10430 Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 / Notices

DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT

Office of the Assistant Secretary for

Community Planning and

Development

[Docket No. N–95–3878; FR 3874–N–01]

Notice of Funding Availability (NOFA)

and Program Guidelines for the

Economic Development Initiative (EDI)

AGENCY: Office of the Assistant

Secretary for Community Planning and

Development, HUD.

SUMMARY: This NOFA announces the

availability of funds for grants under

Section 108(q) of the Housing and

Community Development Act of 1974,

as amended. HUD reserves the right to

award grants under this NOFA up to the

maximum amount authorized by law.

As of the date of this NOFA and subject

to funding availability, HUD intends to

award up to $50 million in EDI funds.

Communities that are authorized to

obtain Section 108 loan guarantee

commitments to carry out qualifying

projects may also be eligible under this

NOFA to receive EDI grants. EDI grants

are used to enhance the security of the

Section 108 guaranteed loan or to

improve the feasibility of proposed

projects through techniques such as

interest rate subsidies, loan loss

reserves, etc. The NOFA sets out

program guidelines that will govern the

application, application review, and

award process for this round of EDI

grants.

DATES: Applications are due in HUD

Headquarters at the address stated

below under ‘‘Addresses,’’ by April 28,

1995 (the ‘‘deadline date’’). HUD will

not accept applications that are

submitted to HUD via facsimile (FAX)

transmission. Applications that are

mailed prior to the deadline date but not

received within ten (10) days after that

date will be deemed to have been

received by that date if postmarked by

the United States Postal Service by no

later than April 25, 1995. Overnight

delivery items received after the

deadline date will be deemed to have

been received by that date upon

submission of documentary evidence

that they were placed in transit with the

overnight delivery service by no later

than April 27, 1995.

ADDRESSES: On and prior to the

deadline date, completed applications

will be accepted at the following

address: Processing and Control Unit,

Room 7255, Office of Community

Planning and Development, Department

of Housing and Urban Development,

451 Seventh Street, SW, Washington,

D.C. 20410, Attention: EDI Grant. At

close of business on the deadline date,

completed applications will also be

received in the South lobby of the

Department of Housing and Urban

Development at the above address

(inquire at the security guard desk).

However, any application received by

the Office of Community Planning and

Development in Headquarters,

Washington, DC, by the deadline date

will be accepted.

FOR FURTHER INFORMATION CONTACT: Paul

Webster, Director, Financial

Management Division, Office of Block

Grant Assistance, Department of

Housing and Urban Development, Room

7178, Washington, DC 20410.

Telephone (202) 708–1871. The TDD

number is (202) 708–2565. (These are

not toll-free numbers.)

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act Statement

The information collection

requirements related to this program

have been approved by the Office of

Management and Budget (OMB) and

assigned the approval number 2506–

0153.

I. Purpose and Substantive Description

(A) Authority. Title I, Housing and

Community Development Act of 1974,

as amended, (42 U.S.C. 5301–5320) (the

‘‘Act’’); 24 CFR part 570.

(B) Definitions.

CDBG funds means, in addition to

those funds specified at § 570.3(e), grant

funds received pursuant to Section

108(q).

Economic Development Initiative

(EDI) means the provision of economic

development grant assistance under

Section 108(q) of the Act, as authorized

by Section 232 of the Multifamily

Housing Property Disposition Reform

Act of 1994 (P.L. 103–233) (the ‘‘1994

Act’’).

Economic development project means

an activity or activities (including

mixed use projects with housing

components) that are eligible under the

Act and under 24 CFR § 570.703, and

that increase economic opportunity for

persons of low- and moderate-income or

that stimulate or retain businesses or

jobs or that otherwise lead to economic

revitalization.

Empowerment Zone or Enterprise

Community means an urban area so

designated by the Secretary pursuant to

24 CFR part 597 (see January 12, 1995

final rule, 60 FR 3034).

Qualifying Empowerment Zone or

Enterprise Community area means an

urban area designated as an

Empowerment Zone or Enterprise

Community pursuant to 24 CFR part 597

or 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. The area need not have

been designated an Empowerment Zone

or Enterprise Community by the

Secretary to be a qualifying

empowerment zone or enterprise

community area, but if it was not so

designated it must meet the eligibility

requirements for a nominated area

pursuant to 24 CFR part 597, subpart B.

