This is a substantial rewrite of the rule.  

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    DEPARTMENT OF COMMUNITY AFFAIRS
    Division of Housing and Community Development

    RULE NO: RULE TITLE
    9B-43.0031: Definitions
    9B-43.0041: Application and Administrative Requirements
    9B-43.0045: Specific Requirements for Competitive Categories.
    9B-43.0051: Grant Administration and Project Implementation
    9B-43.0061: Emergency Set-Aside Assistance
    9B-43.0071: Section 108 Loan Guarantee Program
    9B-43.0081: Nonrecurring CDBG Funding.
    PURPOSE AND EFFECT: This is a substantial rewrite of the rule.
    SUMMARY: Rule Chapter 9B-43, F.A.C., has been revised to include two new sections (Specific Requirements for Competitive Categories and Nonrecurring CDBG Funding). Existing sections have also been revised. Revisions have also been made to the application manual, including scoring criteria, which is incorporated by reference.
    SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost has been prepared. However, the rule revisions will not have a financial impact on the State of Florida or any local government served by the Florida Small Cities CDBG Program. The only costs associated with the rule revision are those related to the public meetings being conducted.
    Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
    SPECIFIC AUTHORITY: 290.048 FS.
    LAW IMPLEMENTED: 290.043, 290.044, 290.0455, 290.046, 290.047, 290.0475, 290.048 FS.
    A HEARING WILL BE HELD AT THE DATE, TIME AND PLACE SHOWN BELOW:
    DATE AND TIME: March 16, 2010, 1:30 p.m. – 5:00 p.m.
    PLACE: Department of Community Affairs, Sadowski Building, Randall Kelley Training Center (Room 305), 2555 Shumard Oak Boulevard, Tallahassee, Florida 32399-2100
    Toll free call in number: 1(888)808-6959; conference code 6518651.
    Pursuant to the provisions of the Americans with Disabilities Act, any person requiring special accommodations to participate in this workshop/meeting is asked to advise the agency at least 7 days before the workshop/meeting by contacting: Judy Peacock, Planning Manager, CDBG Program, 2555 Shumard Oak Boulevard, Tallahassee, Florida 32399-2100 or call (850)487-3644. If you are hearing or speech impaired, please contact the agency using the Florida Relay Service, 1(800)955-8771 (TDD) or 1(800)955-8770 (Voice).
    THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Jacquelyn Dupree, Community Program Manager, Division of Housing and Community Development, 2555 Shumard Oak Boulevard, Tallahassee, Florida 32399-2100, (850)487-3644

    THE FULL TEXT OF THE PROPOSED RULE IS:

    (Substantial rewording of Rule 9B-43.0031 follows. See Florida Administrative Code for present text.)

    9B-43.0031 Definitions.

    The Florida Small Cities Community Development Block Grant (CDBG) Program is governed by definitions provided in the Housing and Community Development Act of 1974, as amended; and Title 24 C.F.R. 570, incorporated herein by reference, as effective on 0-00-00. The following additional definitions are provided for clarification.

    (1) “Administrative closeout” means the written notification to a recipient by the Department that all applicable administrative actions and all required work of the subgrant have been completed, with the exception of submission of the final audit.

    (2) “Administrative costs” include the payment of all reasonable costs of management, coordination, monitoring, and evaluation, and similar costs and carrying charges, related to the planning and execution of community development activities which are funded in whole or in part under the Florida Small Cities Community Development Block Grant Program. Administrative costs shall include all costs of administration, including general administration, planning and urban design, and project administration costs. Excluded from administrative costs are:

    (a) Architectural, engineering and associated construction observation costs where State law or 24 C.F.R. Part 85, as effective on 00-00-00, requires sealed construction documents to obtain a building permit;

    (b) Force account crews performing construction work;

    (c) Title searches, appraisals and costs of surveys.

    (3) “Architectural and engineering services” means the basic services required to be performed by an architect or engineer licensed by the State of Florida including preliminary engineering, design services and services during construction except for the following additional engineering services:

    (a) Site surveys for water treatment plants, sewage treatment works, dams, reservoirs, and other similar special surveys as may be required, such as route surveys.

    (b) Laboratory tests, well tests, borings, and specialized geological soils, hydraulic, or other studies recommended by the engineer.

    (c) Property surveys, detailed description of sites, maps, drawings, or estimates related to them, assistance in negotiating for land and easement rights.

    (d) Necessary data and filing maps for water rights.

    (e) Redesigns ordered by the owner after final plans have been accepted by the owner and the local government, except redesigns to reduce the project cost to within the funds available and projects which received “readiness to proceed” points or a planning and design grant.

    (f) Appearances before courts or boards on matters of litigation or hearings related to the project.

    (g) Preparation of environment assessments or environmental impact statements.

    (h) Performance of detailed staking necessary for construction of the project in excess of the control staking.

    (i) Provision of the operation and maintenance manual for a facility.

    (j) Activities required to obtain state and federal regulatory agency construction permits.

    (k) Design of hookups.

    (l) Cost of engineering specialties such as electrical; hydro-geological services; biologists; and heating, ventilation, and air conditioning (HVAC).

    (4) “Authorized signature” means the original signature of the Chief Elected Official or of a person designated by charter, resolution, code, ordinance or another official action of the local government to sign CDBG-related documents. If a signature other than that of the Chief Elected Official is submitted, a copy of the authorizing document must accompany the signature.

    (5) “Biddable construction plans and specifications” means construction plans and specifications that include all addressed need service areas defined in the application, and includes all addressed need work activities outlined in the application. These documents must be consistent with the project description in the application and the proposed budget and scope of work.

    (6) “CATF” means Citizen’s Advisory Task Force pursuant to Section 290.046(5), Florida Statutes. The CATF shall be comprised of citizens in the jurisdiction in which the proposed project is to be implemented.

    (7) “Complementary activities” are eligible activities, as provided in Section 290.042, F.S., required by the primary activity or project scored in the CDBG application for which grant funds are being requested and which do not, except for Economic Development projects, exceed 35 percent of the cost of the primary activity or project.

    (8) “Direct Benefit” is CDBG assistance that promotes or enhances individual well-being, such as housing rehabilitation, sewer and water hookups, or job creation by a Participating Party. Activities that only meet a national objective through an area-wide benefit do not confer direct benefit.

    (9) “Engineer” means a person meeting the qualifications in Section 47(1)005(4), F.S.

    (10) A “finding” is a specific issue of noncompliance with federal or state regulatory requirements, including the CDBG subgrant contract provisions.

    (11) “Full-time employee” means a person, excluding an elected official, employed by the local government who is on the payroll on one specific payroll date during the 45 day period prior to the application deadline and who is eligible to receive full vacation, retirement, and any other benefits provided by the employing local government to all its regular employees. For county governments, only the employees of the Board of County Commissioners shall be eligible to be included in this definition.

    (12) “Fundable range” for each category, except Emergency Set-Aside, shall be determined from the final scores of the eligible applications, ranked by the Department in descending order. Awards are based on the ranking following appeals, beginning with the highest scored application and proceeding in descending order until all available funds in a category for that funding cycle are depleted. If there are unfunded applications in a category, the highest scored unfunded application shall set the score above which a project must remain to be fundable.

    (13) “Household” means all individuals residing in a dwelling unit, regardless of their relationship.

    (14) “Income” means annual income as defined by the U.S. Department of Housing and Urban Development as set forth in 24 CFR Section 5.609, as effective on 00-00-00.

    (15) “Job creation location” means the geographic location in the project area where job creation activities of the Participating Party and expenditure of non-public funds will occur. This excludes locations where public funds from any source are being expended for local government owned infrastructure, local government owned public facilities or within public easements or rights-of-way.

