65970 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT

[Docket No. FR–4256–N–01]

Notice of Funding Availability for: The

HUD-Administered Small Cities

Community Development Block Grant

(CDBG) Program—Fiscal Year 1997

and Fiscal Year 1998; and the Section

108 Loan Guarantee Program for Small

Communities in New York State

AGENCY: Office of the Assistant

Secretary for Community Planning and

Development, HUD.

ACTION: Notice of Funding Availability

for Fiscal Years 1997 and 1998.

SUMMARY: This Notice of Funding

Availability (NOFA) announces: (1) the

availability of approximately

$49,456,000 in Fiscal Year (FY) 1997

funding and approximately $54,000,000

in Fiscal Year 1998 funding for the

HUD-administered Small Cities Program

in New York State under the

Community Development Block Grant

(CDBG) Program; and (2) the availability

of a maximum of approximately

$200,000,000—$250,000,000 in FY 1998

funding under the Section 108 Loan

Guarantee program for small cities in

New York State. Amounts available

under the Section 108 Loan Guarantee

program are not awarded competitively

and are not rated under the criteria of

this NOFA. Grants awarded under this

NOFA for activities and projects for

which Section 108 assistance will also

be needed, however, will be

conditioned upon approval of the

requisite Section 108 application within

a stated time.

The exact amount of funds that will

be available from the approximately

$49,456,000 of FY 1997 funds and the

approximately $54,000,000 of FY 1998

funds that communities will be able to

compete for under this NOFA is not

known at this time. This amount will

not be known until HUD receives

applications and makes determinations

for grants based on multiyear plans

approved in FY 1995 and FY 1996. In

addition, in FY 1997 HUD carried out

the Canal Corridor Initiative (see the

NOFA for this initiative in the Federal

Register on December 3, 1996 (61 FR

64196) and the amendment published in

the Federal Register on December 12,

1996 (61 FR 66692)). Pursuant to that

NOFA, HUD approved Canal Corridor

applications for approximately $6.5

million in Fiscal Year 1997 New York

Small Cities funds. HUD must also be

prepared, pursuant to 24 CFR 570.432,

to use CDBG funds each year, as

necessary, for the sole purpose of paying

any amounts due on debt obligations,

for up to 20 years, issued by units of

general local government (or their

designated public agencies) and

guaranteed by the Secretary pursuant to

section 108 of the Housing and

Community Development Act of 1974,

as amended, for projects approved

under the Canal Corridor Initiative

NOFA. At this time, the exact amount

of CDBG funds that will be needed to

meet required debt obligation payments

during Fiscal Year 1998 is not known.

However, in the December 3, 1996

NOFA, HUD estimated that the average

amount of CDBG funds required to meet

the debt obligation payments would not

exceed an average of $3 million per year

over a 20-year period.

The funds announced in this NOFA

provide small communities and

counties in New York State with an

opportunity to propose programs that

focus on creating or expanding job

opportunities, addressing housing

needs, or meeting local public facilities

needs. HUD encourages communities to

propose programs that are creative and

innovative in addressing the needs of

their community. A community may

propose a program that is ‘‘single

purpose’’ in nature addressing a specific

area of need. In the final rule published

in the Federal Register on November 25,

1997 (62 FR 62912), HUD decreased the

maximum grant amount for a Single

Purpose grant to $400,000, except for

applications from a county. The

maximum amount for a Single Purpose

grant to a county is $600,000. However,

because this NOFA covers funding for

two fiscal years, applicants may submit

and be funded for up to two

applications. The $400,000 (or $600,000

in the case of a county) maximum grant

award limit will apply to each

application and grant awarded. Each

application will be rated and ranked

independently and must be for

independent projects. HUD will not

make any Single Purpose multiyear

awards with FY 1997 or FY 1998 funds

under this NOFA. HUD will honor

previous multiyear plans approved in

FY 1995 and FY 1996. Multiyear

recipients should carefully review the

limitations and requirements contained

in section I.D. of this NOFA.

DATES: Applications (including

applications from recipients approved

for a multiyear plan for second or third

component in FY 1997 or FY 1998) are

due by March 2, 1998. Application kits

may be obtained from and must be

submitted to either HUD’s New York or

Buffalo Office. (The addresses for these

offices are provided in Section II. of this

NOFA.)

Applications, if mailed, must be

postmarked no later than midnight on

March 2, 1998. If an application is handdelivered to the New York or the Buffalo

Office, the application must be

delivered to the appropriate office by no

later than 4:00 p.m. (local time) on

March 2, 1998.

Application kits will be made

available by a date that affords

applicants no fewer than 45 days to

respond to this NOFA. For further

information on obtaining and

submitting applications, please see

Section II. of this NOFA.

The above-stated application deadline

is firm as to date and hour. In the

interest of fairness to all competing

applicants, HUD will treat as ineligible

for consideration any application that is

not received by 4:00 p.m. on, or

postmarked by, March 2, 1998.

Applicants should take this procedure

into account and make early submission

of their materials to avoid any risk of

loss of eligibility brought about by

unanticipated delays or other deliveryrelated problems.

FOR FURTHER INFORMATION CONTACT:

Cornelia B. Robertson-Terry, State and

Small Cities Division, Office of

Community Planning and Development,

Department of Housing and Urban

Development, Room 7184, 451 Seventh

Street SW, Washington, DC 20410;

telephone (202) 708–1322 (this is not a

toll-free number). Hearing or speechimpaired individuals may access this

number via TTY by calling the toll-free

Federal Information Relay Service at 1–

800–877–8339.

SUPPLEMENTARY INFORMATION:

Contents

I. Purpose and Substantive Description

A. Authority and Background

1. Authority

2. Background

3. Other Program Requirements

a. Abbreviated Consolidated Plan

b. Section 3

4. Accountability in the Provision of HUD

Assistance

a. HUD Responsibilities

(1) Documentation and Public Access

(2) Disclosures

b. Units of Local Government

Responsibilities

B. Allocation Amounts

1. Total Available Funding

2. Imminent Threats

C. Eligibility

1. Eligible Applicants

2. Previous Grantees

3. Eligible Activities and National

Objectives

4. Environmental Review Requirements

D. Types of Grants

1. Comprehensive Grants

2. Single Purpose Grants

a. General
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65971

b. Grant Limits and Funding Requirements

c. Special Limitations for Multiyear Plan

Recipients

3. Applications with Multiple Projects

4. Multiyear Plans

a. General

b. Previously Funded Multiyear Plans

E. Selection Criteria/Ranking Factors and

Final Selection

1. General

2. Performance Evaluation

a. Community Development Activities

b. Compliance with Applicable Laws and

Regulations

c. Performance Assessment Reports

3. Five Factor Rating

a. Need—Absolute Number of Persons in

Poverty

b. Need—Percent of Persons in Poverty

c. Program Impact—Single Purpose Grants

(1) Program Impact—Single Purpose—

Housing

(a) Housing Rehabilitation

(b) Creation of New Housing

(c) Direct Homeownership Assistance

(2) Program Impact—Single Purpose—

Public Facilities Affecting Public Health

and Safety

(3) Program Impact—Single Purpose—

Economic Development

(a) Scoring

(b) The Appropriate Determination

(c) CDBG Assistance Must Minimize

Business and Job Displacement

(d) Section 105(a)(17) Requirements

(e) National Objectives

(f) Application Requirements

d. Fair Housing and Equal Opportunity

Evaluation

(1) Housing Achievements

(a) Provision of Fair Housing Choice

(b) Implementation of a Fair Housing

Strategy that Affirmatively Furthers Fair

Housing

(2) Entrepreneurial Efforts and Local Equal

Opportunity Performance

(3) Equal Opportunity Employment

e. Welfare to Work Initiative

4. Final Selection

II. Application and Funding Award Process

A. Obtaining Applications

B. Submitting Applications

C. The Application

1. Application Requirements

2. Streamlined Application Requirements

for Certain Applicants

D. Funding Award Process

III. Technical Assistance

IV. Checklist of Application Submission

Requirements

V. Corrections to Deficient Applications

VI. Findings and Certifications

I. Purpose and Substantive Description

A. Authority and Background

1. Authority

Title I, Housing and Community

Development Act of 1974 (42 U.S.C.

5301–5320) (1974 HCD Act); 24 CFR

part 570, subpart F, for the New York

State Small Cities program, and subpart

M for the Section 108 Loan Guarantee

program.

2. Background

Title I of the 1974 HCD Act authorizes

the Community Development Block

Grant (CDBG) Program. Section 106(d)

of Title I permits States, in such manner

and at such time as the Secretary shall

prescribe, to elect to assume the

administrative responsibility for the

CDBG Program for nonentitled areas

within their jurisdiction. Section 106

provides that HUD will administer the

CDBG Program for nonentitled areas

within any State that does not elect to

assume the administrative responsibility

for the program. HUD’s regulations at 24

CFR part 570, subpart F describe the

requirements for HUD’s administration

of the CDBG Program in nonentitled

areas (Small Cities Program). This

NOFA supplements subpart F of 24 CFR

part 570.

In accordance with 24 CFR

570.421(b), and with the requirements

of section 102 of the Housing and Urban

Development Reform Act of 1989 (HUD

Reform Act), HUD is issuing this NOFA

for New York State’s Small Cities

Program for FY 1997 and FY 1998. This

NOFA announces the allocation of

funds for a Single Purpose grant

competition, and establishes the

deadline for filing grant applications.

The NOFA explains how HUD will

apply the regulatory threshold

requirements for funding eligibility, and

the selection criteria for rating and

scoring applications for Single Purpose

grants.

HUD has issued final regulations at 24

CFR 570.420—570.432 which govern

the HUD-administered Small Cities

program in New York. HUD will no

longer approve new multiyear plans.

HUD will honor previous multiyear

plans approved in FY 1995 and FY

1996. HUD intends to fund future years

of previously approved multiyear plans

on a noncompetitive basis, based on

satisfactory past performance and a

continuing capacity for carrying out the

proposed CDBG program activities and

submission of an acceptable application

and certifications.

Other information about the Small

Cities Program will be provided in the

application kit, which will be made

available to applicants by HUD’s New

York Office and Buffalo Office (see

Section II. of this NOFA).

3. Other Program Requirements

a. Abbreviated Consolidated Plan.