Strategic Plan means a strategy

developed and agreed to by the

nominating local government(s) and

State(s) and submitted in partial

fulfillment of the application

requirements for designation as an

Empowerment Zone or Enterprise

Community pursuant to 24 CFR Part

597.

Unless otherwise defined herein,

terms defined in 24 CFR part 570 and

used in this NOFA shall have the

respective meanings given thereto in

that part.

(C) Background.

EDI is intended to complement and

enhance the Section 108 Loan

Guarantee program (see 24 CFR

§§ 570.700–710 for regulations

governing the Section 108 program).

This provision of the Community

Development Block Grant (CDBG)

program provides communities with a

source of financing for economic

development, housing rehabilitation,

and large scale physical development

projects. HUD is authorized pursuant to

Section 108 to guarantee notes issued by

CDBG entitlement communities and

non-entitlement units of general local

government eligible to receive funds

under the State CDBG program.

Regulations governing the Section 108

program are found at 24 CFR part 570,

subpart M.

The Section 108 program is

authorized at $2.054 billion in loan

guarantee authority in Fiscal Year 1995.

Under this program communities (and

States, if applicable) pledge future years’

CDBG allocations as security for loans

guaranteed by HUD. The full faith and

credit of the United States is pledged to

the payment of all guarantees made

under Section 108. The Section 108

program, however, does not require

CDBG funds to be escrowed for loan

repayment. This means that a

community can continue to spend its

existing allocation for other CDBG

purposes, unless needed for loan

repayment. The purpose of EDI grant

funds is to further minimize the
Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 / Notices 10431

potential loss of future CDBG

allocations:

(1) By strengthening the economic

feasibility of the projects financed with

Section 108 funds (and thereby

increasing the probability that the

project will generate enough cash to

repay the guaranteed loan),

(2) By directly enhancing the security

of the guaranteed loan, or

(3) Through a combination of these or

other risk mitigation techniques.

HUD envisions that the following

project structures could be typical:

Funding reserves—The cash flow

generated by an economic development

project may be expected to be relatively

‘‘thin’’ in the early stages of the project.

The EDI grant can make it possible for

debt service or operating reserves to be

established in a way that does not

jeopardize the economic feasibility of

the project.

An example is a supermarket or

neighborhood shopping center that is

designed to provide basic services and

jobs for residents in a distressed

neighborhood. The public entity must

be prepared for the Section 108 loan

repayments required during the time

period after completion of construction

and during the lease-up phase when the

shopping center is not fully leased and

generating sufficient revenues to

support the Section 108 loan

repayments. It may therefore require the

developer to establish with a trustee a

reserve account (or accounts) that would

be available to cover operating expenses

and/or debt service during this lease-up

period. While such reserves are

commonplace, their cost may be so high

as to make an already risky

neighborhood shopping center project

economically infeasible. The increased

cost resulting from establishing such

reserves may be defrayed by the EDI

grant. As with the letter of credit

example below, such reserves protect

the CDBG program against the risk that

CDBG funds will have to be used to

cover shortfalls in the intended source

for repayment of the Section 108 loan.

Another example would be a

community that used EDI grant funds

and Section 108 loan funds to create an

economic development loan fund

administered by a community based

development organization, such as a

community development financial

institution (CDFI) when eligible to

undertake the proposed Section 108/EDI

eligible activities. Under this example, a

CDFI could use EDI grant funds together

with Section 108 funds to capitalize the

CDFI to make community economic

development loans, and/or the EDI grant

could serve as security for any defaults

in loans made with the Section 108

proceeds.

Over-collateralizing the Section 108

loan—The use of EDI grant funds may

be structured in appropriate cases so as

to improve the chances that cash flow

will be sufficient to cover debt service

on the Section 108 loan and directly to

enhance the guaranteed loan. One

technique for accomplishing this

approach is over-collateralization of the

Section 108 loan.

