Editorial Note on Part 17
Editorial Note: Nomenclature changes to part 17 appear at 68 FR 51376, Aug. 26, 2003.

§ 17.204 Assurances required. ( a ) *Assurances.* An applicant for Federal financial assistance to which this subpart applies shall provide assurances, in accordance with OMB Circular A-102, that the program or activity will be operated in compliance with this subpart. An applicant may incorporate these assurances by reference in subsequent applications to the Department.
( b ) *Duration of obligation.* ( 1 ) In the case of Federal financial assistance extended in the form of real property or to provide real property or structures on the property, the assurance will obligate the recipient or, in the case of a subsequent transfer, the transferee, for the period during which the real property or structures are used for the purpose for which Federal financial assistance is extended or for another purpose involving the provision of similar services or benefits.
( 2 ) In the case of Federal financial assistance extended to provide personal property, the assurance will obligate the recipient for the period during which it retains ownership or possession of the property.
( 3 ) In all other cases the assurance will obligate the recipient for the period during which Federal financial assistance is extended.
( c ) *Covenants.* ( 1 ) Where Federal financial assistance is provided in the form of real property or interest in the property from the Department, the instrument effecting or recording this transfer shall contain a covenant running with the land to assure nondiscrimination for the period during which the real property is used for a purpose for which the Federal financial assistance is extended or for another purpose involving the provision of similar services or benefits.
( 2 ) Where no transfer of property is involved but property is purchased or improved with Federal financial assistance, the recipient shall agree to include the covenant described in paragraph (c)(1) of this section in the instrument effecting or recording any subsequent transfer of the property.
( 3 ) Where Federal financial assistance is provided in the form of real property or interest in the property from the Department, the covenant shall unless prohibited by the conveyance authority, also include a condition coupled with a right to be reserved by the Department to revert title to the property in the event of a breach of the covenant. If a transferee of real property proposes to mortgage or otherwise encumber the real property as security for financing construction of new, or improvement of existing, facilities on the property for the purposes for which the property was transferred, the Director may, upon request of the transferee and if necessary to accomplish such financing and upon such conditions as he or she deems appropriate, agree to forbear the exercise of such right to revert title for so long as the lien of such mortgage or other encumbrance remains effective.
( 4 ) Every application by a State or any agency or political subdivision of a State for continuing Federal financial assistance shall as a condition to its approval and the extension of any Federal financial assistance pursuant to the application ( i ) contain or be accompanied by a statement that the program or activity is (or, in the case of a new program, will be) conducted in compliance with all requirements imposed by or pursuant to this subpart, or a statement of the extent to which it is not, at the time the statement is made, so conducted, and
( ii ) provide or be accompanied by provision for such methods of administration for the program or activity as are found by the Secretary or his designee to give reasonable assurance that the applicant and all recipients of Federal financial assistance will comply with all requirements imposed by or pursuant to this regulation, including methods of administration which give reasonable assurance that any noncompliance indicated in the statement under paragraph (c)(4)(i) of this section will be corrected.