+-----------+----------------------+---------+-----+------------------+
| **Guide   |                      |         |     |                  |
| for       |                      |         |     |                  |
| Review of |                      |         |     |                  |
| Fiscal    |                      |         |     |                  |
| Year (FY) |                      |         |     |                  |
| 1996      |                      |         |     |                  |
| Home      |                      |         |     |                  |
| ownership |                      |         |     |                  |
| Zones     |                      |         |     |                  |
| (HOZ)**   |                      |         |     |                  |
+-----------+----------------------+---------+-----+------------------+
| **Name of |                      |         |     |                  |
| Program   |                      |         |     |                  |
| Parti     |                      |         |     |                  |
| cipant:** |                      |         |     |                  |
|           |                      |         |     |                  |
|           |                      |         |     |                  |
+-----------+----------------------+---------+-----+------------------+
| **Staff   |                      |         |     |                  |
| Con       |                      |         |     |                  |
| sulted:** |                      |         |     |                  |
|           |                      |         |     |                  |
|           |                      |         |     |                  |
+-----------+----------------------+---------+-----+------------------+
| **HOZ/EDI |                      | **HOZ   |     |                  |
| Grant     |                      | Area:** |     |                  |
| Amount:** |                      |         |     |                  |
|           |                      |         |     |                  |
|           |                      |         |     |                  |
+-----------+----------------------+---------+-----+------------------+
| **HO      |                      | **HOZ   |     |                  |
| Z/Section |                      | U       |     |                  |
| 108 Loan  |                      | nits:** |     |                  |
| Guarantee |                      |         |     |                  |
| Amount:** |                      |         |     |                  |
|           |                      |         |     |                  |
+-----------+----------------------+---------+-----+------------------+
| **Name(s) |                      |         | **D |                  |
| of        |                      |         | ate |                  |
| Revie     |                      |         | :** |                  |
| wer(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}** This Exhibit is applicable to the six
HOZ program participants selected as part of HUD's FY 96 HOZ/EDI Grant
competition ("Round I"). It is designed to evaluate compliance with HOZ
expenditure requirements and assess accomplishments under the
HUD-approved HOZ proposal. The Exhibit is divided into five sections:
Eligible Activities; Performance; Program Management; Financial
Management (cross-referencing only); and Cross-Cutting Requirements.
Certain questions require the use of other Exhibits in this Handbook or
monitoring guidance contained in other documents. One Exhibit is to be
completed for each HOZ project monitored. For activities within the HOZ
that are funded by other CPD programs, the reviewer should determine
whether to include a review of other CPD programs as part of the HOZ
monitoring review and, if so, use the appropriate monitoring Exhibit(s)
elsewhere in this Handbook.

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

[A. Eligible Activities]{.underline}

1\.

+------------------------------------------------------------+---------+
| Is the program participant carrying out the activities     |         |
| described in its latest approved HOZ grant proposal?       |         |
|                                                            |         |
| \[HOZ NOFA, Section I.(D) and II.(B)(2)\]                  |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
| **     **                                                  |         |
+------------------------------------------------------------+---------+

2\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Is the program participant using its HOZ/EDI  |           |
| funds for approved uses?                                 |           |
|                                                          |           |
| \[HOZ NOFA, Sections I.(D)(9) and H; 24 CFR 570.703;     |           |
| HOZ/EDI Grant Agreement, Section 2\]                     |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

3\.

+------------------------------------------------------------+---------+
| Is the program participant using its HOZ/Section 108 Loan  |         |
| Guarantee funds for approved uses?                         |         |
|                                                            |         |
| \[HOZ NOFA, Sections I.(D)(9) and H; 24 CFR 570.703;       |         |
| Contract for Loan Guarantee Assistance, Section 15.        |         |
| "Special Conditions and Modifications"\]                   |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

4\.

