[Federal Register Volume 62, Number 28 (Tuesday, February 11, 1997)]
[Rules and Regulations]
[Pages 6121-6126]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-3283]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 17

RIN 2900-AH89


VA Homeless Providers Grant and Per Diem Program Clarification of 
Per Diem Eligibility

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends the regulations implementing the VA 
Homeless Providers Grant and Per Diem Program concerning per diem 
assistance by: Establishing more detailed criteria for determining 
which entities are eligible for obtaining per diem assistance; 
establishing a priority for funding eligible entities: Clarifying the 
requirements for continued receipt of per diem payments; and clarifying 
the maximum amount payable for per diem assistance. This rule is 
designed to ensure that the appropriate entities receive the 
appropriate amount of per diem assistance under fair and objective 
procedures.

EFFECTIVE DATES: March 13, 1997.

FOR FURTHER INFORMATION CONTACT: Roger Casey, VA Homeless Providers 
Grant and Per Diem Program, Mental Health Strategic Health Group 
(116E), Department of Veterans Affairs, 810 Vermont Avenue, NW, 
Washington, DC 20420; (202) 273-8442. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: In the Federal Register of July 16, 1996 (61 
FR 37024), VA published a proposal to amend the regulations 
implementing the VA Homeless Providers Grant and Per Diem Program. 
Interested persons were invited to submit written comments on or before 
September 16, 1996. No comments were received. The information 
presented in the proposed rule document still provides a basis for this 
final rule. Therefore, based on the rationale set forth in the proposed 
rule document, we are adopting the provisions of the proposed rule as a 
final rule with changes discussed below and with nonsubstantive 
changes.

Paperwork Reduction Act

    Information collection and recordkeeping requirements associated 
with this final rule concerning VA Homeless Providers Grants (38 CFR 
17.710-17.714) have been approved by OMB under the provisions of the 
Paperwork Reduction Act (44 U.S.C. 3501-3520) and have been assigned 
OMB Control Number 2900-0554. The regulations require that the 
application for VA Homeless Providers Grants be submitted on VA forms 
included in the application package. The corresponding form numbers are 
included in the text of the rule.
    Information collection and recordkeeping requirements associated 
with this final rule concerning the VA Homeless Providers Per Diem have 
not been approved by OMB under the provisions of the Paperwork 
Reduction Act. OMB has withheld approval pending review of any comments 
received. VA intends to obtain OMB control numbers for the information 
collection requirements concerning VA Homeless Providers Per Diem. Once 
OMB approval is received, OMB control numbers will be announced by a 
separate Federal Register document.
    VA is not authorized to impose a penalty on persons for failure to 
comply with information collection requirements which do not display a 
current OMB control number, if required.

Regulatory Flexibility Act

    The Secretary hereby certifies that the provisions of the final 
rule will not have a significant economic impact on a substantial 
number of small entities as they are defined in the Regulatory 
Flexibility Act (RFA), 5 U.S.C. 601-602. In all likelihood, only 
similar entities that are small entities will participate in the 
Homeless Providers Grant and Per Diem Program, therefore, pursuant to 5 
U.S.C. 605(b), this final rule is exempt from the initial and final 
regulatory flexibility analysis requirement of sections 603 and 604.

    The Catalog of Federal Domestic Assistance program number is 
64.024.

List of Subjects in 38 CFR Part 17

    Administrative practice and procedure, Alcohol abuse, Alcoholism, 
Claims, Day care, Dental health, Drug abuse, Foreign relations, 
Government contracts, Grant programs-health, Grant programs-veterans, 
Health care, Health facilities, Health professions, Health records, 
Homeless, Medical and dental schools, Medical devices, Medical 
research, Mental health programs, Nursing homes, Philippines, Reporting 
and record-keeping requirements, Scholarships and fellowships, Travel 
and transportation expenses, Veterans.

    Approved: January 31, 1997.
Jesse Brown,
Secretary of Veterans Affairs.

    For the reasons set forth in the preamble, 38 CFR part 17 is 
amended as set forth below:

PART 17--MEDICAL

    1. The authority citation for part 17 continues to read as follows:

    Authority: 38 U.S.C. 501, 1721, unless otherwise noted.