    (16) “Jobs – created” means non-public sector jobs that were not in existence in the State of Florida prior to the provision of the CDBG assistance and which would not be created without CDBG assistance. In cases where an employer both creates and eliminates jobs, “jobs – created” means the difference between the new jobs created and the old jobs eliminated.

    (17) “Jobs – permanent” means full-time jobs (2,000 hours annually) or full-time equivalent jobs (2,000 hours annually) as set forth in the application which are necessary to the overall goals and objectives of a business and which have no known end.

    (18) “Jobs – retained” means jobs that without CDBG assistance, would be abolished by layoffs, plant closing, or other severe economic or natural conditions or as otherwise clarified in 24 C.F.R. 570.483(b)(4), as effective on 00-00-00.

    (19) “Jurisdiction” means the corporate limits of a local government.

    (20) “Leverage” includes non-CDBG grants and loans to the local government, funds expended by other entities for the project (including by a Participating Party in an Economic Development project), fee waivers, or donated land required for the project. Special CDBG allocations awarded separately from the annual allocation, such as disaster recovery funding, may be used as leverage.

    (21) “Liquidated damages” are funds paid to a local government by a contractor, vendor, or any other party pursuant to a CDBG-funded contract when such payment is triggered by non-performance or failure to perform. This definition is applicable whether such funds are withheld by the local government or repaid or rebated to the local government by the contractor, vendor or third party.

    (22) “Local government” means a unit of general purpose local government, such as county governments and municipal governments (incorporated cities, towns and villages) within the State of Florida. Unless otherwise stated, “applicant” shall refer to the applying local government.

    (23) “Low and moderate income (LMI) household means a household whose annual income does not exceed 80 percent of the median income for the area as most recently determined by HUD.

    (24) “Low and moderate income persons” means members of low and moderate-income households.

    (25) “Low income household” means a household whose annual income does not exceed 50 percent of the median income for the area as most recently determined by HUD.

    (26) “Minority” means African American, American Indian, Alaskan native, Asian, Native Hawaiian, or Pacific Islander individual.

    (27) “One hundred year floodplain” or “100 year floodplain” means the area subject to a one percent or greater chance of flooding in any given year as specified in 24 C.F.R. Section 55.2(b)(1), as effective on 00-00-00.

    (28) “On schedule” means the local government’s performance on an open CDBG subgrant agreement is in accordance with the expenditure rates and accomplishments described in the contract workplan. Expenditures shall be considered “on schedule” if the local government has received at least 90 percent of the amount projected in the work plan’s schedule of expenditures. Accomplishments shall be considered “on schedule” if an activity identified in the work plan is not more than two months past the scheduled completion date.

    (29) “On-time performance” means the local government has not received an extension of the subgrant agreement period for twelve (12) months or more, except for time extensions required for an Economic Development project to track additional job creation when contractual job creation commitments have been met, but the cost per job exceeds $10,000. For subgrants initially funded only for planning and design, the 12 months shall begin two years after the subgrant was amended for construction phase funding.

    (30) “Open subgrant” for the purposes of applicant eligibility is a CDBG agreement that has not been administratively closed.

    (31) “Participating Party” means a private, for-profit business or non-governmental private not-for-profit entity responsible for creating or retaining permanent jobs as part of a proposed Economic Development project.

    (32) “Principal” means the owner of 50 percent or more of a Participating Party business in a proposed Economic Development project.

    (33) “Program income” means gross income received by a unit of local government that was generated from the use of CDBG funds.

    (34) “Project area or areas” means the site or sites upon which all subgrant-related construction activities take place, without respect to funding source.

    (35) “Public notice” is an advertisement published in a local newspaper of general circulation at least 5 days and no more than 20 days prior to the event for which the notice was placed. The calculation of the time period shall not include the date of publication of the notice.

    (36) “Section 3” means Section 3 of the Housing and Community Development Act of 1968, as amended, and 24 C.F.R. Part 135, as effective on 00-00-00, relating to employment and other economic opportunities for lower income persons.

    (37) “Service area” means the total geographic area to be directly or indirectly served by the subgrant project, where at least 51 percent of the residents are low and moderate income persons. A service area must include all, and only those, beneficiaries who are reasonably served or would be reasonably served by an activity.

    (38) “Time period” or “days” means calendar days. All time periods specified in this rule, the application, the agreement and all correspondence to and from the Department refer to calendar days unless otherwise specified.

    (39) “Very low-income (VLI) household” is a household whose annual income does not exceed 30 percent of the median income for the area as most recently determined by HUD.

    Rulemaking Specific Authority 290.048 FS. Law Implemented 290.042, 290.043 FS. History–New 5-23-06, Amended________.

     

    (Substantial rewording of Rule 9B-43.0041 follows. See Florida Administrative Code for present text.)

    9B-43.0041 Application Process and Administrative Requirements.

    (1) Funding Cycles and Subgrant Agreement Ceilings. Unless otherwise directed by budgetary or administrative constraints, the Florida Department of Community Affairs shall annually initiate a funding cycle for the receipt and review of applications for Community Development Block Grant assistance from eligible units of local government.

    (a) An annual application cycle will be announced for each federal award. The Department shall publish a Notice of Funding Availability (NOFA) which establishes a deadline date and time for submission of applications. The NOFA shall be published in the Florida Administrative Weekly at least 45 days in advance of the deadline.

    (b) Subgrant ceilings establish limits on the amount of funds that may be requested in an application based on the most recently available U.S. Census of Population data. In the case of county government applicants, the population shall include only the unincorporated areas of the county.

    (c) The local governments’ LMI population determines the maximum amount of funds for which they can apply. Population groupings are based on HUD modified census figures summarizing low and moderate income population as the following chart shows:

    LMI Population Subgrant Ceiling

    1 – 499 $600,000

    500 – 1,249 $650,000

    1,250 – 3,999 $700,000

    4,000 – 10,549 $750,000

    10,550 – and above $750,000

    (d) Planning and Design Specifications subgrants shall not exceed $70,000.

    (2) Eligible Applicants.

    (a) Eligible local governments include those counties and municipalities in Florida that do not receive CDBG entitlement assistance from the U.S. Department of Housing and Urban Development (HUD). In the Small Cities CDBG Program, eligible local governments shall be referred to as “non-entitlement” local governments.

    (b) Eligible local governments that have an open Housing, Neighborhood Revitalization, Commercial Revitalization, or Planning and Design Specifications subgrant shall not be eligible to apply for another Housing, Neighborhood, Commercial Revitalization, or Planning and Design Specifications subgrant until administrative closeout of their existing subgrant.

    (c) Eligible local governments with an open Housing, Neighborhood Revitalization, Commercial Revitalization, or Planning and Design subgrant whose activities and expenditures are on schedule and on time may apply for an Economic Development subgrant.

    (d) Eligible local governments with an open Economic Development subgrant whose activities and expenditures are on schedule and on time as of the opening of the funding cycle can apply for a Housing, Neighborhood Revitalization, Commercial Revitalization, or Planning and Design subgrant.

    (e) Eligible local governments with an open Economic Development subgrant whose activities and expenditures are on schedule and on time may receive no more than one additional Economic Development subgrant in each funding cycle.

    (f) To be eligible to apply for a Housing, Neighborhood Revitalization, or Commercial Revitalization subgrant, a local government with an open but completed Housing, Neighborhood, Commercial Revitalization, or Planning and Design subgrant shall submit an administrative closeout which must be received by the Department no later than 5:00 PM EST on the day prior to the advertised opening of the application cycle. The Department will acknowledge a local government’s closeout request by mailing an administrative closeout notification or a Notice of Outstanding Closeout Issues (NOCISS) letter.

