Federal Register / Vol. 75, No. 217 / Wednesday, November 10, 2010 / Notices 69097 

be limited to 200 participants. To 

reserve a seat in advance, please provide 

a request via email or mail with the 

contact information of the participant 

(including name, mailing address, and 

e-mail address), the meeting(s) to be 

attended, and include the subject/ 

attention line (or on the envelope if by 

mail): Reservation Request for NFIP 

Reform Meeting. Advance reservations 

must be received 3 business days prior 

to the meeting to ensure processing. 

Unregistered participants will be 

accepted after all participants with 

reservations have been accommodated 

and will be admitted on a first-come, 

first-serve basis, provided the 200 

person capacity is not exceeded. To 

submit reservations, please e-mail: 

nfip_reform@dhs.gov or send by mail to 

the address listed in the FOR FURTHER

INFORMATION CONTACT caption. 

Web Site: http://www.fema.gov/ 

business/nfip/nfip_reform.shtm. 

FOR FURTHER INFORMATION CONTACT: 

Michael Grimm, by telephone at 202– 

646–2878 or by e-mail at 

nfip_reform@dhs.gov. Mailing Address: 

NFIP Reform, 1800 South Bell Street, 

Room 970, Arlington, VA 20598–3030. 

Meeting Topics: Background 

information about these topics is 

available on the NFIP Reform Web site. 

The straw man policy alternatives will 

also be posted to Docket ID: FEMA– 

2010–0065. 

Procedure: This meeting is open to 

the public. 

W. Craig Fugate, 

Administrator, Federal Emergency 

Management Agency. 

[FR Doc. 2010–28424 Filed 11–9–10; 8:45 am] 

BILLING CODE 9110–12–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–5452–N–01] 

Allocations and Common Application 

and Reporting Waivers Granted to and 

Alternative Requirements for 

Community Development Block Grant 

(CDBG) Disaster Recovery Grantees 

Under the Supplemental 

Appropriations Act, 2010 (Pub. L. 111– 

212) 

AGENCY: Office of the Secretary, HUD. 

ACTION: Notice of allocations, waivers, 

and alternative requirements. 

SUMMARY: This Notice advises the public 

of the allocation of CDBG disaster 

recovery funds for the purpose of 

assisting the recovery efforts in areas 

declared a major disaster under title IV 

of the Robert T. Stafford Disaster Relief 

and Emergency Assistance Act (42 

U.S.C. 5121 et seq.) as a result of the 

severe storms and flooding that 

occurred from March through May, 

2010. As described in the 

SUPPLEMENTARY INFORMATION section of 

this Notice, HUD is authorized by 

statute and regulations to waive 

statutory and regulatory requirements 

and specify alternative requirements 

upon the request of a grantee. Therefore, 

this Notice describes applicable waivers 

and alternative requirements, as well as 

the application process, eligibility 

requirements, and relevant statutory 

provisions for grants provided under 

this Notice. 

DATES: Effective Date: November 15, 

2010. 

FOR FURTHER INFORMATION CONTACT: 

Scott Davis, Director, Disaster Recovery 

and Special Issues Division, Office of 

Block Grant Assistance, Department of 

Housing and Urban Development, 451 

7th Street, SW., Room 7286, 

Washington, DC 20410, telephone 

number 202–708–3587. Persons with 

hearing or speech impairments may 

access this number via TTY by calling 

the Federal Information Relay Service at 

800–877–8339. Facsimile inquiries may 

be sent to Mr. Davis at 202–401–2044. 

(Except for the ‘‘800’’ number, these 

telephone numbers are not toll-free.) 

SUPPLEMENTARY INFORMATION: 

Authority To Grant Waivers 

The Supplemental Appropriations 

Act, 2010 (Pub. L. 111–212, approved 

July 29, 2010) appropriates $100 

million, to remain available until 

expended, in CDBG funds for necessary 

expenses related to disaster relief, longterm recovery, and restoration of 

infrastructure, housing, and economic 

revitalization in areas affected by severe 

storms and flooding from March 2010 

through May 2010 for which the 

President declared a major disaster 

covering an entire State, or States with 

more than 20 counties declared major 

disasters, under title IV of the Robert T. 

Stafford Disaster Relief and Emergency 

Assistance Act of 1974 (42 U.S.C. 5121 

et seq.). 

The Supplemental Appropriations 

Act authorizes the Secretary to waive, or 

specify alternative requirements for any 

provision of any statute or regulation 

that the Secretary administers in 

connection with the obligation by the 

Secretary, or use by the recipient, of 

these funds and guarantees, except for 

requirements related to fair housing, 

nondiscrimination, labor standards, and 

the environment (including 

requirements concerning lead-based 

paint), upon: (1) A request by the 

grantee explaining why such a waiver is 

required to facilitate the use of such 

funds or guarantees, and (2) a finding by 

the Secretary that such a waiver would 

not be inconsistent with the overall 

purpose of Title I of the Housing and 

Community Development Act of 1974 

(HCD Act). Regulatory waiver authority 

is also provided by 24 CFR 5.110, 

91.600, and 570.5. 

The Secretary finds that the following 

waivers and alternative requirements, as 

described below, are necessary to 

facilitate the use of these funds for the 

statutory purposes, and are not 

inconsistent with the overall purpose of 

Title I of the HCD Act or the CranstonGonzalez National Affordable Housing 

Act, as amended. Under the 

requirements of the Supplemental 

Appropriations Act and the Department 

of Housing and Urban Development 

Reform Act of 1989 (the HUD Reform 

Act), regulatory waivers must be 

justified and published in the Federal 

Register. 

Allocations 

This Notice makes available $50 

million of the $100 million 

appropriation for the CDBG program for 

necessary expenses related to disaster 

relief, long-term recovery, and 

restoration of infrastructure, housing, 

and economic revitalization in areas 

affected by severe storms and flooding 

that occurred from March 2010 through 

May 2010, for which the President 

declared a major disaster covering an 

entire State, or States with more than 20 

counties declared major disasters, under 

title IV of the Robert T. Stafford Disaster 

Relief and Emergency Assistance Act of 

1974 (42 U.S.C. 5121 et seq.). 

The Supplemental Appropriations 

Act further notes: 

That funds shall be awarded directly to the 

State or unit of general local government at 

the discretion of the Secretary * * * 

Provided further, that funds allocated under 

this heading shall not adversely affect the 

amount of any formula assistance received by 

a State or subdivision thereof under the 

Community Development Fund: Provided 

further, that a State or subdivision thereof 

may use up to 5 percent of its allocation for 

administrative costs * * * 

Almost all of the prior appropriations 

to the CDBG disaster recovery program 

have required funds to be administered 

through an entity or entities designated 

by the Governor of each State. In 

contrast, the Supplemental 

Appropriations Act, 2010, states that 

funds may be awarded directly to a 

State or unit of general local 

government, at the discretion of the 

Secretary. Based on the eligible date 

range specified by Congress, 


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communities affected by the relevant 

disasters, and estimates of unmet need, 

HUD has determined that, in addition to 

Tennessee, Rhode Island, and Kentucky, 

multiple units of general local 

government will also receive a direct 

allocation under today’s Notice. 

Therefore, except as described in this 

Notice, statutory and regulatory 

provisions governing the State CDBG 

program shall apply to any State 

receiving an allocation under this 

Notice, while statutory and regulatory 

provisions governing the CDBG 

entitlement program shall apply to any 

unit of general local government 

receiving a direct allocation in this 

Notice. Applicable State and 

entitlement regulations can be found at 

24 CFR part 570. Unless noted 

otherwise, the term ‘‘grantee’’ refers to 

any grantee—whether State, city, or 

county—receiving a direct award under 

this Notice. 

HUD computes allocations based on 

data that are generally available and that 

cover all the eligible affected areas. As 

a result, HUD is making the following 

allocations in today’s Notice: 

TABLE 1—INITIAL ALLOCATIONS UNDER PUB. L. 111–212 

Disaster No. State Grantee Allocation 

1912 ......................................................... Kentucky ................................................. State Government .................................. $13,000,000 

1894 ......................................................... Rhode Island .......................................... City of Cranston ...................................... 1,277,067 

1894 ......................................................... Rhode Island .......................................... City of Warwick ....................................... 2,787,697 

1894 ......................................................... Rhode Island .......................................... State Government .................................. 8,935,237 

1909 ......................................................... Tennessee .............................................. City of Memphis ...................................... 2,031,645 

1909 ......................................................... Tennessee .............................................. Nashville-Davidson County .................... 10,731,831 

1909 ......................................................... Tennessee .............................................. Shelby County ........................................ 1,212,788 

1909 ......................................................... Tennessee .............................................. State Government .................................. 10,023,735 

Total ................................................. ................................................................. ................................................................. 50,000,000 

Please see Appendix A for a complete 

description of the allocation 

methodology. 

Subsequent to this Notice, HUD will 

make a final review of long-term 

disaster recovery needs for all States or 

subdivisions thereof affected by the 

disasters that occurred between March 

and May, 2010, to allocate the 

remaining $50 million. This review will 

include unmet housing, infrastructure, 

and economic revitalization needs. 

The Supplemental Appropriations 

Act requires funds to be used only for 

specific purposes. The statute directs 

that each grantee will describe, in an 

Action Plan for Disaster Recovery, 

criteria for eligibility and how the use 

of the grant funds will address longterm recovery, and restoration of 

infrastructure, housing, and economic 

revitalization. HUD will monitor 

compliance with this directive and may 

disallow expenditures if it finds that 

funds duplicate other benefits or do not 

meet a statutory purpose. HUD 

encourages grantees to contact their 

assigned HUD offices for guidance in 

complying with these requirements 

during development of their Action 

Plans for Disaster Recovery. 

As provided for in the Supplemental 

Appropriations Act, funds may be used 

as a matching requirement, share, or 

contribution for any other Federal 

program. However, the funds may not 

be used for activities reimbursable by, or 

for which funds are made available by, 

the Federal Emergency Management 

Agency (FEMA) or the Army Corps of 

Engineers. 

Prevention of Fraud, Abuse, and 

Duplication of Benefits 

To prevent fraud, abuse of funds, and 

duplication of benefits under the 

Supplemental Appropriations Act, this 

Notice includes specific reporting, 

written procedures, monitoring, and 

internal audit requirements applicable 

to each grantee. Please see the note 

regarding duplication of benefits at 

paragraph 27. Also see paragraph 5, 

sections B–D, under ‘‘Applicable Rules, 

Statutes, Waivers, and Alternative 

Requirements; Pre-Grant Process,’’ for 

these requirements. In addition, the 

Department will: (1) Institute risk 

analysis and on-site monitoring of 

grantee management of the grants and of 

the specific uses of funds, (2) be 

extremely cautious in considering any 

waiver related to basic financial 

management requirements; the 

standard, time-tested CDBG financial 

requirements will continue to apply, 

and (3) collaborate with the HUD Office 

of Inspector General to plan and 

implement oversight of these funds. 

Waiver Justification 

This section of the Notice briefly 

describes the basis for each waiver and 

related alternative requirements, if any. 

Each grantee under today’s Notice may 

request additional waivers from the 

Department as needed to address 

specific needs related to its recovery 

activities. The Department will respond 

to requests for waivers of provisions not 

covered in this Notice, after working 

with the grantee to tailor its program(s) 

to best meet its disaster recovery needs. 

Each grantee under today’s Notice 

receives an annual CDBG allocation, 

and therefore has a consolidated plan, 

citizen participation plan, monitoring 

plan, and has made CDBG certifications. 

To facilitate the timeliness of assistance, 

and expedite community recovery, HUD 

encourages each grantee to carry out its 

CDBG disaster recovery activities, to the 

extent possible, in the context of its 

ongoing community development 

programs (for example, by selecting 

activities consistent with the 

consolidated plan, by providing overall 

benefit to at least 70 percent low- and 

moderate-income persons, and by 

holding hearings or meetings to solicit 

public comment). 

The waivers, alternative requirements, 

and statutory changes described in this 

Notice apply only to the CDBG 

supplemental disaster recovery funds 

appropriated in the Supplemental 

Appropriations Act, and not to funds 

provided under the regular CDBG 

program or those provided under any 

other component of the CDBG program, 

such as the Neighborhood Stabilization 

Program. These actions provide 

additional flexibility in program design 

and implementation and implement 

statutory requirements unique to this 

appropriation. 

The following application and 

reporting waivers and alternative 

requirements are in response to requests 

from each grantee under this Notice. 

Application for Allocations Under the 

Supplemental Appropriations Act, 2010 

These waivers and alternative 

requirements streamline the pre-grant 

process and set guidelines for each 


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grantee’s application. HUD encourages 

each grantee that receives an allocation 

to submit an Action Plan for Disaster 

Recovery to HUD as soon as practicable 

following this Notice. Please see 

paragraph 5 under ‘‘Applicable Rules, 

Statutes, Waivers, and Alternative 

Requirements; Pre-Grant Process,’’ for 

more detailed information regarding the 

Action Plan requirements. 