An example is the creation of a loan

pool made up of Section 108 and EDI

grant funds. The community would

make loans to various businesses at an

interest rate equal to or greater than the

rate on the Section 108 loan. The total

loan portfolio would be pledged to the

repayment of the Section 108 loan. If the

total loan repayments from the loan

fund were twice the amount of the debt

service on the Section 108 loan, the

community could accumulate a loan

loss reserve that would mitigate

virtually any risk to future CDBG funds.

Direct enhancement of the security of

the Section 108 loan—The EDI grant can

be used to cover the cost of providing

enhanced security. An example of how

the EDI grant can be used for this

purpose is by using the grant funds to

cover the cost of a standby letter of

credit, issued in favor of HUD. This

letter of credit will be available to fund

amounts due on the Section 108 loan if

other sources fail to materialize and

will, thus, serve to protect the public

entity’s future CDBG funds.

Provision of financing to for-profit

businesses at a below market interest

rate—While the rates on loans

guaranteed under Section 108 are only

slightly above the rates on comparable

U.S. Treasury obligations, they may

nonetheless be higher than can be

afforded by businesses in severely

economically distressed neighborhoods.

The EDI grant can be used to make

Section 108 financing affordable.

For example, a community’s strategic

plan to stabilize the economic viability

of a severely distressed neighborhood

may include providing loan assistance

to both new and existing businesses at

very low interest rates for some period

of time until each business has reached

a stabilized and profitable level of

operation. EDI grant funds could serve

to ‘‘buy down’’ the interest rate up front,

or make full or partial interest

payments, allowing the businesses to be

financially viable in the early start-up

period not otherwise possible with

Section 108 alone. This strategy would

be particularly useful where a

community was undertaking a large

commercial/retail project in a distressed

neighborhood to act as a catalyst for

other development in the area. The use

of EDI/Section 108 funds for financing

the commercial/retail project along with

providing financial assistance to

neighboring new or existing businesses

within the target area would create

complementary economic activity and

enhance the financial viability of all

assisted activities.

A combination of these techniques—

An applicant could employ a

combination of these or other

techniques in order to implement a

strategy that carries out an economic

development project.

Additionally, assistance provided

under this NOFA is subject to the

requirements of section 3 of the Housing

and Urban Development Act of 1968,

and the implementing regulations in 24

CFR part 135, as amended by an interim

rule published on June 30, 1994 (59 FR

33866). Section 3 requires that 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 be directed to low- and verylow income persons. The eligible

activities for which funding is provided

under this NOFA are consistent with the

objectives of section 3. Public entities

awarded funds under this NOFA and

that intend to use the funds for housing

rehabilitation, housing construction, or

other public construction must comply

with the applicable requirements of the

interim regulations published on June

30, 1994.

(D) Timing of Grant Awards.

To the extent a full Section 108

application is submitted with the EDI

grant application, the Section 108

application will be evaluated

concurrently with the request for EDI

grant funds. Note that EDI grant

assistance cannot be used to support a

Section 108 loan guarantee approved

prior to the date of the publication of

this NOFA. (See II.B. of this NOFA.)

However, the EDI grant may be awarded

prior to HUD approval of the Section

108 commitment if HUD determines

that such award will further the

purposes of the Act. HUD notification to

the grantee of the amount and

conditions (if any) of EDI funds awarded

based upon review of the EDI

application shall constitute an

obligation of grant funds, subject to

compliance with the conditions of

award and execution of a grant

agreement.

(E) Limitations on Grant Amounts.

HUD expects to approve EDI grant

amounts for approvable applications at

a range of ratios of EDI grant funds

awarded to new Section 108 loan
10432 Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 / Notices

guarantee commitments. For example,

an applicant could request an EDI grant

of $1 million and propose to leverage

$10 million in new Section 108 loan

guarantee commitments. Other

applicants could request an EDI grant of

$1 million and propose to only leverage

$1 million in new Section 108 loan

guarantee commitments. However, in no

event will HUD make an award in

which the amount of EDI funds awarded

exceeds the amount of new Section 108

commitments. Of course, even in the

first example above, applicants remain

free to propose a greater leverage ratio

of new Section 108 to EDI grant funds,

for example $12 million of new Section

108 to $1 million of EDI grant funds.

