[Federal Register Volume 61, Number 97 (Friday, May 17, 1996)]
[Rules and Regulations]
[Pages 25124-25125]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12425]




[[Page 25123]]


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Part VII





Department of Housing and Urban Development





_______________________________________________________________________



24 CFR Part 585



Opportunities for Youth: Youthbuild Program; Interim Rule

Federal Register / Vol. 61, No. 97 / Friday, May 17, 1996 / Rules and 
Regulations

[[Page 25124]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of Assistant Secretary for Community Planning and Development

24 CFR Part 585

[Docket No. FR-4038-I-01]
RIN 2506-AB79


Opportunities for Youth: Youthbuild Program

AGENCY: Office of the Assistant Secretary for Community Planning and 
Development, HUD.

ACTION: Interim rule.

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SUMMARY: The Youthbuild program is one of many HUD programs that 
directly invests in distressed communities, and opportunities to 
further the goals of the program and stimulate community investment and 
support for the Youthbuild program must be encouraged. This interim 
rule amends the regulations for the Youthbuild Program to define 
administrative costs for which Youthbuild funds may be expended.

DATES: Effective Date: June 17, 1996.
    Comments Due Date: July 1, 1996.

ADDRESSES: Interested persons are invited to submit comments regarding 
this interim rule to Rules Docket Clerk, Office of General Counsel, 
Room 10276, Department of Housing and Urban Development, 451 Seventh 
Street SW., Washington, D.C. 20410-0500.
    Communications should refer to the above docket number and title. 
Facsimile (FAX) comments are not acceptable. A copy of each 
communications submitted will be available for public inspection and 
copying between 7:30 a.m. and 5:30 p.m. weekdays at the above address.

FOR FURTHER INFORMATION CONTACT: The Office of Economic Development, 
Department of Housing and Urban Development, Room 7136, 451 Seventh 
Street SW., Washington, DC 20410. Telephone (202) 708-2035; TYY (202) 
708-1455. (These telephone numbers are not toll-free.)

SUPPLEMENTARY INFORMATION:

Background

    Section 164 of the Housing and Community Development Act of 1992 
(Pub.L. 102-550) amended title IV of the National Affordable Housing 
Act (42 U.S.C. 1437aaa) to add a new subtitle D which established the 
Youthbuild program. On February 21, 1995, the Department published a 
final rule at 60 FR 9734, which is codified at 24 CFR Part 585. This 
interim rule is intended to further address the use of Youthbuild funds 
for administrative costs, including overhead and salaries and wages 
associated with an implementation grant.
    The Department believes that the Youthbuild program is a valuable 
tool to promote job skills, neighborhood revitalization and economic 
self sufficiency and recognizes the need to staff these programs with 
competent personnel to provide education and training, and other 
support services to an ever growing population of disadvantaged youths. 
The Department and Youthbuild grantees now have valuable program 
experience in cost efficient ways of meeting the program's mission, 
delivering quality training and services, and serving more youth 
successfully. These times of shrinking Federal resources make it even 
more imperative that Youthbuild funds benefit the greatest number of 
youths. Examples of ways Youthbuild grantees have limited overhead 
expense include eliminating some administrative positions and assigning 
tasks to other personnel, physically locating the program in an 
existing facility, utilizing the expertise and experience of other 
programs and organizations, paying administrative costs with other 
funds, using existing equipment from other programs, and securing non-
federal matching funds to cover administrative costs. These examples 
demonstrate that partnerships with other public and private 
organizations in the community can be one of the keys to an effective 
program.
    The Youthbuild program is one of many HUD programs that directly 
invests in distressed communities, and opportunities to further the 
goals of the program and stimulate community investment and support for 
the Youthbuild program must be encouraged. Numerous Youthbuild grantees 
have been particularly innovative in establishing partnerships with 
local organizations such as educational institutions, training 
organizations, apprenticeship programs, social agencies, foundations 
and local governments, and adopting innovative and creative ways of 
delivering program services.
    This interim rule will affect only future grant awards.

Justification for Interim Rulemaking

    HUD generally publishes a rule for public comment before issuing a 
rule for effect, in accordance with HUD's own regulations on rulemaking 
in 24 CFR part 10. However, part 10 provides for exceptions to the 
general rule if the agency finds good cause to omit advance notice and 
public participation. The good cause requirement is satisfied when 
prior public procedure is ``impracticable, unnecessary, or contrary to 
the public interest'' (24 CFR 10.1). HUD finds that good cause exists 
to publish this rule for effect without first soliciting public 
comment, in that prior public comment is contrary to the public 
interest. This rule ensures direct program benefits for the maximum 
number of disadvantaged youths. Further, by letter dated December 6, 
1995, the Department asked all Youthbuild implementation grantees to 
describe innovative ways to limit overhead expenses as well as 
suggestions for measuring success. This rule takes into consideration 
those suggestions. Therefore, the Department believes that a 45-day 
public comment period is more than adequate in light of the compelling 
need to finalize the Department's policy for limiting overhead 
expenses.