    1. The NOCISS letter shall identify issues that the local government must resolve before the Department’s review of the closeout can be completed.

    2. A local government’s response to an NOCISS letter must be received by the Department at least ten days before the application deadline for the local government to retain eligibility for the funding cycle. For a NOCISS response received at least ten days prior to application deadline, eligibility will be retained if the response satisfies the deficiencies set forth in the NOCISS letter, regardless of whether the Department’s closeout notification has been mailed before the application deadline date.

    (3) Citizen Participation Requirements.

    (a) The applicant shall demonstrate that the citizen participation requirements required by this rule, sections 104(a)(1) and (2) and 106(d)(5)(C) of Title I of the Housing and Community Development Act of 1974, and Section 290.046(5), F.S., with public notice provided in accordance with Rule 9B-43.003, F.A.C., have been satisfied. Each applicant shall certify that it is following a Citizen Participation Plan pursuant to Section 104(a)(3) of Title I of the Housing and Community Development Act of 1974. The local government must inform and involve its citizens in the project planning and selection, and decision-making process regarding all CDBG-funded projects. These requirements are:

    1. Public information is made available for various activities and the range of activities that may be undertaken;

    2. At least one public hearing is held to obtain citizens’ views regarding community development needs. This shall be known as the first public hearing. The public hearing must be advertised at least 5 days and no more than 20 days before the meeting;

    3. At least one public hearing is held to obtain citizen views regarding the proposed project to be submitted for funding. A summary of the proposed application shall be published at least 5 days prior to and no more than 20 days before the hearing. The summary must provide citizens with an opportunity to examine the application and submit their comments on the final application prior to its submission to the department. The summary shall include, at a minimum, the proposed project description and anticipated location of the activities, what activities will be undertaken, and a specific CDBG amount for each activity. This shall be known as the second public hearing.

    4. The applicant considers all comments and views expressed by citizens on the proposed application and, if appropriate modifies the proposed application;

    5. Both public hearings shall be given proper public notice as defined in Rule 9B-43.002, F.A.C., Program Definitions (35), herein. The advertisement for the second public hearing on the application shall not occur until after the date of the first public hearing; and

    6. All public hearings required to meet these citizen participation requirements must be conducted by a member of the governing body of the applying local government or by a duly authorized employee of that local government.

    (b) The local government shall establish a Citizens Advisory Task Force (CATF) comprised of at least three residents of the jurisdiction, none of which shall be elected officials and no more than one employee of the local government. The purpose of the CATF shall be to provide input on all phases of the project process. The local government must obtain consent from the Department of Community Affairs for any other type of citizen participation plan upon showing that its plan is better suited to secure citizen participation for that locality.

    1. The Citizens Advisory Task Force shall conduct at least one public meeting to discuss the proposed application before the second public hearing notice is published.

    2. The CATF shall provide recommendations to the local government for all aspects of the local CDBG program.

    (4) Application Preparation and Submission.

    (a) Application Preparation: During each funding cycle, eligible applicants can submit applications in the following categories:

    1. Either Housing or Neighborhood Revitalization, but not both. If both are received from an applicant, only the first application logged in by the Department will be scored. The second application will be returned unscored;

    2. Commercial Revitalization; and

    3. Economic Development;

    (b) An applicant cannot receive more than one subgrant in any funding cycle from any of the following categories: Housing, Neighborhood Revitalization, or Commercial Revitalization, or Planning and Design.

    (c) Application Forms. Application forms are in the application manuals, hereby incorporated into this rule by reference, effective as of 00-00-00, and which are available from the Department of Community Affairs at the address specified in the NOFA:

    1. CDBG-H, Housing Application Manual;

    2. CDBG-N, Neighborhood Revitalization Application Manual;

    3. CDBG-C, Commercial Revitalization Application Manual; and

    4. CDBG-E, Economic Development Application Manual;

    (d) Administrative Costs.

    1. Percentage Limitations. Applicants under the Housing category shall utilize no more than 15 percent of the total eligible subgrant amount for administrative costs. Applicants under the Economic Development, Neighborhood Revitalization and Commercial Revitalization categories shall utilize no more than 8 percent of the total eligible subgrant amount for administrative costs.

    2. If administrative cost percentages set forth in Section 290.047, F.S., are exceeded in the application, the administrative costs shall be reduced prior to the offering of an award to bring the percentages into compliance based on the total eligible subgrant costs.

    (e) Architectural and Engineering Costs. The maximum percentage of CDBG funds that may be spent on design architectural and engineering costs, excluding additional engineering services, shall be based on the total initial construction budget for eligible subgrant activities which require architecture and engineering and shall not exceed the Rural Development (RD) Rural Utility Service (RUS) fee schedule in Florida, RUS Bulletin 1780-9 (rev 10/2009), hereby incorporated into this rule by reference. Engineering services during construction shall not exceed the Rural Development (RD) Rural Utility Service (RUS) fee schedule in Florida, RUS Bulletin 1780-9 (rev 6/2007), hereby incorporated into this rule by reference.

    1. If more than one design professional is needed for an activity or activities (i.e., a landscape architect in addition to an engineer for sidewalk construction in a commercial revitalization project), the local government shall not exceed the appropriate RD/RUS fee curve for each activity covered by each design professional negotiated separately.

    2. For projects involving both Table I and II activities, engineering costs shall be pro-rated appropriately.

    3. For each additional engineering service as defined in subsection 9B-43.003(3), F.A.C., and for preliminary engineering, the local government shall negotiate a reasonable fee for the service following procurement procedures in 24 C.F.R. 85.36, as effective on 00-00-00.

    4. Preliminary engineering costs not to exceed one-half of one percent of the estimated construction cost may be paid with CDBG funds over and above the amounts included the RD/RUS fee schedule.

    5. If “readiness to proceed” points are part of the final application score, then CDBG subgrant funds for engineering costs shall not include preliminary engineering and shall not exceed $10,000 plus the percentage in the fee schedule for Table IA, Table IIA, or a prorated amount of both tables for projects involving activities included in both tables. Also, CDBG funds shall not be used to fund any additional design or redesign costs, even if the “readiness to proceed” points are subsequently removed from the application after a subgrant award.

    (f) Consistency with Local Comprehensive Plan.

    1. The application shall include affirmations from all jurisdictions in which activities will take place that the proposed activities are not inconsistent with the applicable elements of the adopted local comprehensive plan.

    2. If the Department determines that an application is inconsistent with the adopted local comprehensive plan, the applicant shall be advised of that determination in the completeness review letter. If after review of the applicant’s response the Department reaffirms its determination of inconsistency, the application shall be rejected.

    (g) Application Submission. Applications shall be received by the Department in Tallahassee by 5:00 p.m. EST on the date specified in the NOFA. Applications not received by the specified deadline shall not be considered. Applicants must also meet intergovernmental coordination and review requirements as follows:

    1. By the application deadline, 12 copies of the following information for Housing, Neighborhood Revitalization, Commercial Revitalization and Planning and Design Specifications applications shall be mailed to the Department of Environmental Protection, Florida State Clearing House, 3900 Commonwealth Boulevard, Mail Station 47, Tallahassee, Florida 32399-3000:

    a. Application Profile and Narrative.

    b. Sources and Uses of Non-CDBG Funds Information.

    c. CDBG Funds and Activity Goal Score Spreadsheet.

    d. All Maps.

    e. If applicable, Historic Preservation Documents.

    2. A transmittal letter, requesting that documents relating to the Clearing House review be sent to the local government and the CDBG Program, shall accompany the materials sent to the State Clearing House.