Each jurisdiction that applies for funds

under this NOFA must have submitted

a consolidated plan, as provided in 24

CFR part 91. An applicant under this

NOFA for more than one grant need

submit only one consolidated plan or

abbreviated consolidated plan, as

applicable, covering the activities

proposed in both applications. A

jurisdiction that does not expect to be a

participating jurisdiction in the HOME

program under 24 CFR part 92 may

submit an abbreviated consolidated plan

that is appropriate to the types and

amounts of assistance sought from HUD

(see 24 CFR 91.235). Any applicant that

plans to undertake a housing activity

with funds under this NOFA needs to

prepare and submit, at a minimum, an

abbreviated consolidated plan that is

appropriate to the types and amounts of

housing assistance sought under this

NOFA.

Even if the community’s Small Cities

application is approved, HUD must also

approve an abbreviated consolidated

plan that covers activities proposed in

such application(s) before the

community may receive Small Cities

funding. Further, that applicant must

also include a certification that the

housing activities in its CDBG Small

Cities application are consistent with

the consolidated plan. The applicant’s

consolidated plan must describe the

jurisdiction’s priority nonhousing

community development needs eligible

for assistance under the CDBG program

by eligibility category, reflecting the

needs of families for each type of

activity, as appropriate, in terms of

dollar amounts estimated to meet the

priority need for the type of activity (see

24 CFR 91.235(c)(2)).

The abbreviated consolidated plan is

subject to the same citizen participation

requirements as is the jurisdiction’s

Small Cities CDBG application. Both

must meet the citizen participation

requirements before they may be

submitted to HUD (see 24 CFR 570.431).

A Section 108 Loan Guarantee

application would also have to meet

citizen participation requirements, as

described in 24 CFR 570.704, if the

jurisdiction submits one to HUD for

consideration.

If possible, an applicant should

submit the abbreviated consolidated

plan in advance of the Small Cities

application due date. The latest time at

which the abbreviated consolidated

plan will be accepted by HUD for the

HUD-administered Small Cities Program

in New York will be March 2, 1998 (the

application due date for the Small Cities

application). Failure to submit the

abbreviated consolidated plan by the

due date is not a curable technical

deficiency. Questions regarding the

abbreviated consolidated plan should be

directed to the appropriate HUD field

office.

Any application that is fundable but

does not have an approved consolidated
65972 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

plan will receive a conditional approval

subject to HUD’s approval of the

abbreviated consolidated plan. If HUD is

unable to approve the abbreviated

consolidated plan within a reasonable

period of time (but not more than 60

days from the date that the conditional

approval is announced), HUD will

rescind the award. In such event the

funding will be awarded to the highest

rated fundable applicant that did not

receive funding under this competition.

b. Section 3. Assistance provided

under this NOFA is subject to the

requirements of section 3 of the Housing

and Urban Development Act of 1968 (12

U.S.C. 1701u), and HUD’s implementing

regulations in 24 CFR part 135. One of

the purposes of this NOFA, which is

consistent with section 3, is to give, to

the greatest extent feasible and

consistent with Federal, State, and local

laws and regulations, job training,

employment and other contracting

opportunities generated from certain

HUD financial assistance to low- and

very low-income persons. Public

entities awarded funds under this

NOFA that intend to use the funds for

housing rehabilitation, housing

construction, or other public

construction must comply with the

applicable requirements set forth in 24

CFR part 135.

4. Accountability in the Provision of

HUD Assistance: Documentation and

Public Access Requirements; Applicant/

Recipient Disclosures

Section 102 of the Department of

Housing and Urban Development

Reform Act of 1989 (42 U.S.C. 3545)

(HUD Reform Act) and the regulations

codified in 24 CFR part 4, subpart A,

contain a number of provisions that are

designed to ensure greater

accountability and integrity in the

provision of certain types of assistance

administered by HUD. On January 14,

1992 (57 FR 1942), HUD published a

notice that also provides information on

the implementation of section 102. The

documentation, public access, and

disclosure requirements of section 102

are applicable to assistance awarded

under this NOFA as follows:

a. HUD Responsibilities. (1)

Documentation and Public Access. HUD

will ensure that documentation and

other information regarding each

application submitted pursuant to this

NOFA are sufficient to indicate the basis

upon which assistance was provided or

denied. This material, including any

letters of support, will be made

available for public inspection for a 5-

year period beginning not less than 30

days after the award of the assistance.

Material will be made available in

accordance with the Freedom of

Information Act (5 U.S.C. 552) and

HUD’s implementing regulations at 24

CFR part 15. In addition, HUD will

include the recipients of assistance

pursuant to this NOFA in its Federal

Register notice of all recipients of HUD

assistance awarded on a competitive

basis.

(2) Disclosures. HUD will make

available to the public for 5 years all

applicant disclosure reports (HUD Form

2880) submitted in connection with this

NOFA. Update reports (also Form 2880)

will be made available along with the

applicant disclosure reports, but in no

case for a period less than 3 years. All

reports—both applicant disclosures and

updates—will be made available in

accordance with the Freedom of

Information Act (5 U.S.C. 552) and

HUD’s implementing regulations at 24

CFR part 15.

b. Units of General Local Government

Responsibilities. Units of general local

government awarded assistance under

this NOFA must ensure that

documentation and other information

regarding each application submitted to

the recipient by a subsequent recipient

applicant are adequate to indicate the

basis upon which assistance was

provided or denied. The unit of general

local government must make this

material, including any letters of

support, available for public inspection

for a 5-year period beginning not less

than 30 days after the award of the

assistance. Unit of general local

government recipients must also notify

the public of the subsequent recipients

of the assistance. Each recipient will

develop documentation, public access,

and notification procedures for its

programs.

B. Allocation Amounts

1. Total Available Funding

The nonentitlement CDBG funds for

New York State for FY 1997 total

approximately $56,022,000 and for FY

1998 total approximately $54,000,000.

The exact amount of funds available for

the Small Cities CDBG is not known at

this time. The final amount available

will not be known until HUD receives

applications and makes grants based on

multiyear plans approved in FY 1995

and FY 1996. This amount will not be

known until the communities have

submitted their applications to HUD

and determinations have been made by

HUD regarding each community’s past

performance and the community’s

continuing capacity to carry out

additional CDBG activities; however,

the total amount of previously approved

multiyear plans, if submitted and

approved by HUD, would be

approximately $24.6 million in FY 1997

funds and approximately $12 million in

FY 1998 funds. In addition, in FY 1997

HUD carried out the Canal Corridor

Initiative (see the NOFA for this

initiative in the Federal Register on

December 3, 1996 (61 FR 64196) and as

amended on December 18, 1996 (61 FR

66692)). HUD must be prepared,

pursuant to 24 CFR 570.432, to use

CDBG funds each year, as necessary, for

the sole purpose of paying any amounts

due on debt obligations, for up to 20

years, issued by units of general local

government (or their designated public

agencies) and guaranteed by the

Secretary pursuant to section 108 of the

Housing and Community Development

Act of 1974, as amended, for projects

approved under the Canal Corridor

Initiative NOFA. HUD approved

approximately $6.55 million in FY 1997

Small Cities funds for Canal Corridor

grants. However, at this time, the exact

amount of CDBG funds that will be

needed to meet required debt obligation

payments during Fiscal Year 1998 is not

known. Of the approximately

$103,456,000 available under this

NOFA, approximately $90,835,000 is

allocated for distribution to eligible

units of general local government within

the jurisdiction of HUD’s New York

Buffalo Field Office. Approximately

$12,621,000 is allocated for distribution

to eligible units of general local

government within the jurisdiction of

HUD’s New York Office. Once HUD has

determined the final amount of funds

available for competitive distribution

under this NOFA, HUD will allocate

such funds in the same ratio as above to

HUD’s Buffalo and New York Offices.

However, HUD has the option to revise

these final allocations between offices

by up to $400,000 in order to assure full

distribution of funds. Finally, HUD

reserves the right, in its sole discretion,

not to award all of the funds available

under this NOFA and to make any such

funds available in a future NOFA, if an

insufficient number of applications are

determined fundable under this NOFA.

2. Imminent Threats

All imminent threat projects must

meet the national objective of

benefitting low-and moderate-income

persons. HUD may elect to set aside up

to 15 percent of the FY 1997 and/or the

FY 1998 allocations for imminent threat

projects. These funds will be available

until the rating and ranking process for

funds distributed under this NOFA is

completed.
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65973

C. Eligibility

1. Eligible Applicants

Eligible applicants are units of general

local government in New York State,

excluding: (1) metropolitan cities; (2)

urban counties; (3) units of government

which are participating in urban

counties or metropolitan cities even if

only part of the participating unit of

government is located in the urban

county or metropolitan city; and (4)

Indian tribes (as defined in section

102(a)(17) of the 1974 HCD Act).

Applications may be submitted

individually, or jointly, as described in

24 CFR 570.422. However, applicants

that were approved for a 2- or 3-year

comprehensive plan in FY 1995 or FY

1996 may submit the required

application by the deadline date set

above for applications under this NOFA

in order to receive the second and/or

third year increment as applicable (see

sections I.D.2.b. and I.D.4.b. of this

NOFA), but may not submit a separate

application for single purpose grant

under this NOFA unless they notify

HUD no later than the deadline for

receipt of applications under this NOFA

that they are relinquishing their second

or third year multiyear funds.

2. Previous Grantees

Eligible applicants that previously

have been awarded Small Cities

Program CDBG grants are also subject to

an evaluation of capacity and

performance (see generally, section

I.E.2. of this NOFA). Numerical

thresholds for drawdown of funds have

been established to assist HUD in

evaluating a grantee’s progress in

implementing its program activities.

(These standards apply to all CDBG

Program grants received by the

community.) In FY 1996 an additional

threshold was established which relates

to the submission of annual

Performance Assessment Reports

(PARs). A PAR was due on October 31,

1997, for each grant which a local

government received prior to April 1,

1996. Failure to submit a PAR is not a

curable technical deficiency.

Applicants generally will be

determined to have performed

adequately in the area(s) where the

thresholds are met. Where a threshold

has not been met, HUD will evaluate the

documentation of any mitigating factors,

particularly with respect to actions

taken by the applicant to accelerate the

implementation of its program

activities.

3. Eligible Activities and National

Objectives

Eligible activities under the Small

Cities CDBG Program are those

identified in subpart C of 24 CFR part

570. With respect to the Section 108

Loan Guarantee program, eligible

activities are identified in § 570.703.

Note that § 570.703 does not include all

CDBG-eligible activities. Each activity

under both programs must meet one of

the national objectives (i.e., benefit to

low- and moderate-income persons,

elimination of slums or blighting

conditions, or meeting imminent threats

to the health and safety of the

community; see § 570.208), and each

grant and use of Section 108 Loan

Guarantee proceeds must meet the

requirements for compliance with the

primary objective of principally

benefitting low- and moderate-income

persons, as required under § 570.420(e).