Overall Benefit to Low- and ModerateIncome Persons 

The primary objective of Title I of the 

HCD Act and of the funding program of 

each grantee is the ‘‘development of 

viable urban communities, by providing 

decent housing and a suitable living 

environment and expanding economic 

opportunities, principally for persons of 

low and moderate income.’’ 42 U.S.C. 

5301(c). The statute goes on to require 

that 70 percent of the aggregate of a 

regular CDBG program’s funds be used 

to support activities benefitting lowand moderate-income persons. Many 

communities that have suffered a 

Presidentially-declared disaster find this 

target difficult, if not impossible, to 

reach. Furthermore, previous disasters, 

and disasters covered by the 

Supplemental Appropriations Act, 

2010, affect entire communities 

regardless of income, often causing 

extensive damage to community 

structures, housing occupied by persons 

and families of varying incomes, and 

infrastructure. Disaster-affected 

communities are also often faced with 

the dissolution, or relocation of incomeproducing jobs. 

Therefore, today’s Notice provides 

grantees with greater flexibility to carry 

out recovery activities and grants an 

overall benefit waiver that allows for up 

to 50 percent of the grant to assist 

activities under the urgent need, or 

prevention or elimination of slums or 

blight, national objectives, rather than 

the 30 percent allowed under the 

regular CDBG programs. 

HUD may provide additional waivers 

of this requirement only if the Secretary 

specifically finds a compelling need to 

further reduce or eliminate the 

percentage requirement. The 

requirement that each activity meet one 

of the three national objectives of the 

CDBG program is not waived. 

Expanded Distribution and Direct 

Action 

The waivers and alternative 

requirements allowing distribution of 

funds by a State to entitlement 

communities and Indian tribes, and to 

allow a State to carry out activities 

directly, rather than distribute all funds 

to units of local government, are 

consistent with waivers granted for 

previous, similar CDBG disaster 

recovery supplemental appropriations. 

HUD believes that, in using statutory 

language similar to that used for prior 

CDBG supplemental appropriations, 

Congress is signaling its intent that the 

States under this appropriation also be 

able to carry out activities directly. 

Therefore, HUD is waiving program 

requirements in order to support this 

intent. HUD is also including in this 

Notice the necessary complementary 

waivers and alternative requirements 

related to subrecipients to ensure proper 

management and disposition of funds 

during grant execution and at closeout. 

Please note that any city or county 

receiving a direct award under today’s 

Notice will be subject to the standard 

entitlement regulations. Thus, the 

waiver and alternative requirement 

allowing a State to carry out activities 

directly are inapplicable and 

unnecessary. 

Use of Subrecipients 

The State CDBG program rule does 

not make specific provision for the 

treatment of entities called 

‘‘subrecipients’’ in the CDBG entitlement 

program. The waiver allowing the State 

to directly carry out activities creates a 

situation in which the State may use 

subrecipients to carry out activities in a 

manner similar to an entitlement 

community. HUD and its Office of 

Inspector General have long identified 

the use of subrecipients as a practice 

that increases the risk of abuse of funds. 

However, HUD’s experience is that this 

risk can be successfully managed by 

following the CDBG entitlement 

requirements and related guidance. 

Therefore, a State taking advantage of 

the waiver to carry out activities directly 

must follow the alternative 

requirements drawn from the CDBG 

entitlement rule and specified in this 

Notice whenever using a subrecipient. 

Any city or county receiving a direct 

award under today’s Notice is subject to 

the standard CDBG entitlement 

regulations regarding subrecipients. 

Consistency With the Consolidated Plan 

HUD is waiving the requirement for 

consistency with the consolidated plan 

because the effects of a major disaster 

usually alter a grantee’s priorities for 

meeting housing, employment, and 

infrastructure needs. To emphasize that 

uses of grant funds must be consistent 

with the overall purposes of the HCD 

Act, HUD is limiting the scope of the 

waiver for consistency with the 

consolidated plan; the waiver applies 

only until the grantee first updates its 

strategic plan priorities (and the full 

consolidated plan) following the 

disaster. At that time, the grantee should 

also update its Analysis of 

Impediments, so that it more accurately 

reflects the impacts of the disaster. 

Action Plan for Disaster Recovery 

HUD is waiving the CDBG action plan 

requirements and substituting an Action 

Plan for Disaster Recovery. This will 

allow rapid implementation of disaster 

recovery grant programs and ensure 

conformance with provisions of the 

Supplemental Appropriations Act. 

Where possible, the Action Plan for 

Disaster Recovery, including 

certifications, should not repeat 

common action-plan elements the 

grantee has already committed to carry 

out as part of its annual CDBG 

submission. 

Any grantee receiving an allocation 

under this Notice will be responsible for 

compliance with Federal requirements. 

During the course of the grant, HUD will 

monitor the grantee’s actions and use of 

funds for consistency with the Action 

Plan. The grantee may submit an initial 

partial Action Plan and amend it one or 

more times subsequently until the 

Action Plan describes uses for the total 

grant amount. An Action Plan may also 

be amended to modify activities. 

Citizen Participation 

The citizen participation waiver and 

alternative requirements will permit a 

more streamlined public process, but 

one that still provides for reasonable 

public notice, appraisal, examination, 

and comment on the activities proposed 

for the use of CDBG disaster recovery 

grant funds. The waiver removes the 

requirement at both the grantee and 

grant recipient levels for public hearings 

or meetings as the method for 

disseminating information or collecting 

citizen comments. 

The CDBG program normally requires 

a grantee to solicit comments from its 

citizens for at least 30 days before it 

submits an annual action plan to HUD, 

which then has 45 days to accept or 

reject the plan. To expedite the process 

and to ensure that the disaster recovery 

grants are awarded in a timely manner, 

while preserving reasonable citizen 

participation, HUD is waiving the 

requirement that the grantee follow its 

citizen participation plan to the extent 

necessary to allow a grantee to submit 

an Action Plan for Disaster Recovery in 

an expedited manner. HUD is 

shortening the minimum time for 

citizen comments and is requiring the 

proposed Action Plan for Disaster 

Recovery, and any amendment thereof, 

to be posted on the grantee’s official 

Web site as the plan or amendment is 


emcdonald on DSK2BSOYB1PROD with NOTICES
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developed, published, and submitted to 

HUD. 

In combination, this Notice’s 

alternative requirements provide the 

following expedited steps for disaster 

recovery grants: 

• Proposed Action Plan for Disaster 

Recovery published via the usual 

methods and on the grantee’s official 

Web site for no less than 7 calendar 

days of public comment; 

• Final Action Plan posted on the 

Internet and submitted to HUD (grant 

application includes Standard Form 424 

(SF–424) and certifications; other parts 

of the Action Plan may initially be 

submitted through the Department’s 

Disaster Recovery Grant Reporting 

(DRGR) system, or by mailing/e-mailing 

a paper copy); 

• HUD expedites review; 

• HUD accepts the plan and prepares 

a cover letter, grant agreement, and 

grant conditions; 

• Grant agreement signed by HUD 

and immediately transmitted to the 

grantee; 

• Grantee signs and returns the grant 

agreement; 

• HUD establishes the line of credit 

and the grantee requests and receives 

DRGR access (if the grantee does not 

already have it); 

• If it has not already done so, grantee 

enters the Action Plan into DRGR and 

submits it to HUD. (Funds can be drawn 

from the line of credit only for an 

activity that is established in an Action 

Plan in DRGR.) 

After completing the environmental 

review(s) pursuant to 24 CFR part 58 

and, as applicable, receiving from HUD 

or the State an approved Request for 

Release of Funds and certification, the 

grantee may draw down funds from the 

line of credit. 

The Department expects each grantee 

to make a reasonable effort to notify all 

affected citizens that the Action Plan is 

available for comment. Examples of a 

reasonable effort include electronic 

mailings, press releases, statements by 

public officials, media advertisements, 

and personal contacts with 

neighborhood representatives. Grantees 

are cautioned that, despite the 

expedited application and plan process, 

they are still responsible for ensuring 

that all citizens have equal access to 

information about the programs, 

including persons with disabilities. In 

addition, each grantee must ensure that 

program information is available in the 

appropriate languages for the geographic 

area served by the jurisdiction. This 

issue may be particularly applicable to 

States receiving an award under this 

Notice. Unlike grantees in the regular 

State CDBG program, State grantees 

under today’s Notice may make grants 

throughout the State, including into 

CDBG entitlement areas if these 

entitlements are included in a relevant 

disaster declaration. Thus, State CDBG 

staff may not be aware of limitedEnglish-proficient (LEP) speaking 

populations in those metropolitan 

jurisdictions. For assistance in ensuring 

that this information is available to LEP 

populations, recipients should consult 

the Final Guidance to Federal Financial 

Assistance Recipients Regarding Title 

VI, Prohibition Against National Origin 

Discrimination Affecting Limited 

English Proficient Persons published on 

January 22, 2007, in the Federal 

Register (72 FR 2732). 

Administration Limitation 

For all State grantees under today’s 

Notice, the annual State CDBG program 

administration requirements must be 

modified to be consistent with the 

Supplemental Appropriations Act, 

which allows up to 5 percent of the 

grant to be used for administrative costs, 

whether by the State, by entities 

designated by the State, by units of 

general local government, or by 

subrecipients. The provisions at 42 

U.S.C. 5306(d) and 24 CFR 

570.489(a)(1)(i) and (iii) will not apply 

to any State grantee to the extent that 

they cap administration expenditures 

and require a dollar-for-dollar match of 

State funds for administrative costs 

exceeding $100,000. However, a State 

under today’s Notice may fund planning 

activities that exceed the 5 percent 

limitation on general administrative 

costs. HUD does not waive 24 CFR 

570.489(a)(3), which allows a State to 

spend up to 20 percent of its total 

allocation on a combination of planning 

and program administration costs. 

Any city or county receiving a direct 

award under today’s Notice is also 

subject to the 5 percent administrative 

cap. This 5 percent applies to all 

administrative costs—whether incurred 

by the grantee or its subrecipients. 

However, the provisions at 24 CFR 

570.200(g) allow a city or county to fund 

planning activities that may exceed the 

5 percent general administration cap. 

Thus, similar to a State grantee, a city 

or county receiving a direct allocation 

under today’s Notice is allowed to 

spend 20 percent of its total allocation 

on a combination of planning and 

program administration costs. 

Planning 

The annual State CDBG program 

requires that local government grant 

recipients for planning-only grants must 

document that the use of funds meets a 

national objective. In the State CDBG 

program, these planning grants are 

typically used for individual project 

plans. By contrast, planning activities 

carried out by entitlement communities 

are more likely to include non-project 

specific plans such as functional landuse plans, master plans, historic 

preservation plans, comprehensive 

plans, community recovery plans, 

development of housing codes, zoning 

ordinances, and neighborhood plans. 

These plans may guide long-term 

community development efforts 

comprising multiple activities funded 

by multiple sources. In the annual 

entitlement program, these more general 

stand-alone planning activities are 

presumed to meet a national objective 

under the requirements at 24 CFR 

570.208(d)(4). The Department notes 

that almost all effective CDBG disaster 

recoveries in the past have relied on 

some form of area-wide or 

comprehensive planning activity to 

guide overall redevelopment 

independent of the ultimate source of 

implementation funds. Therefore, for 

State grantees receiving an award under 

this Notice, the Department is removing 

the eligibility requirements at 24 CFR 

570.483(b)(5) or (c)(3). Instead, States 

must comply with 24 CFR 570.208(d)(4) 

when funding disaster recovery-assisted 

planning-only grants, or directly 

administering planning activities that 

guide recovery in accordance with the 

Supplemental Appropriations Act. 24 

CFR 570.208(d)(4) will apply to any city 

or county receiving a direct allocation 

under this Notice. 

Reporting 

HUD is waiving the annual reporting 

requirement. In the alternative and to 

ensure consistency between grants 

allocated under today’s Notice and 

grants allocated previously under the 

CDBG disaster recovery program, HUD 

is requiring quarterly reports from each 

grantee on the uses of the awarded 

funds, the funded activities, and other 

various aspects. HUD will use many of 

the data elements to exercise oversight 

for compliance with the requirements of 

this Notice and for prevention of fraud, 

abuse of funds, and duplication of 

benefits. To collect these data elements, 

HUD is requiring each grantee to report 

to HUD quarterly using the online DRGR 

system, which uses a streamlined, 

Internet-based format. Grantees will also 

use DRGR to record obligations and to 

make draws of funds from the line of 

credit established for each grant. HUD 

will use transactional data from DRGR, 

and grantee reports, to: (1) Monitor for 

anomalies or performance problems that 

suggest fraud, abuse of funds, and 

duplication of benefits; (2) reconcile 


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budgets, obligations, funding draws, and 

expenditures; (3) calculate applicable 

administrative and public service 

limitations and the overall percent of 

benefit to low- and moderate-income 

persons; and (4) report to Congress and 

the public. Furthermore, the grantee 

reports and DRGR will be used as a 

basis for risk analysis in determining a 

monitoring plan. 

The grantee must post the quarterly 

report on an Internet site for its citizens 

within 3 business days of the report’s 

submission to HUD. 

Eligibility—Housing Related 

The broadening of the Section 

105(a)(24) of the 1974 Act, and a waiver 

of Section 105(a) is necessary following 

major disasters in which large numbers 

of affordable housing units have been 

damaged or destroyed, as is the case of 

the disasters eligible under this Notice. 