    3. By the application deadline, one copy of the above materials shall be sent to the Regional Planning Council that serves the local government.

    (h) Application Submission and Fund Reservation for Economic Development Projects.

    1. Economic Development applications may be submitted when the annual funding cycle opens. Economic Development applications received by the application deadline will be scored, ranked and, if successful, awarded until all available funds are committed. Should initial application requests not exceed available funds, applications received after the application deadline will be reviewed and awarded on a first-come, first-served basis until all funds are committed.

    2. These funds shall include the annual Economic Development allocation and may include any funds unawarded from previous cycles and deobligated funds from previous Economic Development subgrants, in accordance with the Annual Action Plan under the State of Florida Consolidated Plan submitted by the Department to the U.S. Department of Housing and Urban Development, as amended.

    3. A local government may apply up to three times in an annual funding cycle.

    4. A local government cannot submit an additional Economic Development application in an annual funding cycle until any previously submitted Economic Development application for that annual funding cycle has been rejected by the Department, has lost its funding reservation, or is withdrawn in writing by the Chief Elected Official or his or her designee.

    5. Economic Development applications will be date stamped upon receipt by the Community Development Block Grant Section. The date stamp and time received by the Community Development Block Grant Section shall establish the date and time for fund reservation purposes. Date stamps from any other section of the Department shall not establish a funding reservation. Funds will be reserved in the order received by date and time.

    6. Once the application is received, the local government will not be allowed to provide new documentation from a Participating Party to meet the initial Participating Party requirements in the application.

    7. If sufficient funds are available to fully fund an application, that amount is reserved for the applicant upon receipt of the application. The application continues to have those funds reserved until a subgrant is executed or until there is a loss of fund reservation.

    8. Should insufficient funds be available to fund or partially fund applications with a funding reservation, those applications shall retain a position in the funding reservation line and may be funded if additional funds are made available by additional allocations or by a loss of funding reservation by another applicant.

    9. If partial funding is available, the Department will offer to partially fund an eligible application and will continue with the application review and scoring for partial funding. If the application remains eligible after review and scoring considering the partial funding available, the Department will offer to partially fund it. There is no guarantee of full funding in such an offer, but a partially funded subgrant will be considered first if additional funds become available. The local government has the option of declining a partially funded offer.

    10. The review and offer of funding will then be made to the next eligible pending application. If there are no other applications pending or if the amount of the funds available is too small for reasonable consideration, the partial funds can be held until additional funds are available.

    (5) National Objective and Public Benefit Documentation.

    (a) Achievement of national objectives. An applicant shall demonstrate that each of the activities proposed in its application meets at least one of the following three national objectives and that at least 70 percent of the funds requested shall benefit low and moderate-income persons:

    1. An activity shall be considered to benefit low and moderate income persons when it benefits are low and moderate income persons as specified in 24 C.F.R. Section 570.483(b), as effective on 00-00-00; or

    2. Aid in the prevention or elimination of slums or blight as determined pursuant to 24 C.F.R. Section 570.483(c), as effective on 00-00-00; or

    3. Meet urgent community development needs where there is a serious and immediate threat to the health and welfare of the community, which are of recent origin or recently became urgent and where other financial resources are not available as determined pursuant to 24 C.F.R. Section 570.483(d), as effective on 00-00-00.

    4. Applications must demonstrate they meet the criteria for complying with a national objective per 24 CFR 570.483, that they meet public benefit standards as outlined in 24 CFR 483, and that they address community need as outlined in Florida Statutes 290.046(3)(a)-(d). Each annual action plan will identify which national objective(s) will be considered for funding.

    5. An applicant for a Neighborhood Revitalization or Commercial Revitalization subgrant shall meet a national objective by demonstrating that its activities will be carried out in distinct service areas characterized by the existence of slums or blighted conditions, or by the concentration of persons of low or moderate income.

    (b) Public Benefit Acheivement. Determination of benefit to persons of low to moderate income is established through the following methods:

    1. HUD Census Data – LMI benefit can be documented by using HUD-provided Census Data where the service area geographically corresponds with block groups, census tracts, or local government geographical limits. A jurisdiction-wide activity using census data rather than a survey to establish the national objective of benefit primarily to low and moderate income persons can score VLI points by calculating a percentage of VLI benefit using census data. VLI beneficiaries are calculated by totaling, for each block group in each census tract, the numbers shown in the PVLOW. The total of VLI beneficiaries is divided by the total beneficiaries (LOWMODUNIV) to establish the VLI percentage for scoring the appropriate VLI beneficiary points.

    2. Random Sample Survey Methodology – A sample-based survey of the beneficiaries must use the “Household Income Certification Form,” located in the Application Manual, which must correspond with the random sampling requirements established by HUD in Notice CPD-05-06, as effective on 5-23-06.

    a. The survey process must verify eligibility of any proposed direct benefit activities, certify the number of projected very low, low and moderate income households and beneficiaries, and the total number of beneficiaries.

    b. When the sample-based survey results appear to substantially overstate the proportion of persons with low or moderate income in a service area when compared to census data, the Department will require the local government to provide supporting evidence substantiating the survey data. If the survey results are found to be inaccurate, the application shall be rejected.

    3. Small Service Area Survey Methodology. For surveys of service areas under 50 households, all households must be surveyed. Any non-responding household must be assumed to be above low and moderate income.

    4. The number of household members for non-responding households shall be based on the average household size for all responding households.

    5. A survey approved by the Department for a funded CDBG application remains valid for the same geographic service area for up to five years from the date the survey was completed.

    6. Only the methods of LMI benefit determination provided for in this rule shall be used.

    (6) Beneficiaries of Public Improvements.

    (a) For activities where hookups or connections are required for beneficiary access to the CDBG-funded improvement, low and moderate income benefit shall be determined by the number of low and moderate income persons in households connected to and able to use the water, sewer or other infrastructure at the time of administrative closeout. The percentage of low and moderate income benefit shall be calculated by dividing the number of LMI persons connected to the CDBG-funded infrastructure by the total number of persons who could be connected to it.

    (b) CDBG funded activities may not extend beyond the location of the last LMI beneficiary except where it is required for sound engineering, operation, or design reasons as certified by a licensed engineer.

    (c) For activities where hookups or connections are required as a condition for beneficiary access to a CDBG funded public improvement, hookup or connection fees shall not be charged to very-low, low or moderate-income beneficiaries. Further, none of the project construction costs shall be charged to very-low, low or moderate income beneficiaries. All very low, low and moderate income beneficiaries in a Neighborhood Revitalization project service area with hookups as an activity shall be hooked up unless they provide written notice that they do not desire a hookup.

    (d) Where non-LMI beneficiaries will have to pay a one-time fee (i.e., assessment, impact fee, etc.) to connect to or access the CDBG funded public improvement, and where a periodic service fee (i.e., water bill, sewer bill, etc.) will be charged, the proposed non-LMI beneficiaries will be advised of the estimated cost of the one-time fee and all beneficiaries will be advised of the estimated amount of any periodic service fee. The application narrative and budget must outline the estimated costs to be paid by non-LMI beneficiaries.

    (e) Surveyed beneficiaries shall be advised of both fees in writing with signature acknowledgement of receipt and understanding prior to application submission. If census data is used, a random sample representing ten percent of the beneficiaries must be advised in writing with signature acknowledgement of receipt and understanding prior to application submission. If a household refuses to provide signature acknowledgement, the refusal shall be noted on the form.

    (f) An applicant for an Economic Development project must meet a national objective through the creation or retention of jobs, of which fifty-one perceent must be jobs for persons from low to moderate-income households and must provide a public benefit by creating or retaining a number of full time equivalent jobs that divided into the subgrant amount results in a cost per job of under $35,000.

