41384 Federal Register / Vol. 63, No. 148 / Monday, August 3, 1998 / Notices

DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT

[Docket No. FR–4340–N–03]

Notice of Application Kit Clarification

Concerning HOPE VI Revitalization

AGENCY: Office of the Assistant

Secretary for Public and Indian

Housing, HUD.

ACTION: Notice.

SUMMARY: On March 31, 1998, HUD

published a Super Notice of Funding

Availability (SuperNOFA) for Housing

and Community Development Programs

(63 FR 15489). This SuperNOFA

contained a component for

Revitalization of Severely Distressed

Public Housing (HOPE VI Revitalization

NOFA) at 63 FR 15577. In order to help

public housing agencies (PHAs) in

preparing their applications for HOPE

VI Revitalization funds, HUD also made

available an Application Kit. The

purpose of this Notice is to advise

applicants of a discrepancy between the

HOPE VI Revitalization NOFA and the

Application Kit and to allow them to

clarify their applications with respect to

this discrepancy.

CLARIFICATION DUE DATE: Clarifications to

the HOPE VI application must be

received at HUD Headquarters on or

before 12:00 Noon Eastern time on

August 17, 1998.

ADDRESSES AND CLARIFICATION

SUBMISSION PROCEDURES: Addresses:

Clarifications must be submitted to:

Department of Housing and Urban

Development, 451 Seventh Street, SW,

Room 4138, Washington, D.C. 20410.

Submission Procedures: Applicants

are advised that all clarifications must

be received by HUD by the date and

time specified in this Notice. No

information provided after that date and

time will be considered in review of the

application. Applicants may send

clarifying information by facsimile (fax)

to (202) 401–2370. Applicants should

contact the Office of Urban

Revitalization at the telephone number

given below to verify the receipt of any

information sent by fax. Because of the

importance of timely submission of

clarifying information, applicants are

advised to submit such information at

the earliest time possible to avoid the

risks brought about by unanticipated

delays or delivery-related problems.

FOR FURTHER INFORMATION CONTACT: For

further information you may call Mr.

Milan Ozdinec, Office of Urban

Revitalization, Department of Housing

and Urban Development, 451 Seventh

Street, S.W., Room 4142, Washington

D.C. 20410; telephone (202) 401–8812

(this is not a toll free number.) Persons

with hearing or speech impairments

may access this number via TTY by

calling the Federal Information Relay

Service at 1–800–877–8399.

SUPPLEMENTARY INFORMATION: This

Notice informs the public about a

discrepancy between the HOPE VI

Revitalization NOFA and the

Application Kit with respect to the

requirement that an application that

proposes new construction of

replacement public housing must

comply with the requirements of section

6(h) of the U.S. Housing Act of 1937.

Section 6(h) provides that the

Secretary may enter into a contract

involving new construction only if the

PHA demonstrates to the satisfaction of

the Secretary that the cost of new

construction in the neighborhood where

the housing is needed is less than the

cost of acquisition or acquisition and

rehabilitation in such neighborhood.

Section III.A.(4) of the HOPE VI

Revitalization NOFA provided that an

applicant could satisfy the section 6(h)

requirement by ‘‘submitting the

information described in paragraphs (a)

or (b) of this section:

‘‘(a) A PHA comparison of the costs of

new construction (in the neighborhood

where the PHA proposes to construct

the housing) and the costs of acquisition

of existing housing or acquisition and

rehabilitation in the same neighborhood

(including estimated costs of lead-based

paint testing and abatement), or

‘‘(b) A PHA certification,

accompanied by supporting

documentation, that there is insufficient

existing housing in the neighborhood to

develop housing through acquisition of

existing housing or acquisition and

rehabilitation.’’

In an effort to help applicants address

this section 6(h) requirement, the

Application Kit provided instructions

that may have confused applicants with

respect to satisfaction of the NOFA

requirement. Section D.8 of the

Application Kit instructed the

applicants to ‘‘include a narrative that

contains information described in

paragraphs a or b below. If the

application involves new construction,

provide evidence of compliance with

section 6(h) of the 1937 Act in one of

the following two ways:

‘‘a. Compare the cost of construction

in the neighborhood where the

applicant proposes to construct housing

and the cost of acquisition and

rehabilitation in the same

neighborhood.