Thus, in accordance with the grantees’ 

requests, the following is eligible: New 

housing construction, homeownership 

assistance for families whose income is 

up to 120 percent of median income, 

and payment of up to 100 percent of a 

housing down payment. These 

modifications will allow each grantee to 

implement mixed-use housing recovery 

programs included in its HUD-accepted 

action plan. 

In addition, Metropolitan Nashville 

and Davidson County has stated that it 

may be necessary for the community to 

offer incentives to promote suitable 

housing development or resettlement in 

accordance with its comprehensive 

recovery plan. Generally, incentives are 

offered in addition to other programs or 

funding (such as insurance), to try to 

influence individual residential location 

decisions, when these decisions are in 

doubt. For example, a grantee may offer 

an incentive payment (possibly in 

addition to buyouts) for households that 

volunteer to relocate within a particular 

period of time, or who choose to resettle 

outside a 100- or 500-year floodplain. 

In the past, the State of New York 

successfully used an incentive program 

to induce rapid and stable resettlement 

of lower Manhattan following 

September 11, 2001. Also, the city of 

Grand Forks, North Dakota, provided a 

very affordable soft-second loan as an 

incentive to help induce households to 

resettle within the city during its 

recovery. Therefore, Metropolitan 

Nashville and Davidson County may 

provide housing incentives so long as it 

maintains documentation, at least at a 

programmatic level, describing how the 

amount of assistance was determined to 

be necessary and reasonable. The 

Department is waiving 42 U.S.C. 5305(a) 

and associated regulations to make this 

use of grant funds eligible. Please note 

that this waiver does not permit a 

compensation program. Additionally, if 

the Entitlement grantee requires the 

incentives to be used for a particular 

purpose by the household receiving the 

assistance, then the activity will be that 

required use, and not considered as an 

incentive. 

Eligibility—Emergency Grant Payments 

Upon its request, HUD is waiving 42 

U.S.C. 5305(a) so that Metropolitan 

Nashville and Davidson County may 

extend interim mortgage assistance to 

qualified individuals for up to 20 

months. Several hundred families are in 

the position of paying a mortgage and 

rent while awaiting reconstruction or 

the implementation of a FEMA-funded 

hazard mitigation program. Thus, this 

interim assistance will be critical for 

many households facing financial 

hardship. 

Eligibility—Buildings for the General 

Conduct of Government 

Grantees under this Notice (except for 

the State of Tennessee) have requested 

a limited waiver of the prohibition on 

funding buildings for the general 

conduct of government. HUD has 

considered the request and agrees that it 

is consistent with the overall purposes 

of the 1974 Act for each requesting 

grantee to be able to use the grant funds 

under this notice to repair or reconstruct 

buildings used for the general conduct 

of government. Provided that the 

building is selected in accordance with 

the method described in the grantee’s 

Action Plan for Disaster Recovery, and 

it has been determined that the building 

has substantial value in promoting 

disaster recovery. However, as stated by 

the Supplemental Appropriations Act, 

funds allocated under today’s Notice 

may not be used for activities 

reimbursable by, or for which funds are 

made available by, FEMA or the Army 

Corps of Engineers. 

Anti-Pirating 

The limited waiver of the job 

relocation requirements allows a grantee 

to provide assistance to a business 

located in another State, or another 

labor market area within the same State, 

if the business was displaced from a 

declared area and wishes to return. This 

waiver is necessary to allow a grantee 

affected by a major disaster to 

reestablish and rebuild its employment 

base. This waiver will not apply to the 

City of Cranston. 

Relocation Requirements 

The grantees have indicated that they 

plan to engage in, or wish to facilitate, 

voluntary acquisition and relocation 

activities (in a form often called 

‘‘buyouts’’), by using waivers related to 

acquisition and relocation requirements 

under the Uniform Relocation 

Assistance and Real Property 

Acquisition Policies Act of 1970, as 

amended, (42 U.S.C. 4601 et seq.) 

(URA), and the replacement of housing 

and relocation assistance provisions 

under section 104(d) of the HCD Act (42 

U.S.C. 5304(d)). The grantees believe 

these waivers will more effectively 

assist displaced persons in a timely and 

efficient manner. 

CDBG funds are Federal financial 

assistance. Therefore, CDBG-assisted 

programs or projects are subject to the 

URA and the government-wide 

implementing regulations at 49 CFR part 

24. The URA’s protection and assistance 

apply to acquisitions of real property 

and displacements resulting from the 

acquisition, rehabilitation, or 

demolition of real property for CDBGassisted programs or projects. The URA 

provides assistance and protections to 

individuals and businesses affected by 

Federal or federally-assisted projects. 

HUD is waiving the following URA 

requirements to help promote 

accessibility to suitable, decent, safe, 

and sanitary housing for victims of 

severe storms and flooding that 

occurred from March through May, 

2010. 

The acquisition requirements of the 

URA and implementing regulations are 

waived so that they do not apply to an 

arm’s length voluntary purchase carried 

out by a person who does not have the 

authority to acquire by power of 

eminent domain, in connection with the 

purchase and occupancy of a principal 

residence by that person. The failure to 

suspend these requirements would 

impede disaster recovery and may result 

in windfall payments. 

A limited waiver is granted of the 

URA’s implementing regulations to the 

extent that they require grantees to 

provide URA financial assistance 

sufficient to reduce the displaced 

person’s post-displacement rent/utility 

cost to 30 percent of household income. 

The failure to suspend these one-size 

fits-all requirements could impede 

disaster recovery. To the extent that a 

tenant has been paying rent in excess of 

30 percent of household income without 

demonstrable hardship, rental 

assistance payments to reduce tenant 

costs to 30 percent would not be 

required. 

The URA and implementing 

regulations are waived to the extent 

necessary to permit a grantee to meet all 

or a portion of a grantee’s replacement 

housing financial assistance obligation 


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to a displaced renter by offering rental 

housing through a tenant-based rental 

assistance (TBRA) housing program 

subsidy (e.g., Section 8 rental voucher 

or certificate), provided that the tenant 

is also provided with referrals to 

suitable, available rental replacement 

dwellings where the owner is willing to 

participate in the TBRA program, and 

the period of authorized assistance is at 

least 42 months. Failure to grant this 

waiver would impede disaster recovery 

whenever TBRA program subsidies are 

available but funds for cash relocation 

assistance are limited. This waiver gives 

grantees an additional relocation 

resource option. 

The URA and implementing 

regulations are waived to the extent that 

they require a grantee to offer a person 

displaced from a dwelling the option to 

receive a ‘‘moving expense and 

dislocation allowance’’ based on the 

current schedule of allowances prepared 

by the Federal Highway Administration. 

In the alternative, the grantee must 

establish and offer the person a moving 

expense and dislocation allowance 

under a schedule of allowances that is 

reasonable for the jurisdiction and takes 

into account the number of rooms in the 

displacement dwelling, whether the 

person owns and must move the 

furniture, and, at a minimum, the kinds 

of expenses described in 49 CFR 24.301. 

Failure to suspend and provide 

alternative requirements in this case 

would impede disaster recovery by 

requiring grantees to offer allowances 

that do not reflect current local labor 

and transportation costs. Persons 

displaced from a dwelling remain 

entitled to choose a payment for actual 

reasonable moving and related expenses 

if they find that approach preferable to 

the locally established moving expense 

and dislocation allowance. 

In addition to the URA waivers, HUD 

is waiving requirements of section 

104(d) of the HCD Act dealing with onefor-one replacement of lower-income 

dwelling units demolished or converted 

in connection with a CDBG-assisted 

development project for housing units 

damaged by one or more disasters. HUD 

is waiving this requirement because it 

does not take into account the large, 

sudden changes a major disaster may 

cause to the local housing stock, 

population, or local economy. Further, 

the requirement does not take into 

account the threats to public health and 

safety and to economic revitalization 

that may be caused by the presence of 

disaster-damaged housing structures 

that are unsuitable for rehabilitation. As 

it stands, the requirement would 

impede disaster recovery and 

discourage grantees from converting or 

demolishing disaster-damaged housing 

because of excessive costs that would 

result from replacing all such units 

within the specified time frame. HUD is 

also waiving the relocation assistance 

requirements contained in section 

104(d) of the HCD Act to the extent that 

they differ from those of the URA (42 

U.S.C. 4601 et seq.). This change will 

simplify implementation while 

preserving statutory protections for 

persons displaced by projects assisted 

with CDBG disaster recovery grant 

funds. 

Some disaster recovery CDBG funds 

may be used to support programs 

receiving FEMA funding, e.g. buyouts 

and relocation activities. The statutory 

requirements of the URA are also 

applicable to the administration of 

FEMA mitigation funding, and 

disparities in rental assistance payments 

for activities funded by HUD and FEMA 

will thus be eliminated. FEMA is 

subject to the requirements of the URA. 

Pursuant to this authority, FEMA 

requires that rental assistance payments 

be calculated on the basis of the amount 

necessary to lease or rent comparable 

housing for a period of 42 months. HUD 

is also subject to these requirements, but 

is also covered by alternative relocation 

provisions authorized under 42 U.S.C. 

5304(d)(2)(A)(iii) and (iv), and 

implementing regulations at 24 CFR 

42.350. These alternative relocation 

benefits, available to low- and moderateincome displacees opting to receive 

them in certain HUD programs, require 

the calculation of similar rental 

assistance payments on the basis of 60 

months, rather than 42 months, thereby 

creating a disparity between the 

available benefits offered by HUD and 

FEMA (although not always an actual 

cash difference). The waiver assures 

uniform and equitable treatment by 

allowing the URA benefits requirements 

to be the standard for assistance under 

this Notice. 

Program Income 

The waivers and alternative 

requirements pertaining to program 

income are most significant for State 

grantees under this Notice. Prior to 

2002, program income earned on 

disaster recovery grants was usually 

considered program income in 

accordance with the rules of the regular 

State CDBG program of the applicable 

grantee. As a result, the funds lost their 

disaster recovery identity, and thereby 

lost use of the waivers and streamlined 

alternative requirements. 

The HCD Act provides that a unit of 

general local government in receipt of 

CDBG funds from a State can retain 

program income if it uses the funds for 

additional eligible activities under the 

annual CDBG program; although the Act 

also states that under certain 

circumstances, a State may require the 

program income to be returned. 

This Notice waives the existing 

statute and regulations to give each 

State grantee, in all circumstances, the 

choice of whether a unit of general local 

government receiving a distribution of 

CDBG disaster recovery funds and using 

program income for activities in the 

Action Plan may retain this income and 

use it for additional disaster recovery 

activities. 

Additionally, this Notice addresses 

the use of program income for both State 

grantees, and units of general local 

government receiving a direct allocation 

under today’s Notice. Any program 

income to the disaster recovery grant 

generated by activities undertaken 

directly by the grantee or its agent(s) 

will retain the original disaster recovery 

grant’s alternative requirements and 

waivers and remain under the grantee’s 

discretion until grant closeout. At 

closeout, any program income on hand 

or received subsequently will become 

program income to the grantee’s annual 

CDBG program. The alternative 

requirements provide all the necessary 

conforming changes to the program 

income regulations. 

Economic Development 

Grantees under today’s Notice (except 

for Shelby County) have asked to apply 

individual salaries or wages-per-job and 

the income limits for a household of one 

when documenting the national 

objective for business assistance 

activities. This method would replace 

the usual CDBG standard of total 

household income and income limits by 

total household size. The grantees have 

asserted that this proposed 

documentation would be simpler and 

quicker for participating lenders to 

administer, easier to verify, and would 

not misrepresent the amount of lowand moderate-income benefit provided. 

Upon consideration, HUD is granting 

this waiver. CDBG disaster recovery 

grantees received this waiver following 

September 11, 2001, the Gulf Coast 

hurricanes of 2005, and the 

Presidentially-declared 2008 disasters. 

Due to the significant breadth of many 

State and local economic development 

programs, this waiver will play a key 

role in streamlining the documentation 

process because it allows collection of 

wage data for each position created or 

retained from the assisted businesses, 

rather than from each individual 

household. 

In addition to national objective 

documentation, grantees under today’s 


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Notice (except for the State of 

Tennessee) have requested a waiver of 

the standard public benefit provisions. 

The public benefit provisions set 

standards for individual economic 

development activities (such as a single 

loan to a business) and for economic 

development activities in the annual 

aggregate. Currently, public benefit 

standards limit the amount of CDBG 

assistance per job retained or created, or 

the amount of CDBG assistance per lowand moderate-income person to which 

goods or services are provided by the 

activity. These dollar thresholds were 

set more than a decade ago and, under 

disaster recovery conditions (which 

often require a larger investment to 

achieve a given result), can impede 

recovery by limiting the amount of 

assistance the grantee may provide to a 

critical activity. Requesting grantees 

will make public in their Action Plans 

the disaster recovery needs each activity 

is addressing and the public benefits 

expected. 