Those requesting the higher ratios of

EDI grant funds to new Section 108 loan

guarantee commitments should indicate

in their application why the higher ratio

is necessary for their proposed project.

This explanation will be considered as

part of the rating for need under the

selection criterion at paragraph

II.(C)((2).

HUD reserves the right to determine a

minimum and a maximum amount of

any EDI award or 108 award per

applicant, application or project and to

modify requests accordingly. In the case

of an applicant that has received a prior

EDI grant award, the Department

reserves the right to consider the

amount of the previous EDI award and

the grant amount requested in response

to this NOFA and to adjust the amount

of an EDI award under this NOFA,

including, if appropriate, not making an

award.

In the event the applicant is awarded

an EDI grant that has been reduced

below the original request, the applicant

will be required to modify its project

plans and application to conform to the

terms of HUD approval before execution

of a grant agreement. HUD reserves the

right to reduce or de-obligate the EDI

award if approvable Section 108 loan

guarantee applications are not

submitted by the grantee in the required

amounts on a timely basis. Any

requested modifications must be within

the scope of the original EDI

application. If any additional EDI grant

monies from this or previous EDI

NOFAs become available, HUD may

fund additional applicants in

accordance with this NOFA during

Fiscal Year 1995 or may add any

deobligated funds to funds available for

any future EDI competitions.

In the case of requested amendments

to an approved Section 108 loan

guarantee commitment (as further

discussed in paragraph II.B.), the EDI

assistance approved will be based on

the increased amount of Section 108

loan guarantee assistance.

(F) Eligibility to apply for grant

assistance.

Any public entity eligible to apply for

Section 108 loan guarantee assistance

pursuant to § 570.702 may apply for

grant assistance under Section 108(q).

ELIGIBLE APPLICANTS ARE CDBG

ENTITLEMENT UNITS OF GENERAL

LOCAL GOVERNMENT AND NONENTITLEMENT UNITS OF GENERAL

LOCAL GOVERNMENT ELIGIBLE TO

RECEIVE LOAN GUARANTEES UNDER

§ 570.702. Note that effective January

25, 1995, non-entitlement communities

in the states of New York and Hawaii

were authorized to apply to HUD for

Section 108 loans (see 59 FR 47,510,

published December 27, 1994). Thus

non-entitlement communities in all 50

states are now eligible to participate in

the Section 108 and EDI programs.

(G) Eligible activities.

EDI grant funds may be used for:

(1) Activities listed at § 570.703,

provided such activities are carried out

as part of an economic development

project. If the applicant is awarded

points for activities and projects under

selection criterion II.(C)(6)(b) (Proposals

Addressing Special Need), the applicant

is required to continue to use any funds

awarded for such activities and projects

under this NOFA and Program

Guidelines to benefit the Qualifying

Empowerment Zone or Enterprise

Community area.

(2) Payment of costs of private

financial guaranty insurance policies,

letters of credit, or other credit

enhancements for the notes or other

obligations guaranteed by HUD

pursuant to Section 108, provided such

notes or obligations are used to finance

an economic development project. Such

enhancements shall be specified in the

contract required by § 570.705(b)(1), and

shall be satisfactory in form and

substance to HUD for security purposes.

(3) The payment of principal or

interest due (including such servicing,

underwriting, or other costs as may be

authorized by HUD) on the notes or

other obligations guaranteed pursuant to

the Section 108 loan guarantee program.

(H) Catalogue of Federal Domestic

Assistance (CFDA). The EDI program

has not been assigned a CFDA number

as of the date of this NOFA. Please

insert the letters ‘‘EDI’’ on the SF 424 as

appropriate.

II. The Application Process

Public entities seeking EDI assistance

must make a specific request for that

assistance, in accordance with this

NOFA. The EDI application shall be

accompanied by a request for a Section

108 loan guarantee commitment, as

further described in Section II.B. of this

NOFA below. Application guidelines for

the Section 108 program are found at

§ 570.704.

(A) Timing of submission.

Applications for EDI assistance shall

be received at HUD Headquarters in the

manner described under ‘‘Dates’’ and

‘‘Addresses’’ above.

(B) Submission requirements.