Sec. 17.700  [Amended]

    2. In Sec. 17.700, paragraph (a) is amended by removing 
``17.715(a)'' and adding, in its place, ``17.716''.
    3. Sections 17.710 through 17.719 are revised to read as follows:


Sec. 17.710  Application requirements.

    (a) General. Applications for grants must be submitted in the form 
prescribed by VA in the application package, must meet the requirements 
of this part, and must be submitted within the time period established 
by VA in the notice of fund availability under

[[Page 6122]]

Sec. 17.708 of this part. The application packet includes exhibits to 
be prepared and submitted as part of the application process, 
including:
    (1) Justification for the project by addressing items listed in 
Sec. 17.711(c) of this part;
    (2) Site description, design, and cost estimates (VA Forms 10-
0362G, 10-0362H);
    (3) Documentation on eligibility to receive assistance under this 
part (VA Form 10-0362J);
    (4) Documentation on matching funds committed to the projects (VA 
Forms 10-0362N, 10-0362M);
    (5) Documentation on operating budget and cost sharing (VA Form 10-
0362P);
    (6) Documentation on supportive services committed to the project 
(VA Form 10-0362o);
    (7) Documentation on site control and appropriate zoning, and on 
the boundaries of the area or community proposed to be served (VA Form 
10-0362Q);
    (8) Applicants who are States must submit any comments or 
recommendations by appropriate State (and areawide) clearinghouses 
pursuant to E.O. 12372 (3 CFR, 1982 Comp., p. 197) (Standard Form SF 
424); and
    (9) Reasonable assurances with respect to receipt of assistance 
under this part that (VA Form 10-0362K):
    (i) The project will be used principally to furnish to veterans the 
level of care for which such application is made; that not more than 25 
percent of participants at any one time will be nonveterans; and that 
such services will meet standards prescribed by VA;
    (ii) Title to such site or van will vest solely in the applicant;
    (iii) Each recipient will keep those records and submit those 
reports as VA may reasonably require, within the time frames required; 
and give VA, upon demand, access to the records upon which such 
information is based; and
    (iv) Adequate financial support will be available for the purchase 
of the van or completion of the project, and for its maintenance, 
repair and operation.
    (b) Pre-award expenditures. Costs incurred for a project after the 
date VA notifies an applicant that the project is feasible for VA 
participation are allowable costs if the application is approved and 
the grant is awarded. These pre-award expenditures include 
architectural and engineering fees. Such notification occurs when VA 
requests information for the second submission portion of the 
application.

(Paperwork requirements were approved by the Office of Management 
and Budget under control number 2900-0554.)

(Authority: 38 U.S.C. 501, 7721, note)

Sec. 17.711  Rating criteria for applications.