The principal benefit requirement under

the CDBG program is 70 percent. The

method of calculating the use of these

funds for compliance with the 70

percent overall benefit requirement is

set forth in § 570.420(e). In general, all

applications must describe the projects

and activities proposed in sufficient

detail that compliance with these and

other applicable statutory, regulatory,

and NOFA provisions can be

determined.

4. Environmental Review Requirement

The HUD environmental review

procedures contained in 24 CFR part 58

apply to this program. Under part 58,

grantees assume all of the

responsibilities for environmental

review, decisionmaking and action

pursuant to the National Environmental

Policy Act of 1969 (42 U.S.C. 4321 et

seq.) and the other provisions of law

specified by the Secretary in 24 CFR

part 58 that would apply to the

Secretary were he to undertake such

projects as Federal projects.

D. Types of Grants

1. Comprehensive Grants

There will not be a competition for

new comprehensive grant awards for FY

1997 or FY 1998. However, HUD will

honor those existing multiyear

commitments awarded in FY 1995 and

FY 1996, provided the community

submits to HUD an acceptable

application and HUD’s review of the

community’s past performance is

satisfactory. HUD’s review must also

indicate that the community has

sufficient continuing capacity to carry

out the proposed CDBG activities.

2. Single Purpose Grants

a. General. Single Purpose grants are

designed to address and resolve a

specific community development need.

A Single Purpose grant may consist of

more than one project. A project may

consist of one activity or a set of

activities. Each project must address

community development needs in one

of the following problem areas:

• Housing.

• Public Facilities.

• Economic Development.

Each project will be rated against all

other projects addressing the same

problem area, according to the criteria

outlined below. It should be noted that

each project within an application will

be given a separate impact rating, if each

one is clearly designated by the

applicant as a separate and distinct

project (i.e., separate Needs Description,

Community Development Activities,

Impact Description and Program

Schedule forms have been filled out,

indicating project names). In some

cases, it may be to the applicant’s

advantage to designate separate projects

for activities that can ‘‘stand on their

own’’ in terms of meeting the described

need, especially where a particular

project would tend to weaken the

impact rating of the other activities, if

they were rated as a whole, as has been

the case with some economic

development and housing projects. If,

however, the projects tend to meet

impact criteria to the same extent, or the

weaker element is only a small portion

of the overall project, there is no

discernable benefit in designating

separate projects.

b. Grant Limits and Funding

Requirements. The maximum annual

grant for a Single Purpose grant is

$400,000, except that counties may

apply for up to $600,000 in Single

Purpose funds, if the project will be

carried out in more than one

community. If other sources of funds are

to be used with respect to a project, the

source of those funds must be identified

and the level of commitment indicated.

With respect to grant limits for joint

applicants, the maximum amount that

may be awarded pursuant to a joint

application is the maximum single grant

limit established above for communities

and counties multiplied by the number

of participants in the cooperation

agreement, provided that for purposes of

determining such a multiple grant limit,

and in order to receive that amount, a

participating joint applicant must

receive a substantial direct benefit from

the activities proposed in the

application and must not be acting

solely on behalf of or in conjunction
65974 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

with another jurisdiction for the sole

purpose of raising the maximum grant

amount that may be awarded. In

addition, the statistics of each

participant counted for maximum grant

limits purposes shall also be used for

purposes of the selection factors under

section I.E.3. of this NOFA.

Because this NOFA covers funding for

two fiscal years, applicants may submit

up to two applications and receive two

grants. The $400,000 (or $600,000 in the

case of a county) maximum grant award

limit will apply to each application and

grant awarded. Each application will be

rated and ranked independently, and

must be for independent projects.

c. Special Limitations for Multiyear

Plan Recipients. With respect to a 3-year

multiyear plan approved for FY 1995,

FY 1996 and FY 1997, in which the

applicant still wishes to apply for and

receive its FY 1997 increment, the

applicant may apply for and receive

approval for one Single Purpose grant of

$400,000 (or $600,000 in the case of a

county) under this NOFA. Similarly, a

grantee that received approval of a 2-

year, multiyear plan for FY 1996 and FY

1997, and for which the applicant still

wishes to apply for and receive its FY

1997 increment, that community may

apply for and receive approval for one

Single Purpose grant of $400,000 (or

$600,000 in the case of a county) under

this NOFA. However, an applicant that

received approval of an FY 1996

multiyear plan for FY 1996, 1997, and

1998, and that still wishes to apply for

and receive approval for its FY 1997 and

FY 1998 increments, may not apply for

a Single Purpose grant under this

NOFA. Similarly, a multiyear applicant

that wishes to forgo applying for its FY

1997 or FY 1998 multiyear grant

increment(s) may do so and would thus

be eligible to apply for and receive up

to one or two Single Purpose grants, as

applicable.

3. Applications With Multiple Projects

If an application contains more than

one project, each project will be rated

separately for program impact.

Applicants should note that regardless

of the number of projects, the total grant

amount cannot exceed the limits

identified in section I.D.2.b. of this

NOFA.

4. Multiyear Plans

a. General. Multiyear plan grants will

not be awarded for FY 1997 or FY 1998.

However, multiyear plan grants

awarded in FY 1995 and FY 1996 will

be honored for the FY 1997 and FY 1998

funding increments, provided HUD’s

review indicates that the grantee has

acceptable past performance, the grantee

has continuing capacity to carry out the

CDBG activities proposed in the

application, and the grantee submits an

acceptable application and

certifications. HUD reserves the right to

lower the amount of funds for

succeeding years if grantees are not in

compliance with performance

requirements and applicable

regulations. Note that a multiyear

applicant that received a 3-year

multiyear plan approval in FY 1996 for

FY 1996, 1997, and 1998, should submit

two separate applications: one

application for the FY 1997 increment;

and one application for the FY 1998

increment. See section I.D.2.b., above,

regarding grant limits and funding

requirements for guidance on when a

previously approved multiyear

applicant may submit an application for

a Single Purpose Grant under this

NOFA. All applications for funding of a

second or third year increment of a

previously approved multiyear plan

must be submitted by the deadline date

for applications established by this

NOFA.

b. Previously Funded Multiyear Plans.

The maximum annual grant available

for a FY 1996 multiyear plan was

$1,900,000. The maximum funding for

implementing an entire multiyear plan

was $3,100,000 for a 2-year multiyear

plan, and $5,000,000 for a 3-year

multiyear plan. The maximum grant

awarded in FY 1996 was $1,200,000.

Grant funds requested must have been

sufficient, either by themselves or in

combination with funds from other

sources (including any Section 108 Loan

Guarantee resources requested in

conjunction with a Small Cities

application under this NOFA), to

complete the project within a reasonable

amount of time. If other sources of funds

were to have been used with respect to

a project, the source of those funds

should have been identified and the

level of commitment indicated. The

maximum grant for a multiyear plan

that was originally funded in FY 1995

and which was not revised in FY 1996

was $900,000.

E. Selection Criteria/Ranking Factors

and Final Selection

1. General

Complete applications received from

eligible applicants by March 2, 1998

will be rated and scored by HUD.

Applications are rated and scored

against five factors. These five factors

are discussed in more detail in section

I.E.3. of this NOFA. Note that when an

applicant proposes to use Section 108

Loan Guarantee assistance as a partial

funding resource for a proposed project

under this NOFA, HUD, when applying

the rating factors to such projects, will

consider the applicant’s description of

the Section 108 assisted project in

arriving at the score for a particular

factor. An applicant may either have an

approved 108 Loan Guarantee

application, submit a full Section 108

Loan Guarantee application or provide a

description of the Section 108 Loan

Guarantee application. (The description

must be specific as to the amount of the

Section 108 Loan Guarantee

commitment that the applicant will

request and the purpose for which the

108 Loan Guarantee proceeds will be

used. See section II.C.1. of this NOFA

for more information on this subject.)

However, any such CDBG application

under this NOFA that is fundable and

relies upon Section 108 Loan Guarantee

assistance to partially carry out the

activities and does not have an

approved Section 108 Loan Guarantee

commitment will receive a conditional

approval. If the applicant does not

submit and HUD does not approve the

required Section 108 Loan Guarantee

application within a reasonable period

of time (see section II.C.1.(f)(2) of this

NOFA), HUD may rescind the award. In

such event the funding will be awarded

to the highest rated fundable applicant

that did not receive funding under this

competition.

2. Performance Evaluation

As noted in section I.C. of this NOFA,

previous grantees of Small Cities

Program CDBG grants are subject to an

evaluation of performance and

continuing capacity to undertake the

proposed program. For purposes of

making performance evaluations, HUD

will use any information that becomes

available before grant awards are

announced. Performance also will be

evaluated using information which may

be available already to HUD, including

previously submitted performance

reports, site visit reports, audits,

monitoring reports and annual

community assessments. The HUD

Office may request and consider

additional information in cases where it

is essential to make the required

performance judgments (see 24 CFR

570.423(d), Thresholds). No grants will

be made to an applicant that does not

have the capacity to undertake the

proposed program. A performance

determination will be made by an

evaluation of the following areas:

a. Community Development Activities.

The following thresholds for

performance in expending CDBG funds

have been established for FY 1997 and

FY 1998 and pertain to all Single

Purpose and Comprehensive Grants,
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65975

including grants pursuant to approved

multiyear plans:

FY 1992 and earlier—Grants must be

closed out

FY 1993—Grant funds 100 percent

expended

FY 1994—Grant funds 75 percent

expended

FY 1995—Grant funds 30 percent

expended

FY 1996—Recipients must be on target

with respect to the latest Small Cities

Program Schedule received by HUD.

Note: These standards will be used as

benchmarks in judging program performance,

but will not be the sole basis for determining

whether the applicant is ineligible for a grant

due to a lack of capacity to carry out the

proposed project or program. Any applicant

that fails to meet the percentages specified

above may wish to provide updated data to

HUD, either in conjunction with the

application submission or under separate

cover, but in no case will data received by

HUD after March 2, 1998 be accepted, unless

specifically requested by HUD.

b. Compliance With Applicable Laws

and Regulations. An applicant will be

considered to have performed

inadequately if the applicant:

(1) Has not substantially complied

with the laws, regulations, and

Executive Orders applicable to the

CDBG Program, including applicable

civil rights laws as may be evidenced

by: (1) an outstanding finding of civil

rights noncompliance, unless the

applicant demonstrates that it is

operating in compliance with a HUDapproved compliance agreement

designed to correct the area(s) of

noncompliance; (2) an adjudication of a

civil rights violation in a civil action

brought against it by a private

individual, unless the applicant

demonstrates that it is operating in

compliance with a court order designed

to correct the area(s) of noncompliance;

(3) a deferral of Federal funding based

upon civil rights violations; (4) a

pending civil rights suit brought against

it by the Department of Justice; or (5) an

unresolved charge of discrimination

issued against it by the Secretary under

section 810(g) of the Fair Housing Act,

as implemented by 24 CFR 103.400;

(2) Has not resolved or attempted to

resolve findings made as a result of

HUD monitoring; or

(3) Has not resolved or attempted to

resolve audit findings.