  ------------------------------------------------------------- ---------
  **\[OS\]** a. Is the program participant using its HOZ/EDI or 
  HOZ/Section 108 Loan Guarantee Funds for new housing          
  construction?                                                 

  **Describe Basis for Conclusion:**                            

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

+------------------------------------------------------------+---------+
| b\. If the answer to "a" above is "yes," is the new        |         |
| housing construction being carried out by an approved      |         |
| Community Based Development Organization (CBDO)?           |         |
|                                                            |         |
| \[24 CFR 570.204 and HOZ/EDI Grant Agreement, Section 4\]  |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

5\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Are all HOZ activities being carried out      |           |
| within the approved HOZ boundaries?                      |           |
|                                                          |           |
| \[HOZ NOFA, Sections I.(B), I.(D)(1), and II.(B)(2)\]    |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

6\.

+------------------------------------------------------------+---------+
| If the program participant has made changes to its         |         |
| HUD-approved grant proposal, did the program participant   |         |
| follow the procedures for material and non-material        |         |
| amendments?                                                |         |
|                                                            |         |
| \[FY 96 HOZ/EDI Competition Procedures for Amendments,     |         |
| 7/8/99\]                                                   |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
|                                                            |         |
|                                                            |         |
+------------------------------------------------------------+---------+

7\.

+------------------------------------------------------------+---------+
| Did the program participant receive HUD approval for       |         |
| material amendments?                                       |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
|                                                            |         |
|                                                            |         |
+------------------------------------------------------------+---------+

8\.

+------------------------------------------------------------+---------+
| If the program participant has changed the use of its      |         |
| HOZ/EDI grant funds, did HUD approve an amendment to the   |         |
| program participant's HOZ/EDI Grant Agreement?             |         |
|                                                            |         |
| \[HOZ/EDI Grant Agreement, Section 8\]                     |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
|                                                            |         |
|                                                            |         |
+------------------------------------------------------------+---------+

9\.

+------------------------------------------------------------+---------+
| If the program participant has changed the use of its      |         |
| HOZ/Section 108 Loan Guarantee funds, did HUD approve an   |         |
| amendment to the program participant's Contract for Loan   |         |
| Guarantee Assistance?                                      |         |
|                                                            |         |
| \[24 CFR 570.704(c)(5) and HOZ/EDI Grant Agreement,        |         |
| Section 4\]                                                |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
|                                                            |         |
|                                                            |         |
+------------------------------------------------------------+---------+

10\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Do the program participant's files support    |           |
| the eligibility of the activities funded by the HOZ/EDI  |           |
| and HOZ/Section 108 Loan Guarantee funds?                |           |
|                                                          |           |
| \[24 CFR 570.506; 24 CFR Part 85.20; and HOZ/EDI Grant   |           |
| Agreement, Section 4\]                                   |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+

[B. Performance]{.underline}

11\.

+------------------------------------------------------------+---------+
| Is the program participant submitting the required         |         |
| Quarterly Reports on time?                                 |         |
|                                                            |         |
| \[FY 96 HOZ/EDI Competition Procedures for Progress and    |         |
| Performance Reports, 7/8/99 (revised 5/03)\]               |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

12\.

  ------------------------------------------------------------- ---------
  Are the Quarterly Reports consistent and accurate?            

  **Describe Basis for Conclusion:**                            

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

13\.

+------------------------------------------------------------+---------+
| Do the Quarterly Reports cover all phases of the HOZ?      |         |
|                                                            |         |
| \[FY 96 HOZ/EDI Competition Procedures for Progress and    |         |
| Performance Reports, 7/8/99 (revised 5/03)\]               |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

14\.

+------------------------------------------------------------+---------+
| Is the program participant meeting its HUD approved        |         |
| timeline?                                                  |         |
|                                                            |         |
| \[HOZ NOFA, Sections I.(D)(7) and II.(B)(2); HOZ/EDI Grant |         |
| Agreement, Section 6; Contract for Loan Guarantee          |         |
| Assistance, Section 1.(b)\]                                |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

15\.

+------------------------------------------------------------+---------+
| Is the program participant meeting its goal for assisting  |         |
| new homebuyers?                                            |         |
|                                                            |         |
| \[HOZ NOFA, Sections I.(D)(1) and II.(B)(2)\]              |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

16\.