(1) The EDI application (an original

and two copies) shall be accompanied

by a request for loan guarantee

assistance under Section 108. The

request for Section 108 loan guarantee

can be either one or more of the

following:

(a) A formal application for Section

108 loan guarantee(s), including the

documents listed at § 570.704(b);

(b) A brief description (not to exceed

three pages) 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 EDI selection (EDI awards will be

conditioned on approval of actual

Section 108 loan commitments). This

description must be sufficient to

support the basic eligibility of the

proposed project or activities for Section

108 assistance;

(c) If applicable, a copy of a Section

108 loan guarantee approval document

with grant number and date of approval

(which was approved after the date of

this NOFA, except in conjunction with

a previous EDI award); or

(d) A request for a Section 108 loan

guarantee amendment (analogous to

subparagraph (a) or (b) above) that

proposes to increase the amount of a

previously approved application.

However, any amount of Section 108

loan guarantee authority approved

before the date of this NOFA is not

eligible to be used in conjunction with

an EDI grant under this NOFA. Further,

a Section 108 loan guarantee amount

that is required to be used in

conjunction with a prior EDI grant

award, whether or not the Section 108

loan guarantee has been approved as of

the date of this NOFA, is not eligible for

an EDI award under this NOFA. For

example, if a community has a

previously approved Section 108 loan

guarantee commitment of $12 million,

even if none of the funds have been

utilized, or if the community had

previously been awarded an EDI grant of

$1 million and had certified that it will

submit a Section 108 loan application

for $10 million in support of that EDI

grant, the community’s application

under this NOFA must propose to

increase the amount of its total Section
Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 / Notices 10433

108 loan guarantee commitments

beyond those amounts (the $12 million

or $10 million in this example) to which

it has previously agreed.

(2) In addition, an application for EDI

grant funds shall include the following:

(a) SF 424, Application for Federal

Assistance.

(b) The certification regarding

lobbying required under 24 CFR part 87

(Appendix A). The applicant may use

the lobbying certification published

with this NOFA.

(c) A narrative statement describing

the activities that will be carried out

with the EDI grant funds and explaining

how the use of EDI grant funds meets

the criteria in paragraph II.(C) below.

The narrative statement shall not exceed

two 8.5′′ by 11′′ pages for the

description of the activities to be carried

out with the EDI grant funds and one

page for each of the listed selection

criteria.

(3) Where relevant, applications shall

be deemed to include a copy of the

strategic plan for community

revitalization previously submitted to

HUD as part of a Federal Empowerment

Zone or Enterprise Community

application pursuant to a Notice

inviting applications, published on

January 18, 1994 at 59 FR 2711.

(C) Selection Criteria.

All applications will be considered

for selection based on the following

criteria that demonstrate the quality of

the proposed project or activities, and

the applicant’s creativity, capacity and

commitment to obtain maximum benefit

from the EDI funds, in accordance with

the purposes of the Act.

(1) Distress—(up to 20 points). In

evaluating this criterion, HUD will

consider the level of distress in the

immediate community to be served by

the project and the jurisdiction applying

for assistance. Note that in the first EDI

competition in September 1994, the

poverty rate was often considered the

best indicator of distress levels,

although the applicant may demonstrate

the level of distress with other factors

indicative of distress such as income,

unemployment, drug use, homelessness

and other indicators of distress.

(2) Extent of need for EDI assistance

to financially support the Section 108

loan and the project— (up to 15 points).

In evaluating this criterion, HUD will

consider the extent to which the

applicant’s response demonstrates the

financial need and feasibility of the

project and the leverage ratio of EDI

grant funds to Section 108 loan

proceeds. Additionally, the score may

be increased within this criterion to the

extent other funds (public or private) are

leveraged. This may include factors

such as:

(i) Project costs and financial

requirements.

(ii) The amount of any debt service or

operating reserve accounts to be

established in connection with the

economic development project.

(iii) The reasonableness of the costs of

any credit enhancement paid with EDI

grant funds.

(iv) The amount of program income (if

any) to be received each year during the

repayment period for the guaranteed

loan.

(v) Interest rates on those loans to

third parties (other than subrecipients)

(either as an absolute rate or as a plus/

minus spread to the Section 108 rate).

