 CFR 570.208(a)\]                                      |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

[F. FEES]{.underline}

12\.

  ---------------------------------------------------------- ------------
  a\. If the activity is a facility or service, are fees     
  charged?                                                   

  **Describe Basis for Conclusion:**                         

                                                             
  ---------------------------------------------------------- ------------

  -----------------------------------------------------------------------
  b\. If "yes," how much is charged to use the facility or service?

  **Describe Basis for Conclusion:**

       
  -----------------------------------------------------------------------

+----------------------------------------------------------+-----------+
| c\. If fees are charged, do they appear excessive so as  |           |
| to preclude low- and moderate-income persons from using  |           |
| the facility or service?                                 |           |
|                                                          |           |
| \[24 CFR 570.200(b)(2)\]                                 |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[G. RECORD-KEEPING/VISUAL INSPECTION]{.underline}

13

+----------------------------------------------------------+-----------+
| **\[OS\]** Did your inspection of the records validate   |           |
| the information and documentation contained in the       |           |
| Integrated Disbursements and Information System (IDIS)   |           |
| and/or the program participant's most recently completed |           |
| Consolidated Annual Performance and Evaluation Report    |           |
| (CAPER) for the activity?                                |           |
|                                                          |           |
| \[24 CFR 91.525(a)(3)\]                                  |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

**14.**

  ---------------------------------------------------------- ------------
  **\[OS\]** If you inspected the service area/activity      
  location, is there substantial evidence that the activity  
  fails to benefit low- and moderate-income persons in the   
  identified area?                                           

  **Describe Basis for Conclusion:**                         

                                                             
  ---------------------------------------------------------- ------------

15\.

+------------------------------------------------------------+---------+
| Does the activity meet the national objective criteria for |         |
| serving a low- and moderate-income area?                   |         |
|                                                            |         |
| \[24 CFR 570.208(a)(1) and 24 CFR 570.506\]                |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+