    (7) Interlocal Agreements for Applicants with Activities Outside Their Jurisdiction.

    (a) Prior to application submission, a written interlocal agreement shall be executed by all local governments in whose jurisdictions the CDBG activities will be undertaken. The interlocal agreement must authorize the applying local government to undertake the activities outside its jurisdiction, giving the concurrence of the other local government(s) with the activity and committing resources by one or both local governments to maintain the activity. Such an interlocal agreement must be submitted with the application for funding.

    (b) Each local government signing an interlocal agreement shall affirm that all activities, project areas, service areas, and job creation locations are not inconsistent with its comprehensive plan.

    (c) The application shall contain excerpts of the comprehensive plans of all local governments in whose jurisdiction activities will take place. The excerpts must document that the activities, project areas, service areas, and job creation locations are not inconsistent with the local government’s comprehensive land use plan.

    (d) An eligible applicant’s activities can extend beyond its jurisdiction, provided the areas outside its jurisdiction are eligible. The applicant must have legal authority to provide such services or undertake such activities and be supported by a signed interlocal agreement executed by both eligible local governments. Except for Economic Development projects, no more than 25 percent of the service area beneficiaries may reside outside the applicant’s jurisdiction unless all CDBG funded work is taking place within the applicant’s jurisdiction or on property owned by the applicant. When all work will take place within the applicant’s jurisdiction or on property owned by the applicant, up to 50 percent of the beneficiaries may reside outside the applicant’s jurisdiction.

    (e) Pursuant to 24 C.F.R. 570.486(b), as effective on 00-00-00, an eligible individual applicant may apply to undertake a portion of an eligible Neighborhood Revitalization activity in an otherwise eligible location outside its jurisdiction or service area, if it can provide written documentation that the activity is required by an engineer or by a state or federal agency having regulatory authority over the activities. Any benefit to persons outside the jurisdiction or service area must not be a Direct Benefit and may only be incidental to the like activity undertaken within the jurisdiction or service area. Indirect benefit to persons outside the jurisdiction or service area shall not be used to establish activity eligibility for scoring purposes. All service area residents shall reside within the jurisdiction of the local government submitting the individual application.

    (f) An eligible individual applicant can apply to undertake Economic Development infrastructure activity outside its jurisdiction, if it can provide written documentation that the infrastructure activities outside its jurisdiction are necessary to meet the needs of a job-creating Participating Party, pursuant to Section 290.046(2)(b), F.S.

    1. The job creation location shall either be within the jurisdiction of the applying local government connecting to infrastructure outside its jurisdiction owned and operated by another public or private entity, or

    2. The job creation location shall be outside the jurisdiction of the applying local government if that local government owns the necessary infrastructure (treatment, production, or storage) to be connected to the job creation location on behalf of the Participating Party.

    3. In either case, liability for CDBG performance and compliance with all applicable rules and regulations rests with the applying local government.

    (8) Application Reviews.

    (a) The Department will complete a threshold review to determine that the local government, the application, and all proposed activities are eligible.

    (b) The Department will undertake a completeness review to determine that the application is mathematically correct and contains all required documentation. This review will generate a list of issues to be addressed at site visit.

    (c) Except for the Community-Wide Needs Score, any scoring item left blank will be scored as zero. This zero score cannot be changed as a result of site visit or because of information elsewhere in the application.

    (9) Application Site Visits and Completeness Letters.

    (a) Site visits shall be conducted by the Department prior to publication of the application rankings in the fundable range. For Economic Development projects, any Participating Party must be available during the site visit(s), or the Participating Party must come to Tallahassee to meet with Department staff within 30 days after the site visit(s). Should a Participating Party fail to meet one of the two conditions, the application must be withdrawn by the local government or the application will lose its funding reservation.

    (b) The Department shall notify the Chief Elected Official in writing of the date and approximate time the site visit will take place.

    (c) The Department shall examine all documents that have been certified to in the application.

    (d) Except as otherwise provided for in Economic Development applications, after the site visit, the Department shall request in writing all documentation found to be unavailable or inadequate. Applicants shall have 21 days from the date that the request is received to provide the requested information to the Department. Responses to completeness letters must be transmitted by the applicant and received by the deadline established by the Department.

    (e) Additional Completeness Review Items for Neighborhood Revitalization Applications. During the completeness review period, the Department shall review applications that propose land assembly or site preparation for new housing construction for low and moderate income persons to determine whether documentation is provided to show:

    1. Firm commitments for construction from the developer,

    2. Documentation of ownership, or

    3. An option on the land to control the sale to or ensure use by low and moderate income persons, and

    4. Documentation that the proposed site is properly zoned.

    (f) If the requested material is not received by five p.m. EST on the 21st day in the Community Development Block Grant Section at the address specified in the application manual, or if at the end of the completeness period, material is found to be incomplete or not in compliance, the following points shall be deducted from the applicant’s total score:

    1. Required Maps with information specified in the completeness letter – 250 points.

    2. Interlocal Agreement, if applicable – 250 points.

    3. In the Housing category, selection criteria for beneficiaries or a complete list of beneficiaries selected – 250 points.

    4. Any scoring points associated with issues in the completeness letter for which additional documentation was requested.

    (g) Completeness Review Items for Economic Development Applications. Completeness Issues found during application review, that require a response, are included in the Notice of Upcoming Site Visit letter. Following the site visit, the Department will mail to the local government an award and offer to contract letter and a subgrant agreement, including any necessary special conditions, for execution by the local government.

    1. If additional issues are generated during the site visit, a list of additional questions or requests for information will be included with the award and offer to contract letter and the subgrant agreement if they have not been resolved prior to that time.

    2. Within 60 calendar days of the local government’s receipt of the award and offer to contract letter (the 60 day period), the Department must receive from the applying local government the information required in the Award and Offer to Contract Documentation section of the Application, any additional required documentation referenced in the award and offer to contract letter, and a signed subgrant agreement ready for the Department’s execution.

    3. The signed subgrant and all required documentation in 2. above must be received by the Department on or before 5:00 PM EST of the 60th day. The day the award and offer to contract letter is received by the local government shall not be included in the sixty-day completeness period. Facsimile or electronic submissions are acceptable to meet the requirements of the 60 day period.

    4. If all program requirements have been met, the Department will execute the subgrant and return a signed copy of it to the local government.

    5. If CDBG Economic Development funds are unavailable, the elgible applications will be held in the order of their funding reservation as established in this section should additional funds become available.

    (10) Application Scoring. Once an application is submitted to the Department, no aspect of the application may be revised to improve the score or broaden the scope of the project.

    (a) The maximum score possible in each category is 1,000 points. These points shall be divided among three program factors as specified below.

    Community-wide needs:250 points

    Program Impact:650 points

    Outstanding performance in equal

    opportunity employment and fair housing:100 points

    Total points:1,000 points

    (b) Community-wide Need Scores (CWNS) for All Categories. The Department shall calculate the community-wide needs score from the most recent and uniformly available federal and State data for all jurisdictions eligible to apply. Current decennial U.S. Census data shall be used unless otherwise noted. Data shall be further defined as:

    1. For municipal government applicants, the data relevant for the entire incorporated area shall be used;

    2. For county government applicants, the data relevant for only the unincorporated areas within the county shall be used;

    3. For municipalities incorporated since the most recent census, the block group or census tract data for the area that was incorporated shall be used where available; otherwise a proportion of the county’s census data shall be used to calculate the community-wide needs score.

    4. Factors. Three factors shall be used to determine the community-wide needs score with the following maximum points available for each:

    a. Number of persons below poverty – 125 points

    b. Number of year-round housing units with 1.01 or more persons per room – 62.5 points;

    c. Number of persons in the low and moderate income population according to the latest HUD census – 62.5 points.

