North Carolina Administrative Code › Title 04 - COMMERCE › Chapter 19 - RURAL ECONOMIC DEVELOPMENT › Subchapter L - NORTH CAROLINA COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM › Section .0900 - GRANT ADMINISTRATION › Section 19L .0907 - PROGRAM INCOME

Current through Register Vol. 39, No. 2, July 15, 2024
(a) Definition.
				  Program Income is defined as gross income earned by the recipient from grant
				  supported activities. Such earnings may include, but not be limited to, sale of
				  property, interest received from a loan program, and the return of sales taxes
				  on purchases made during the program. Receipts derived from the operation of a
				  public work or facility, the construction of which was assisted by this
				  program, do not constitute program income. Income generated under the
				  Development Loan Fund program, including loan repayments, fees, lease payments
				  does not constitute program income.
(b) Unless the grant agreement provides
				  otherwise, recipients shall have no obligation to the Department with respect
				  to royalties received as a result of copyrights or patents produced under the
				  grant or other agreement. Recipients must however, follow the procedures set
				  forth in Rule .0909 PROPERTY MANAGEMENT STANDARDS.
(c) All interest earned on grant funds prior
				  to distribution shall be returned to the Department, except recipients may keep
				  one hundred dollars ($100.00) per year for administrative expenses in
				  accordance with 24 CFR
				  570.489(c)(2).
(d) Recipients shall record the receipt and
				  expenditure of revenues (such as taxes, special assessments, levies, fines,
				  etc.) as a part of grant project transactions when such revenues are
				  specifically earmarked for a grant project in accordance with the grant
				  agreement.
(e) Unless otherwise
				  required, program income generated by a pre-1986 grant may be retained by the
				  recipient. Program income is identified by the grant year in which the
				  activities which generated the program income were funded. Pre-1986 program
				  income shall be added to funds committed to a current project and used for
				  activities approved in the project's application. Pre-1986 program income shall
				  be expended prior to requesting additional funds from the Department or shall
				  be used in future CDBG projects.
(f) Program Income generated by grants made
				  in 1986 or afterwards shall be returned to the Department except when:
(1) the recipient shall propose at the time
				  of application or at the time the program income is anticipated, a use or uses
				  for the projected program income, and
(2) the Department determines that, at the
				  time of the proposal, the use of the projected program income meets federal
				  requirements prohibiting the state from recapturing the program income;
				  or
(3) the recipient, designated at
				  the time of the preliminary grant award as a "severely distressed county"
				  pursuant to
				  G.S.
				  105-130.40(c), or a city in
				  such a county, wishes to retain the program income to establish a local
				  economic development revolving loan fund. Any activities that are eligible
				  under Title I of the federal Housing and Community Development Act of 1974, as
				  amended, and that meet at least one of the three national objectives of the
				  Housing and Community Development Act may be undertaken. If the designation,
				  pursuant to
				  G.S.
				  105-130.40(c), as a
				  "severely distressed county" is removed from a county, projects having received
				  at least a preliminary grant award prior to the removal of the designation may
				  continue to retain program income resulting from that grant as provided in this
				  subsection. Provisions of
				  4 NCAC
				  19L .0913 apply at the time of closeout;
				  or
(4) the program income is
				  generated from an Entrepreneurial Empowerment project, and the Department has
				  approved the plan for re-use of program income.