+------------------------------------------------------------+---------+
| Has HUD approved the HOZ as a designated Neighborhood      |         |
| Revitalization Strategy Area (NRSA)?                       |         |
|                                                            |         |
| \[HOZ NOFA, Section I.(D)(3); 24 CFR 570.208(d)(5\]        |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

17\.

+------------------------------------------------------------+---------+
| Is the program participant meeting the requirement that    |         |
| 51% of new homebuyer families be low- and moderate-income? |         |
|                                                            |         |
| \[HOZ NOFA, Section I.(D)(3); 24 CFR 570.208(d)(5)(ii)\]   |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

18\.

+------------------------------------------------------------+---------+
| Is the program participant leveraging the anticipated      |         |
| amount of other funds?                                     |         |
|                                                            |         |
| \[HOZ NOFA, Section I.(D)(5)\]                             |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

19\.

  ------------------------------------------------------------- ---------
  **\[OS\]** Has the program participant inspected the          
  completed homebuyer properties to ensure that each property   
  meets all applicable State and local codes and building       
  standards?                                                    

  **Describe Basis for Conclusion:**                            

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

20\.

  ------------------------------------------------------------- ---------
  a\. Does the program participant have a process for resolving 
  homebuyer complaints?                                         

  **Describe Basis for Conclusion:**                            

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

  -----------------------------------------------------------------------
  b\. If the answer to "a" above is "yes," describe the process.

  **Describe Basis for Conclusion:**

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

21\.

  ------------------------------------------------------------- ---------
  Has the program participant missed any significant            
  benchmarks? (If "yes," specify below.)                        

  **Describe Basis for Conclusion:**                            

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

22\.

+------------------------------------------------------------+---------+
| Has the program participant met the requirement that all   |         |
| HOZ/EDI funds be expended by September 30, 2003?           |         |
|                                                            |         |
| \[FY 96 HUD Appropriations Bill\]                          |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

23\.

+------------------------------------------------------------+---------+
| Has the program participant met the requirement that all   |         |
| HOZ/Section 108 Loan Guarantee funds be advanced by        |         |
| September 30, 2003?                                        |         |
|                                                            |         |
| \[FY 96 HUD Appropriation Bill\]                           |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

24\.

+------------------------------------------------------------+---------+
| **\[OS\]** Do the program participant's files support the  |         |
| information reported in the Quarterly Report as described  |         |
| below:                                                     |         |
|                                                            |         |
| \[24 CFR 570.506; 24 CFR Part 85.20 and HOZ/EDI Grant      |         |
| Agreement, Section 4\]                                     |         |
+------------------------------------------------------------+---------+
| a\. Number of HOZ units?                                   |         |
+------------------------------------------------------------+---------+
| b\. Location of units within the HOZ boundaries?           |         |
+------------------------------------------------------------+---------+
| c\. Beneficiary data?                                      |         |
+------------------------------------------------------------+---------+
| d\. Sources and uses of funds?                             |         |
+------------------------------------------------------------+---------+
| e\. Leverage?                                              |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

[C. Program Management]{.underline}

25\.

  ------------------------------------------------------------- ---------
  Has the program participant designated a HOZ coordinator?     

  **Describe Basis for Conclusion:**                            

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

26\.

+------------------------------------------------------------+---------+
| **\[OS\]** Does the coordinator have sufficient authority  |         |
| to achieve results, resolve interagency conflicts or       |         |
| issues and take corrective actions?                        |         |
|                                                            |         |
| \[24 CFR 570.501 and HOZ/EDI Grant Agreement, Section 4\]  |         |
+------------------------------------------------------------+---------+
| **Describe Basis for Conclusion:**                         |         |
+------------------------------------------------------------+---------+
|                                                            |         |
+------------------------------------------------------------+---------+

27\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Has the program participant executed written  |           |
| agreements with its contractors and subrecipients?       |           |
|                                                          |           |
| \[24 CFR 570.503 and HOZ/EDI Grant Agreement, Section    |           |
| 4\]                                                      |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
|                                                          |           |
|                                                          |           |
+----------------------------------------------------------+-----------+

28\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Does the program participant have procedures  |           |
| to monitor the performance of its contractors and        |           |
| subrecipients?                                           |           |
|                                                          |           |
| \[HOZ/EDI Grant Agreement, Section 5; 24 CFR 570.501\]   |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
|                                                          |           |
|                                                          |           |
+----------------------------------------------------------+-----------+

29\.