    5. Method of Calculation. All eligible local governments shall be compared on the factors identified in paragraph 9B-43.0041(10)(a), F.A.C. Eligible local governments shall be compared on each factor with all other applicants in their population group as designated in paragraph 9B-43.0041(1)(c), F.A.C. Calculating each applicant’s score shall include the following steps:

    a. The highest statistic in each population group for each factor identified in paragraph 9B-43.0041(10)(a), F.A.C., shall be the basis for relative comparison of all other eligible local governments in the population group.

    statistic on factor

    -------------------=percentage to be used as factor multiplier highest statistic on factor population group

    b. For each eligible local government, the percentage calculated shall then be multiplied by the maximum number of points available for that particular factor.

    percent x maximum points available = score for eligible local government on factor

    c. The Community-Wide Needs Score factors shall be summed for each eligible local government for the overall Community-Wide Needs Score. Pursuant to Section 290.046(3)(b), F.S., each local government awarded subgrant funds shall have its community-wide needs score reduced by 5 points for every $100,000, or fraction thereof, of contracted funding. If $100,000 or more in funding is deobligated at the time the administrative closeout is approved by the Department, the score will be adjusted and the CWNS increased accordingly. This adjustment shall not be made during the first application cycle in which the most recent census data is used. All adjustments for subgrant funds received shall be based on subgrants received in all application cycles after the most recent census data was first used. This calculation shall be based on all funds contracted as of the end of the month prior to the opening date of the application cycle. The adjusted community-wide needs score cannot be less than zero. No deduction to CWNS shall be made for Emergency Set-Aside subgrants.

    (c) Further point breakdowns for Program Impact, Equal Opportunity and Fair Housing are found in the rule section pertaining to individual program categories or in the application manual for each category.

    (d) Applications with scores in the fundable range following appeals and that meet all other requirements contained herein shall be awarded funds for eligible activities.

    (e) In the event that two or more applications receive an equal final score, the application addressing the highest State priority goal as reflected by the goal points for application activities shall receive first consideration. If a tie still exists, then the applicant with the highest community-wide needs score shall receive first consideration.

    (f) The Department shall offer an applicant scoring within the fundable range an amount less than that requested in the application when insufficient funds are available to fund the total subgrant request or if ineligible activities are proposed in the application.

    (g) Leverage. For leverage scoring purposes, only leveraged funds expended after the date of site visit and prior to the date of submission of the administrative closeout shall be counted.

    (h) Penalty Points for Past Performance. A penalty shall be assessed against future subgrant applications based on prior contractual performance on subgrant agreements, including those subgrants which have submitted an administrative closeout prior to application deadline. This penalty will apply regardless of whether the subgrant has been amended to permit the reduction in accomplishments. If the subgrant is terminated with no expenditures or is terminated with expenditures for administration and/or engineering only, no penalty shall be assessed. This penalty expires two years from the date of administrative closeout. The Department will waive these penalties if the local government is unable to meet subgrant requirements due solely to a state or federally declared natural disaster or emergency. Penalties will include:

    1. A penalty of five points per housing unit up to a maximum of 50 points for failure to rehabilitate or address the original number of housing units scored in the original application in the Housing category.

    2. A penalty of five points per low and moderate income household not served or business facade not addressed as geographically displayed on the original application maps (as modified, if necessary, during the completeness process) in the Neighborhood Revitalization or the Commercial Revitalization categories up to a maximum of 50 points. All direct benefit proposed in the application (i.e., water hookups) must be completed to avoid this penalty per house or facade. No penalty shall be assessed for failure to provide a water or sewer hookup if the hookup is not possible because the home is vacant or became damaged or destroyed after application submission, the homeowner refused the hookup or became non-LMI after the survey, and there are no other homes in the service area identified in the application as unmet need which can qualify for a hookup to replace any home not hooked up.

    (11) Application Rejection and Loss of Funding Reservation Criteria. Applications that do not meet the following minimum requirements as outlined in Section 290.0475, F.S. shall be rejected without scoring:

    (a) The application is not received by the Department by the application deadline.

    (b) The proposed project does not meet one of three national objectives as contained in federal or state legislation;

    (c) The application is not consistent with the local government’s comprehensive plan adopted pursuant to Section 163.3184(7), F.S.;

    (d) The proposed project is not an eligible activity as contained in the federal legislation;

    (e) The applicant has an open Community Development Block Grant, except as provided in Section 290.046(2)(c), F.S.

    (f) The local government is not in compliance with the citizen participation requirements required by ss.104(a)(1) and (2) and 106(d)(5)(c) of Title I of the Housing and Community Development Act of 1984 and department rule.

    (g) Misrepresentation. The eligibility and scoring of the application is subject to the truth and accuracy of all information, representations, and materials submitted or provided by the applicant in the application, in any subsequent submission or in any response to fulfill the application requirements. The lack of accuracy thereof or any material changes which would materially change the scoring of the application or the subgrantee’s eligibility shall cause the application to be rejected for eligibility or scoring.

    (h) The survey results are inaccurate or cannot be substantiated.

    (i) Loss of Fund Reservation for Economic Development Applications: An Economic Development application shall lose its fund reservation if:

    1. An applicant is not eligible.

    2. An activity is found to be ineligible. If an activity is found to be ineligible, the funding reservation will be reduced by the budgeted amount for that activity and any related engineering and administration.

    3. The application is missing an initially required item that is specified in the Documentation Requirements section of the application.

    4. The local government withdraws the application in a letter signed by the Chief Elected Official.

    5. Prior to the end of the site visit, the local government fails to provide documentation requested in the Notice of Pending Site Visit letter.

    6. The Department does not receive the required documentation and the subgrant signed by the Chief Elected Official or his or her designee within 60 days of the applying local government’s receipt of the award and offer to contract letter. If the local government submits the required documentation and signed subgrant after the 60-day period has expired and unreserved funds are available, the date that the subgrant and all required documents are received by the Department becomes the new fund reservation date. If the documentation is adequate and unreserved funds are available to fund the application, a subgrant will be executed by the Department.

    7. A Participating Party withdraws prior to the execution of the subgrant by the Department, unless the subgrant remains within the fundable range with the remaining Participating Parties. Increasing the job creation numbers or leverage of the remaining Participating Parties beyond that referenced in the application shall not be allowed. Replacement of Participating Parties shall not be allowed without withdrawal and resubmission of the application.

    Rulemaking Specific Authority 290.048 FS. Law Implemented 290.044, 290.046, 290.047, 290.0475 FS. History–New 5-23-06, Amended 2-26-07,________.

     

    9B-43.0045 Category Specific Requirements.

    (1) Program Requirements for Neighborhood Revitalization.

    (a) The primary objective of the Neighborhood Revitalization category is to preserve and revitalize declining, primarily residential, low and moderate-income service area neighborhoods by addressing the major infrastructure problems contributing to such decline.

    (b) Measurement of Program Impact. Specific criteria used to calculate the total 650 points for Program Impact are found in the Neighborhood Revitalization section of the application.

    (c) Service Area Requirements.

    1. An activity conducted in a primarily residential service area will be considered to benefit low-and moderate-income persons when at least 51 percent of the residents of that service area are low- and moderate-income persons. Such a service area must contain all households that will benefit from the activity. All activities shall meet the national objective of LMI benefit as specified in 24 C.F.R. 570.483(b), as effective on 00-00-00. When all construction is limited to direct benefit activities (e.g., water or sewer hookups), no service area is needed because all households benefitting from the activity must be LMI.

