CDBG-DR 2018 and 2019 Federal Register Notice Webinar February 13, - - PowerPoint PPT Presentation

2018 and 2019 Disasters 1

CDBG-DR 2018 and 2019 Federal Register Notice

Webinar February 13, 2020 - 2:00-3:30 EST

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2018 and 2019 Disasters

Welcome & Speakers

Session Objectives:

• Learn about CDBG-DR 2018 and 2019 Action Plan requirements and timelines
• Discuss 2017 Infrastructure allocation and requirements

Presenters:

• HUD
• Bonnie Newcomb, CPD Specialist
• Mikayla Catani, CPD Specialist
• Jen Carpenter, Assistant Director of Policy
• Enterprise Community Partners
• Marion McFadden, Senior Vice President, Public Policy; Senior Advisor,

Resilience

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2018 and 2019 Disasters

Agenda

• Overview
• Timelines and Important Deadlines
• Grant Administration and Action Plan
• Review of Prior Notices and Amended Requirements
• Explain New Requirements and Alternatives
• Questions?

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2018 and 2019 Disasters

Overview

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2018 and 2019 Disasters

Overview: Allocation

The CDBG-DR 2018 and 2019 Federal Register Notice (85 FR 4681) allocates $3.8 billion in CDBG-DR funds appropriated by:

• Supplemental Appropriations for Disaster Relief Act, 2018 (Public

Law 115-254) and

• Additional Supplemental Appropriations for Disaster Relief Act,

2019 (Public Law 116-20)

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2018 and 2019 Disasters

Overview: CDBG-DR Allocations for 2017, 2018, and 2019

Prior Allocation Notices 83 FR 5844 and 83 FR 40314 Current Notice 85 FR 4681 Disaster Year

Public Law 115-56 Public Law 115- 123 Public Law 115- 254 Public Law 116-20 Combined Allocations for P.L. 115-254 and P.L. 116-20

2017 $7,390,000,000 $10,030,484,000 $431,000,000 $431,000,000 2018 $1,677,500,000 $1,216,134,000 $2,893,634,000 2019 $506,794,000 $506,794,000 Total $7,390,000,000 $10,030,484,000 $1,677,500,000 $2,153,928,000 $3,831,428,000 Excludes $15.9 billion designated for mitigation and $2 billion designated for electrical system improvements in Puerto Rico and the U.S. Virgin Islands.

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2018 and 2019 Disasters

Overview: Waivers and Alternative Requirements

The CDBG-DR 2018 and 2019 Federal Register Notice:

• Imposes requirements of prior CDBG-DR notices (as amended by

provisions in this notice)

• Provides clarifications on waivers and alternative requirements

included in prior notices

• Amends prior notices by adding regulations that apply to local

governments

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2018 and 2019 Disasters

New Grantees

Several jurisdictions are receiving CDBG-DR grants for the first time in this allocation; others are receiving grants for the first time in decades

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2018 and 2019 Disasters

Allocations and Important Dates

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2018 and 2019 Disasters

Allocations

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2018 and 2019 Disasters

Allocations

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2018 and 2019 Disasters

Allocations

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2018 and 2019 Disasters

Important Dates- 2018 and 2019 Grants

• Applicability Date: February 3, 2020
• April 3, 2020: Financial Management and Grant Compliance
• June 2, 2020: Action Plan (projection of expenditures and
• utcomes)
• 30-day Public Comment Period
• 45-day HUD Review
• QPRs: 30 days after 1st full quarter of grant execution
• Grant Expenditures: 6 years

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2018 and 2019 Disasters

Important Dates- 2017 Infrastructure Grants

• Applicability Date: February 3, 2020
• April 3, 2020: Financial Management and Grant Compliance
• May 3, 2020: Substantial Action Plan Amendment
• 30-day Public Comment Period
• 45-day HUD Review
• QPRs: 30 days after 1st full quarter of grant execution
• Grant Expenditures: 6 years

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2018 and 2019 Disasters

Grant Administration and Action Plan

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2018 and 2019 Disasters

2018 and 2019 Grant Process

• Citizen participation plan
• Consult with stakeholders, including affected local governments,

Indian tribes and public housing authorities

• Submission of certification of financial controls and procurement

processes, and grant management

• Submission of implementation plan and capacity assessment
• Publish draft action plan for no less than 30 calendar days public

comment period

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2018 and 2019 Disasters

2018 and 2019 Grant Process

• Responds to public comment and submits its action plan and

projected expenditures and outcomes

• Standard Form 424 and certifications
• Requests and receives Disaster Recovery Grant Reporting (DRGR)

system access

• Enter activities before or after submission of the action plan
• HUD reviews and approves or disproves the action plan within 45
• days. If the plan is not approved, HUD will notify the grantee of the

deficiencies and the grantee will resubmit the action plan.