An applicant will be ineligible for a

grant where the inadequate performance

in compliance with applicable laws and

regulations evidences a lack of capacity

to carry out the proposed project or

program. For example, an application

will not be accepted from a unit of

general local government which has an

outstanding audit finding or monetary

obligation for any HUD program.

Additionally, applications will not be

accepted from any entity which

proposes an activity in a unit of general

local government that has an

outstanding audit finding or monetary

obligation for any HUD program. The

Director of the Community Planning

and Development Division of the HUD

field office may provide an exception to

this prohibition if the unit of general

local government has made a good faith

effort to clear the audit finding. No

exception will be provided if funds are

due HUD, unless a satisfactory

arrangement for repayment of the debt

has been made.

c. Performance Assessment Reports.

Under 24 CFR 570.507, Small Cities

CDBG grantees are required to submit

Performance Assessment Reports (PARs)

on October 31st, for the period ended

September 30th, for all open grants

awarded before April 1st of the same

year. For an application for FY 1997/

1998 funds to be considered for funding,

the applicant must be current in its

submission of PARs. Failure to submit

a PAR is not a curable technical

deficiency under section V. of this

NOFA.

3. Five Factor Rating

As noted in section I.E.1. of this

NOFA, all applications are rated and

scored against five factors. These five

factors are:

• Need based on absolute number of

persons in poverty;

• Need based on the percent of

persons in poverty;

• Program Impact;

• Outstanding performance in fair

housing and equal opportunity; and

• Welfare to Work Initiative.

A maximum of 605 points is possible

under this system with the maximum

points for each factor being:

Points

Need—absolute number of persons

in poverty ....................................... 75

Need—percent of persons in poverty 75

Program Impact ................................ 400

Outstanding performance—FHEO:

a. Provision of fair housing choice 20

b. New Horizons Fair Housing Assistance Project ......................... 20

c. Equal opportunity employment 10

Welfare to Work Initiative ................. 5

Total ........................................... 605

Each of the five factors is outlined

below. All awarded points for each

factor will be rounded to the nearest

whole number.

a. Need—Absolute number of persons

in poverty. HUD uses 1990 census data

to determine the absolute number of

persons in poverty residing within the

applicant unit of general local

government. Applicants which are

county governments are rated separately

from all other applicants. For

applications from joint applicants, data

from each participating unit of general

local government (as described in 24

CFR 570.422) will be aggregated.

Applicants in each group are compared

in terms of the number of persons

whose incomes are below the poverty

level. Individual scores are obtained by

dividing each applicant’s absolute

number of persons in poverty by the

greatest number of persons in poverty of

any applicant and multiplying by 75.

b. Need—Percent of persons in

poverty. HUD uses 1990 census data to

determine the percent of persons in

poverty residing within the applicant

unit of general local government.

Applicants in each group are compared

in terms of the percentage of their

population below the poverty level. For

applications from joint applicants, data

from each participating unit of general

local government will be aggregated.

Individual scores are obtained by

dividing each applicant’s percentage of

persons in poverty by the highest

percentage of persons in poverty of any

applicant and multiplying by 75.

c. Program Impact—Single Purpose

Grants. In evaluating program impact,

HUD will consider various factors.

Within each activity type described

below is a set of factors and scoring

weights that will be used. Each proposal

will be rated using the factors and

scoring weights described in the

selection criteria below.

Assessments are done on a

comparative basis and, as a result, it is

important that each applicant present

information in a detailed and uniform

manner.

For projects consisting of more than

one activity, the activity that directly

addresses the need must represent at

least the majority of funds requested.

Other activities must be incidental to

and in support of the principal activity.

For example, public improvements

included in a rehabilitation project that

addresses housing need must: (1) be a

relatively small amount in terms of

funds requested; (2) clearly be in

support of the housing objective; and (3)

demonstrate a positive and direct link to

the national objective. For incidental

activities claiming benefit to low- and

moderate-income persons on an area

basis, the application must document

that at least 51 percent of the residents

of the service area meet the low- and

moderate-income requirement. Funds

should not be requested for activities
65976 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

that are not incidental to and in support

of the principal activity.

In addressing Program Impact criteria,

applicants should adhere to the

following general guidelines for

quantification. Where appropriate,

absolute and percentage figures should

be used to describe the extent of

community development needs and the

impact of the proposed program. This

includes, but is not limited to,

appropriate units of measure (e.g.,

number of housing units or structures,

linear feet of pipe, pounds per square

inch, etc.), and costs per unit of

measure. These quantification

guidelines apply to the description of

need, the nature of proposed activities

and the extent to which the proposed

program will address the identified

need.

Appropriate documentation should be

provided to support the degree of need

described in the application. Basically,

the sources for all statements and

conclusions relating to community

needs should be included in the

application or incorporated by

reference. Examples of appropriate

documentation include planning

studies, letters from public agencies,

newspaper articles, photographs and

survey data.

Generally, the most effective

documentation is that which

specifically addresses the subject matter

and has a high degree of credibility.

Applicants which intend to conduct

surveys to obtain data are advised to

contact the appropriate HUD office prior

to conducting the survey for a

determination as to whether the survey

methodology is statistically acceptable.

There are a number of program design

factors related to feasibility which can

alter significantly the award of impact

points. Accordingly, it is imperative that

applicants provide adequate

documentation in addressing these

factors. Common feasibility issues

include site control, availability of other

funding sources, validity of cost

estimates, and status of financial

commitments as well as evidence of the

status of regulatory agency review and

approval.

Past productivity and administrative

performance of prior grantees will be

taken into consideration when

reviewing the overall feasibility of the

program. Overall program design,

administration and guidelines are other

feasibility issues that should be

articulated and presented in the

application, since they are critical in

assessing the effectiveness and impact

of the proposed program.

Each project will be rated against

other projects addressing the same

problem area, so that, for example,

housing projects only will be compared

with other housing projects, according

to the criteria outlined below. It should

be noted that each project within an

application will be given a separate

impact rating, if each one is clearly

designated by the applicant as a

separate and distinct project (i.e.,

separate Needs Descriptions,

Community Development Activities,

and Impact Description and Program

Schedule forms have been filled out,

indicating separate project names).

In some cases, it may be to the

applicant’s advantage to designate

separate projects for activities that can

‘‘stand on their own’’ in terms of

meeting the described need, especially

where a particular project would tend to

weaken the impact rating of the other

activities, if they were all related as a

whole, as has been the case with some

economic development projects. If,

however, the projects tend to meet the

impact criteria to the same extent, or the

weaker element is only a small portion

of the overall program, there is no

discernable benefit in designating

separate projects.

Applicants should bear in mind that

the impact of the proposed project will

be judged by persons who may not be

familiar with the particular community.

Accordingly, individual projects will be

rated according to how well the

application demonstrates in specific,

measurable terms, the extent to which

the impact criteria are met. General

statements of need and impact alone

will not be sufficient to obtain a

favorable rating. HUD will not make a

Small Cities grant when it determines

that the grant will only have a minimal

or insignificant impact on the grantee.

For the purposes of this NOFA, any

application not scoring above 100 points

of the possible 400 points for the

Program Impact factor will be deemed to

have a minimal or insignificant impact

on the grantee and will not be funded

regardless of the number of points the

applicant may otherwise receive or the

ranking it attains as a result of its score

due to points received on other rating

factors.

For purposes of this NOFA,

Champion Community means an urban

or rural area that: (1) was designated by

the Secretary of HUD as an urban

Empowerment Zone or Enterprise

Community, or designated by the

Secretary of Agriculture as a rural

Empowerment Zone or Enterprise

Community; or (2) was nominated by

one or more local governments and the

State or States in which it is located for

consideration of designation as an

Empowerment Zone or Enterprise

Community pursuant to 24 CFR part 597

or 7 CFR part 25, meets the eligibility

requirements in 24 CFR part 597,

subpart B, or 7 CFR part 25, subpart B,

but was not so designated because of

statutory limits on the number of such

designations. The Champion

Communities in New York State are:

Kingston, Steuben County, Chenango

County, Sullivan County and

Chautauqua County.

(1) Program Impact—Single

Purpose—Housing. There are three

distinct types of Single Purpose Housing

projects: Housing Rehabilitation,

Creation of New Housing and Direct

Homeownership Assistance. Separate

rating criteria are provided for each type

of project.

(a) Housing Rehabilitation. The

following factors and weights will be

used evaluate proposed housing

rehabilitation projects:

(i) Severity of Need (proportion of

units that are substandard and extent of

disrepair) (up to 160 points of the total

Program Impact score). Each application

should provide information on the total

number of units in the project area, the

number that are substandard, and the

number of substandard units occupied

by low- and moderate-income

households. The purpose of this

information is to establish the relative

severity of housing conditions within

the designated project area compared to

other housing rehabilitation

applications. The application also

should describe the date and

methodology of any surveys used to

obtain the information, including any

explicit and detailed definition of

‘‘substandard.’’

Surveys of Housing Conditions.

Surveys of housing conditions serve

several purposes in evaluating

applications for housing rehabilitation

activities. These include establishing

the seriousness of need for such

assistance in the project area, providing

a basis for estimating overall budgetary

needs, and providing an indication of

the marketability of the project.

(ii) Extent to which proposed program

will resolve the identified problem (up

to 40 points of the total Program Impact

score). Note that programs that propose

minimal rehabilitation may not

necessarily be addressing the identified

problem.

(iii) Feasibility (marketability, project

design affecting timely completion of

the project) (up to 40 points of the total

Program Impact score). The application

should describe the project in sufficient

detail to allow the reviewer to assess its

feasibility and its probable impact on

the conditions described. It also should

describe project requirements in such a
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65977

way that regulatory and policy concerns

will be addressed.

HUD encourages communities to

support a new Secretarial initiative,

called Healthy Homes. Applicants

applying for Small Cities CDBG funds to

rehabilitate housing and/or construct

new housing units may support these

initiatives by including Healthy Homes

features in their program design, such as

window locks, deadbolt locks on doors,

locks or safety latches on medicine

cabinets, smoke detectors, carbon

monoxide detectors, energy efficient

windows, elimination of lead-based

paint, and any other activities that

contribute to Healthy Homes, especially

regarding children.