‘‘b. State that there is insufficient

existing housing in the neighborhood to

develop public housing through

acquisition and/or acquisition and

rehabilitation where such cost would be

lest (sic) than new construction.

Describe how you came to that

conclusion.’’

In the event of discrepancies between

the NOFA and the Application Kit, or

between the NOFA and any other

supplemental information issued by

HUD, the language of the NOFA

supersedes and prevails over any

inconsistency in the Application Kit.

However, HUD believes that the

differences between the text in the

HOPE VI Revitalization NOFA and the

text in the Application Kit with respect

to the 6(h) requirement caused

confusion in a couple of different ways.

First, with respect to the cost

comparison method in (a), the

Application Kit does not describe with

the precision of the NOFA the cost

comparison that HUD was seeking.

Some of the detail in the NOFA

description is not contained in the

Application Kit. For instance, the NOFA

cites the costs of lead-based paint

testing and abatement in connection

with acquisition and rehabilitation and

the Application Kit fails to do so. In

addition, the Application Kit in

paragraph (b) discusses the cost of

rehabilitation and new construction,

thus confusing the differences between

method (a) and method (b). This

discrepancy between the NOFA and

Application Kit language created

ambiguities in a number of applications

which need to be clarified.

With respect to method (b), the NOFA

required a PHA certification,

accompanied by supporting

documentation, that there is insufficient

existing housing in the neighborhood to

develop housing through acquisition of

existing housing or acquisition and

rehabilitation. The Application Kit fails

to use the words ‘‘accompanied by

supporting documentation’’. The

Application Kit merely requests that

applicants state that there is insufficient

existing housing and describe how the

applicant came to that conclusion. We

think that this discrepancy between the

NOFA and the Application Kit caused

confusion among applicants as to what

the applicant had to submit in order to

support the applicant’s contention that

there is insufficient existing housing in

the neighborhood.

In addition, the Application Kit

introduced into method (b) a cost factor

that is totally lacking in the NOFA. This

further confused applicants as to the

kind of information that was needed to

support the applicant’s contention that

there is insufficient existing housing in

the neighborhood for acquisition or

acquisition and rehabilitation. And, as
Federal Register / Vol. 63, No. 148 / Monday, August 3, 1998 / Notices 41385

indicated above, by introducing a cost

element into method (b) the Application

Kit confused the distinction between the

two methods. Under method (b) in the

NOFA, the application only had to

provide supporting documentation that

there was an insufficient supply of

existing housing in the neighborhood to

acquire for replacement public housing.

The cost of acquiring or acquiring and

rehabilitating the insufficient supply of

existing housing is irrelevant to the

determination to be made under method

(b).

For these reasons, the Department has

determined that the discrepancy

between the HOPE VI Revitalization

NOFA and the Application Kit has

caused a need for some applications to

be clarified. Therefore, HUD has

determined, in order to provide

fundamental fairness to all applicants,

that a number of HOPE VI applicants

should be requested to clarify their

applications with respect to the section

6(h) requirement. In addition to the

publication of this Notice, HUD will be

contacting these applicants by

telephone to advise them that their

applications need clarification with

respect to the satisfaction of the section

6(h) requirement. In accordance with

section III of the HOPE VI Revitalization

NOFA and this Notice, HUD will advise

the applicants that the applicant must

submit either a comparison of costs in

accordance with section III.(A)(4)(a) of

the HOPE VI Revitalization NOFA, or

supporting documentation with respect

to the certification that there is

insufficient existing housing in the

neighborhood in accordance with

section III.(A)(4)(b) of the HOPE VI

Revitalization NOFA.

Dated: July 30, 1998.

Deborah Vincent,

General Deputy Assistant Secretary for Public

and Indian Housing.

[FR Doc. 98–20786 Filed 7–30–98; 3:14 pm]

BILLING CODE 4210–33–P