    (a) General. Applications will be assigned a rating score and 
placed in ranked order, based upon the criteria listed in paragraphs 
(b) through (d) of this section.
    (b) Threshold review. Applicants will undergo a threshold review 
prior to rating and ranking, to ensure they meet the following:
    (1) Forms, time, and adequacy. Applications must be filed in the 
form prescribed by VA in the application process and within the time 
established in the Notice of Funding Availability (NOFA).
    (2) Application eligibility. The applicant and project sponsor, if 
relevant, must be eligible to apply for the specific program.
    (3) Eligible population to be served. The population proposed to be 
served must be homeless veterans and meet other eligibility 
requirements of the specific program.
    (4) Eligible activities. The activities for which assistance is 
requested must be eligible for funding under this part (e.g., new 
programs or new components of existing programs).
    (5) Outstanding audit findings. No organization that receives 
assistance may have an outstanding obligation to VA that is in arrears 
or for which a payment schedule has not been agreed to, or whose 
response to an audit is overdue or unsatisfactory.
    (c) Rating and ranking of first submission. Applicants that pass 
the threshold review will then be rated using the eight selection 
criteria listed in paragraphs (c)(1) through (c)(8) of this section. 
Applicants must receive at least 600 points (out of a possible 1,200) 
and must receive points under criteria 1, 2, 3, 4, and 8. Applicants 
that are applying as an innovative supportive housing project must 
achieve points under the innovative quality of the proposal criterion.
    (1) Quality of the project--300 points (VA Forms 10-0362A, 10-
0362D);.
    (2) Targeting to persons on streets and in shelters--150 points (VA 
Form 10-0362C);
    (3) Ability of the applicants to develop and operate a project--200 
points (VA Form 10-0362E);
    (4) Need for the type of project proposed in the area to be 
served--150 points (VA Form 10-0362B);
    (5) Innovative quality of the proposal--50 points (VA Forms 10-
0362A, 10-0362D);
    (6) Leveraging--50 points (VA Form 10-0362F);
    (7) Cost-effectiveness--100 points (VA Form 10-0362A); and
    (8) Coordination with other programs--200 points (VA Form 10-0362D-
1).
    (d) Selection criteria--(1) Quality of the project. VA will award 
up to 300 points based on the extent to which the application presents 
a clear, well-conceived and thorough plan for assisting homeless 
veterans to achieve residential stability, increased skills and/or 
income, and more influence over decisions that affect their lives. 
Higher ratings will be assigned to those applications that clearly 
describe:
    (i) How program participants will achieve residential stability, 
including how available supportive services will help participants 
reach this goal;
    (ii) How program participants will increase their skill level and/
or income, including how available supportive services will help 
participants reach this goal;
    (iii) How program participants will be involved in making project 
decisions that affect their lives, including how they will be involved 
in selecting supportive services, establishing individuals goals and 
developing plans to achieve these goals so that they achieve greater 
self-determination;
    (iv) How permanent affordable housing will be identified and made 
available to participants upon leaving the transitional housing, and 
how participants will be provided necessary follow-up services to help 
them achieve stability in the permanent housing;
    (v) How the service needs of participants will be assessed on an 
ongoing basis;
    (vi) How the proposed housing, if any, will be managed and 
operated;
    (vii) How participants will be assisted in assimilating into the 
community through access to neighborhood facilities, activities and 
services;
    (viii) How and when the progress of participants toward meeting 
their individual goals will be monitored and evaluated;
    (ix) How and when the effectiveness of the overall project in 
achieving its goals will be evaluated and how program modifications 
will be made based on those evaluations; and
    (x) How the proposed project will be implemented in a timely 
fashion.
    (2) Targeting to persons on streets and in shelters. VA will award 
up to 150 points based on:
    (i) The extent to which the project will serve homeless veterans 
living in places not ordinarily meant for human habitation (e.g., 
streets, parks, abandoned buildings, automobiles, under bridges, in 
transportation

[[Page 6123]]