After consideration, today’s Federal 

Register Notice waives the public 

benefit standards for the cited activities, 

except that each grantee requesting the 

waiver shall report and maintain 

documentation on the creation and 

retention of: (a) Total jobs, (b) number 

of jobs within certain salary ranges, (c) 

the average amount of assistance per job 

by activity or program, and (d) the types 

of jobs. As a conforming change for the 

same activities or programs, HUD is also 

waiving paragraph (g) of 24 CFR 570.482 

and paragraph (c) of 24 CFR 570.209 to 

the extent these provisions are related to 

public benefit. 

Certifications 

HUD is waiving the standard CDBG 

certifications and substituting an 

alternative requirement for certifications 

that are tailored to the CDBG disaster 

recovery grants. 

Applicable Rules, Statutes, Waivers, 

and Alternative Requirements; PreGrant Process 

Unless stated otherwise, the following 

waivers and alternative requirements 

apply to any State or unit of general 

local government receiving a direct 

award under this Notice. 

1. General note. Prerequisites to a 

grantee’s receipt of CDBG disaster 

recovery assistance include: (1) 

Adoption of a citizen participation plan; 

(2) publication of a proposed Action 

Plan for Disaster Recovery; (3) public 

notice and comment; and (4) submission 

to HUD of an Action Plan for Disaster 

Recovery, including certifications. 

Except as described in this Notice, 

statutory and regulatory provisions 

governing the State CDBG program shall 

apply to any State receiving an 

allocation under this Notice, while 

statutory and regulatory provisions 

governing the CDBG entitlement 

program shall apply to any unit of 

general local government receiving a 

direct allocation in this Notice. 

Applicable statutory provisions can be 

found at 42 U.S.C. 5301 et seq. 

Applicable State and entitlement 

provisions can be found at 24 CFR part 

570. 

2. Overall benefit waiver and 

alternative requirement. The 

requirements at 42 U.S.C. 5301(c), 42 

U.S.C. 5304(b)(3)(A), 24 CFR 570.484, 

and 24 CFR 570.200(a)(3), that 70 

percent of funds are for activities that 

benefit low- and moderate-income 

persons are waived to stipulate that at 

least 50 percent of a grant’s funds are for 

activities that principally benefit lowand moderate-income persons. 

3. Direct grant administration and 

means of carrying out eligible 

activities—applicable to State grantees 

only. Requirements at 42 U.S.C. 5306 

are waived to the extent necessary to 

allow a State to use its disaster recovery 

grant allocation directly to carry out 

State-administered activities eligible 

under this Notice. Activities eligible 

under this Notice may be undertaken, 

subject to State law, by the grantee 

through its employees, or through 

procurement contracts, or through loans 

or grants under agreements with 

subrecipients. Unless a waiver provides 

otherwise, activities made eligible under 

section 105(a)(15) of the HCD Act, as 

amended, may only be undertaken by 

entities specified in that section, 

whether the assistance is provided to 

such an entity from the State or from a 

unit of general local government. 

4. Consolidated Plan waiver. 

Requirements at 42 U.S.C. 12706, 24 

CFR 91.325(a)(5), and 24 CFR 

91.225(a)(5), that housing activities 

undertaken with CDBG funds be 

consistent with the consolidated plan, 

are waived. Further, 42 U.S.C. 5304(e), 

to the extent that it would require HUD 

to annually review grantee performance 

under the consistency criteria, is also 

waived. These waivers apply only until 

the grantee first updates its strategic 

plan priorities (and the full consolidated 

plan) following the disaster. At that 

time, the grantee must also update its 

Analysis of Impediments, so that it more 

accurately reflects the impacts of the 

disaster. 

5. Action Plan waiver and alternative 

requirement. The requirements at 42 

U.S.C. 12705(a)(2), 42 U.S.C. 5304(a)(1), 

42 U.S.C. 5304(m), 42 U.S.C. 

5306(d)(2)(C)(iii), 24 CFR 1003.604, 24 

CFR 91.220, and 24 CFR 91.320 are 

waived for these disaster recovery 

grants. Each State or unit of general 

local government receiving a direct 

award under this Notice must submit to 

HUD an Action Plan for Disaster 

Recovery that describes: 

A. The effects of the covered disasters, 

especially in the most affected areas and 

populations, and the greatest recovery 

needs resulting from the covered 

disasters that have not been addressed 

by insurance proceeds, other Federal 

assistance, or any other funding source; 

B. The grantee’s overall plan for 

disaster recovery including: 

(1) How it will promote sound shortand long-term recovery planning at the 

State (if applicable) and local levels, 

especially land-use decisions that reflect 

responsible flood plain management, 

removal of regulatory barriers to 

reconstruction, and coordination with 

planning requirements of other local, 

State and Federal programs and entities; 

(2) How it will leverage CDBG disaster 

recovery funds with funding provided 

by other HUD programs, FEMA (and 

specifically the Hazard Mitigation Grant 

Program), the Small Business 

Administration, the Army Corps of 

Engineers, the U.S. Department of 

Agriculture, and other State, local, 

private, and non-profit sources to 

generate a more effective and 

comprehensive recovery; 

(3) How it will encourage 

construction methods that emphasize 

high quality, durability, energy 

efficiency, sustainability, and mold 

resistance, including how it will 

support adoption and enforcement of 

modern building codes and mitigation 

of flood risk, where appropriate; and 

(4) How it will provide or encourage 

provision of adequate, flood-resistant 

housing for all income groups that lived 

in the disaster-affected areas prior to the 

incident date(s) of the applicable 

disaster(s), including a description of 

the activities it plans to undertake to 

address emergency shelter and 

transitional housing needs of homeless 

individuals and families (including 

subpopulations), to prevent low-income 

individuals and families with children 

(especially those with incomes below 30 

percent of median) from becoming 

homeless, to help homeless persons 

make the transition to permanent 

housing and independent living, and to 

address the special needs of persons 

who are not homeless identified in 

accordance with 24 CFR 91.315(e) or 24 

CFR 91.215(e) (as applicable); 

C. Monitoring standards and 

procedures that are sufficient to ensure 

program requirements, including 

nonduplication of benefits, are met and 


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that provide for continual quality 

assurance, investigation, and internal 

audit functions with responsible staff 

reporting independently to the Governor 

of the State or, at a minimum, to the 

chief officer of the governing body of 

any designated administering entity; 

D. A description of the steps the 

grantee will take to avoid or mitigate 

occurrences of fraud, abuse, and 

mismanagement, especially with respect 

to accounting, procurement, and 

accountability. Also, a description of 

how it will provide for increasing the 

capacity for implementation and 

compliance of local government grant 

recipients, subrecipients, subgrantees, 

contractors, and any other entity 

responsible for administering activities 

under this grant; and 

E. Projected uses of funds. 

(1) Funds awarded to a State; method 

of distribution. A State’s method of 

distribution shall describe the method 

of allocating funds to units of local 

government and descriptions of specific 

programs or projects the State will carry 

out directly, as applicable. The 

descriptions will include: 

(a) When funds are allocated to units 

of local government, all criteria used to 

distribute funds, including: (1) The 

relative importance of each criterion, (2) 

a description of how the disaster 

recovery grant resources will be 

allocated among all funding categories, 

and (3) the threshold factors and grant 

size limits that are to be applied; and 

(b) The projected uses for the CDBG 

disaster recovery funds, by responsible 

entity, activity, and geographic area, 

when the State carries out an activity 

directly; 

(c) How the method of distribution to 

local governments or use of funds 

described in accordance with the above 

subparagraphs will result in eligible 

uses of grant funds related to long-term 

recovery from specific effects of the 

disaster(s), and/or restoration of 

infrastructure, housing, and economic 

revitalization. 

(2) Funds awarded directly to a unit 

of general local government. The unit of 

local government shall describe specific 

programs and projects it will carry out. 

The Action Plan will describe: 

(a) How the disaster recovery grant 

resources will be allocated and the 

relative importance of all criteria by 

which projects are selected; and 

(b) The threshold factors and grant 

size limits that are to be applied; and 

(c) The projected uses for the CDBG 

disaster recovery funds, by responsible 

entity, activity, and geographic area; and 

(d) How the use of funds described in 

accordance with the above 

subparagraphs will result in eligible 

uses of grant funds related to long-term 

recovery from specific effects of the 

disaster(s), or restoration of 

infrastructure, housing, and economic 

revitalization. 

(3) Clarity of Action Plan. All grantees 

must include sufficient information so 

that citizens, units of general local 

government (where applicable), and 

other eligible subgrantees or 

subrecipients will be able to understand 

and comment on the Action Plan and, 

if applicable, be able to prepare 

responsive applications to the grantee. If 

a grantee submits an action plan that 

includes sufficient detail and clarity for 

only a portion of the allocation, HUD 

may still issue a grant agreement for the 

entire grant amount. However, HUD will 

restrict access to the portion of the 

funds for which the grantee has not 

clearly described eligible activities. 

6. Citizen participation waiver and 

alternative requirement. Provisions of 

42 U.S.C. 5304(a)(2) and (3), 42 U.S.C. 

12707, 24 CFR 570.486, 24 CFR 

91.105(b), and 24 CFR 91.115(b), with 

respect to citizen participation 

requirements, are waived and replaced 

by the requirements below. The 

streamlined requirements do not 

mandate public hearings at a State, 

entitlement, or local government level, 

but do require providing a reasonable 

opportunity (at least 7 days) for citizen 

comment and ongoing citizen access to 

information about the use of grant 

funds. The streamlined citizen 

participation requirements for a grant 

administered under this Notice are: 

A. Before the grantee adopts the 

Action Plan for this grant or any 

substantial amendment to this grant, the 

grantee will publish the proposed plan 

or amendment (including the 

information required in this Notice for 

an Action Plan for Disaster Recovery). 

The manner of publication must include 

prominent posting on the State, local, or 

other relevant Internet site and must 

afford citizens, affected local 

governments, and other interested 

parties a reasonable opportunity to 

examine the plan or amendment’s 

contents. Subsequent to publication, the 

grantee must provide a reasonable time 

frame and method(s) (including 

electronic submission) for receiving 

comments on the plan or substantial 

amendment. The grantee’s plans to 

minimize displacement of persons or 

entities, and to assist any persons or 

entities displaced, must be published 

with the Action Plan. 

B. Each grantee will specify in its 

Action Plan criteria for determining 

what changes in the grantee’s activities 

constitute a substantial amendment to 

the plan. At a minimum, adding or 

deleting an activity or changing the 

planned beneficiaries of an activity will 

constitute a substantial change. The 

grantee may modify or substantially 

amend the Action Plan if it follows the 

same procedures required in this Notice 

for the preparation and submission of an 

Action Plan for Disaster Recovery. Prior 

to submission of a substantial 

amendment, the grantee is encouraged 

to work with the Department to ensure 

the proposed change is consistent with 

this Notice, and all applicable 

regulations and Federal law. 

C. The grantee must notify HUD, but 

is not required to notify the public, 

when it makes any plan amendment 

that is not substantial. The Department 

may acknowledge receipt of the 

notification via e-mail within 5 business 

days. 

D. The grantee must consider all 

comments received on the Action Plan 

or any substantial amendment. A 

summary of the comments and the 

grantee’s response to each must be 

submitted to HUD with the Action Plan 

or substantial amendment. 

E. The grantee must make the Action 

Plan, any substantial amendments, and 

all performance reports available to the 

public on the Internet and on request. In 

addition, the grantee must make these 

documents available in a form 

accessible to persons with disabilities 

and non-English-speaking persons. 

During the term of this grant, the grantee 

will provide citizens, affected local 

governments, and other interested 

parties with reasonable and timely 

access to information and records 

relating to the Action Plan and to the 

grantee’s use of this grant. 

F. The grantee will provide a timely 

written response to every citizen 

complaint. The response will be 

provided within 15 working days of the 

receipt of the complaint, if practicable. 

7. Modify requirement for 

consultation with local governments— 

applicable to State grantees only. 

Currently, the statute and regulations 

require consultation with affected units 

of local government in the nonentitlement areas of the State regarding 

the State ’s proposed method of 

distribution. HUD is waiving 42 U.S.C. 

5306(d)(2)(C)(iv), 24 CFR 91.325(b), and 

24 CFR 91.110, with the alternative 

requirement that any State receiving an 

allocation under this Notice consult 

with all disaster-affected units of 

general local government, including any 

CDBG-entitlement communities, in 

determining the use of funds. 

8. Note on change to administration 

limitation. Up to 5 percent of the grant 

amount may be used for administrative 

costs. 


emcdonald on DSK2BSOYB1PROD with NOTICES
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A. The provisions of 42 U.S.C. 

5306(d) and 24 CFR 570.489(a)(1)(i) and 

(iii) will not apply to the extent that 

they cap State administration 

expenditures, limit a State’s ability to 

charge a de minimis application fee for 

grant applications for activities the State 

carries out directly, and require a dollarfor-dollar match of State funds for 

administrative costs exceeding 

$100,000. HUD does not waive 24 CFR 

570.489(a)(3), which will allow the State 

to carry out planning activities that may 

exceed the 5 percent limitation on 

general administrative costs. 