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2018 and 2019 Disasters

2018 and 2019 Grant Process

• The Secretary of HUD certifies each grantee’s proficiencies and

Action Plan

• HUD sends an approval letter and grant agreement to grantee
• Grantee signs and returns the grant agreement
• Grantee publishes final HUD-approved action plan on its official

website

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2018 and 2019 Disasters

2018 and 2019 Grant Process

• HUD establishes the grantee’s line of credit
• Grantee drafts and publishes policies and procedures for programs

and key recovery operations implemented by the grantee with CDBG-DR funds

• Grantee must enter the activities from its approved action plan

into the DRGR system and submit its DRGR action plan to HUD

• Grantee may draw down on funds after environmental review is

completed

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2018 and 2019 Disasters

2017 Infrastructure Grant Process

• Substantial amendment to current action plan must include:
• Additional allocation of funds
• Address the requirements of prior notices (83 FR 5844 & 83 FR

40314)

• For grantees who have entered into alternative procedures under

section 428 of the Stafford Act HUD will condition the availability of funds

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2018 and 2019 Disasters

Pre-award Evaluation

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2018 and 2019 Disasters

Certifications

• Certification on financial controls and procurement processes, and

adequate procedures for proper grant management

(1) Proficient financial management controls (2) Procurement process/standards (3) Duplication of benefits procedures (4) Timely expenditures (5) Comprehensive disaster recovery website (6) Procedures to detect and prevent fraud, waste, and abuse

• Due: April 3, 2020

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2018 and 2019 Disasters

Sufficient Management Capacity

(1) Timely information on app status (2) Implementation plan

(a) Capacity assessment (b) Staffing (c) Internal and interagency coordination (d) Technical assistance (e) Accountability

• Due: April 3, 2020

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2018 and 2019 Disasters

Review of Prior Notices, Waivers, and Additional Requirements

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2018 and 2019 Disasters

Prior Notices

• Waivers and alternative requirements are established and

amended in prior notices:

• February 9, 2018 at 83 FR 5844
• August 14, 2018 at 83 FR 40314
• February 19, 2019 at 84 FR 4836
• June 20, 2019 at 84 FR 28848

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2018 and 2019 Disasters

Waivers and Requirements

• Congress gives HUD the right to waive certain parts of regular

CDBG in order to make it more responsive to a disaster.

• Good cause exists
• Is not inconsistent with overall purpose of HCD Act
• Cannot conflict with cross-cutting requirements:
• Equal opportunity
• Fair Housing
• Environmental Review
• Davis Bacon Labor Standards

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2018 and 2019 Disasters

Administrative Waivers and Additional Requirements

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2018 and 2019 Disasters

Administrative Waivers and Requirements

• Public Comment Period: 30-day public comment period required

for all action plans and substantial amendments.

• Planning and Administration Cap: Administration expenditures

may not exceed 5 percent of the total grant. Planning expenditures are capped at 15 percent of the total grant.

• Direct Grant Administration: States may directly administer

programs.

• Overall Benefit: The 70 percent overall benefit requirement

remains in effect.

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2018 and 2019 Disasters

Most Impacted and Distressed

• Administration Expenditures in the MID: 80 percent of

administration expenditures will count towards the MID requirement.

• Planning Expenditures: Expenditures for planning activities may
• nly be counted towards the MID requirement if the grantee

describes in its action plan how those planning activities will benefit the MID area.

• MID Calculations: 80 percent of the total grant must be spent in

the HUD-identified MID areas.

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2018 and 2019 Disasters

Substantial Amendment Requirements

• Substantial Amendment Criteria:
• Change in program benefit or eligibility criteria
• Addition or deletion of an activity
• Allocation or reallocation of a monetary threshold amount as specified by

the grantee in its action plan

• Change in the monetary threshold amount established

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2018 and 2019 Disasters

Administrative Waivers and Requirements

• Urgent Need: Required to document how each program or project

responds to a disaster-related impact, but not limited to 24 months.

• Criteria to Mitigate Risk: HUD may establish grant conditions to

mitigate the risk of a grant award.

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2018 and 2019 Disasters

Waivers Related to Housing and Construction Projects

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2018 and 2019 Disasters

Housing Priority

• Each grantee is required to primarily consider and address its

unmet housing recovery needs.

• However, grantees may propose the unmet economic revitalization

and infrastructure needs unrelated to unmet housing IF the grantee shows there is not a remaining unmet housing need, or the unmet housing need will be addressed by other sources.