(vi) Underwriting guidelines used (or

expected to be used) in determining

project feasibility.

(vii) The extent to which federal

funds provided as a result of the Federal

Empowerment Zone/Enterprise

Community designation process may be

utilized for the proposed EDI project.

(viii) The extent to which the EDI

grant is proposed to leverage the

proposed Section 108 loan guarantee

commitments and other economic

development activities. Applicants that

use their EDI grant to leverage more 108

commitments are expected to receive

more points under this subcriterion

(viii).

(ix) Other relevant information.

Note that if the applicant proposes a

generic loan fund to assist a certain

category of project or businesses, the

applicant should demonstrate why the

use of Section 108 loans to assist such

businesses would not be financially

feasible without EDI grant assistance.

(3) The extent to which the proposed

activities effectively support important

National interests— (up to 15 points).

These activities include:

(i) The provision of jobs for low- and

moderate-income individuals with

special consideration for participants in

any of the following programs: Jobs

Training Partnership Act (JTPA), Jobs

Opportunities for Basic Skills (JOBS), or

Aid to Families with Dependent

Children (AFDC);

(ii) The provision of jobs for

participants in Unemployment

Insurance programs;

(iii) The provision of jobs for residents

of Public and Indian Housing or other

assisted housing units;

(iv) The provision of jobs for homeless

persons;

(v) The provision of jobs that provide

clear opportunities for promotion for

low- and moderate-income individuals,

such as through the provision of

training;

(vi) The establishment, stabilization,

or expansion of microenterprises that

employ low- and moderate-income

individuals;

(vii) The stabilization or revitalization

of a neighborhood that is predominantly

low- and moderate-income;

(viii) The provision of assistance to a

community development financial

institution whose service area is

predominantly low- and moderateincome;

(ix) The provision of assistance to a

neighborhood-based nonprofit

organization serving a neighborhood

that is predominantly low- and

moderate-income;

(x) The provision of employment

opportunities that are an integral

component of a community’s strategy to

promote spatial deconcentration of lowand moderate-income and minority

families;

(xi) The provision of assistance to

business(es) that operate(s) within a

census tract (or block numbering area)

that has at least 20 percent of its

residents who are in poverty; or

(xii) Other innovative approaches that

provide substantial benefit to low- and

moderate-income persons.

(4) Quality of the plan—(up to 60

points). HUD will consider the quality

of the applicant’s plan for the use of EDI

funds and Section 108 loans, including

the extent to which the applicant’s

proposed plan for the effective use of

EDI grant/Section 108 loan guarantee

will address its described need in the

applicant’s immediate community and/

or its jurisdiction, and the extent to

which the plan is logically, feasibly, and

substantially likely to achieve its stated

purpose.

(5) The capacity or potential of the

public entity to successfully carry out

the plan—(up to 15 points). This may

include factors such as the applicant’s

performance in the administration of its

CDBG program; its previous experience,

if any, in administering a section 108

loan guarantee; its performance and

capacity in carrying out economic

development projects; its ability to

conduct prudent underwriting; its

capacity to manage and service loans

made with the guaranteed loan funds or

EDI grant funds; and, if applicable, its

capacity to manage projects under this

NOFA along with any federal funds

awarded as a result of a federal urban

Empowerment Zone/Enterprise

Community designation.

(6) Applicants will be rated on both

criteria (a) and (b) (if applicable) below,

but will receive points for only the

higher rated criterion of the two, but not

both.
10434 Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 / Notices

(a) The extent to which the proposed

plan follows a comprehensive and

coordinated approach in addressing the

community and economic development

needs of the public entity and furthers

neighborhood revitalization—(up to 20

points).

OR

(b) Proposals Addressing Special

Need —(Applicants to which this

criterion does not apply need not

respond thereto.) (up to 20 points). Of

the 20 points under this factor, one

point will be awarded to applicants that

received a federal urban Empowerment

Zone or Enterprise Community

designation and up to 19 additional

points will be awarded to applicants

that propose EDI and Section 108 loan

assisted activities that will benefit the

applicant’s Qualifying Empowerment

Zone or Enterprise Community area and

are consistent with the applicant’s

Strategic Plan; and

(7) Innovation and creativity—(up to

20 points). The extent to which the

applicant incorporated innovation and/

or creativity in the design and proposed

implementation of the proposed

activities carried out with Section 108/

EDI funds.