B. Any city or county receiving a 

direct award under today’s Notice is 

also subject to the 5 percent 

administrative cap. This 5 percent 

applies to all administrative costs— 

whether incurred by the grantee or its 

subrecipients. To the extent necessary, 

HUD retains the provisions of 24 CFR 

570.200(g) which allow a city or county 

to fund planning activities that may 

exceed the 5 percent general 

administration cap. Thus, similar to a 

State grantee, a city or county receiving 

a direct allocation under today’s Notice 

is ultimately limited to spending 20 

percent of its total allocation on a 

combination of planning and program 

administration costs. 

9. Planning activities. For CDBG 

disaster recovery-assisted general 

planning activities that will guide 

recovery in accordance with the 

Supplemental Appropriations Act, the 

State CDBG program rules at 24 CFR 

570.483(b)(5) and (c)(3) are waived and 

the presumption at 24 CFR 

570.208(d)(4) applies for any State 

grantee under this Notice. 24 CFR 

570.208(d)(4) will apply to any unit of 

general local government that receives a 

direct allocation under this Notice. 

10. Waiver and alternative 

requirement for distribution to CDBG 

metropolitan cities and urban 

counties—applicable to State grantees 

only. 

A. Section 5302(a)(7) of title 42, 

U.S.C. (definition of ‘‘nonentitlement 

area’’) and provisions of 24 CFR part 570 

that would prohibit a State from 

distributing CDBG funds to UGLGs 

regardless of their status in the 

entitlement CDBG program and to 

Indian tribes, are waived, including 24 

CFR 570.480(a), to the extent that such 

provisions limit the distribution of 

funds to units of local government 

located in entitlement areas, and to 

State or federally recognized Indian 

tribes. Instead, the State is required to 

distribute funds to activities assisting a 

declared county or counties and eligible 

under this Notice without regard to the 

status of a local government or Indian 

tribe under any other CDBG program. 

B. Additionally, because the State 

grantees under this appropriation have 

requested a waiver to carry out activities 

directly, HUD is applying the 

regulations at 24 CFR 570.480(c) with 

respect to the basis for HUD 

determining whether the State has failed 

to carry out its certifications so that 

such basis shall be that the State has 

failed to carry out its certifications in 

compliance with applicable program 

requirements. 

11. Use of subrecipients—applicable 

to State grantees only. The following 

alternative requirement applies for any 

activity that a State carries out directly 

by funding a subrecipient: 

A. 24 CFR 570.503, except that 

specific references to 24 CFR parts 84 

and 85 need not be included in 

subrecipient agreements. 

B. 24 CFR 570.502(a), in instances 

where a State’s subrecipients are 

governmental entities, except that HUD 

recommends, but does not require, 

application of the requirements at 24 

CFR part 85. 

C. 24 CFR 570.502(b), in instances 

where a State’s subrecipients are not 

governmental entities, except that HUD 

recommends, but does not require, 

application of the requirements at 24 

CFR part 84. 

12. Recordkeeping—applicable to 

State grantees only. Recognizing that the 

State may carry out activities directly, 

24 CFR 570.490(b) is waived in such a 

case and the following alternative 

provision shall apply: The State shall 

establish and maintain such records as 

may be necessary to facilitate review 

and audit by HUD of the State’s 

administration of CDBG disaster 

recovery funds under 24 CFR 570.493. 

Consistent with applicable statutes, 

regulations, waivers and alternative 

requirements, and other Federal 

requirements, the content of records 

maintained by the State shall be 

sufficient to: Enable HUD to make the 

applicable determinations described at 

24 CFR 570.493; make compliance 

determinations for activities carried out 

directly by the State; and show how 

activities funded are consistent with the 

descriptions of activities proposed for 

funding in the Action Plan. For fair 

housing and equal opportunity 

purposes, and as applicable, such 

records shall include data on the racial, 

ethnic, and gender characteristics of 

persons who are applicants for, 

participants in, or beneficiaries of the 

program. 

13. Change of use of real property— 

applicable to State grantees only. This 

waiver conforms the change of use of 

real property rule to the waiver allowing 

a State to carry out activities directly. 

For purposes of this program, in 24 CFR 

570.489(j), (j)(1), and the last sentence of 

(j)(2), ‘‘unit of general local government’’ 

shall be read as ‘‘unit of general local 

government or State .’’ 

14. Responsibility for review and 

handling of noncompliance 

—applicable to State grantees only. This 

change is in conformance with the 

waiver allowing the State to carry out 

activities directly. 24 CFR 570.492 is 

waived and the following alternative 

requirement applies for any State 

receiving a direct award under this 

Notice: The State shall make reviews 

and audits, including onsite reviews of 

any subrecipients, designated public 

agencies, and units of general local 

government, as may be necessary or 

appropriate to meet the requirements of 

section 104(e)(2) of the HCD Act, as 

amended, as modified by this Notice. In 

the case of noncompliance with these 

requirements, the State shall take such 

actions as may be appropriate to prevent 

a continuance of the deficiency, mitigate 

any adverse effects or consequences, 

and prevent a recurrence. The State 

shall establish remedies for 

noncompliance by any designated 

public agencies or units of general local 

governments and for its subrecipients. 

15. Waiver of performance report and 

alternative requirement. The 

requirements for submission of a 

Performance Evaluation Report (PER) 

pursuant to 42 U.S.C. 12708 and 24 CFR 

91.520 are waived. The alternative 

requirement is that: 

A. Each grantee must submit its 

Action Plan for Disaster Recovery, 

including performance measures, into 

HUD’s Internet-based DRGR system. 

(The signed certifications and the SF– 

424 must be, and the initial Action Plan 

for Disaster Recovery may be, submitted 

in hard copy.) As additional information 

about uses of funds becomes available to 

the grantee, the grantee must enter such 

detail into DRGR, in sufficient detail to 

serve as the basis for acceptable 

performance reports. 

B. Each grantee must submit a 

quarterly performance report, as HUD 

prescribes, no later than 30 days 

following each calendar quarter, 

beginning after the first full calendar 

quarter after grant award and continuing 

until all funds have been expended and 

all expenditures reported. Each 

quarterly report will include 

information about the uses of funds 

during the applicable quarter including 

(but not limited to) the project name, 

activity, location, and national 

objective; funds budgeted, obligated, 

drawn down, and expended; the 


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funding source and total amount of any 

non-CDBG disaster funds; beginning 

and ending dates of activities; and 

performance measures such as numbers 

of low- and moderate-income persons or 

households benefiting. Quarterly reports 

to HUD must be submitted using HUD’s 

Internet-based DRGR system and, within 

3 days of submission, be posted on the 

grantee’s official Internet site open to 

the public. 

16. Housing-related eligibility waivers. 

42 U.S.C. 5305(a) is waived to the extent 

necessary to allow: (1) Homeownership 

assistance for households with up to 

120 percent of area median income, (2) 

downpayment assistance for up to 100 

percent of the down payment (42 U.S.C. 

5305(a)(24)(D)), and (3) new housing 

construction. 

17. Housing incentives to resettle in 

disaster-affected communities. 42 U.S.C. 

5305(a) and associated regulations are 

waived to the extent necessary to make 

eligible incentives to resettle in 

Metropolitan Nashville and Davidson 

County. The incentives must be in 

accordance with Metropolitan Nashville 

and Davidson County’s approved Action 

Plan and published program design(s). 

Furthermore, the Entitlement grantee 

must maintain documentation, at least 

at a programmatic level, describing how 

the amount of assistance was 

determined to be necessary and 

reasonable. Please note that this waiver 

does not permit a compensation 

program. Additionally, if the 

Entitlement grantee requires the 

incentives to be used for a particular 

purpose by the household receiving the 

assistance, then the activity will be that 

required use, and not considered as an 

eligible incentive. 

18. Limitation on emergency grant 

payments. 42 U.S.C. 5305(a) is waived 

so that Metropolitan Nashville and 

Davidson County can extend interim 

mortgage assistance to qualified 

individuals for up to 20 months. 

19. Buildings for the general conduct 

of government. 42 U.S.C. 5305(a) is 

waived to the extent necessary to allow 

the grantee to fund the rehabilitation or 

reconstruction of public buildings that 

are otherwise ineligible and that are 

selected in accordance with its 

approved Action Plan for Disaster 

Recovery and that are determined have 

substantial value in promoting disaster 

recovery. Please note that this waiver is 

inapplicable to the State of Tennessee. 

20. Waiver and modification of the job 

relocation clause to permit assistance to 

help a business return. 42 U.S.C. 

5305(h), 24 CFR 570.210, and 24 CFR 

570.482 are hereby waived only to allow 

the grantee to provide assistance under 

this grant to any business that was 

operating in the covered disaster area 

before the incident date of the 

applicable disaster and has since 

moved, in whole or in part, from the 

affected area to another State or to a 

labor market area within the same State 

to continue business. Please note that 

this waiver and modification is 

inapplicable to the City of Cranston. 

21. URA provisions. 

A. One-for-one replacement 

requirements at 42 U.S.C. 5304(d)(2) 

and (d)(3), and 24 CFR 42.375(a) are 

waived for lower-income dwelling 

units: (1) Damaged by the disaster, (2) 

for which CDBG funds are used for 

conversion or demolition, and (3) which 

are not suitable for rehabilitation. 

B. Relocation assistance requirements 

at 42 U.S.C. 5304(d)(2)(A) and 24 CFR 

42.350 are waived, to the extent that 

they differ from those of the URA and 

its implementing regulation at 49 CFR 

part 24, for activities involving buyouts 

and other activities covered by the URA 

and related to disaster recovery 

activities assisted by the funds covered 

by this Notice and included in an 

approved Action Plan. 

C. The requirements at 49 CFR 

24.101(b)(2)(i)–(ii) are waived to the 

extent that they apply to an arm’s length 

voluntary purchase carried out by a 

person who does not have the power of 

eminent domain, in connection with the 

purchase and occupancy of a principal 

residence by that person. 

D. The requirements at sections 204(a) 

and 206 of the URA, 49 CFR 24.2, 

24.402(b)(2), and 24.404 are waived to 

the extent that they require the State to 

provide URA financial assistance 

sufficient to reduce the displaced 

person’s post-displacement rent/utility 

cost to 30 percent of household income. 

To the extent that a tenant has been 

paying rent in excess of 30 percent of 

household income without 

demonstrable hardship, rental 

assistance payments to reduce tenant 

costs to 30 percent would not be 

required. Before using this waiver, the 

State must establish a definition of 

‘‘demonstrable hardship.’’ 

E. The requirements of sections 204 

and 205 of the URA, and 49 CFR 

24.402(b) are waived to the extent 

necessary to permit a grantee to meet all 

or a portion of a grantee’s replacement 

housing financial assistance obligation 

to a displaced tenant by offering rental 

housing through a TBRA housing 

program subsidy (e.g., Section 8 rental 

voucher or certificate), provided that the 

tenant is also provided referrals to 

suitable, available rental replacement 

dwellings where the owner is willing to 

participate in the TBRA program, and 

the period of authorized assistance is at 

least 42 months. 

F. The requirements of section 202(b) 

of the URA and 49 CFR 24.302 are 

waived to the extent that they require a 

grantee to offer a person displaced from 

a dwelling the option to receive a 

‘‘moving expense and dislocation 

allowance’’ based on the current 

schedule of allowances prepared by the 

Federal Highway Administration, 

provided that the grantee establishes 

and offers the person a moving expense 

and dislocation allowance under a 

schedule of allowances that is 

reasonable for the jurisdiction and takes 

into account the number of rooms in the 

displacement dwelling, whether the 

person owns and must move the 

furniture, and, at a minimum, the kinds 

of expenses described in 49 CFR 24.301. 

22. Program income alternative 

requirement. 

A. Units of general local government 

receiving a direct allocation under this 

Notice. Any unit of general local 

government receiving a direct allocation 

under this award will be subject to 24 

CFR 570.500 and 24 CFR 570.504. 

However, please note: 

(1) Program income that is received 

and retained by the unit of local 

government before closeout of the grant 

(that generated the program income), is 

treated as additional disaster recovery 

CDBG funds and is subject to the 

requirements of this Notice. 

(2) Program income that is received 

and retained by the unit of local 

government after closeout of the grant 

(that generated the program income), 

but that is used to continue the disaster 

recovery activity that generated the 

program income, is subject to the 

waivers and alternative requirements of 

this Notice. 

B. State grantees under this Notice. 42 

U.S.C. 5304(j), and 24 CFR 570.489(e) 

are waived to the extent necessary to 

allow additional flexibility in the 

administration of program income. 

(1) Program income. 

(a) For the purposes of this subpart, 

‘‘program income’’ is defined as gross 

income generated from the use of CDBG 

funds, except as provided in paragraph 

(a)(2) of this section, and received by: 

(1) A State, unit of local government, or 

tribe, or (2) a subrecipient of a State, 

unit of general local government, or 

tribe. When income is generated by an 

activity that is only partially assisted 

with CDBG funds, the income shall be 

prorated to reflect the percentage of 

CDBG funds used (e.g., a single loan 

supported by CDBG funds and other 

funds; a single parcel of land purchased 

with CDBG funds and other funds). 