Other Matters

    (a) Environmental Impact. A Finding of No Significant Impact with 
respect to the environment for this interim rule has been made in 
accordance with HUD regulations at 24 CFR part 50, which implement 
section 102(2)(C) of the National Environmental Policy Act of 1969. The 
Finding of No Significant Impact is available for public inspection 
between 7:30 a.m. and 5:30 p.m. weekdays in the Office of the Rules 
Docket Clerk, Office of the General Counsel, Department of Housing and 
Urban Development, Room 10276, 451 Seventh Street SW., Washington, D.C. 
20410.
    (b) Regulatory Flexibility Act. The Secretary, in accordance with 
the Regulatory Flexibility Act (5 U.S.C. 605(b)), has reviewed this 
interim rule before publication and by approving it certifies that this 
interim rule would not have a significant economic impact on a 
substantial number of small entities because the Youthbuild program 
affects primarily economically disadvantaged young adults by providing 
assistance for a wide range of multi-disciplinary activities to assist 
those young adults. The opportunities are designed to help 
disadvantaged young adults who have dropped out of high school to 
obtain the education and employment skills necessary to achieve 
economic self-sufficiency and develop leadership skills and a 
commitment to community development in low-income communities. It is 
anticipated that this interim rule will increase the number of young 
adults receiving assistance under federally-funded Youthbuild programs.

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    (c) Executive Order 12612, Federalism. The General Counsel, as the 
Designated Official under section 6(a) of Executive Order 12612, 
Federalism, has determined that this interim rule does not have 
``federalism implications'' because it does not have substantial direct 
effects on the States (including their political subdivisions), or on 
the distribution of power and responsibilities among the various levels 
of government.
    (d) Executive Order 12606, The Family. The General Counsel, as the 
Designated Official under Executive Order 12606, The Family, has 
determined that some of the policies of this interim rule would have a 
potential significant impact on family formation, maintenance, and 
general well-being. The expected expansion of opportunities to 
economically disadvantaged young adults to enhance their education and 
employment skills will provide a positive impact on the family 
maintenance and general well-being. However since the impact on the 
family is beneficial and the interim rule involves very little HUD 
discretion, no further review is necessary.
    (e) Catalog of Federal Domestic Assistance. The Catalog of Federal 
Domestic Assistance Program number assigned to this program is 14.243.

List of Subjects in 24 CFR Part 585

    Grant programs--housing and community development, Homeless, Low- 
and very low-income families, Reporting and recordkeeping requirements.

    Accordingly, for the reasons set forth in the preamble, part 585 of 
title 24 of the Code of Federal Regulations is amended as follows:

PART 585--YOUTHBUILD PROGRAM

    1. The authority citation for part 585 continues to read as 
follows:

    Authority: 42 U.S.C. 3535(d) and 8011.

    2. In Sec. 585.305, paragraph (m) is amended to add new paragraphs 
(m)(1) and (m)(2), to read as follows:


Sec. 585.305  Eligible activities.

* * * * *
    (m) * * *
    (1) Administrative costs. The amount of Youthbuild funds used to 
pay the following costs, in whole or in part, must be charged as 
administrative costs:
    (i) Salaries, wages and related costs of the grantee's staff or 
other staff who are primarily engaged in general program administration 
and oversight. Youthbuild funded staff presumed to be primarily engaged 
in general program administration and oversight include the executive 
director, the program manager, the fiscal officer, the secretary and 
the administrative or program assistant. However, a grantee may provide 
evidence to rebut this presumption for an individual case.
    (ii) Other costs for goods and services required for the program, 
such as rental or purchase of vehicles, office supplies and equipment, 
utilities, insurance, legal, staff training, rental and maintenance of 
office space, mailing, advertising, technical assistance and fund 
raising.
    (2) Further restrictions on the use of Youthbuild funds. (i) 
Further restrictions may be imposed if the Department determines, based 
on information readily available that:
    (A) Costs are not sufficiently itemized;
    (B) The amount of program funds for trainee wages and benefits, 
including need-based stipends, benefits, incentives, tools and work 
clothes and/or the number of Youthbuild participants served are low in 
comparison to other comparable programs;
    (C) The participant training period is shorter than that in other 
comparable programs;
    (D) Alternative use of funds for eligible activities would be in 
the overall interest of the Youthbuild program.
    (ii) Restrictions include, but are not limited to, limitations on 
the use and availability of grant funds, reallocation of Youthbuild 
program budget, or cancellation of grant.

    Dated: April 24, 1996.
Andrew M. Cuomo,
Assistant Secretary for Community Planning and Development.
[FR Doc. 96-12425 Filed 5-16-96; 8:45 am]
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