6510.1

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CHAPTER 5: REVIEW FOR MAXIMUM FEASIBLE PRIORITY

5-1. INTRODUCTION. Starting with the annual CD program approved in 1979

(program year 1979 was the first program year in which all

entitlement grantees\' programs were subject to the maximum feasible

priority rules published on March 1, 1978), each annual community

development program shall be reviewed in three ways:

a\. The reviewer shall assure that each project being carried out

meets one of the qualification factors in 24 CFR 570.302 for

program benefit;

b\. The reviewer shall ensure that the community development

programs are addressing the needs of low-income as well as

moderate-income persons; and

c\. The reviewer shall determine if the grantee has made

substantial changes in the extent of benefit to low- and

moderate income persons in the program as a whole such that the

program would be plainly inappropriate to address the needs of

low- and moderate-income persons in the community.

5-2. DATA SOURCES. In addition to the Grantee Performance Report (GPR),

the reviewer will need a copy of the approved annual application for

each annual CD Block Grant from 1979 forward which has not previously

been reported as completely expended.

5-3. REVIEW FOR \"MAXIMUM FEASIBLE PRIORITY\".

a\. General.

Each project proposed and implemented with Community

Development Block Grant funds must (1) principally benefit

low- and moderate-income persons, or (2) prevent or eliminate

slums and blight, or (3) meet another community development

need of particular urgency, pursuant to 24 CFR 570.302(b)(1).

b\. Conducting the Review.

\(1\) The reviewer of the Grantee Performance Report (GPR)

should review each project to assure that it is being

carried out in a manner which meets one of the standards

described at 24 CFR 570.302(d), (e) and (f).

\(2\) The GPR requires the grantee to identify, in column (e)

of the Area Benefit form (HUD-4950.4), which regulatory

standard

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5-1 8/81

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6510.1

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each project meets. For each reported project, the

reviewer should verify that, based on the data presented

in the GPR, the project, as it is being carried out,

meets the standard identified by the grantee. A

worksheet has been provided in Exhibit 5 to assist the

reviewer in verifying the project qualification. The

reviewer should pay particular attention to projects

created by local option and reprogramming since the

application approval.

c\. Resolving Apparent Performance Problems.

\(1\) If the reviewer identifies any project(s), whether

approved in the application or newly created, which

appears not to meet any of the regulatory standards

described in Exhibit 5a of this Chapter, he/she should

notify the grantee of this possible performance problem,

following the procedure described in Chapter 11 of this

Handbook. In this notice to the grantee, the Area Office

should provide 30 days for the grantee to present

additional information that demonstrates that the

project(s) meets the requirements of the regulatory

provision it identified in the GPR, or that the

project(s) meets the requirements of another regulatory

provision under 24 CFR 570.302(d), (e) or (f).

\(2\) If the grantee fails to show that a questioned project

meets one of the regulatory standards described at 24 CFR

570.302(d), (e) or (f), the Area Office should undertake

one or more of the corrective or remedial actions

specified in 24 CFR 570.910(b).

5-4. LOW-INCOME BENEFIT.

a\. 24 CFR 570.302(b)(5) requires that applicants for CD Block

Grants address the needs of low-income as well as

moderate-income persons given the nature and relative severity

of their needs, and that applicants include projects suitable

to meeting those needs.

b\. The reviewer should analyze the data presented in Column (e) of

the Area Benefit form (HUD-4950.4) and Column (e) of the Direct

Benefit Activities form (HUD-4950.5) to determine whether the

grantee, in carrying out its program, has apparently failed to

address the needs of its low-income population. If the grantee

has apparently failed to address the needs of its low-income

population, the grantee should be given the opportunity to

present information indicating that it is addressing the needs

of its low-income population.

c\. If the reviewer determines, after considering data in the GPR

and any additional information submitted by the grantee or

acquired through

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8/81 5-2

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6510.1

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monitoring activities, that the grantee\'s program does not

address the needs of low-income as well as moderate-income

persons, the Area Office shall require the grantee to revise

its program to address such needs.

5-5. EXTENT OF PROGRAM BENEFIT TO LOW- AND MODERATE-INCOME

PERSONS. It is important to determine whether the grantee in

carrying out its program, has significantly reduced the proportion of

funds benefitting low- and moderate-income persons from the

proportion described in the annual application. The reviewer should

analyze the data in the GPR to identify the amount of project costs

which can be expected to benefit low- and moderate-income persons and

compare that amount with the amount of CDBG funds originally approved

in the annual application as benefitting low- and moderate-income

persons. If in carrying out the programs the grantee has

substantially reduced the proportion of funds benefitting low- and

moderate-income persons, the reviewer shall reevaluate the needs of

low- and moderate-income persons to determine whether the program as

a whole is plainly inappropriate to address such needs.

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5-3 8/81

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6510.1

Exhibit 5

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Maximum Feasible Priority Review

24 CFR 570.302(d)(1)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(d)(1)

answer the following questions.