    2. Any survey of the beneficiaries of a service area must correspond to the requirements established in paragraph 9B-43.0041(5)(b), F.A.C.

    3. For activities where hookups or connections are required for beneficiary access to the public improvement (Direct Benefit), low and moderate income benefit shall be determined by the number of low and moderate income persons in households connected to and able to use the water, sewer or other infrastructure at the time of administrative closeout compared to the total number of persons who could be connected to the infrastructure. Evidence at the time of closeout must show:

    a. The total number of persons in households in the service area, and

    b. The total number of low and moderate income persons in households connected to the infrastructure, and

    c. Document that the number of LMI persons in households connected to the infrastructure divided by the total number of beneficiaries for that activity in the service area equals at least 51 percent, or a larger percent if required to remain within the fundable range.

    d. Eligibility for a hookup shall be based on verification of household income and sources not more than one year before the hookup is provided.

    4. Area benefit activities as defined in 24 C.F.R. 570.483(b)(1)(i), as effective on 00-00-00, addressing the needs of elderly, handicapped or homeless beneficiaries are presumed to provide 51 percent low and moderate income benefit for scoring purposes unless a survey of the service area of such activity documents a higher percentage of benefit.

    5. CDBG funded activities may not extend beyond the location of the last LMI beneficiary except where it is required for sound engineering, operation, or design as certified by a licensed engineer.

    (2) Program Requirements for Housing.

    (a) The primary objectives of the Housing category are to improve housing conditions or expand housing opportunities primarily for low and moderate income persons.

    (b) Housing subgrant recipients must have a Department approved Housing Assistance Plan addressing the activities specified in the application.

    (c) Low and Moderate Income Benefit for Housing.

    1. Selection of beneficiaries or housing units need not take place during the application process, but may take place at any time during the subgrant application or implementation process. All beneficiaries must be low and moderate income persons pursuant to 24 C.F.R. Section 570.482, as effective on 00-00-00.

    2. Activities involving rehabilitation or acquisition of property to provide housing shall be considered to directly benefit low and moderate income persons only to the extent that such housing shall, upon completion, be occupied by low and moderate income persons, and for rental units the units must be occupied by low and moderate income persons at affordable rents pursuant to 24 C.F.R. 92.252, as effective on 00-00-00.

    3. Water or sewer hookups may only be performed under this category as a complementary activity in conjunction with rehabilitation of a home.

    (d) The applicant shall adopt and implement procedures to fulfill regulatory and statutory requirements relating to Lead-Based Paint pursuant to 24 C.F.R. 570.487, 24 C.F.R. 36 and 37, all as effective on March 28, 2002, and Section 302 of the Lead-Based Paint Poisoning Prevention Act (42 U.S.C. Section 1251 et seq.). The recipient is required to:

    1. Prohibit use of lead-based paint;

    2. Notify potential beneficiaries of the hazards of lead-based paint;

    3. Inspect appropriate properties prior to initiating rehabilitation to determine if lead-based paint is present;

    4. Undertake appropriate protection of workers and occupants during abatement;

    5. Ensure proper clean up and disposal procedures are used;

    6. Retain records of enforcement and monitoring for at least five years.

    (e) Rehabilitation of all housing units addressed in any way with CDBG funds must be in compliance with the current Florida Building Code for Existing Buildings, as well as implementing local Building Codes and local Maintenance Codes. If housing units must be replaced, construction of new units must be in full compliance current Florida Building Code.

    (f) When CDBG funds are expended to acquire property through a voluntary process for the purpose of assisting low and moderate-income households to relocate out of a 100 year floodplain, the following shall apply:

    1. Future development of the property acquired shall be prohibited;

    2. The local government may retain title to the property or transfer the title to a land conservancy agency or program, subject to Department approval;

    3. The beneficiaries shall agree in writing to relocate outside a 100 year floodplain; and

    4. Any beneficiary or household who subsequently relocates at any time into a 100 year floodplain shall not be provided any direct benefit with CDBG funds at any future point in time and this restriction shall be noted in the relocation document signed by the beneficiaries in paragraph (c) above.

    5. All structures on the property shall be demolished or relocated out of the floodplain.

    (3) Program Requirements for Commercial Revitalization. Applications submitted under this category shall be designed to conserve and revitalize commercial areas, which serve primarily low and moderate income persons.

    (a) Eligible activities. All activities must be geographically and physically located within the boundaries of the jurisdiction and the project area and be contiguous to or located on property that is primarily commercial as of the application deadline date. Unimproved property on which activities are proposed cannot be zoned for residential purposes only.

    (b) Funds requested and approved for Commercial Revitalization activities shall not be used as grants or loans for working capital, inventory or supplies, or for interior repairs and renovations, except for repairs necessary to correct code violations or removal of architectural barriers to handicap access; and

    (c) Service Area Requirements. Activities in Commercial Revitalization projects are considered to serve the entire jurisdiction in which they are to be undertaken, unless the applicant can justify a smaller service area (e.g., a CRA in a portion of a county). The applicant shall document, using census data or a survey, that least 51 percent of beneficiaries in the service area are low and moderate-income persons. A survey shall comply with the requirements specified in subparagraph 9B-43.004(5)(b)2., F.A.C.

    (d) Requirements for Rehabilitation of Commercial Buildings. If CDBG funds will be used for rehabilitation of commercial buildings, the local government must prepare, receive Departmental approval, and then adopt procedures for providing rehabilitation assistance to building units occupied by businesses through the Rehabilitation of Commercial Buildings activity before requesting funds for that activity. The procedures shall include at a minimum, but not be limited to, the following:

    1. Restrict the Rehabilitation of Commercial Buildings activity to commercial buildings within the project area pursuant to 24 C.F.R. Section 570.202(a)(3). Properties upon which or adjacent to where CDBG activities are undertaken shall not be zoned for residential purposes only;

    2. Require all businesses receiving rehabilitation assistance to provide services, which are available to all the residents of the service area, thereby meeting the national objective of benefiting low and moderate-income persons;

    3. Specify the terms and conditions under which the rehabilitation assistance will be provided.

    4. Provide that all buildings to be rehabilitated, except as provided in 11. below will be occupied at the time the assistance is provided or subject to a lease agreement such that the building will be occupied prior to closeout. The occupant shall be a legally constituted business with business, sales tax, and occupational licenses;

    5. Provide that all contracts for rehabilitation over $2,000 will comply with the DavisBacon Act.

    6. Provide that businesses residing in a building rehabilitated with CDBG funds shall comply with the provisions of Section 504 of the Rehabilitative Act of 1973 (29 U.S.C. Section 794) as it relates to employment discrimination and facility accessibility;

    7. Provide that CDBG funds addressing those code violations specified in the application will be in compliance with all local and state building codes and standards;

    8. Establish a process for recognizing potential conflicts of interest, making those conflicts publicly known, dealing with those conflicts on a local level, and requesting waivers of those conflicts when appropriate pursuant to 24 C.F.R. Section 570.489 and Chapter 112.311-112.3143, F.S. Additionally, provide that no building owner, lesser, lessee, tenant, or occupant, or employee or immediate relative of the same, either personally or corporately, shall serve as a contractor to be paid with CDBG funds for the rehabilitation of said building, nor shall they be paid for their own labor with CDBG funds for the rehabilitation of said building;

    9. Establish a process for final inspection of a commercial structure after rehabilitation and a process for final acceptance of a contractor’s work on any grant funded activity and before the local government considers the rehabilitation completed.

    10. The expenditure of CDBG funds per façade shall not exceed $22,000 in CDBG funds. A building on a corner containing a single business may be considered to have two facades. Buildings which have been previously subdivided or portioned may be addressed as separate facades only if the building is subdivided such that:

    a. There are separate primary entrances for each business;

    b. Each of the businesses has separate and distinct occupational and sales tax licenses.