Selection Process—Once scores are

assigned, all applications will be ranked

in order of points assigned, with the

applications receiving more points

ranking above those receiving fewer

points. Applications will be funded in

rank order, however, HUD, in its sole

discretion, may choose to award EDI

assistance to a lower rated approvable

application over a higher rated

application in order to increase the level

of geographic diversity of grants

approved under this part. As discussed

in paragraph I.E. above, HUD reserves

the right to determine a minimum and

a maximum amount of any EDI award

or Section 108 commitment per

applicant, application or project and to

modify requests accordingly. In

addition, if HUD determines that an

application rated, ranked and fundable

could be funded at a lesser EDI grant

amount than requested consistent with

feasibility of the funded project or

activities and the purposes of the Act,

HUD reserves the right to reduce the

amount of the EDI award and/or

increase the Section 108 loan guarantee

commitment, if necessary, in

accordance with such determination.

HUD may decide not to award the full

amount of EDI grant funds available

under this NOFA and may make any

remaining amounts available under a

future NOFA.

Timing of grant awards—To the

extent full Section 108 applications are

submitted concurrently with the EDI

grant application, HUD’s approval of the

related Section 108 loan guarantee

commitment will in most cases be

granted contemporaneously with EDI

grant approval. However, the EDI grant

may be awarded prior to HUD approval

of the Section 108 commitment if HUD

determines that such award will further

the purposes of the Act. EDI funds shall

not be disbursed to the public entity

before the issuance of the related

Section 108 guaranteed obligations.

III. Technical Assistance

To the extent permitted by law, HUD

may advise applicants of technical

deficiencies in the EDI applications after

submission and permit them to be

corrected. Technical deficiencies relate

only to items, such as a failure to submit

or sign a required certification, that

would not improve the substantive

quality of the application relative to the

selection criteria . Applicants will have

14 calendar days from the date HUD

notifies the applicant of any such

technical deficiency to submit the

appropriate information in writing to

HUD. At any time during the selection

process, which began with preparation

of this NOFA, HUD staff is limited in

the assistance it is permitted to provide

regarding applications for EDI grants,

due to the requirements of the HUD

Reform Act. The assistance and advice

that can be provided includes such

activities as explaining and responding

to questions about program regulations,

identification of those parts of an

application that need substantive

improvement, the dates by which

decisions will be made and the

procedures that are required to be

performed to process an application.

The term ‘‘technical assistance’’

however, does not include advising the

applicant how to make substantive

improvements in its application that

will affect ratings.

In addition, any information

published in the Federal Register and in

this NOFA, and any information that

has been made public through a means

other than the Federal Register or

NOFA, may be discussed.

HUD staff will be available

throughout the EDI application period

to provide extensive advice and

assistance, as is currently provided, to

develop 108 loan applications since the

108 program is not subject to the HUD

Reform Act. Staff providing such

assistance may provide technical advice

to the EDI selection panel but in no case

will such staff participate in the panel’s

voting process for EDI awards under this

NOFA.

IV. Other Matters

Environmental Impact

A Finding of No Significant Impact

with respect to the environment has

been made in accordance with HUD

regulations at 24 CFR part 50,

implementing section 102(2)(C) of the

National Environmental Policy Act of

1969 (42 U.S.C. 4332). The Finding of

No Significant Impact is available for

public inspection and copying between

7:30 am and 5:30 pm weekdays at the

Office of the Rules Docket Clerk, 451

Seventh Street, SW, Room 10276,

Washington, DC 20410.

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 offers financial

assistance to units of general local

government, none of its provisions will

have an effect on the relationship

between the Federal Government and

the States, or the States’ political

subdivisions.

Family

The General Counsel, as the

Designated Official for Executive Order

12606, The Family, has determined that

the policies announced in this NOFA

would not have the potential for

significant impact on family formation,

maintenance and general well-being

within the meaning of the Order. No

significant change in existing HUD

policies and programs will result from

issuance of this NOFA, as those policies

and programs relate to family concerns.