facilities) and those who reside in emergency shelters; and
    (ii) The likelihood that proposed plans for outreach and selection 
of participants will result in these populations being served.
    (3) Ability of applicant to develop and operate a project. VA will 
award up to 200 points based on the extent to which those who will be 
involved in carrying out the project have experience in activities 
similar to those proposed in the application. Ratings will be assigned 
based on the extent to which the application demonstrates experience in 
the following areas:
    (i) Engaging the participation of homeless veterans living in 
places not ordinarily meant for human habitation and in emergency 
shelters;
    (ii) Assessing the housing and relevant supportive service needs of 
homeless veterans;
    (iii) Accessing housing and relevant supportive service resources;
    (iv) If applicable, contracting for and/or overseeing the 
rehabilitation or construction of housing;
    (v) If applicable, administering a rental assistance program;
    (vi) Providing supportive services for homeless veterans;
    (vii) Monitoring and evaluating the progress of persons toward 
meeting their individual goals; and
    (viii) Evaluating the overall effectiveness of a program and using 
evaluation results to make program improvements.
    (4) Need. VA will award up to 150 points based on the applicant's 
demonstrated understanding of the needs of the specific homeless 
veteran population proposed to be served in the specified area or 
community. Ratings will be made based on the extent to which applicants 
demonstrate:
    (i) Substantial unmet needs, particularly among the target 
population living in places not ordinarily meant for human habitation 
(e.g., streets) and in emergency shelters, based on reliable data from 
surveys of homeless populations, a Comprehensive Housing Affordability 
Strategy (CHAS), or other reports or data gathering mechanisms that 
directly support claims made;
    (ii) An understanding of the homeless population to be served and 
its unmet housing and supportive service needs.
    (5) Innovative quality of the proposal. Applicants who have 
indicated in their application that they are applying under the 
innovative supportive housing component must receive points under this 
criteria to be eligible for award. VA will award up to 50 points based 
on the innovative quality of the proposal, when compared to other 
applications and projects; in terms of:
    (i) Helping homeless veterans or homeless veterans with 
disabilities to be served to reach residential stability, increase 
their skill level and/or income and increase the influence they have 
over decisions that affect their lives; and
    (ii) A clear link between the innovation(s) and its proposed 
effect(s); and
    (iii) Its ability to be used as a model for other projects.
    (6) Leveraging. VA will award up to 50 points based on the extent 
to which resources from other public and private sources, including 
cash and the value of third party contributions, have been committed to 
support the project at the time of application. Note: Any applicant who 
wishes to receive points under this criterion must submit documentation 
of leveraged resources which meets the requirements stated in the 
application. This is optional; applicants who cannot, or choose not to, 
provide firm documentation of resources as part of the application will 
forego any points for leveraging.
    (7) Cost-effectiveness. VA will award up to 100 points for cost-
effectiveness. Projects will be rated based on the cost and number of 
new supportive housing beds made available or the cost, amount and 
types of supportive services made available, when compared to other 
transitional housing and supportive services projects, and when 
adjusted for high-cost areas. Cost-effectiveness may include using 
excess government properties (local, State, Federal), as well as 
demonstrating site control at the time of application.
    (8) Coordination with other programs. VA will award up to 200 
points based on the extent to which applicants demonstrate that they 
have coordinated with Federal, State, local, private and other entities 
serving homeless persons in the planning and operation of the project. 
Such entities may include shelter transitional housing, health care, or 
social service providers; providers funded through Federal initiatives; 
local planning coalitions or provider associations; or other programs 
relevant to the local community. Applicants are required to demonstrate 
that they have coordinated with the VA medical care facility of 
jurisdiction and VA Regional Offices of jurisdiction in their area. 
Higher points will be given to those applicants who can demonstrate 
that:
    (i) They are part of an ongoing community-wide planning process 
which is designed to share information on available resources and 
reduce duplication among programs that serve homeless veterans;
    (ii) They have consulted directly with other providers regarding 
coordination of services for project participants. VA will award up to 
50 points of the 200 points for this criterion based on the extent to 
which commitments to provide supportive services are available at the 
time of application. Applicants who wish to receive points under this 
optional criterion must submit documentation of supportive service 
resources.

(Paperwork requirements were approved by the Office of Management 
and Budget under control number 2900-0554.)

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.712  Selecting applications.

    (a) General. The highest-ranked applications will be conditionally 
selected in accordance with their ranked order, as determined under 
Sec. 17.711 of this part. Each will be requested, as necessary, to 
provide additional project information, as described in Sec. 17.713 of 
this part as a prerequisite to a grant from VA.
    (b) Ties between applicants. In the event of a tie between 
applicants, VA will use the selecting criterion in Sec. 17.711(d)(4) of 
this part, need for the type of project proposed in the area to be 
served, to determine which application should be selected for potential 
funding.
    (c) Procedural error. If an application would have been selected 
but for a procedural error committed by VA, VA will select that 
application for potential funding when sufficient funds become 
available if there is no material change in the information that 
resulted in its selection. A new application will not be required for 
this purpose.

(Paperwork requirements were approved by the Office of Management 
and Budget under control number 2900-0554.)

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.713  Obtaining additional information and awarding grants.

    (a) Additional information. Applicants who have been conditionally 
selected will be requested by VA to submit additional project 
information, as described in the second submission of the application, 
which may include:
    (1) Documentation to show that the project is feasible.
    (2) Documentation showing the sources of funding for the project 
and firm financing commitments for the matching requirements described 
in Sec. 17.706 of this part.
    (3) Documentation showing site control, as described in Sec. 17.731 
of this part.
    (4) Information necessary for VA to ensure compliance with the 
provisions

[[Page 6124]]