(iv) Leveraging of other resources (up

to 60 points of the total Program Impact

score). HUD encourages communities to

design projects supplementing Small

Cities rehabilitation funds with private

funds wherever feasible and

appropriate, especially in the case of

rental units and housing not occupied

by lower-income persons. In such cases,

the Small Cities grant subsidy should be

as low as possible, while retaining

sufficient incentive to attract local

participants. On the other hand, projects

designed for low-income homeowners

should not require private contributions

at a level that puts the project out of

reach of potential participants.

(v) Cost per unit (up to 80 points of

the Program Impact score). HUD will

review the applicant’s documentation to

determine whether the applicant’s costper-unit is lower than other applicants’

costs-per-unit. All applications should

provide documentation to justify the

cost-per-unit estimates, particularly

grantees where past performance does

not support the estimates in the

applications. In reviewing applications

from grantees with prior housing

rehabilitation projects, reasonableness

of cost-per-unit, stated in the

application, will be compared against

the grantee’s actual past performance.

(vi) Extent to which the project

supports the strategic plan of a

Champion Community (up to 20 points

of the total Program Impact score).

(b) Creation of New Housing. CDBG

funds may be used to support the

construction of new housing units, the

creation of new units proposed through

conversion of existing structures

(currently vacant structures or

conversion of nonresidential structures

for residential use) and, in certain

circumstances, to finance the actual cost

of constructing new units. New

construction may be carried out by an

eligible nonprofit entity pursuant to 24

CFR 570.204, or as last resort housing.

Note that for purposes of specific uses

of Section 108 Loan Guarantee

proceeds, eligibility is limited to

assistance for community economic

development projects under

§ 570.204(a)(2). See also 24 CFR

570.703(i)(2). Support of new

construction could include

nonconstruction assistance such as the

acquisition and/or clearance of land, the

provision of infrastructure, or the

payment of certain planning costs.

The following factors and weights

will be used to evaluate proposed

projects for the creation of new housing:

(i) Severity of need for new housing

affordable to low- and moderate-income

persons shown in the project area (up to

160 points of the total Program Impact

score). Where the creation of new units

is proposed, the application should

document the need for additional units

based on vacancy rates, waiting lists,

and other pertinent information.

(ii) Extent to which the proposed

program will create new housing units

affordable to low- and moderate-income

persons (up to 40 points of the total

Program Impact score). The proposed

project clearly must support, or result

in, additional units for low- and

moderate-income persons. The units

may result from new construction

projects for which the proposed project

will provide nonconstruction assistance.

(iii) Feasibility (marketability, project

design affecting timely completion of

the project) (up to 40 points of the total

Program Impact score). Applicants

should address issues of site control and

marketability, in addition to addressing

feasibility from the standpoint of market

financing.

(iv) Leveraging of other resources (up

to 60 points of the total Program Impact

score). Where the proposed project

involves the use of Federally assisted

housing, the applicant must identify

and document the current commitment

status of the Federal assistance. Lack of

a firm financial commitment for

assistance may adversely affect project

impact.

(v) Cost per unit (up to 60 points of

the total Program Impact score). HUD

will review the applicant’s

documentation to determine whether

the applicant’s cost-per-unit is lower

than other applicants’ costs-per-unit. All

applications should provide

documentation to justify the cost-perunit estimates, particularly grantees

where past performance does not

support the estimates in the

applications. In reviewing applications

from grantees with prior housing

projects, reasonableness of cost-per-unit,

stated in the application, will be

compared against the grantee’s actual

past performance.

(vi) Extent to which the project would

affirmatively further fair housing (either

through spatial deconcentration of

minorities throughout the community or

through spatial deconcentration of lowand moderate-income households if

there are no areas of minority

concentration) (up to 20 points of the

total Program Impact score).

(vii) Extent to which the project

supports the strategic plan of a

Champion Community (up to 20 points

of the total Program Impact score).

(c) Direct Homeownership Assistance.

Homeownership activities are defined

as activities which would promote

homeownership within the applicant

jurisdiction, focusing particularly on

aiding low- and moderate-income

persons in becoming homeowners. This

may include activities authorized under

24 CFR 570.201(n) for purposes of use

of Small Cities grant funding. However,

activities eligible solely under 24 CFR

570.201(n) are not permitted uses of

Section 108 loan guarantee proceeds.

While declining to identify any

particular type of proposed project as

superior, HUD is identifying several

criteria which must be addressed within

the project design, in order for the

application to receive the maximum

project impact.

Applications must include a well

developed description of

homeownership needs in the applicant

jurisdiction, focusing particularly on the

needs of low- and moderate-income

persons. The description also should

include, if applicable, any alternative

approaches which have been considered

in meeting homeownership needs.

Project feasibility must be addressed as

part of the application.

The application must demonstrate

that the proposed project would make

effective use of all available funds. This

would include any local, State or other

Federal funds which would be utilized

by the proposed project. If other such

funds are included as part of the

proposed project, the applicant must

demonstrate that such funds are

committed and truly available for the

project. Any efforts which would

affirmatively further fair housing, by

promoting homeownership among

minorities as well as homeownership

throughout the community, must be

outlined in the application.

The application must explain how the

project would benefit low- and

moderate-income homebuyers,

particularly focusing on first-time and

minority homebuyers. The application

also should address any

homeownership counseling services,

including counseling pertaining to

Federal, State, and local fair housing
65978 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

laws and requirements, which would be

provided to persons selected to

participate in the proposed project.

Finally, the application should describe

how the project would utilize public/

private partnerships to promote

homeownership, particularly in the

sense that private sector financing

would be accessible, as necessary, to

project participants to complement

available public sector funds, including

CDBG money.

The following factors and weights

will be used to evaluate proposed direct

homeownership assistance projects:

(i) The extent to which the

application demonstrates severity of

homeownership needs in the

community (up to 160 points of the total

Program Impact score).

(ii) The extent to which: the project

design is appropriate to meet

demonstrated homeownership needs;

the project would make effective us of

available funds; alternative approaches

to meeting the homeownership needs

have been considered; and the proposed

project would target first-time

homebuyers (up to 60 points of the total

Program Impact score).

(iii) The extent to which the project is

feasible and likely to be implemented in

accordance with a project schedule (up

to 40 points of the total Program Impact

score).

(iv) The extent to which the proposed

project would: complement other

Federal, State or local programs that

promote homeownership; and utilize

public/private partnerships in

attempting to promote homeownership,

particularly in regard to participation by

local financial institutions considering

the cost per unit (up to 80 points of the

total Program Impact score).

(v) The extent to which the proposed

project would provide homeownership

counseling to project participants (up to

20 points of the total Program Impact

score).

(vi) The extent to which the project

would affirmatively further fair housing

through proposed initiatives to reach

out to potential minority homeowners

and/or to promote homeownership

opportunities throughout the

community (up to 20 points of the total

Program Impact score).

(vii) The extent to which the project

supports the strategic plan of a

Champion Community (up to 20 points

of the total Program Impact score).

(2) Program Impact—Single

Purpose—Public Facilities Affecting

Public Health and Safety. In the case of

public facility projects, documentation

of the problem by outside, third-party

sources is of primary importance. In the

case of water and sewer projects,

documentation from public agencies is

particularly helpful, especially where

such agencies have pinpointed the exact

cause of the problem and have

recommended courses of action which

would eliminate the problem. Such

supporting documentation should be as

up-to-date as possible; the older the

supporting material, the more doubt

arises that the need is current and

immediate. Applicants also should be

sure to indicate how the project would

address public health and safety needs

and conditions. Quantification also is

essential in describing needs.

Documentation from those affected

should be included.

The following factors and weights

will be used to evaluate proposed public

facilities projects affecting the public

health and safety:

(a) Severity of Need (up to 160 points

of the total Program Impact score). The

applicant should describe, including

appropriate documentation, as best as

possible, the degree to which the need

is serious, current and requires prompt

attention.

(b) Extent to which the proposed

program will resolve the identified

problem and public health and safety

concerns (up to 40 points of the total

Program Impact score). The applicant

should demonstrate that the project will

completely solve the problem and, if

applicable, the applicant should address

whether the proposal would be

satisfactory to other State/local agencies

which have jurisdiction over the

problem.

(c) Feasibility (up to 40 points of the

total Program Impact score). The

applicant should address whether the

proposal is the most cost effective and

efficient among the possible alternatives

considered, and the funding requested

will be sufficient to resolve the problem.

Total project costs should be

documented by qualified third-party

estimates, and be as recent as possible.

(d) Extent of benefit to affected

persons and the cost per household (up

to 80 points of the total Program Impact

score).

(e) Leveraging other resources to

minimize project costs (up to 40 points

of the total Program Impact score). To

the extent that Small Cities grant funds

will not cover all costs, the source of

other funds should be identified and

committed. If local funds are to be used,

the applicant should show both the

willingness and the ability to provide

the funds.

(f) Extent to which the project

addresses deficiencies in accessibility

for disabled persons and/or provides a

significant increase in the number of

public facilities accessible to disabled

persons (up to 20 points of the total

Program Impact score).

(g) Extent to which the project

supports the strategic plan of a

Champion Community (up to 20 points

of the total Program Impact score).

(3) Program Impact—Single

Purpose—Economic Development

Projects. As discussed earlier in this

section of the NOFA, each individual

Single Purpose project will receive a

separate impact rating. Applicants

whose proposed economic development

program will include multiple proposals

should determine the most appropriate

form of submission. This determination

will require a choice as to either the

incorporation of all proposals into a

single project or the submission of

separate projects for each proposal (each

transaction will be considered a

separate project). The single project

format presents an ‘‘all or nothing’’

situation. In determining the

appropriate submission format,

applicants should consider the ability of

a transaction to rate well on its own,

based on the magnitude of employment

impact, size of the financial transaction

and the other factors discussed in this

section.

The submission of proposals as

separate projects must be clearly

designated by the applicant with

individual Needs Descriptions,

Community Development Activities,

Impact Descriptions and Program

Schedule forms, including an

appropriate name for each project on

HUD Form 4124.1.

Section 807(c)(3) of the Housing and

Community Development Act of 1992

(42 U.S.C. 5305 note) provides that it is

the sense of Congress that each grantee

should devote one percent of its grant

for the purpose of providing assistance

under section 105(a)(23) of the 1974

HCD Act to facilitate economic

development through commercial

microenterprises. A ‘‘microenterprise’’

is defined as a commercial enterprise

with five or fewer employees, one or

more of whom owns the enterprise.

While not a requirement, this intent

should be considered in developing an

economic development application.