Prohibition Against Lobbying Activities

The use of funds awarded under this

NOFA is subject to the disclosure

requirements and prohibitions of

section 319 of the Department of Interior

and Related Agencies Appropriations

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

1352) and the implementing regulations

at 24 CFR part 87. These authorities

prohibit recipients of Federal contracts,

grants, or loans from using appropriated

funds for lobbying the Executive or

Legislative Branches of the Federal

Government in connection with a

specific contract, grant, or loan. The

prohibition also covers the awarding of

contracts, grants, cooperative

agreements, or loans unless the

recipient has made an acceptable
Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 / Notices 10435

certification regarding lobbying. Under

24 CFR part 87, applicants, recipients,

and subrecipients of assistance

exceeding $100,000 must certify that no

Federal funds have been or will be spent

on lobbying activities in connection

with the assistance.

Prohibition Against Lobbying of HUD

Personnel

Section 13 of the Department of

Housing and Urban Development Act

(42 U.S.C. 3537b) contains two

provisions dealing with efforts to

influence HUD’s decisions with respect

to financial assistance. The first imposes

disclosure requirements on those who

are typically involved in these efforts—

those who pay others to influence the

award of assistance or the taking of a

management action by the Department

and those who are paid to provide the

influence. The second restricts the

payment of fees to those who are paid

to influence the award of HUD

assistance, if the fees are tied to the

number of housing units received or are

based on the amount of assistance

received, or if they are contingent upon

the receipt of assistance. HUD’s

regulation implementing section 13 is

codified at 24 CFR part 86. If readers are

involved in any efforts to influence the

Department in these ways, they are

urged to read the final rule, particularly

the examples contained in Appendix A

of the rule.

Any questions concerning the rule

should be directed to the Office of

Ethics, Room 2158, Department of

Housing and Urban Development, 451

Seventh Street, SW., Washington DC

20410–3000. Telephone: (202) 708–3815

(voice/TDD). (This is not a toll-free

number.) Forms necessary for

compliance with the rule may be

obtained from the local HUD Office.

Dated: February 16, 1995.

Andrew Cuomo,

Assistant Secretary for Community Planning

and Development.

Certification Regarding Lobbying

Certification for Contracts, Grants, Loans and

Cooperative Agreements

The undersigned certifies, to the best of his

or her knowledge and belief, that:

(1) No Federal appropriated funds have

been paid or will be paid, by or on behalf of

the undersigned, to any person for

influencing or attempting to influence an

officer or employee of an agency, a Member

of Congress, an officer or employee of

Congress, or an employee of a Member of

Congress in connection with the awarding of

any Federal contract, the making of any

Federal grant, the making of any Federal

loan, the entering into of any cooperative

agreement, and the extension, continuation,

renewal, amendment, or modification of any

Federal contract, grant, loan, or cooperative

agreement.

(2) If any funds other than Federal

appropriated funds have been paid or will be

paid to any person for influencing or

attempting to influence an officer or

employee of any agency, a Member of

Congress, an officer or employee of Congress,

or an employee of a Member of Congress in

connection with this Federal contract, grant,

loan, or cooperative agreement, the

undersigned shall complete and submit

Standard Form-LLL, ‘‘Disclosure Form to

Report Lobbying,’’ in accordance with its

instructions.

(3) The undersigned shall require that the

language of this certification be included in

the award documents for all subawards at all

tiers (including subcontracts, subgrants, and

contracts under grants, loans, and

cooperative agreements) and that all

subrecipients shall certify and disclose

accordingly.

This certification is a material

representation of fact upon which reliance

was placed when this transaction was made

or entered into. Submission of this

certification is a prerequisite for making or

entering into this transaction imposed by

section 1352, title 31, U.S. Code. Any person

who fails to file the required certification

shall be subject to a civil penalty of not less

than $10,000 and not more than $100,000 for

each such failure.

Signed: lllllllllllllllll

Date: llllllllllllllllll

lllllllllllllllllllll

(Print name and title)

24 CFR Part 87, Appendix A

[FR Doc. 95–4448 Filed 2–21–95; 8:45 am]

BILLING CODE 4210–29–P