  ------------------------------------------------------------- ---------
  **\[OS\]** Has the program participant monitored any          
  contractors or subrecipients?                                 

  **Describe Basis for Conclusion:**                            

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

30\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Has the program participant taken corrective  |           |
| actions to resolve any findings or concerns?             |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
|                                                          |           |
|                                                          |           |
+----------------------------------------------------------+-----------+

[D. Financial Management]{.underline}

> **\[OS\] [Instructions:]{.underline}** Use Section C of Exhibit 5-1,
> "Guide for Review of Section 108 Loan Guarantees, EDI and BEDI
> Grants;" Exhibit 3-15, "Guide for Review of Financial Management" and
> Exhibit 3-16, "Guide for Review of Cost Allowability" to conduct
> financial management monitoring for this HOZ.

E. [Cross-cutting Requirements.]{.underline}

**[Instructions:]{.underline}** The following question is to be answered
based upon the use of other Exhibits in this Handbook, or in some cases,
other review documents not included here. Areas not reviewed, or not
part of this HOZ, should be noted by marking the "N/A" box.

31\.

+----------------------------------------------------------+-----------+
| **\[OS\]** Is there evidence that the program            |           |
| participant is complying with the following              |           |
| cross-cutting requirements (identify those reviewed):    |           |
+----------------------------------------------------------+-----------+
| a.  Procurement? (Use Exhibit 3-20.)                     |           |
|                                                          |           |
|     \[24 CFR 85.36 and HOZ/EDI Grant Agreement Section   |           |
|     4\]                                                  |           |
+----------------------------------------------------------+-----------+
| b.  Section 3 Economic Opportunities? (Use Exhibit       |           |
|     22-7.)                                               |           |
|                                                          |           |
| > \[24CFR 570.607(b) and HOZ/EDI Grant Agreement,        |           |
| > Section 4\]                                            |           |
+----------------------------------------------------------+-----------+
| c.  MBE/WBE? (Use Exhibit 3-20.)                         |           |
|                                                          |           |
| > \[24 CFR 85.36(e) and HOZ/EDI Grant Agreement, Section |           |
| > 4\]                                                    |           |
+----------------------------------------------------------+-----------+
| d.  Lead-based Paint? (Use applicable Exhibits in        |           |
|     Chapter 24.}                                         |           |
|                                                          |           |
| > \[24 CFR 570.608 and HOZ/EDI Grant Agreement, Section  |           |
| > 4\]                                                    |           |
+----------------------------------------------------------+-----------+
| e.  Uniform Relocation Act? (See Handbook 1378.0.)       |           |
|                                                          |           |
|     \[24 CFR 570.606 and HOZ/EDI Grant Agreement,        |           |
|     Section 4\]                                          |           |
+----------------------------------------------------------+-----------+
| f.  NEPA? (Use Exhibit 21-1.)                            |           |
|                                                          |           |
| > \[24 CR 570.200(a)(4) and HOZ/EDI Grant Agreement,     |           |
| > Section 4\]                                            |           |
+----------------------------------------------------------+-----------+
| g.  Architectural Barriers Act? (Use Exhibit 22-1.)      |           |
|                                                          |           |
| > \[24 CFR 570.614 and HOZ/EDI Grant Agreement, Section  |           |
| > 4\]                                                    |           |
+----------------------------------------------------------+-----------+
| h.  Property Equipment Disposition? (Use Exhibit 3-21.)  |           |
|                                                          |           |
| > \[24 CFR 85.32 and HOZ/EDI Grant Agreement, Section    |           |
| > 4)\]                                                   |           |
+----------------------------------------------------------+-----------+
| i.  Other (specify)?                                     |           |
+----------------------------------------------------------+-----------+
| **Describe Basis for Conclusion:**                       |           |
+----------------------------------------------------------+-----------+
|                                                          |           |
+----------------------------------------------------------+-----------+