It is noted that in accordance with

section 105 of the 1974 HCD Act, HUD

published on January 5, 1995 (60 FR

1922), a final rule relating to evaluation

and selection of Economic Development

activities by grantees, including

evaluation of public benefit (generally

codified at 24 CFR 570.209). Economic

Development applications must be

specific enough to permit a

determination that such threshold

public benefit standards are met.
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65979

(a) Scoring. The following factors and

weights will be used to evaluate

proposed economic development

projects:

(i) The extent to which the project

will have a direct and positive impact

on employment opportunities for

persons from low-and moderate-income

households (up to 160 points of the total

Program Impact score). Applicants are

reminded that for an activity to be

consistent with the statutory objective of

low-and moderate-income benefit, as a

result of the creation or retention of

jobs, at least 51 percent of created or

retained employment opportunities

must be held by, or made available to,

persons from low-and moderate-income

families. Applicants must fully

document and describe employment

benefits. In addition, applicants should

address the following issues:

a. All employment data must be

expressed in terms of full-time

equivalents (FTEs). Only permanent

jobs may be counted, and applicants

must take into account such factors as

seasonal and part-time employment. A

seasonal job may be considered

permanent if the season is long enough

to be considered the person’s principal

occupation; permanent part-time jobs

must be converted to the full-time

equivalent.

b. The amount of CDBG assistance

required to produce each full-time

equivalent job will affect the impact

assessment by HUD. Lower CDBG costs

per job are preferable to higher CDBG

costs per job. Such assessments of

impact will be done on a comparative

basis among all projects submitted,

rather than by comparison to a given

standard.

c. The use of CDBG funds to assist a

business with transferring to a different

community will generally be considered

as having no employment impact.

Exceptions to this rule may include an

expansion to the business as a result of,

or concurrent with, the transfer; or if the

business can demonstrate that it is

infeasible to continue operations at the

current site. An applicant that fails to

document a basis for such an exception

could receive a substantially lower score

under this ranking factor. Applicants are

encouraged to use CDBG funds for

projects that provide as many jobs as

possible for individuals that are

currently receiving public assistance.

Providing employment to recipients of

public assistance will help break the

cycle of dependency and empower lowincome citizens to take control of their

lives.

(ii) The extent to which market

analysis and other risk data provides

assurance that the proposed project will

be successful (up to 40 points of the

total Program Impact score).

(iii) The extent to which the proposed

project addresses all appropriate

feasibility issues (including extent of

firm private financing commitments)

and the extent to which there is

reasonable assurance that the project

will be completed in a timely manner

(up to 40 points of the total Program

Impact score). Projects that are likely to

encounter feasibility issues which

would hinder the timely completion of

the project will receive a lower score

under this criterion. Such issues

include, but are not limited to: site

control, zoning, public approvals and

permits, infrastructure, environment,

and relocation. Applicants should

address these and any other applicable

issues and provide documentation

where appropriate.

Applicants also must demonstrate the

reasonable likelihood of the project’s

success, from both a financial and

employment standpoint. An analysis or

market data, which indicates an

inordinate risk in the undertaking of the

project, will affect the overall rating of

program impact. In order to receive a

higher rating, the costs must be

reasonable (i.e., not inflated).

(iv) Extent to which the project

provides Public Benefits relative to

other proposals’ cost per job (up to 80

points of the total Program Impact

score).

(v) The extent to which Small Cities

grant funds will leverage the investment

of private and other dollars and the

extent to which Small Cities grant funds

are NOT used to substitute for private

financing (up to 60 points of the total

Program Impact score). Leverage is

defined as the amount of private debt

and equity to be invested as a direct

result of the CDBG-funded activity.

Projects which provide the maximum

feasible level of private investment will

be considered as having appropriate

leverage. The extent of firm

commitments for private financing will

be reviewed as well as the amount of

equity investment. The project will be

reviewed to determine whether CDBG

funds are replacing private sources of

funds. In order to receive maximum

impact CDBG funds may not replace

private financing, CDBG assistance must

be limited to the amount necessary to

fund the project without replacing

CDBG funds for private funds, and

equity funds should bear the greatest

risk in the project.

(vi) The extent to which the project

supports the strategic plan of a

Champion Community (up to 20 points

of the total Program Impact score).

In addition to the standard

submission requirements, HUD will

evaluate the following as part of its

Eligibility Review prior to considering

an application for funding in the FY

1997/1998 competition.

(b) The Appropriate Determination.

HUD has developed guidelines for

review of economic development

activities undertaken with CDBG funds.

These guidelines are composed of two

components: guidelines for evaluating

project costs and financial requirements;

and standards for evaluating public

benefit. The standards for evaluating

public benefit are mandatory, but the

guidelines for evaluating project costs

and financial requirements are not. The

guidelines for evaluating project costs

are to ensure:

(i) Reasonableness of Proposed Costs.

The applicant must review each project

cost element and determine that the cost

is reasonable and consistent with thirdparty, fair-market prices for that cost

element. The general principle is that

the level of CDBG assistance cannot be

adequately determined if the project

costs are understated or inflated.

(ii) Commitment of Other Sources of

Funds. The applicant shall review all

projected sources of funds necessary to

complete the project and shall verify

that all sources (in particular private

debt and equity financing) have been

firmly committed to the extent

practicable, and are available to be

invested in the project. Verification

means ascertaining that: the source of

funds is committed; that the terms and

conditions of the committed funds are

known; and the source has the capacity

to deliver.

(iii) No Substitution of CDBG Funds

(including Section 108 Loan Guarantee

proceeds) for Private Sources of Funds.

The applicant shall financially

underwrite the project and ensure to the

extent possible that CDBG funds are not

being substituted for available private

debt financing or equity capital. The

analysis must be tailored to the type of

project being assisted (e.g., real estate,

user project, capital equipment, working

capital, etc.). Real estate projects require

different financial analysis than working

capital or machinery and equipment

projects. Applicants should ensure that

both a significant equity commitment by

the for-profit business exists and that

the level of certainty of the end use of

the property or project is sufficient to

ensure the achievement of national

objectives within a reasonable period of

time.

(iv) Establishment of Small Cities

Grant Financing Terms. The amount of

Small Cities grant assistance provided to

a for-profit business ideally should be
65980 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

limited to the amount, with appropriate

repayment terms, sufficient to go

forward without substituting Small

Cities grant funds for available private

debt or cash equity. The applicant

should structure its repayment terms so

that the business is allowed a reasonable

rate of return on invested equity,

considering the level of risk of the

project. Equity funds generally should

bear the greatest risk of all funds

invested in a project.

(v) Public Benefit Determination. The

applicant’s activities must meet the

public benefit standards found in 24

CFR 570.209(b). Activities covered by

these guidelines (subject to certain

exceptions) must, in the aggregate,

either:

• Create or retain at least one fulltime equivalent, permanent job per

$35,000 of CDBG funds used; or

• Provide goods or services to

residents of an area, such as the number

of low- and moderate-income persons

residing in the areas served by the

assisted businesses amounts to at least

one low- and moderate-income person

per $350 of CDBG funds used.

(c) CDBG Assistance Must Minimize

Business and Job Displacement. Each

applicant will evaluate the potential of

each economic development project for

causing displacement of existing

businesses and lost jobs in the

neighborhood where the project is

proposed to be located. When the

grantee concludes that the potential

exists to cause displacement, given the

size, scope or nature of the business,

then the grantee must, to the extent

practicable, take steps to minimize such

displacement. The project file must

document the grantee’s review

conclusions and, if applicable, the steps

the grantee will take to minimize

displacement.

(d) Section 105(a)(17) Requirements.

Section 105(a)(17) of the 1974 HCD Act

requires that an activity assisted under

that section achieve one of the following

criteria:

(i) Creates or retains jobs for low- and

moderate-income persons (note that a

project which meets the national

objective of principally benefitting lowand moderate-income persons by

creating or retaining jobs, 51 percent of

which are for low- and moderateincome persons, will be deemed to have

met this criterion without any

additional documentation);

(ii) Prevents or eliminates slums or

blight (note that a project which meets

the national objective of aiding in the

prevention or elimination of slums or

blight on an area basis will be deemed

to have met this criterion without any

additional documentation);

(iii) Meets an urgent need (note that

a project which meets the national

objective of meeting community

development needs having a particular

urgency will be deemed to have met this

criterion without any additional

documentation);

(iv) Creates or retains businesses

owned by community residents;

(v) Assists businesses that provide

goods or services needed by and

affordable to low- and moderate-income

residents;

(vi) Provides technical assistance to

promote any of the activities under (i)

through (v) of this subsection.

(e) National Objectives. As previously

stated in this NOFA, all CDBG-assisted

activities must address one of the three

broad national objectives. Since

economic development projects usually

result in new employment or the

retention of existing jobs, these

activities most likely would be

categorized as principally benefitting

low- and moderate-income persons in

this manner. Such projects will be

considered to benefit low- and

moderate-income persons where the

criteria of 24 CFR 570.208(a)(4) are met.

HUD will consider an activity to qualify

under this provision where the activity

involves jobs at least 51 percent of

which are taken by or made available to

such persons, or retained by such

persons. The extent to which the

proposed project will directly address

employment opportunities for low- and

moderate-income persons in the

applicant jurisdiction will be a primary

factor in HUD’s assessment of the

proposed program.

The application must contain

adequate documentation to explain

fully, and to support, the process that

will be used to ensure that project(s)

comply with the low- and moderateincome employment requirements. The

documentation must be sufficient to

show that the process has been

developed and that program

participants have agreed to adhere to

that process. In determining whether the

person is a low- and moderate-income

person for these activities, it is the

person’s family income at the time the

CDBG assistance is provided that is

determinative. When making judgments

concerning whether an individual

qualifies as a low- and moderate-income

person, both family size and the income

of the entire family must be considered.

This consideration is necessary because

a ‘‘low- and moderate-income person’’ is

defined as a member of a low- and

moderate-income family.

HUD will accept a written

certification by a person of his or her

family income and size to establish lowand moderate-income status. The

certification may simply state that the

person’s family income is below that

required to be low- and moderateincome in that area. The form for such

certification must include a statement

that the information is subject to

verification.

In addition to person-by-person

income certifications discussed above,

under section 105(c)(4) of the 1974 HCD

Act, an employee may be presumed to

be a low- and moderate-income person

if the employee resides in a census tract

where not less than 70 percent of the

residents are low- and moderate-income

persons, and a presumption of low- and

moderate-income may also be made if

the business is located in and/or the

employee resides in a census tract (or

block numbering group) where 20

percent of the residents are in poverty.