• The additional allocation for unmet infrastructure needs MUST be

used for infrastructure activities.

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2018 and 2019 Disasters

Affordability Periods and Incentives

• Affordability Periods for Multi-Family Rental:
• 15 years— rehab or recon with eight or more units
• 20 years— new construction with five or more units
• Affordability Periods for Single-Family Housing:
• 5 years— new construction through homeownership programs
• Housing Incentives: Grantees must document how the incentive

was determined to be necessary and reasonable.

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2018 and 2019 Disasters

Housing Waivers and Requirements

• Buyout vs. Acquisition for Redevelopment: Buyout is defined as

acquisition of property in a floodway or floodplain and cannot be redeveloped.

• Second Homes: At the time of a disaster or after the disaster are

not eligible for rehab or housing incentives but may be eligible for buyout.

• Eminent Domain: Will not support Federal, State or Local projects

seeking eminent domain unless the project is for public use.

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2018 and 2019 Disasters

Housing Waivers and Requirements

• Interim Mortgage Assistance: Extended mortgage assistance to

qualified beneficiaries up to 20 months.

• Forced Mortgage Payoff: CDBG-DR funds may not be used to pay
• ff forced mortgages.
• Rental Assistance: This notice does not extend the standard

emergency rental assistance provision.

• Prohibiting Assistance to Private Utilities: Grantees may not assist

a privately-owned utility for any purpose.

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2018 and 2019 Disasters

Cost Requirements

• Cost Price Analysis: Full and open competition that includes an

evaluation of the cost or price of a product or service.

• Cost Verification: Grantee’s must describe their controls for

assuring that construction costs are reasonable.

• Rehabilitation and Reconstruction Cost-Effectiveness: Requires

grantees to establish policies and procedures to assess the cost- effectiveness of each proposed project and consider alternatives.

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2018 and 2019 Disasters

Green Building Standards

• Green Building Standards: Green building standards apply for

replacement and new construction housing. Green Building Retrofit Checklist should be used for all housing rehabs. Grantees must identify which standard will be used.

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2018 and 2019 Disasters

Waivers Related to Environmental Review Requirements

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2018 and 2019 Disasters

Floodplain Requirements

• Federal Assistance in a Floodplain: Prohibition on assistance for

rehab/reconstruction, if:

• The combined household income is greater than 120 percent AMI or the

national median,

• The property was located in a floodplain at the time of the disaster, and
• The property owner did not maintain flood insurance on the damaged

property

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2018 and 2019 Disasters

Environmental Review Requirements

• Elevation Standards: All substantially damaged residential

structures and new construction in a 100-year floodplain must be elevated 2 feet above base flood elevation.

• Elevation of Nonresidential Structures: Elevated or floodproofed

up to at least 2 feet above the 100-year floodplain.

• Environmental Review: Adoption of another Federal agency’s

review without review or public comment.

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2018 and 2019 Disasters

Environmental Review & Infrastructure

• Discipline and Accountability in Environmental Review and

Infrastructure Projects: Establishes a coordinated, predictable and transparent process for the review and permitting of infrastructure projects, including standard operating procedures that include FEMA’s review.

• Requirements for Flood Control Structures: Prohibited from using

CDBG-DR funds to enlarge a dam or levee beyond the original footprint.

• Infrastructure Planning and Design: Requires grantees to address long-

term recovery and hazard mitigation planning in action plan.

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2018 and 2019 Disasters

Waivers Related to Economic Revitalization

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2018 and 2019 Disasters

Economic Revitalization Requirements

• Prioritizing Small Businesses: Grantees are required to prioritize

assisting small businesses or businesses engaged in farming

• perations.
• Clarification of Working Capital: Working capital is defined as

“Current Assets minus Current Liabilities”. Expenses for construction or expansion of existing facilities should not be included in working capital.

• Underwriting: Funds provided for a for-profit entity must be

evaluated and selected per HUD guidelines.

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2018 and 2019 Disasters

CDBG-DR as Match

• CDBG-DR as Match for FEMA 428: Grantees must document that

CDBG-DR funds have been used for the actual costs incurred for the assisted project and for costs that are eligible, meet a national

• bjective, and meet other applicable CDBG requirements.

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2018 and 2019 Disasters

Duplication of Benefits

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2018 and 2019 Disasters

Duplication of Benefits

• Check out the Duplication of Benefits Webinar (June 26, 2019)
• A subsidized loan is not a duplication, provided that all Federal

assistance is used toward a loss suffered as a result of a major disaster or emergency.