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Program income includes, but is not 

limited to, the following: 

(i) Proceeds from the disposition by 

sale or long-term lease of real property 

purchased or improved with CDBG 

funds; 

(ii) Proceeds from the disposition of 

equipment purchased with CDBG funds; 

(iii) Gross income from the use or 

rental of real or personal property 

acquired by the unit of general local 

government or a tribe or subrecipient of 

a State, a tribe, or a unit of general local 

government with CDBG funds, less the 

costs incidental to the generation of the 

income; 

(iv) Gross income from the use or 

rental of real property owned by a State, 

tribe, or the unit of general local 

government or a subrecipient of a State, 

tribe, or unit of general local 

government, that was constructed or 

improved with CDBG funds, less the 

costs incidental to the generation of the 

income; 

(v) Payments of principal and interest 

on loans made using CDBG funds; 

(vi) Proceeds from the sale of loans 

made with CDBG funds; 

(vii) Proceeds from the sale of 

obligations secured by loans made with 

CDBG funds; 

(viii) Interest earned on program 

income pending disposition of the 

income, but excluding interest earned 

on funds held in a revolving fund 

account; 

(ix) Funds collected through special 

assessments made against properties 

owned and occupied by households not 

of low- and moderate-income, where the 

special assessments are used to recover 

all or part of the CDBG portion of a 

public improvement; and 

(x) Gross income paid to a State, tribe, 

unit of local government, or 

subrecipient from the ownership 

interest in a for-profit entity acquired in 

return for the provision of CDBG 

assistance. 

(b) ‘‘Program income’’ does not 

include the following: 

(i) The total amount of funds which 

is less than $25,000 received in a single 

year and retained by a unit of local 

government, tribe, or subrecipient; 

(ii) Amounts generated by activities 

eligible under section 105(a)(15) of the 

HCD Act and carried out by an entity 

under the authority of section 105(a)(15) 

of the HCD Act; 

(c) A State may permit a unit of local 

government or tribe which receives or 

will receive program income to retain 

the program income, subject to the 

requirements of paragraph B(1)(c)(ii) of 

this section. In the alternative, the State 

may require the unit of local 

government or tribe to pay the program 

income to the State. 

(i) Program income paid to a State. 

Program income that is paid to the State 

or received by the State is treated as 

additional disaster recovery CDBG 

funds subject to the requirements of this 

Notice and must be used by the State or 

distributed to units of general local 

government (if applicable) in 

accordance with the applicable Action 

Plan for Disaster Recovery. To the 

maximum extent feasible, program 

income shall be used or distributed 

before the grantee makes additional 

withdrawals from the U.S. Treasury, 

except as provided in paragraph (b) of 

this section. 

(ii) Program income retained by a unit 

of local government or tribe. 

(A) Program income that is received 

and retained by the unit of local 

government or tribe before closeout of 

the grant (that generated the program 

income), is treated as additional disaster 

recovery CDBG funds and is subject to 

the requirements of this Notice. 

(B) Program income that is received 

and retained by the unit of local 

government or tribe after closeout of the 

grant (that generated the program 

income), but that is used to continue the 

disaster recovery activity that generated 

the program income, is subject to the 

waivers and alternative requirements of 

this Notice. 

(C) All other program income is 

subject to the requirements of 42 U.S.C. 

5304(j) and subpart I of 24 CFR part 570. 

(D) Unit of local government or tribes, 

to the maximum extent feasible, should 

disburse program income that is subject 

to the requirements of this Notice before 

requesting additional funds from the 

grantee for activities, except as provided 

in paragraph (b) of this section. 

(2) Revolving funds. 

(a) The State may establish or permit 

a unit of local government or tribe to 

establish revolving funds to carry out 

specific, identified activities. A 

revolving fund, for this purpose, is a 

separate fund (with a set of accounts 

that are independent of other program 

accounts) established to carry out 

specific activities. These activities 

generate payments, which will be used 

to support similar activities going 

forward. These payments to the 

revolving fund are program income and 

must be substantially disbursed from 

the revolving fund before additional 

grant funds are drawn from the U.S. 

Treasury for revolving fund activities. 

Such program income is not required to 

be disbursed for non-revolving fund 

activities. 

(b) The State may also establish a 

revolving fund to distribute funds to 

units of local government or tribes to 

carry out specific, identified activities. 

A revolving fund, for this purpose, is a 

separate fund (with a set of accounts 

that are independent of other program 

accounts) established to fund grants to 

units of local government to carry out 

specific activities. These activities 

generate payments to the fund so that 

additional grants can be made to units 

of local government to carry out similar 

activities going forward. Program 

income in the revolving fund must be 

disbursed from the fund before 

additional grant funds are drawn from 

the U.S. Treasury for payments to units 

of local government that could be 

funded from the revolving fund. 

(c) A revolving fund established by 

the State shall not be directly funded or 

capitalized with grant funds. 

(3) Transfer of program income. 

Notwithstanding other provisions of this 

Notice, the State may transfer program 

income before closeout of the grant that 

generated the program income to its 

own annual CDBG program or to any 

annual CDBG-funded activities 

administered by a unit of local 

government or Indian tribe within the 

State . 

(4) Program income on hand at the 

State or at its subrecipients at the time 

of grant closeout by HUD, and program 

income received by the grantee after 

such grant closeout, shall be program 

income to the most recent annual CDBG 

program grant. 

23. National Objective Documentation 

for Economic Development Activities. 

24 CFR 570.483(b)(4)(i) and 

570.208(a)(4)(i) are waived to allow the 

grantees under this Notice (except for 

Shelby County) to establish low- and 

moderate-income jobs benefit by 

documenting, for each person 

employed, the name of the business, 

type of job, and the annual wages or 

salary of the job. HUD will consider the 

person income-qualified if the annual 

wages or salary of the job is at or under 

the HUD-established income limit for a 

one-person family. 

24. Public benefit for certain 

economic development activities. For 

economic development activities 

designed to create or retain jobs or 

businesses (including, but not limited 

to, long-term, short-term, and 

infrastructure projects), the public 

benefit standards at 42 U.S.C. 

5305(e)(3), 24 CFR 570.482(f)(1), (2), (3), 

(4)(i), (5), and (6), and 24 CFR 

570.209(b)(1), (2), (3)(i), (4) are waived. 

However, grantees shall report and 

maintain documentation on the creation 

and retention of total jobs; the number 

of jobs within certain salary ranges; the 

average amount of assistance provided 


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per job, by activity or program; and the 

types of jobs. Paragraph (g) of 24 CFR 

570.482, and 24 CFR 570.209(c), and (d) 

are also waived to the extent these 

provisions are related to public benefit. 

Please note that these waivers and 

alternative requirements will not apply 

to the State of Tennessee. 

25. Allow reimbursement for preagreement costs. The provisions of 24 

CFR 570.489(b) are applied to permit a 

State to reimburse itself for otherwise 

allowable costs incurred on or after the 

incident date of the covered disaster. 

Any unit of general local government 

receiving a direct allocation under this 

Notice is subject to the provisions of 24 

CFR 570.200(h) but may reimburse itself 

for otherwise allowable costs incurred 

on or after the incident date of the 

covered disaster. 24 CFR 

570.200(h)(1)(i) will not apply to the 

extent that it requires pre-agreement 

activities to be included in a 

consolidated plan. 

The Department expects both State 

grantees and units of general local 

government receiving a direct award 

under this Notice to include all preagreement activities in their Action 

Plans. 

26. Clarifying note on the process for 

environmental release of funds when a 

State carries out activities directly. 

Usually, a State distributes CDBG funds 

to units of local government and takes 

on HUD’s role in receiving 

environmental certifications from the 

grant recipients and approving releases 

of funds. For this grant, HUD will allow 

a State grantee to also carry out 

activities directly instead of distributing 

them to other governments. According 

to the environmental regulations at 24 

CFR 58.4, when a State carries out 

activities directly, the State must submit 

the certification and request for release 

of funds to HUD for approval. 

27. Duplication of benefits. In general, 

section 312 of the Robert T. Stafford 

Disaster Assistance and Emergency 

Relief Act (42 U.S.C. 5155), as amended, 

prohibits any person, business concern, 

or other entity from receiving financial 

assistance with respect to any part of a 

loss resulting from a major disaster as to 

which he has received financial 

assistance under any other program or 

from insurance or any other source. 

In order to comply with this law, 

grantees should ensure that each 

program provides assistance to a person 

or entity only to the extent that the 

person or entity has a disaster recovery 

need that has not been fully met. 

Generally, all sources of assistance 

should be included in this needs 

analysis, including, but not limited to, 

funds received (or to be received) via 

insurance, FEMA, the SBA, other local, 

State, or Federal programs, or recovery 

support from private charity 

organizations. However, the Stafford Act 

prohibition on duplication of disaster 

recovery assistance does not require the 

ultimate CDBG award to be reduced by: 

(1) Private loans; (2) funds provided for 

a general, non-specific purpose, i.e. 

‘‘disaster recovery’’; and (3) other assets 

or lines of credit available to a 

homeowner or a business owner. This 

last category includes, but is not limited 

to, the following: Checking or savings 

accounts, stocks, bonds, mutual funds, 

pension or retirement benefits, credit 

cards, mortgages or lines of credit, and 

life insurance. Please note that these 

items may be held in the name of an 

individual, or in the name of a business. 

(Of course, such other resources may be 

considered as the grantee determines, in 

accordance with the principles of cost 

circular OMB A–87, the necessary and 

appropriate amount of assistance to 

provide to achieve program purposes.) 

In general, please note that CDBG 

disaster recovery funds should not be 

used to pay down an SBA loan. Rather, 

if need remains after an SBA loan has 

been executed, additional CDBG funds 

may be used to address that need. 

However, in certain situations (to be 

determined and defined by each 

grantee), SBA loans may be paid down, 

upon inclusion of this activity in a 

HUD-accepted Action Plan or Action 

Plan Amendment. 

Last, the Supplemental 

Appropriations Act stipulates that funds 

may not be used for activities 

reimbursable by, or for which funds 

have been made available by, FEMA or 

by the Army Corps of Engineers. 

28. Note that use of grant funds must 

relate to the purposes of the 

Supplemental Appropriations Act, 

2010. In addition to being eligible under 

42 U.S.C. 5305(a) or this Notice, and 

meeting a CDBG national objective, the 

Supplemental Appropriations Act 

requires that activities funded under 

this Notice must be necessary expenses 

related to disaster relief, long-term 

recovery, and restoration of 

infrastructure, housing, and economic 

revitalization in areas affected by severe 

storms and flooding from March 

through May, 2010, for which the 

President declared a major disaster 

covering an entire State, or States with 

more than 20 counties declared major 

disasters, under title IV of the Robert T. 

Stafford Disaster Relief and Emergency 

Assistance Act of 1974 (42 U.S.C. 5121 

et seq.). 

29. Notes on flood buyouts. 

A. Payment of pre-flood values for 

buyouts. Grant recipients under this 

Notice have the discretion to pay preflood or post-flood values for the 

acquisition of properties located in a 

floodway or floodplain. In using CDBG 

disaster recovery funds for such 

acquisitions, the grantee must uniformly 

apply whichever valuation method it 

chooses. 

B. Ownership and maintenance of 

acquired property. Any property 

acquired with disaster recovery grants 

funds being used to match FEMA 

Section 404 Hazard Mitigation Grant 

Program funds is subject to section 

404(b)(2) of the Robert T. Stafford 

Disaster Relief and Emergency 

Assistance Act, as amended, which 

requires that such property be dedicated 

and maintained in perpetuity for a use 

that is compatible with open space, 

recreational, or wetlands management 

practices. In addition, with minor 

exceptions, no new structure may be 

erected on the property and no 

subsequent application for Federal 

disaster assistance may be made for any 

purpose. The acquiring entity may want 

to lease such property to adjacent 

property owners or other parties for 

compatible uses in return for a 

maintenance agreement. Although 

Federal policy encourages leasing rather 

than selling such property, the property 

may be sold. In all cases, a deed 

restriction or covenant running with the 

land must require that the property be 

dedicated and maintained for 

compatible uses in perpetuity. HUD 

urges grantees carrying out buyouts with 

funds under this Notice to consider 

implementing the same or similar use 

restrictions on properties acquired 

under CDBG-assisted buyouts. 

C. Future Federal assistance to owners 

remaining in floodplain. 

(1) Section 582 of the National Flood 

Insurance Reform Act of 1994, as 

amended, (42 U.S.C. 5154a) prohibits 

flood disaster assistance in certain 

circumstances. In general, it provides 

that no Federal disaster relief assistance 

made available in a flood disaster area 

may be used to make a payment 

(including any loan assistance payment) 

to a person for repair, replacement, or 

restoration for damage to any personal, 

residential, or commercial property if 

that person at any time has received 

Federal flood disaster assistance that 

was conditional on the person first 

having obtained flood insurance under 

applicable Federal law and the person 

has subsequently failed to obtain and 

maintain flood insurance as required 

under applicable Federal law on such 

property. (Section 582 is selfimplementing without regulations.) This 

means that a grantee may not provide 

disaster assistance for the 


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abovementioned repair, replacement, or 

restoration to a person who has failed to 

meet this requirement. 