The key consideration in this

presumption is the location of the

business or employee. The

documentation to support the

presumption must contain the location.

(See 24 CFR 570.209(b)(2)(v) for more

information on this subject.)

In cases where an activity (e.g., a

shopping center or a super market)

provides goods and services to residents

of an area, the low- and moderateincome objective may be met by the area

benefit requirements at 24 CFR

570.208(a)(1). To document low and

moderate income, 51 percent of the

residents of the area or block numbering

group must be low- and moderateincome persons.

(f) Application Requirements. To the

extent feasible, the material listed below

should be submitted for economic

development projects. The material

should be submitted for each proposed

activity, whether the proposed activity

is presented as a separate project or as

part of a project involving multiple

activities. Since economic development

projects are rated against each other, the

more completely these submission

requirements are met, the greater the

potential exists for enhancing the

impact score of the project.

(i) A letter from each appropriate

developmental entity which includes at

least the following information:

a. A detailed physical description of

the project with a schedule of events

and maps or drawings as appropriate.

b. The estimated costs for the project,

including any working capital

requirements.

c. A discussion of all financing

sources, including the need for CDBG,

the terms of the CDBG assistance, and

the proposed lien structure. The

amount, source, and nature of any

equity investment(s) must also be
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65981

provided as well as a commitment to

invest the equity.

d. A discussion of employment

impact which includes a schedule of

newly created positions. The schedule

should identify the number, salary and

skill level of each permanent position to

be created. If jobs are made available to

low- and moderate-income persons, the

applicant must also demonstrate and

document how persons from low- and

moderate-income households will be

accorded first consideration for

employment opportunities.

e. A discussion of all appropriate

feasibility issues including, but not

limited to: site control, zoning, public

approvals and permits, impact fees,

corporate authorizations, infrastructure,

environment and relocation.

f. An analysis and summary of market

and other data which supports the

anticipated success of the project.

(ii) A development budget showing all

costs for the project, including

professional fees and working capital.

(iii) Documentation to support project

costs. Documentation generally should

be from a third-party source and be

consistent with the following

guidelines:

a. Acquisition costs should be

supported by an appraisal.

b. Construction/renovation costs

should be certified by an architect,

engineer or contractor. Use of Federal

Prevailing Wage Rates should be cited

where applicable.

c. Machinery and equipment costs

should be supported by vendor quotes.

d. Soft costs (e.g., legal, accounting,

title insurance) need be substantiated

only where such costs are anticipated to

be abnormally high.

(iv) Letters from all financing sources

discussing (at a minimum) the amount

and terms of the proposed financing,

and the current status of the application

for funding.

(v) Historical financial data of the

development entity, preferably for the

last 3 years. This information may be

submitted under separate cover with

confidentiality requested. It is

recognized that historical financial data

may be unavailable or inappropriate for

some projects (e.g., start-up companies

and real estate transactions).

(vi) A 2- to 5-year cash flow pro forma

with accompanying notes citing basic

assumptions.

(vii) The applicant’s assessment of the

project’s consistency with the CDBG

program eligibility requirements and

standards for evaluating project cost,

financial requirements and public

benefit.

d. Fair Housing and Equal

Opportunity Evaluation. Documentation

for the 50 points for these items is the

responsibility of the applicant. Claims

of outstanding performance must be

based upon actual accomplishments.

Clear, precise documentation will be

required. Maps must have a census tract

or block numbering area (BNA), and

they must be in accordance with the

1990 Census data. Additionally, maps

must identify the locations of areas with

minorities by census tract or BNA. If

there are no minority areas, state so on

the map. Only population data from the

1990 Census will be acceptable for

purposes of this section.

Please note that a ‘‘minority’’ is a

person belonging to, or culturally

identified as, a member of any one of

the following racial/ethnic categories:

Black, Hispanic, Asian or Pacific

Islander, and American Indian or

Alaskan Native. For the purposes of this

section, the separate category of

‘‘women’’ is not considered a minority.

Counties claiming points under this

criterion must use county-wide statistics

(excluding entitlement communities). In

the case of joint applications, points

will be awarded based on the

performance of the lead entity only.

The following factors will be used to

judge outstanding performance in these

areas. Please note that points for

outstanding performance may be

claimed under each criterion:

(1) Housing Achievements (40 points

total).

(a) Provision of Fair Housing Choice

(20 points)

(i) HUD will consider the extent to

which the applicant demonstrates that it

has provided housing assistance for low

and moderate income families that

results in housing choice in areas

outside of minority or low- and

moderate income concentration. Such

actions may include the construction or

rehabilitation of housing in areas

outside of minority or low and moderate

income concentration; the provision of

Section 8 Existing Certificate or Voucher

assistance in ways that lessen

concentration of such assisted units

within minority and low- and moderate

income concentrated areas; or the

provision of direct homeownership

assistance such as homeownership

counseling, downpayment assistance, or

first-time homebuyer assistance. If

applicable, the applicant may use a map

to show the general location(s) of

individual projects and/or housing

occupied by Section 8 Existing Program

participants.

(ii) Points also may be awarded for

efforts which enable low- and moderateincome persons to remain in their

neighborhood when such

neighborhoods are experiencing

revitalization and substantial

displacement as a result of private

reinvestment. Applicants requesting

points under this criterion would not

need to meet the requirements of

paragraphs (a) and (b) in order to receive

points. Points will be awarded where

more than one-half of the families

displaced were able to remain in their

original neighborhood through the

assistance of the applicant. Applicants

must show that:

• The neighborhood experienced

revitalization;

• The amount of displacement was

substantial;

• Displacement was caused by private

reinvestment;

• Low- and moderate-income persons

were permitted to remain in the

neighborhood as a result of action taken

by the applicant.

If the community is inhabited

predominantly by persons who are

members of minority and/or low-income

groups, points will be awarded where

there is a balanced distribution of

assisted housing throughout the

community.

(b) Implementation of a Fair Housing

Strategy that Affirmatively Furthers Fair

Housing (20 points). The applicant must

demonstrate that it is implementing or

plans to implement a Fair Housing

Strategy on its own or demonstrate that

it does or plans to participate in a

county/State or regional analysis of

impediments to fair housing choice. A

fair housing strategy must include the

following elements:

• Local compliance activities;

• Educational programs to enhance

the clarity and understanding of the

community’s fair housing policy. For

communities with few or no minorities,

this should include publication in the

surrounding communities of the

applicant’s policy of fair housing for

minorities and persons with disabilities;

• Assistance to minority families; and

• Special programs (e.g., utilization of

Community Housing Resource Board

(CHRB) Programs, efforts to encourage

local realtors to enter into voluntary

agreements to encourage equal access to

financial institutions, etc.).

• Assistance to minority families

through mobility counseling programs

and other activities that encourage such

families to pursue such housing

opportunities outside of minority

concentrated areas;

• Special programs targeted at

lenders, builders, realtors, and other

housing industry groups;

• Affirmative marketing strategies

targeted at those groups in the eligible

population considered least likely to

apply without special outreach.
65982 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

The fair housing strategy must

include goals for each of the above

elements. The date of adoption or

development of the strategy should be

indicated, as well as the date proposed

activities will be or have been

implemented.

(2) Entrepreneurial Efforts and Local

Equal Opportunity Performance. HUD

encourages the use of minority

contracting, although it will not be used

as an evaluation factor in this NOFA.

(3) Equal Opportunity Employment.

(10 points) Under this factor, the

applicant must document that its

percentage of minority, permanent fulltime employees is greater than the

percentage of minorities within the

county or the community, whichever is

higher. Applicants with no full-time

employees may claim points based on

part-time employment provided that

they document that the only permanent

employment is on a part-time basis.

e. Welfare to Work Initiative. (5

points) Five bonus points will be added

to proposals which support the Welfare

to Work Initiative. These points will be

added to those proposals that include

activities which will provide assistance

to persons moving from welfare to work.

Examples of such activities are: jobs,

day care slots, training or transportation

assistance.

4. Final Selection. The total points

received by a project for all of the

selection factors are added, and the

project is ranked against all other

projects from all applications, regardless

of the program areas in which the

projects were rated. The highest ranked

projects will be funded to the extent

funds are available. If an applicant

submits two applications under this

NOFA, it may receive up to two single

grants in the amounts of the project or

projects applied for in those

applications which were ranked high

enough to be funded. In the case of ties

at the funding line, HUD will use the

following criteria in order to break ties:

• The project receiving the highest

program impact rating will be funded;

• If tied projects have the same

program impact rating, the project

having the highest combined score on

the needs factors will be funded;

• If tied projects have the same

program impact ratings and equal needs

factor scores, the project having the

highest score on the percent of persons

in poverty needs factor will be funded;

and

• If tied projects have the same

program impact ratings, equal needs

factor scores, and an equal percent of

persons in poverty needs factor score,

the application having the most

outstanding performance in fair housing

and equal opportunity will be funded.

As soon as possible after the rating

and ranking process has been

completed, HUD will notify all

applicants regarding their rating scores

and funding status. Thereafter,

applicants may contact HUD to discuss

scores or any aspects of the selection

process.

II. Application and Funding Award

Process

A. Obtaining Applications

All nonentitled communities in New

York State may obtain application kits

through HUD’s New York or Buffalo

Offices. The addresses for HUD’s

Buffalo and New York offices are:

Department of Housing and Urban

Development, Office of Community

Planning and Development,

Attention: Small Cities Coordinator,

26 Federal Plaza, New York, NY

10278–0068, Telephone (212) 264–

2885

Department of Housing and Urban

Development, Community Planning

and Development Division, Attention:

Small Cities Coordinator, 465 Main

Street, Lafayette Court, Buffalo, NY

14203, Telephone (716) 551–5768

B. Submitting Applications

A final application must be submitted

to HUD no later than March 2, 1998. A

final application includes an original

and two photocopies. Final applications

may be mailed, and if they are received

after the deadline, must be postmarked

no later than midnight, March 2, 1998.

If an application is hand-delivered to

the New York or Buffalo Offices, the

application must be delivered by 4:00

p.m. on the application deadline date.

Applicants in the counties of Sullivan,

Ulster, Putnam, and in nonparticipating

jurisdictions in the urban counties of

Dutchess, Orange, Rockland,

Westchester, Nassau, and Suffolk

should submit applications to the New

York Office. All other nonentitled

communities in New York State should

submit their applications to the Buffalo

Office. Applications must be submitted

to the HUD office at the addresses listed

above in section II.A.