of the National Environmental Policy Act of 1969 (42 U.S.C. 4321, et 
seq.), as described in Sec. 17.714 of this part.
    (5) A site survey performed by a licensed land surveyor. A 
description of the site shall be submitted noting the general 
characteristics of the site. This should include soil reports and 
specifications, easements, main roadway approaches, surrounding land 
uses, availability of electricity, water and sewer lines, and 
orientation. The description should also include a map locating the 
existing and/or new buildings, major roads, and public services in the 
geographic area. Additional site plans should show all site work 
including property lines, existing and new topography, building 
locations, utility data, and proposed grades, roads, parking areas, 
walks, landscaping, and site amenities.
    (6) Design development (35 percent) drawings.
    (i) The applicant shall provide to VA one set of sepias and two 
sets of prints, rolled individually per set, to expedite the review 
process. The drawing shall indicate the designation of all spaces, size 
of the areas and rooms, and indicate in outline the fixed and moveable 
equipment and furniture. The drawings shall be drawn at \1/8\'' or \1/
4\'' scale. Bedroom and toilet layouts, showing clearances and Uniform 
Federal Accessibility Standards requirements, should be shown at \1/
4\'' scale. The total floor and room areas shall be shown in the 
drawings. The drawings shall include:
    (A) A plan of any proposed demolition work;
    (B) A plan of each floor. For renovation, the existing conditions 
and extent of new work should be clearly delineated;
    (C) Elevations;
    (D) Sections and typical details;
    (E) Roof plan;
    (F) Fire protection plans; and
    (G) Technical engineering plans, including structural, mechanical, 
plumbing, and electrical drawings.
    (ii) If the project involves acquisition, remodeling, or 
renovation, the applicant should include the current as-built site 
plan, floor plans and building sections which show the present status 
of the building and a description of the building's current use and 
type of construction.
    (7) Design development outline specifications. The applicant shall 
provide eight copies of outline specifications which shall include a 
general description of the project, site, architectural, structural, 
electrical and mechanical systems such as elevators, air conditioning, 
heating, plumbing, lighting, power, and interior finishes (floor 
coverings, acoustical material, and wall and ceiling finishes).
    (8) Design development cost estimates. The applicant shall provide 
three copies of cost estimates showing the estimated cost of the 
buildings or structures to be acquired or constructed in the project. 
Cost estimates should list the cost of construction, contract 
contingency, fixed equipment not included in the contract, movable 
equipment, architect's fees and construction supervision and 
inspection.
    (9) A design development conference. After VA reviews design 
development documents, a design development conference may be 
recommended in order to provide applicants and their architects an 
opportunity to learn VA procedures and requirements for the project and 
to discuss VA review comments.
    (10) Such other documentation as specified by VA in writing to the 
applicant that confirms or clarifies information provided in the 
application.
    (b) Receipt of additional information. The required additional 
information must be received in acceptable form within the time frame 
established by VA in a notice of fund availability published in the 
Federal Register. VA reserves the right to remove any proposed project 
from further consideration for grant assistance if the required 
additional project information is not received in acceptable form by 
the established deadline.
    (c) Grant award. Following receipt of the additional information in 
acceptable form (and, where applicable, provided that the environmental 
review described in Sec. 17.714 of this part indicates that the 
proposed project is environmentally acceptable to VA), to the extent 
funds are available VA will approve the application and send a grant 
agreement for execution to the applicant.

(Paperwork requirements were approved by the Office of Management 
and Budget under control number 2900-0554.)

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.714  Environmental review requirements.

    (a) General. Project selection is subject to completion of an 
environmental review of the proposed site, and the project may be 
modified or the site rejected as a result of that review. The 
environmental effects must be assessed in accordance with the 
requirements of the National Environmental Policy Act of 1969 (NEPA) 
(42 U.S.C. 4321, et seq.) as implemented pursuant to the Council on 
Environmental Quality's applicable regulations (40 CFR parts 1500-1508) 
and VA's applicable implementing regulations (38 CFR part 26).
    (b) Responsibility for review. (1) VA will perform the 
environmental review, in accordance with part 26 of this title, for 
conditionally selected applications received directly from private 
nonprofit organizations and governmental entities with special or 
limited purpose powers. VA is not permitted to approve such 
applications prior to its completion of this review. Because of time 
constraints, any applications subject to environmental review by VA 
that requires an Environmental Impact Statement (EIS) (generally, an 
application that VA determines would result in a major Federal action 
significantly affecting the quality of the human environment in 
accordance with the environmental assessment procedures at 38 CFR part 
26) will not be eligible for assistance under this part.
    (2) Applicants that are States, metropolitan cities, urban 
counties, Indian tribes, or other governmental entities with general 
purpose powers shall include environmental documentation for the 
project submitting information establishing a Categorical Exclusion 
(CE), a proposed Environmental Assessment (EA), or a proposed 
Environmental Impact Statement (EIS). The environmental documentation 
will require approval by VA before final award of a construction or 
acquisition grant under this part. (See 38 CFR 26.6 for compliance 
requirements.) If the proposed actions involving construction or 
acquisition do not individually or cumulatively have a significant 
effect on the human environment, the applicant shall submit a letter 
noting a CE. If construction outside the walls of an existing structure 
will involve more than 75,000 gross square feet (GSF), the application 
shall include an EA to determine if an EIS is necessary for compliance 
with section 102(2)(c) of the National Environmental Policy Act 1969. 
When the application submission requires an EA, the State shall briefly 
describe the possible beneficial and/or harmful effect which the 
project may have on the following impact categories:
    (i) Transportation;
    (ii) Air quality;
    (iii) Noise;
    (iv) Solid waste;
    (v) Utilities;
    (vi) Geology (soils/hydrology/flood plains);
    (vii) Water quality;
    (viii) Land use;
    (ix) Vegetation, wildlife, aquatic, and ecology/wetlands;
    (x) Economic activities;