(2) Section 582 also implies a 

responsibility for a grantee that receives 

CDBG disaster recovery funds or that, 

under 42 U.S.C. 5321, designates 

annually appropriated CDBG funds for 

disaster recovery. That responsibility is 

to inform property owners receiving 

disaster assistance that triggers the flood 

insurance purchase requirement that 

they have a statutory responsibility to 

notify any transferee of the requirement 

to obtain and maintain flood insurance, 

and that the transferring owner may be 

liable if he or she fails to do so. These 

requirements are described below. 

(3) Duty to notify. In the event of the 

transfer of any property described in 

paragraph d., the transferor shall, not 

later than the date on which such 

transfer occurs, notify the transferee in 

writing of the requirements to: 

(a) Obtain flood insurance in 

accordance with applicable Federal law 

with respect to such property, if the 

property is not so insured as of the date 

on which the property is transferred; 

and 

(b) Maintain flood insurance in 

accordance with applicable Federal law 

with respect to such property. Such 

written notification shall be contained 

in documents evidencing the transfer of 

ownership of the property. 

(4) Failure to notify. If a transferor 

fails to provide notice as described 

above and, subsequent to the transfer of 

the property: 

(a) The transferee fails to obtain or 

maintain flood insurance, in accordance 

with applicable Federal law, with 

respect to the property; 

(b) The property is damaged by a 

flood disaster; and 

(c) Federal disaster relief assistance is 

provided for the repair, replacement, or 

restoration of the property as a result of 

such damage, the transferor shall be 

required to reimburse the Federal 

Government in an amount equal to the 

amount of the Federal disaster relief 

assistance provided with respect to the 

property. 

D. The notification requirements 

apply to personal, commercial, or 

residential property for which Federal 

disaster relief assistance made available 

in a flood disaster area has been 

provided, prior to the date on which the 

property is transferred, for repair, 

replacement, or restoration of the 

property, if such assistance was 

conditioned upon obtaining flood 

insurance in accordance with applicable 

Federal law with respect to such 

property. 

E. The term ‘‘Federal disaster relief 

assistance’’ applies to HUD or other 

Federal assistance for disaster relief in 

‘‘flood disaster areas.’’ The term ‘‘flood 

disaster area’’ is defined in section 

582(d)(2) of the National Flood 

Insurance Reform Act of 1994, as 

amended, to include an area receiving a 

presidential declaration of a major 

disaster or emergency as a result of 

flood conditions. 

30. Procurement. 

A. Grants to States. Per 24 CFR 

570.489(d), a State must have fiscal and 

administrative requirements for 

expending and accounting for all funds. 

Furthermore, per 24 CFR 570.489(g), a 

State shall establish requirements for 

procurement policies and procedures 

for units of general local government 

based on full and open competition. All 

subgrantees of a State (including units 

of general local government) are subject 

to the procurement policies and 

procedures required by the State. 

A State may meet the above 

requirements by adopting 24 CFR part 

85. If a State has adopted part 85 in full, 

it must follow the same policies and 

procedures it uses when procuring 

property and services with its nonFederal funds. However, the State must 

ensure that every purchase order or 

other contract includes any clauses 

required by Federal statutes and 

executive orders and their 

implementing regulations per 24 CFR 

85.36(a). 

If a State has not adopted 24 CFR 

85.36(a), but has adopted 24 CFR 

85.36(b)–(i), the State and its 

subgrantees must follow State and local 

law (as applicable), so long as the 

procurements conform to applicable 

Federal law and the standards identified 

in 24 CFR 85.36(b)–(i). 

B. Direct grants to units of general 

local government. Any unit of general 

local government receiving a direct 

appropriation under today’s Notice will 

be subject to 24 CFR 85.36(b) through 

(i). 

31. Timely distribution of funds. 24 

CFR 570.494 and 24 CFR 570.902 

regarding timely distribution of funds 

are waived. However, HUD expects each 

grantee to expeditiously obligate and 

expend all funds, including any 

recaptured funds or program income, 

and to carry out activities in a timely 

manner. 

32. Information collection approval 

note. HUD has approval for information 

collection requirements in accordance 

with the Paperwork Reduction Act of 

1995 (44 U.S.C. 3501–3520) under OMB 

control number 2506–0165. In 

accordance with the Paperwork 

Reduction Act, HUD may not conduct or 

sponsor, nor is a person required to 

respond to, a collection of information, 

unless the collection displays a valid 

control number. 

33. Certifications waiver and 

alternative requirement. Sections 91.325 

and 91.225 of title 24 of the Code of 

Federal Regulations are waived. Each 

State or unit of general local government 

receiving a direct allocation under this 

Notice must make the following 

certifications prior to receiving a CDBG 

disaster recovery grant: 

A. The grantee certifies that it will 

affirmatively further fair housing, which 

means that it will conduct an analysis 

to identify impediments to fair housing 

choice within its jurisdiction, take 

appropriate actions to overcome the 

effects of any impediments identified 

through that analysis, and maintain 

records reflecting the analysis and 

actions in this regard. (See 24 CFR 

570.487(b)(2).) 

B. The grantee certifies that it has in 

effect and is following a residential antidisplacement and relocation assistance 

plan in connection with any activity 

assisted with funding under the CDBG 

program. 

C. The grantee certifies its compliance 

with restrictions on lobbying required 

by 24 CFR part 87, together with 

disclosure forms, if required by part 87. 

D. The grantee certifies that the 

Action Plan for Disaster Recovery is 

authorized under State and local law 

and that the grantee, and any entity or 

entities designated by the State, 

possess(es) the legal authority to carry 

out the program for which it is seeking 

funding, in accordance with applicable 

HUD regulations and this Notice. 

E. The grantee certifies that it will 

comply with the acquisition and 

relocation requirements of the URA, as 

amended, and implementing regulations 

at 49 CFR part 24, except where waivers 

or alternative requirements are provided 

for this grant. 

F. The grantee certifies that it will 

comply with section 3 of the Housing 

and Urban Development Act of 1968 (12 

U.S.C. 1701u), and implementing 

regulations at 24 CFR part 135. 

G. The grantee certifies that it is 

following a detailed citizen 

participation plan that satisfies the 

requirements of 24 CFR 91.105 or 

91.115, as applicable (except as 

provided for in notices providing 

waivers and alternative requirements for 

this grant). Also, each unit of local 

government receiving assistance from 

the grantee must follow a detailed 

citizen participation plan that satisfies 

the requirements of 24 CFR 570.486 

(except as provided for in notices 


emcdonald on DSK2BSOYB1PROD with NOTICES
69110 Federal Register / Vol. 75, No. 217 / Wednesday, November 10, 2010 / Notices 

providing waivers and alternative 

requirements for this grant). 

H. Each State receiving a direct award 

under this Notice certifies that it has 

consulted with affected units of local 

government in counties designated in 

covered major disaster declarations in 

the non-entitlement, entitlement, and 

tribal areas of the State in determining 

the method of distribution of funding. 

I. The grantee certifies that it is 

complying with each of the following 

criteria: 

(1) Funds will be used solely for 

necessary expenses related to disaster 

relief, long-term recovery, and 

restoration of infrastructure, housing, 

and economic revitalization in areas 

affected by severe storms and flooding 

that occurred between March and May, 

2010, for which the President declared 

a major disaster covering an entire State, 

or States with more than 20 counties 

declared major disasters, under title IV 

of the Robert T. Stafford Disaster Relief 

and Emergency Assistance Act of 1974 

(42 U.S.C. 5121 et seq.). 

(2) With respect to activities expected 

to be assisted with CDBG disaster 

recovery funds, the Action Plan has 

been developed so as to give the 

maximum feasible priority to activities 

that will benefit low- and moderateincome families. 

(3) The aggregate use of CDBG disaster 

recovery funds shall principally benefit 

low- and moderate-income families in a 

manner that ensures that at least 50 

percent of the amount is expended for 

activities that benefit such persons 

during the designated period. 

(4) The grantee will not attempt to 

recover any capital costs of public 

improvements assisted with CDBG 

disaster recovery grant funds, by 

assessing any amount against properties 

owned and occupied by persons of lowand moderate-income, including any fee 

charged or assessment made as a 

condition of obtaining access to such 

public improvements, unless: (A) 

Disaster recovery grant funds are used to 

pay the proportion of such fee or 

assessment that relates to the capital 

costs of such public improvements that 

are financed from revenue sources other 

than under this title; or (B) for purposes 

of assessing any amount against 

properties owned and occupied by 

persons of moderate income, the grantee 

certifies to the Secretary that it lacks 

sufficient CDBG funds (in any form) to 

comply with the requirements of clause 

(A). 

J. The grantee certifies that the grant 

will be conducted and administered in 

conformity with title VI of the Civil 

Rights Act of 1964 (42 U.S.C. 2000d) 

and the Fair Housing Act (42 U.S.C. 

3601–3619) and implementing 

regulations. 

K. The grantee certifies that it has and 

that it will require UGLGs that receive 

grant funds to certify that they have 

adopted and are enforcing: 

(1) A policy prohibiting the use of 

excessive force by law enforcement 

agencies within its jurisdiction against 

any individuals engaged in nonviolent 

civil rights demonstrations; and 

(2) A policy of enforcing applicable 

State and local laws against physically 

barring entrance to or exit from a facility 

or location that is the subject of such 

nonviolent civil rights demonstrations 

within its jurisdiction. 

L. Each State receiving a direct award 

under this Notice certifies that each 

State grant recipient or administering 

entity has the capacity to carry out 

disaster recovery activities in a timely 

manner, or the State has a plan to 

increase the capacity of any State grant 

recipient or administering entity that 

lacks such capacity. 

M. The grantee certifies that it will 

not use CDBG disaster recovery funds 

for any activity in an area delineated as 

a special flood hazard area in FEMA’s 

most current flood advisory maps, 

unless it also ensures that the action is 

designed or modified to minimize harm 

to or within the floodplain, in 

accordance with Executive Order 11988 

and 24 CFR part 55. 

N. The grantee certifies that it will 

comply with applicable laws. 

Duration of Funding 

Availability of funds provisions in 31 

U.S.C. 1551–1557, added by section 

1405 of the National Defense 

Authorization Act for Fiscal Year 1991 

(Pub. L. 101–510), limit the availability 

of certain appropriations for 

expenditure. This limitation may not be 

waived. However, the Supplemental 

Appropriations Act for these grants 

directs that these funds be available 

until expended unless, in accordance 

with 31 U.S.C. 1555, HUD determines 

that the purposes for which the 

appropriation has been made have been 

carried out and no disbursement has 

been made against the appropriation for 

2 consecutive fiscal years. In such a 

case, HUD shall close out the grant prior 

to expenditure of all funds. 

Catalog of Federal Domestic Assistance 

The Catalog of Federal Domestic 

Assistance numbers for the disaster 

recovery grants under this Notice are as 

follows: 14.218; 14.228. 

Finding of No Significant Impact 

A Finding of No Significant Impact 

(FONSI) with respect to the 

environment has been made in 

accordance with HUD regulations at 24 

CFR part 50, which implement section 

102(2)(C) of the National Environmental 

Policy Act of 1969 (42 U.S.C. 4332). The 

FONSI is available for public inspection 

between 8 a.m. and 5 p.m. weekdays in 

the Regulations Division, Office of 

General Counsel, Department of 

Housing and Urban Development, 451 

7th Street, SW., Room 10276, 

Washington, DC 20410–0500. Due to 

security measures at the HUD 

Headquarters building, an advance 

appointment to review the docket file 

must be scheduled by calling the 

Regulations Division at 202–708–3055 

(this is not a toll-free number). Hearing 

or speech-impaired individuals may 

access this number through TTY by 

calling the toll-free Federal Information 

Relay Service at 800–877–8339. 

Appendix A—Allocation Methodology 

Detail 

HUD determined that only four States met 

the statutory requirements for funding 

eligibility under Pub. L. 111–212: Tennessee, 

Rhode Island, Kentucky, and Nebraska each 

had federally declared disasters due to both 

flooding and severe storms that occurred 

between March 1 and May 31, 2010 where 

either the whole State or at least 20 counties 

were declared by the President to be major 

disasters. 

HUD made preliminary estimates of unmet 

needs for each State. In total, HUD estimated 

across the four disasters nearly $694 million 

in remaining unmet needs after taking into 

account losses already covered by insurance, 

FEMA Public Assistance, FEMA Individual 

Assistance, and SBA Business Disaster Loans 

(see Table 1). With only $50 million allocated 

by this Notice, awards were made to the three 

States with the greatest unmet needs— 

Tennessee, Rhode Island, and Kentucky. 

TABLE 1—PRELIMINARY ESTIMATES OF UNMET NEEDS

State Housing Infrastructure Business Total 

Tennessee ....................................................................................... $363,412,407 $64,907,061 $108,349,875 $536,669,343 

Rhode Island .................................................................................... 54,111,522 3,290,878 23,910,814 81,313,214 

Kentucky .......................................................................................... 60,379,939 3,540,307 10,899,431 74,819,677 


emcdonald on DSK2BSOYB1PROD with NOTICES
Federal Register / Vol. 75, No. 217 / Wednesday, November 10, 2010 / Notices 69111 

TABLE 1—PRELIMINARY ESTIMATES OF UNMET NEEDS—Continued 

State Housing Infrastructure Business Total 

Nebraska .......................................................................................... 0 1,186,985 0 1,186,985 

Total .......................................................................................... 477,903,868 72,925,231 143,160,120 693,989,220 

For Tennessee, Rhode Island, and 

Kentucky, the amount of unmet needs 

substantially exceeded the amount available 

for allocation. Therefore, today’s Notice 

allocated $13 million to both Rhode Island 

and Kentucky, and $24 million to Tennessee. 