The above-stated application deadline

is firm as to date and hour. In the

interest of fairness to all competing

applicants, HUD will treat as ineligible

for consideration any application that is

not received on, or postmarked by

March 2, 1998. Applicants should take

this practice into account and make

early submission of their materials to

avoid any risk of loss of eligibility

brought about by unanticipated delays

or other delivery-related problems.

C. The Application

1. Application Requirements

An application for the Small Cities

Program CDBG Grants is made by the

submission of:

(a) A completed HUD Form 4124,

including HUD Forms 4124.1 through

4124.6 and all appropriate supporting

material;

(b) A completed Standard Form 424;

(c) A signed copy of certifications

required under the CDBG Program,

including, but not limited to the DrugFree Workplace Certification, and the

Certification Regarding Lobbying

pursuant to section 319 of the

Department of Interior Appropriations

Act for Fiscal Year 1990 (31 U.S.C.

1352), generally prohibiting use of

appropriated funds, and, if applicable,

Disclosure of Lobbying Activities (SF–

LLL);

(d) Form HUD–2880, Applicant/

Recipient Disclosure/Update Report, as

required under subpart A of 24 CFR part

4 (Accountability in the Provision of

HUD Assistance); and, if applicable,

(e) Abbreviated Consolidated Plan.

(f) A Section 108 Loan Guarantee

application or request, if applicable,

consisting of one of the following:

(1) A formal application for Section

108 Loan Guarantee(s), including the

documents listed at § 570.704(b);

(2) A brief description of a Section

108 Loan Guarantee application(s) to be

submitted within 60 days (with HUD

reserving the right to extend such period

for good cause on a case-by-case basis)

of a notice of CDBG Small Cities grant

award. (The CDBG grant award will be

conditioned on approval of actual

Section 108 Loan Guarantee

commitments within a stated period of

time.) This description must be

sufficient to support the basic eligibility

of the proposed project or activities for

Section 108 assistance; or

(3) If applicable, a copy of a Section

108 Loan Guarantee approval document

with grant number and date of approval.

2. Streamlined Application

Requirements for Certain Applicants

Single Purpose applications

submitted under the FY 1996 NOFA but

not selected for funding will be

reactivated for consideration under this

NOFA, if the applicant notifies HUD in

writing by March 2, 1998 that the

applicant wishes the prior application

to be considered in this competition.

Applications which are reactivated may

be updated, amended or supplemented

by the applicant provided that such
Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices 65983

amendment or supplementation is

received no later than the due date for

applications under this NOFA. If there

is no significant change in the

application involving new activities or

alteration of proposed activities that

will significantly change the scope,

location or objectives of the proposed

activities or beneficiaries, there will be

no further citizen participation

requirement to keep the application

active for a succeeding round or

competition.

D. Funding Award Process. In

accordance with section 102 of the HUD

Reform Act and HUD’s regulation in 24

CFR part 4, HUD will notify the public

by notice published in the Federal

Register of all award decisions made by

HUD under this competition. In

accordance with the requirements of

section 102 of the Reform Act and

HUD’s regulations at 24 CFR part 4,

HUD also will ensure that

documentation and other information

regarding each application submitted

under this NOFA is sufficient to

indicate the basis upon which

assistance was provided or denied.

Additionally, in accordance with

§ 4.5(b) of these regulations, HUD will

make this material available for public

inspection for a period of 5 years,

beginning not less than 30 calendar days

after the date on which assistance is

provided.

III. Technical Assistance

Prior to the application deadline, the

Buffalo and New York offices will

provide technical assistance on request

to individual applicants, including

explaining and responding to questions

regarding program regulations, and

defining terms in the application

package. In addition, HUD will conduct

informational meetings around the State

to discuss the Small Cities Program, and

will conduct application workshops in

conjunction with these meetings. Please

contact the New York or Buffalo Office

for further information regarding these

meetings. Application kits will be

available at these meetings, as well as

from the New York or Buffalo Offices.

In order to ensure that the application

deadline is met, it is strongly suggested

that applicants begin preparing their

applications immediately and not wait

for the informational meetings.

IV. Checklist of Application Submission

Requirements

The following checklist is intended to

aid applicants in determining whether

their application is complete:

Application Completeness Checklist

Applicant: lllllllllllllll

Amount Requested $ lllllllllll

1. Is amount of funds requested within

established maximum?

2. Part I—Needs Description (HUD Form

4124.1).

a. Program Area

lll Housing

lll Target Area

lll Nontarget Area

lll Public Facilities

lll Economic Development (If an

‘‘appropriate’’ analysis is required but is

not included, the application cannot be

rated.)

b. Is description of community development

needs included in application?

3. Part II—Community Development

Activities (HUD Form 4124.2).

a. Has national objective been identified for

each activity? b. Will 70 percent of grant

funds primarily benefit low-and moderateincome persons? (If not, the application

cannot be rated.)

4. Part III—Impact Description (HUD Form

4124.3).

5. Part IV—Outstanding Performance (HUD

Form 4124.4).

6. Part V—Program Schedule (HUD Form

4124.5).

7. Part VI—Maps.

a. Location of proposed activities.

(Applicants must show the boundaries of the

defined area or areas.)

b. Location of areas with minorities by

census tract. (If there are no minority areas,

state so on the map.)

c. Housing conditions if project involves

housing rehabilitation. (Number and location

of each standard and substandard unit

should be clearly identified.)

8. a. Is Standard Form 424 complete?

Yes No

b. Is original signature on at least one

copy?

Yes No

9. Is Certification signed with original

signature?

Yes No

10. Has the abbreviated consolidated plan

been prepared and submitted to HUD (or

included with this application)?

11. Form HUD–2880, Application/

Recipient Disclosure/Update Report.

12. Do proposed economic development

activities meet the public benefit standards as

defined in 24 CFR 570.209?

V. Corrections to Deficient Applications

Under no circumstances will HUD

accept from the applicant unsolicited

information regarding the application

after the application deadline has

passed.

HUD may advise applicants of

technical deficiencies in applications

and permit them to be corrected. A

technical deficiency would be an error

or oversight which, if corrected, would

not alter, in either a positive or negative

fashion, the review and rating of the

application. Examples of curable

technical deficiencies would be a failure

to submit the proper certifications or

failure to submit an application

containing an original signature by an

authorized official. Situations not

considered curable would be, for

example, a failure to submit program

impact descriptions.

HUD will notify applicants in writing

of any curable technical deficiencies in

applications. Applicants will have 14

calendar days from the date of HUD’s

correspondence to reply and correct the

deficiency. If the deficiency is not

corrected within this time period, HUD

will reject the application as

incomplete.

Applicants should note that if an

abbreviated consolidated plan is not

submitted, the failure to submit it in a

timely manner is not considered a

curable deficiency.

VI. Findings and Certifications

Paperwork Reduction Act Statement

The information collection

requirements related to this CDBG

program have been approved by the

Office of Management and Budget

(OMB) in accordance with the

Paperwork Reduction Act of 1995 (44

U.S.C. 3501–3520), and have been

assigned OMB approval number 2506–

0020. An agency may not conduct or

sponsor, and a person is not required to

respond to, a collection of information

unless the collection displays a valid

control number.

Environmental Impact

This NOFA provides funding under,

and does not alter environmental

requirements of, a regulation previously

published in the Federal Register.

Accordingly, under 24 CFR 50.19(c)(5),

this NOFA is categorically excluded

from environmental review under the

National Environmental Policy Act. The

environmental review provisions of this

regulation are in 24 CFR 570.604.

Federalism

The General Counsel, as the

Designated Official under section 6(a) of

Executive Order 12612, Federalism, has

determined that this NOFA will not

have substantial, direct effects on States,

on their political subdivisions, or on

their relationship with the Federal

Government, or on the distribution of

power and responsibilities between

them and other levels of government.

While the NOFA will provide financial

assistance to the Small Cities Program of

New York State, none of its provisions

will have an effect on the relationship

between the Federal Government and

New York State, or the State’s political

subdivisions.
65984 Federal Register / Vol. 62, No. 241 / Tuesday, December 16, 1997 / Notices

Accountability in the Provision of HUD

Assistance

See Section I.A.4. of this NOFA.

Prohibition Against Lobbying Activities

Applicants for funding under this

NOFA are subject to the provisions of

section 319 of the Department of Interior

and Related Agencies Appropriation Act

for Fiscal Year 1991 (31 U.S.C. 1352)

(the Byrd Amendment) and to the

provisions of the Lobbying Disclosure

Act of 1995 (Pub. L. 104–65; December

19, 1995).

The Byrd Amendment, which is

implemented in regulations at 24 CFR

part 87, prohibits applicants for Federal

contracts and grants from using

appropriated funds to attempt to

influence Federal executive or

legislative officers or employees in

connection with obtaining such

assistance, or with its extension,

continuation, renewal, amendment or

modification. The Byrd Amendment

applies to the funds that are the subject

of this NOFA. Therefore, applicants

must file a certification stating that they

have not made and will not make any

prohibited payments and, if any

payments or agreement to make

payments of nonappropriated funds for

these purposes have been made, a form

SF–LLL disclosing such payments must

be submitted. The certification and the

SF–LLL are included in the application

package.

The Lobbying Disclosure Act of 1995,

which repealed section 112 of the HUD

Reform Act and resulted in the

elimination of the regulations at 24 CFR

part 86, requires all persons and entities

who lobby covered executive or

legislative branch officials to register

with the Secretary of the Senate and the

Clerk of the House of Representatives

and file reports concerning their

lobbying activities.

Prohibition Against Advance

Information on Funding Decisions

HUD’s regulations implementing

section 103 of the Department of

Housing and Urban Development

Reform Act of 1989 (42 U.S.C. 3537a),

codified in 24 CFR part 4, apply to this

funding competition. The regulations

continue to apply until the

announcement of the selection of

successful applicants. HUD employees

involved in the review of applications

and in the making of funding decisions

are limited by the regulations from

providing advance information to any

person (other than an authorized

employee of HUD) concerning funding

decisions, or from otherwise giving any

applicant an unfair competitive

advantage. Persons who apply for

assistance in this competition should

confine their inquiries to the subject

areas permitted under 24 CFR part 4.

Applicants or employees who have

ethics related questions, such as

whether particular subject matter can be

discussed with persons outside HUD,

should contact the HUD Office of Ethics

(202) 708–3815. (This is not a toll-free

number.)

Catalog of Federal Domestic Assistance

The Catalog of Federal Domestic

Assistance Number for this program is

14.219.

Date: December 11, 1997.

Fred Karnas, Jr.,

Deputy Assistant Secretary for Economic

Development.

[FR Doc. 97–32851 Filed 12–12–97; 9:27 am]

BILLING CODE 4210–29–P