[[Page 6125]]

    (xi) Cultural resources;
    (xii) Aesthetics;
    (xiii) Residential population;
    (xiv) Community services and facilities;
    (xv) Community plans and projects; and
    (xvi) Other.
    (3) If an adverse environmental impact is anticipated, the action 
to be taken to minimize the impact should be explained in the EA. An 
entity covered by this section that believes that it does not have the 
legal capacity to carry out the responsibilities required by 38 CFR 
part 26 should contact the VA Homeless Providers Grant and Per Diem 
Program, Mental Health and Behavioral Sciences Service (111C), U.S. 
Department of Veterans Affairs, 810 Vermont Avenue NW., Washington, DC 
20420, for further instructions. Determinations of legal capacity will 
be made on a case-by-case basis.

(Paperwork requirements were approved by the Office of Management 
and Budget under control number 2900-0554.)

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.715  Aid for supportive services and supportive housing.

    (a) Per diem payments. Aid in the form of per diem payments may be 
paid to an entity meeting the requirements of the regulations of this 
part under the heading ``VA Homeless Providers Grant and Per Diem 
Program,'' including the specific criteria of Sec. 17.716 of this part, 
if:
    (1) VA referred the homeless veteran to a recipient of a grant 
under this part (or entity eligible for such a grant as described in 
Sec. 17.716 of this part); or
    (2) VA authorized the provision of supportive services or 
supportive housing for the homeless veteran.
    (b) In-kind assistance. In lieu of per diem payments under this 
section, VA may, with approval of the grant recipient (or entity 
eligible for such a grant as described in Sec. 17.716 of this part), 
provide in-kind assistance through the services of VA employees and the 
use of other VA resources, to a grant recipient (or entity eligible for 
such a grant as described in Sec. 17.716 of this part).
    (c) Selection of per diem applicants. In awarding per diem 
assistance, applications from grant recipients and nongrant recipients 
will be reviewed and ranked separately. Funds will first be awarded to 
grant recipients who request such assistance. If funds are still 
available for nongrant recipients, VA will announce funding through a 
Notice of Funding Availability (NOFA) process as described in 
Sec. 17.708 of this part. VA will not award per diem payments when 
doing so would decrease funding to those entities already receiving 
such payments. For both grant recipients and non-grant recipients, 
eligibility will be determined by the criteria described in Sec. 17.716 
of this part, and applications will be ranked according to scores 
achieved on the portions of the application described in 
Sec. 17.716(b)(4) of this part. Applicants must score a minimum of 500 
points on these portions to be eligible for per diem. Those 
applications that meet the eligibility criteria will be conditionally 
selected for per diem assistance. Funds will be allocated to the 
highest-ranked, conditionally selected applicants in descending order 
until funds are expended. Payments will be contingent upon meeting the 
requirements of a site inspection conducted by VA pursuant to 
Sec. 17.721 of this part.
    (d) Continued receipt of per diem assistance. (1) Continued receipt 
of per diem assistance for both grant recipients and nongrant 
recipients will be contingent upon maintaining the program for which 
per diem is provided so that it would score at least the required 
minimum 500 points as described in Sec. 17.716(b)(4) of this part on 
the application. VA will ensure compliance by conducting inspections as 
described in Sec. 17.721 of this part.
    (2) Where the recipient fails to comply with paragraph (d)(1) of 
this section, VA will issue a notice of the Department's intent to 
discontinue per diem payments. The recipient will then have 30 days to 
submit documentation demonstrating why payments should not be 
terminated. After review of any such documentation, VA will issue a 
final decision on termination of per diem payment.
    (3) Continued payment is subject to availability of funds. When 
necessary due to funding limitations, VA will, in proportion to the 
decrease in funding available, decrease the per diem payment for each 
authorized veteran.