• Accepted but undisbursed loan amounts are not considered a DOB

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2018 and 2019 Disasters

Duplication of Benefits

• Treatment of undisbursed loan amounts: Assistance for the same

purpose as the undisbursed loan requires that the grantee notify the lender, obtain applicant’s agreement not to draw loan funds without approval, and determine that all federal assistance is used toward a loss resulting from a major disaster or emergency

• Updates to the action plan are required if assistance is inconsistent

with grantee’s plan

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2018 and 2019 Disasters

Duplication of Benefits

• Subject to conditions in the 2019 DOB Notice, grantees may grant

CDBG-DR funds to reimburse individuals and businesses (other than the grantee or subrecipients) for the same costs of CDBG-DR eligible activities that were paid with subsidized loans

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2018 and 2019 Disasters

Duplication of Benefits

• FEMA Permanent and Semi Permanent Housing: Grantees must

ensure that CDBG-DR funds are not used for activities reimbursable or duplicative of FEMA or U.S. Army Corps of Engineers funding.

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2018 and 2019 Disasters

NEW Waivers, and Additional Requirements

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2018 and 2019 Disasters

Local Governments

This notice extends waivers and alternatives in prior notices to local governments:

• Action Plan for Disaster Recovery
• Citizen participation
• Use of urgent need national objective
• Procurement

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2018 and 2019 Disasters

Administrative Waivers and Requirements

• Use of Administrative Funds Across Multiple Grants: Grantees

under Public Laws for disaster occurring in 2015, 2016, and 2017

• r future acts may use up to 5 percent administration and program

income funds regardless of the original disaster allocation.

• Use of Funds in Response to Hurricane Matthew and Hurricane

Florence (North and South Carolina only): Funds may be used interchangeably for the same activities in the MIDs related to Florence.

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2018 and 2019 Disasters

Administrative Waivers and Requirements

• Consolidated Plan: Are temporarily waived.
• 2017 disasters: Fiscal Year 2020
• 2018 and 2019 disasters: Fiscal Year 2022

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2018 and 2019 Disasters

One for One Replacement Waiver

• One for One Replacement Housing: Grantees with a previous

CDBG-DR grant from 2015, 2016, or 2017 that also receive a grant under Public Laws 115-254 or 116-20 have a choice to either:

• Continue with the same requirements (81 FR 83266), or
• Follow 2017 disaster requirements (83 FR 5858).
• New grants under P.L. 115-254 or 116-20 are covered under the waiver.

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2018 and 2019 Disasters

Clarifications on Affordability Periods

• Clarification on Affordability Periods and Amended

Requirements: 5-year affordability period is only imposed on newly constructed single-family units sold through a homeownership program.

• Affordability period is imposed when a grantee is expanding the

housing stock, not when a grantee is replacing damaged units

• wned and occupied by a beneficiary

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2018 and 2019 Disasters

Clarifications to Include Wildfires

• Acquisition of Real Property; Flood and Other Buyouts:

Wildland fire risk areas are eligible for buyout.

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2018 and 2019 Disasters

Clarifications to Section 414

• Section 414: HUD extends the Section 414 waiver to include all

grantees with a CDBG-DR grant in 2017, 2018, or 2019 disaster that also have a grant from 2015, 2016 or 2017 disaster:

• Option 1: Follow Section 414 requirements, or
• Option 2: Follow the waiver and alternative requirement (83 FR 40319).
• New grants under P.L. 115-254 or 116-20 are covered under the waiver.

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2018 and 2019 Disasters

Clarifications on Procurement

• Procurement and Use of Subrecipients: States have the flexibility to

choose one of three options when developing policies and procedures, including requirements for local governments and subrecipients.

• Adopt 2 CFR 200.318 through 200.326 for itself and its subrecipients,
• Follow its own procurement requirements and establish requirements for

subrecipients (including full and open competition and a cost or price analysis in accordance with 24 CFR 570.489(g)), or

• Adopt 2 CFR 200.317, meaning that it will follow its own State procurement

policies (including a cost or price analysis), but impose 2 CFR 200.318 through 200.326 on its subrecipients.

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2018 and 2019 Disasters

Resources

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2018 and 2019 Disasters

Resources

• CDBG-DR Toolkit- Program Launch
• https://www.hudexchange.info/programs/cdbg-dr/toolkits/
• Duplication of Benefits Webinar (June 26, 2019)
• https://www.hudexchange.info/trainings/courses/duplication-of-

benefits-webinar-2019/2970/

• CDBG-DR Laws, Regulations, and Federal Register Notices
• https://www.hudexchange.info/programs/cdbg-dr/cdbg-dr-laws-

regulations-and-federal-register-notices/

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2018 and 2019 Disasters

Questions?

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