These base allocations were designed to 

address a part of the unmet needs existing in 

each State. 

The substate allocations were made to 

entitlement jurisdictions within the State 

based on their proportional share of need 

within the State, provided that no grant to a 

local government would be less than $1 

million. 

TABLE 2—FORMULA ALLOCATIONS

Disaster No. State Grantee Allocation 

1912 ......................................................... Kentucky ................................................. State Government .................................. $13,000,000 

1894 ......................................................... Rhode Island .......................................... City of Cranston ...................................... 1,277,067 

1894 ......................................................... Rhode Island .......................................... City of Warwick ....................................... 2,787,697 

1894 ......................................................... Rhode Island .......................................... State Government .................................. 8,935,237 

1909 ......................................................... Tennessee .............................................. City of Memphis ...................................... 2,031,645 

1909 ......................................................... Tennessee .............................................. Nashville-Davidson County .................... 10,731,831 

1909 ......................................................... Tennessee .............................................. Shelby County ........................................ 1,212,788 

1909 ......................................................... Tennessee .............................................. State Government .................................. 10,023,735 

Total ................................................. ................................................................. ................................................................. 50,000,000 

Available Data 

The Department identified available data to 

calculate ‘‘relative damage and anticipated 

assistance from Federal sources’’ from the 

following sources: 

• FEMA Individual Assistance program 

data on housing unit damage; 

• SBA for management of its disaster 

assistance loan program for housing repair 

and replacement; 

• SBA for management of its disaster 

assistance loan program for business real 

estate repair and replacement as well as 

content loss; and 

• FEMA estimated and obligated amounts 

under its Public Assistance program, Federal 

and State cost share. 

Calculating Unmet Housing Needs 

The core data on housing damage for both 

the unmet housing needs calculation and the 

concentrated damage were based on home 

inspection data for FEMA’s Individual 

Assistance program. For unmet housing 

needs, the FEMA data were supplemented by 

Small Business Administration data from its 

Disaster Loan Program. HUD calculated 

‘‘unmet housing needs’’ as the number of 

housing units with unmet needs times the 

estimated cost to repair those units less 

repair funds already provided by FEMA, 

where: 

• The number of owner-occupied units 

with unmet needs were units FEMA housing 

inspectors determined would require more 

than $3,000 to become habitable AND were 

determined by FEMA to be eligible for a 

repair or replacement grant (now up to 

$30,300, earlier disasters in the year had a 

cap of $28,800). In general, when HUD refers 

to units ‘‘seriously damaged’’, it is referring to 

unit with a FEMA damage assessment of 

$3,000 or greater. 

• The number of rental units with unmet 

needs were units FEMA housing inspectors 

determined received more than $1,000 in 

personal property damage AND were 

occupied by households with an income 

reported to FEMA of less than $20,000. The 

use of the $20,000 income cut-off for 

calculating rental unmet needs is intended to 

capture the loss of affordable rental housing. 

• Each of the FEMA inspected units were 

categorized by HUD into one of five 

categories: 

Æ Minor-Low: Less than $3,000 of FEMA 

inspected damage. 

Æ Minor-High: $3,000 to $7,999 of FEMA 

inspected damage. 

Æ Major-Low: $8,000 to $14,999 of FEMA 

inspected damage. 

Æ Major-High: $15,000 to $28,800 of FEMA 

inspected damage. 

Æ Severe: Greater than $28,800 of FEMA 

inspected damage or determined destroyed. 

(Please note that FEMA has recently raised 

its maximum grant amount above $28,800. 

For this allocation, HUD continued to use the 

$28,800 as the threshold to be consistent 

with past allocations. FEMA no longer 

estimates the cost to repair rental properties, 

it only estimates the cost to replace the 

personal property of renters. Based on a 

comparison of personal property loss to real 

property repair loss of homeowners, HUD has 

made a rough calculation that personal 

property loss of renters of $7,500 or greater 

equates to Severe real property damage; 

$3,500 to $7,499 equates to Major-High 

damage; $2,000 to $3,499 equals Major-Low 

damage; $1,000 to $1,999 equals Minor-High 

damage; and less than $1,000 equals MinorLow damage.) 

• The average cost to fully repair a home 

for a specific disaster within each of the 

damage categories noted above was 

calculated using the average real property 

damage repair costs determined by the Small 

Business Administration for its disaster loan 

program for the subset of homes inspected by 

both SBA and FEMA. Because SBA was 

inspecting for full repair costs, it is presumed 

to reflect the full cost to repair the home, 

which is generally more than the FEMA 

estimates on the cost to make the home 

habitable. If fewer than 100 SBA inspections 

were made for homes within a FEMA damage 

category, the estimated damage amount in 

the category for that disaster has a cap 

applied at the 75th percentile of all damaged 

units for that category for all disasters and 

has a floor applied at the 25th percentile. 

• The base amount of unmet housing 

needs was then increased by 20 percent to 

reflect an assumed premium associated with 

the additional costs needed to run a repair 

program with CDBG funding. 

Calculating Infrastructure Needs 

Unmet infrastructure need was calculated 

as the required match portion for the public 

assistance program for the categories of 

activities most likely to require CDBG 

funding above the Public Assistance and 

State Match requirement. Those activities 

were categories: C–Roads and Bridges; D– 

Water Control Facilities; E–Public Buildings; 

F–Public Utilities; and G–Recreational-Other. 

Categories A (Debris Removal) and B 

(Protective Measures) were largely expended 

immediately after a disaster and reflect 

interim recovery measures rather than the 

long-term recovery measures the CDBG funds 

are generally used for. Not all disasters have 

the same match requirements under Public 

Assistance. Each State ’s match unmet need 

infrastructure was calculated at the FEMA 

determined match requirement. 


emcdonald on DSK2BSOYB1PROD with NOTICES
69112 Federal Register / Vol. 75, No. 217 / Wednesday, November 10, 2010 / Notices 

1Section 470 of the Housing and Urban-Rural 

Recovery Act of 1983 (42 U.S.C. 3542) provides 

that: ‘‘No demonstration program not expressly 

authorized in law may be commenced by the 

Secretary of Housing and Urban Development until 

(1) a description of such demonstration program is 

published in the Federal Register, which 

description may be included in a notice of funding 

availability; and (2) there expires a period of sixty 

calendar days following the date of such 

publication, during which period the Secretary 

shall fully consider any public comments submitted 

with respect to such demonstration program.’’ The 

Retrofit Pilot Program is specifically authorized by 

the Consolidated Appropriations Act, 2010. 

Accordingly, HUD is not required to solicit 

comment on this demonstration. Nevertheless, HUD 

welcomes public comment on the proposed pilot 

program. 

Calculating Economic Revitalization Needs 

Based on SBA disaster loans to businesses, 

HUD used the sum of real property and real 

content loss of small businesses not receiving 

an SBA disaster loan. This was adjusted 

upward by the proportion of applications 

that were received for a disaster that content 

and real property loss were not calculated 

because the applicant had inadequate credit 

or income. For example, if a State had 160 

applications for assistance, 150 had 

calculated needs and 10 were denied in the 

pre-processing stage for not enough income 

or poor credit, the estimated unmet need 

calculation would be increased as (1 + 10/ 

160) * calculated unmet real content loss. 

Because applications denied for poor credit 

or income are the most likely measure of 

requiring the type of assistance available 

with CDBG recovery funds, the calculated 

unmet business needs for each State were 

adjusted upwards by the proportion of total 

application that were denied at the preprocess stage because of poor credit or 

inability to show repayment ability. 

Dated: November 3, 2010. 

Mercedes M. Ma ́ rquez, 

Assistant Secretary for Community Planning 

and Development. 

[FR Doc. 2010–28421 Filed 11–9–10; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–5450–N–01] 

Federal Housing Administration (FHA): 

Notice of FHA PowerSaver Home 

Energy Retrofit Loan Pilot Program: 

Request for Comments and 

Expressions of Interest 

AGENCY: Office of the Assistant 

Secretary for Housing—Federal Housing 

Commissioner, HUD. 

ACTION: Notice. 

SUMMARY: This notice announces HUD’s 

proposal to conduct an FHA Home 

Energy Retrofit Loan Pilot Program 

(Retrofit Pilot Program or Pilot Program) 

known as FHA PowerSaver. The 

Consolidated Appropriations Act, 2010 

directs HUD to conduct an Energy 

Efficient Mortgage Innovation pilot 

program targeted to the single family 

housing market. The Retrofit Pilot 

Program is designed by HUD to meet 

this statutory directive and provides 

funding to support that effort. 

Under the Retrofit Pilot Program, 

HUD, through FHA-approved lenders, 

will insure loans for homeowners who 

are seeking to make energy 

improvements to their homes. HUD 

intends to select a limited number of 

lenders to participate in the Retrofit 

Pilot Program. The Pilot Program will be 

for loans originated during a 2-year 

period, will be restricted to lenders 

approved by HUD to participate in the 

Pilot Program, and will be conducted in 

geographic areas identified by HUD as 

optimum locations to conduct the Pilot 

Program. In making these 

determinations, HUD will consider the 

factors and criteria that are proposed in 

this notice to establish the framework 

for the Pilot Program, and for which 

HUD specifically solicits public 

comment.1

For this Pilot Program, HUD will 

deploy up to $25 million appropriated 

by the Act for an Energy Efficient 

Mortgage Innovation Fund pilot 

program directed at the single family 

housing market. HUD will utilize those 

funds primarily to provide incentive 

payments with grant funds to 

participating lenders to support 

approved activities that deliver bona 

fide benefits to borrowers, with 

remaining funds available to support the 

evaluation of the Pilot Program. 

Following the public comment 

period, HUD will announce the lenders 

that have been selected to participate in 

the Pilot Program, the geographic areas 

in which the Pilot Program will be 

conducted, and any modifications to the 

Retrofit Pilot Program made in response 

to public comment and/or in response 

to HUD’s further consideration of how 

the pilot program should be structured. 

At the conclusion of the Pilot Program, 

HUD will assess the results of the 

Retrofit Pilot Program, and determine 

any additional action based on that 

assessment. HUD will assess the extent 

to which energy retrofits under the Pilot 

Program delivered expected benefits in 

terms of energy reductions, cost savings, 

and property value improvement, 

among other results. 

In addition to seeking comments on 

the proposed Pilot Program, HUD 

invites lenders interested in 

participating in this Pilot Program to 

notify HUD of such interest as provided 

in Appendix A to this notice. 

DATES: Comment Due Date: December 

27, 2010. 

ADDRESSES: Note: The following 

procedures pertain to the submission of 

general comments on this notice. 

Lenders interested in participating in 

this Pilot Program must e-mail their 

Expressions of Interest to 

FHAPowerSaver@hud.gov in accordance 

with Appendix A of this notice. 

Interested persons are invited to 

submit comments regarding this notice 

to the Regulations Division, Office of 

General Counsel, Department of 

Housing and Urban Development, 451 

7th Street, SW., Room 10276, 

Washington, DC 20410–0500. 

Communications must refer to the above 

docket number and title. There are two 

methods for submitting public 

comments. All submissions must refer 

to the above docket number and title. 

1. Submission of Comments by Mail. 

Comments may be submitted by mail to 

the Regulations Division, Office of 

General Counsel, Department of 

Housing and Urban Development, 451 

7th Street, SW., Room 10276, 

Washington, DC 20410–0500. 

2. Electronic Submission of 

Comments. Interested persons may 

submit comments electronically through 

the Federal eRulemaking Portal at 

http://www.regulations.gov. HUD 

strongly encourages commenters to 

submit comments electronically. 

Electronic submission of comments 

allows the commenter maximum time to 

prepare and submit a comment, ensures 

timely receipt by HUD, and enables 

HUD to make them immediately 

available to the public. Comments 

submitted electronically through the 

http://www.regulations.gov Web site can 

be viewed by other commenters and 

interested members of the public. 

Commenters should follow the 

instructions provided on that site to 

submit comments electronically. 

Note: To receive consideration as public 

comments, comments must be submitted 

through one of the two methods specified 

above. Again, all submissions must refer to 

the docket number and title of the notice. No 

Facsimile Comments. Facsimile (FAX) 

comments are not acceptable. 

Public Inspection of Public 

Comments. All properly submitted 

comments and communications 

submitted to HUD will be available for 

public inspection and copying between 

8 a.m. and 5 p.m. weekdays at the above 

address. Due to security measures at the 

HUD Headquarters building, an advance 

appointment to review the public 

comments must be scheduled by calling 

the Regulations Division at 202–708– 

3055 (this is not a toll-free number). 

Individuals with speech or hearing 

impairments may access this number 

via TTY by calling the Federal 


emcdonald on DSK2BSOYB1PROD with NOTICES