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.716  Eligibility to receive per diem payments.

    An entity must be formally recognized by VA as eligible to receive 
per diem payments under this section before per diem payments can be 
made for the care of homeless veterans, except that per diem payments 
may be made on behalf of a veteran up to three days prior to this 
recognition.
    (a) A grant recipient will be eligible if it receives the minimum 
score as described in paragraph (b)(4) of this section.
    (b) A nongrant recipient will be eligible if it is an entity 
eligible to receive a grant, which for the purposes of this section 
means:
    (1) At least 75 percent of persons who are receiving supportive 
services or supportive housing from the entity are veterans who may be 
included in computation of the amount of aid payable from VA;
    (2) The supportive services or supportive housing program for which 
per diem payments is requested was established after November 10, 1992;
    (3) The entity is a public or nonprofit private entity; and
    (4) The entity score at least 500 cumulative points on the 
following sections of the Grant/Per Diem application: Quality (1); 
Targeting (2); Ability (3); Description of Need (4); and Coordination 
with Other Programs (8). These sections correspond to the selection 
criteria of Sec. 17.711(c) of this part.
    (c) For grant recipients, only those programs that provide 
supportive services or supportive housing (or the portions thereof) 
created with grant funds will be considered for per diem assistance. 
For nongrant recipients, only those portions of the supportive services 
or supportive housing described in the application will be considered 
for per diem assistance.

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.717  Request for recognition of eligibility.

    (a) Requests for recognition of eligibility may be addressed to the 
VA Homeless Providers Grant and Per Diem Programs, Mental Health 
Strategic Healthcare Group (116E), U.S. Department of Veterans Affairs, 
810 Vermont Avenue NW, Washington, DC 20420.
    (b) For nongrant recipients, the receipt of application for per 
diem will constitute the request for recognition of eligibility. Grant 
recipients seeking per diem assistance will indicate this request on 
the application. Grant recipients are not required to complete a 
separate application for per diem assistance. VA will review those 
portions of the grant application that pertain to per diem. Those 
entities already receiving a grant must submit a request for 
recognition to initiate the scoring of their application for per diem 
payments.

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.718  Approval of annexes and new facilities.

    Separate applications for recognition must be filed for any annex, 
branch, enlargement, expansion, or relocation of the site of service 
provision of an eligible entity's facility which is not on

[[Page 6126]]

the same or contiguous grounds on which the parent facility is located. 
When an eligible entity establishes sites which have not been inspected 
and approved by VA, a request for separate approval of such sites must 
be made. The prohibitions in Sec. 17.720 of this part are also 
applicable to applications for aid on behalf of any veterans cared for 
in a new annex, branch or enlarged, expanded or relocated facility.

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.719  Amount of aid payable.

    The per diem amount payable for supportive housing is the current 
VA State Home Program per diem rate for domiciliary care as set forth 
in 38 U.S.C. 1741. The per diem amount payable for supportive services, 
not provided in conjunction with supportive housing, is $1.10 for each 
half-hour during which supportive services are provided, up to $17.60 
per day. These rates will be paid provided, however, the per diem 
amount for supportive housing or supportive services (not provided in 
conjunction with supportive housing) does not exceed one-half of the 
cost to the per diem recipient of providing the services. Also, 
provided further, per diem payment of supportive housing and supportive 
services may be lessened because of budget restriction as described in 
Sec. 17.715(d)(3) of this part. Per diem payments may not be paid for a 
veteran for both supportive housing and supportive services (not in 
conjunction with supportive housing).

(Authority: 38 U.S.C. 501, 7721, note)


Sec. 17.720  [Amended]

    (4) In Sec. 17.720, paragraphs (a) introductory text, (a)(1) , and 
(a)(2) are amended by removing ``17.715(a)'' and adding, in their 
place, ``17.716''.

[FR Doc. 97-3283 Filed 2-10-97; 8:45 am]
BILLING CODE 8320-01-P