Are 100% of the beneficiaries of the project low- and moderate-income

persons, as shown in column (d) on the Direct Benefit Activities Report

(HUD-4950.5)?

a\. If yes, the project qualifies under 24 CFR 570.302(d)(1). Go on to

the next project.

b\. If no, list the project on the worksheet found in this exhibit and
go

on to the next project.

24 CFR 570.302(d)(2)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(d)(2)

answer the f allowing questions.

Are a majority of the residents of the project area low- and

moderate-income persons, as shown in column (d) of the Area Benefit form

(HUD-4950.4)? Any project for which data is not required in column (d)
of

the Area Benefit form of the GPR should be included among those projects

considered for on-site monitoring.

a\. If yes, the project qualifies under 24 CFR 570.302(d)(2). Go on to

the next project.

b\. If no, list the project on worksheet at the end of this exhibit and

go on to the next project.

24 CFR 570.302(d)(3)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(d)(3)

answer the f allowing questions.

Do all products of this project constitute architectural barriers which

have been removed, as listed in column (h) of the Project Progress
Report

(HUD-4950.2)?

a\. If yes, the project qualifies under 24 CFR 570.302(d)(3). Go on to

the next project.

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1 8/81

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6510.1

Exhibit 5

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Maximum Feasible Priority Review

b\. If no, list the project on worksheet at the end of this exhibit and

go on to the next project.

24 CFR 570.302(d)(4)

For each project identified by the grantee in column (e) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(d)(4)

answer the following questions.

1\. Based on currently available information, is the project of which

this project is an integral part or a necessary support, still

expected to be completed?

a\. If yes, continue to question 2. below.

b\. If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

2\. Based on currently available information, is the project of which
the

project is an integral part or a necessary support, still expected to

principally benefit low- and moderate-income persons?

a\. If yes, the project qualifies under 24 CFR 570.302(d)(4). Go on

to the next project.

b\. If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

24 CFR 570.302(d)(5)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(d)(5)

answer the following questions.

1\. Did the Area Office specifically approve the use of this provision
by

this grantee, based upon data documenting the existence of the

necessary conditions stipulated in 24 CFR 570.302(d)(5)?

a\. If yes, go on to question 2. below.

b\. If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

2\. Is the percent of low- and moderate-income residents served by the

project as shown in column (d) of the Area Benefit form

(HUD-4950.4) at least equal to the percentage of low- and

moderate-income residents of the

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8/81 2

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6510.1

Exhibit 5

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Maximum Feasible Priority Review

project area as stated in the approved application for CDBG funding

or other documentation?

a\. If yes, the project qualifies under 24 CFR 570.302(d)(5). Go on

to the next project.

b\. If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

24 CFR 570.302(e)(1)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(e)(1)

answer the following questions.

1\. Is this project an approved Neighborhood Strategy Area project, as

described at 24 CFR 570.301(c)?

a\. If yes, go on to question 2. below.

b\. If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

2\. Was this project listed as a slum/blight project in the Three Year

Project Summary (HUD-7065) and approved as such in the application

for CDBG funding?

a\. If yes, the project qualifies under 24 CFR 570.302(e)(1). Go on

to the next project.

b\. If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

24 CFR 570.302(e)(2)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(e)(2)

answer the following questions.

Was this project listed as slum/blight project in the Three Year Project

Summary (HUD-7065) and approved as such in the application for CDBG

funding?

a\. If yes, is the project composed only of acquisition, demolition,

historic preservation, relocation, and/or rehabilitation activities,

as shown in column (c) of the Project Progress Report (HUD-4950.2)?

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3 8/81

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6510.1

Exhibit 5

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Maximum Feasible Priority Review

\(1\) If yes, the project qualifies under 24 CFR 570.302(e)(2). Go

on to the next project.

\(2\) If no, list the project on the worksheet at the end of this

exhibit and go on to the next project.

b\. If no, list the project on the worksheet at the end of this exhibit

and go on to the next project.

24 CFR 570.302(e)(3)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR
570.302(e)(3)

answer the following questions.

Is this project designed to continue a previously approved Urban Renewal

project?

a\. If yes, the project qualifies under 24 CFR 570.302(e)(3). Go on to

the next project.

b\. If no, list the project on the worksheet at the end of this exhibit

and go on to the next project.

24 CFR 570.302(f)

For each project identified by the grantee in column (c) of the Area

Benefit form (HUD-4950.4) as meeting the standards of 24 CFR 570.302(f)

answer the following questions.

Was this project approved as an urgent needs project in the original

application for CDBG funding?

a\. If yes, the project qualifies under 24 CFR 570.302(f). Go on to the

next project.

b\. If no, list the project on the worksheet at the end of this exhibit

and go on to the next project.

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8/81 4

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6510.1

Exhibit 5

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MAXIMUM FEASIBLE PRIORITY WORKSHEET.

Grant Number

List all projects which appear not to meet the maximum feasible priority

criteria identified by the grantee in Column (c) of the Area Benefit

(HUD-4950.4), based on the data presented in the Grantee Performance

Report. Upon completion of the review for maximum feasible priority,
take

the actions to resolve these apparent performance problems as described
in

Paragraph 5-3 of this Chapter.

Project Number Project Name

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5 8/81