    11. The façade only of a vacant building may be addressed if it is part of an overall building façade renovation effort in a contiguous area.

    12. CDBG funds may be expended on the roof of a privately owned commercial building only after the issuance of a bona fide code violation report and only after the rehabilitation of the façade, the removal of architectural barriers to handicap access in the entrances and the bathroom areas, and the correction of other documented code violations.

    13. CDBG funds for Commercial Revitalization activities shall not be used as grants or loans for working capital, inventory or supplies, or for interior repairs and renovations, except for repairs necessary to correct code violations or removal of architectural barriers to handicap access and correction of architectural barriers to handicap access in public buildings located in the project area pursuant to the requirements of 24 C.F.R. Part 8, as effective 00-00-00.

    (4) Program Requirements for Economic Development.

    (a) Applications submitted under this category shall be for creation or retention of jobs, of which at least 51 percent are for low and moderate income persons. A governmental entity cannot be a Participating Party.

    (b) Prohibited Uses of Funds.

    1. Funds shall not be used for working capital, inventory or supplies or to refinance existing debt.

    2. Direct assistance to non-public entity shall not be in the form of a grant.

    3. Funds cannot be used to purchase assets from any entity if any principal of the Participating Party owns an interest of 20 percent or more in that entity.

    4. Funds cannot be used to build or develop infrastructure beyond that which is required as a prerequisite for the job creation by the Participating Party.

    5. Funds shall not be used to refinance existing debt.

    6. Funds cannot be used for a loan to a non-public entity which is determined not to be appropriate as defined in 24 C.F.R. 570.482(e), as effective on March 28, 2002.

    (c) Eligibility Requirements for Loans.

    1. Determining Eligibility for loans to non-public entities. All Economic Development applications submitted to the Department shall be screened to determine if the amount of any loan assistance to a private, for-profit entity; a private non-profit entity; a neighborhood based organization, a local development organization; or other not for profit entities is appropriate to carry out the Economic Development project. A financial underwriting analysis of the project shall be conducted to determine that the minimum amount of assistance is being requested, that the terms and interest rates are appropriate given the entity’s debt service capacity, and that the entity has the ability to meet the proposed debt service, given historical financial statements, data and reasonable projections of revenues and operating expenses, if applicable.

    2. Applications which do not contain justification of the appropriateness of the assistance being requested shall be ineligible in accordance with federal law and federal guidelines and shall be ineligible for scoring as provided in Section 290.0475, F.S.

    3. If based on the Department’s review of the financial underwriting analysis for the assistance, the funds requested exceeds the funds necessary, the application request shall be reduced by the Department.

    4. The local government shall provide to the Department a financial underwriting analysis and other Participating Party documentation not required at the time of application. The underwriting analysis must meet the requirements of 24 C.F.R. Section 570.482(e), as effective on March 28, 2002, and Appendix A. The underwriting analysis must be prepared by a certified public accountant, a commercial lending underwriter, a financial professional employed by the local government or the Participating Party, or some other financial or economic development professional, and shall verify:

    a. That all project costs are reasonable;

    b. That all sources of funding included in the application document their commitment to the project through written offers to fund with all contingencies stated;

    c. That to the extent practicable, CDBG funds are not substituted for readily available non-federal financial support;

    d. That the project is financially feasible;

    e. That to the extent practicable, the return on owner’s equity investment shall not be unreasonably high; and

    f. That to the extent practicable, CDBG funds will be disbursed on a pro-rata basis with other finances provided to the project.

    5. Once this financial underwriting analysis and other required documentation has been provided by the local government, any material change, including changes in corporate or ownership structure, which affects the underlying assumptions upon which the local government relied will require that the analysis be re-evaluated by the local government and any assistance requested for the Participating Party must be adjusted if a “material change” has occurred.

    6. For CDBG loans only, CDBG funds may be used to fund up to 50 percent of the cost of eligible activities at the job creation location. The administrative cost shall not be included in this calculation. Applications which do not meet this requirement shall lose their funding reservation.

    (d) Eligibility Requirements for Infrastructure Projects.

    1. Determination of eligibility for infrastructure projects shall be based on the type of activities proposed and documentation that benefit primarily to low and moderate-income persons shall occur.

    2. Applications shall also document that the entity proposing to create jobs is financially viable based on accepted industry standards.

    3. The applicant shall document that the route, scope, cost, and size of the components of the proposed infrastructure are the minimum necessary to provide for the needs of a Participating Party at a job creation location.

    4. Job Commitment. Applicants shall document that the Participating Party has the financial capacity to meet its commitment to provide or retain the jobs specified in the application. Applications which do not contain evidence of the capacity to provide jobs shall be assessed a 251-point reduction of their program impact score and will lose their funding reservation.

    5. Job Creation or Retention. The number of jobs proposed to be created or retained shall be such that the cost in CDBG funds per job is consistent with 24 C.F.R. 570.482(f)(2) and (f)(4), as effective on 00-00-00. Applications which do not meet the cost-per-job requirements shall lose their funding reservation.

    6. Leveraging of CDBG Dollars. Non-CDBG public funds directly linked to the proposed project may be included for scoring purposes. Applicants shall include documentation that all funds to be used for leverage are available and committed to the project and will be in the form of cash, loans, or grants. For CDBG loans, funds expended on assets purchased prior to the date of site visit shall not be counted to meet the 50 percent non-CDBG match portion of the project costs. Match is not required for infrastructure only projects. In order to be eligible for scoring, only leveraged funds expended after the date of the site visit and prior to the date of submission of administrative closeout shall be counted except for the cost of CDBG application preparation paid by the local government.

    (e) National Objective and Public Benefit Documentation.

    1. In determining whether an activity will benefit low and moderate-income persons, the net effect of the completed activity shall be considered. In the Economic Development category, each activity shall meet a national objective pursuant to 24 C.F.R. Section 570.483(b)(4), as effective on 00-00-00.

    a. New jobs. The determination of actual benefit to low and moderate income persons shall be made based on the number and percent of persons who, at the time they were hired, were low and moderate-income persons as defined herein.

    b. Retained jobs. The determination of actual benefit to low and moderate income persons shall be made based on the number of low and moderate income persons employed in the jobs that would actually be lost to the labor market or the jobs that would reasonably be expected to turn over within the following two years and filled with LMI persons upon turn over. The calculation of jobs shall be determined as of the date the application is submitted.

    c. Where job creation is the method of meeting a national objective for construction of a public improvement or facility, all jobs created or retained as a direct result of the construction of the public improvement or facility shall be considered. However, if the costs per job and the time period specified in 24 C.F.R. Section 570.482(f)(2)(i), as effective on 00-00-00, are attained, only those jobs created by businesses included in the application must be counted for the purpose of meeting a national objective.

    2. Determination of Availability of Jobs to Low and Moderate Income Persons. To determine that the created or retained jobs will be made available to low and moderate-income persons, the local government or Participating Party shall ensure that:

    a. Jobs will be created which do not require special skills that can only be acquired with substantial work experience, education beyond high school, or specialized work experience.

    b. Training opportunities will be provided to make such jobs available to low and moderate income persons who would not otherwise qualify; and

    c. The advertising and recruiting efforts are directed toward low and moderate income persons.

    3. If a national objective is attained under the provisions of 24 C.F.R. 570.483(b)(4)(iv) or (v), as effective on 00-00-00, demographic and/or census documentation must be provided with the application.

    (f) Public improvement activities are also subject to the requirements of 24 C.F.R. Section 570.483(e)(1), as effective on 00-00-00. Activities to address the needs of those beneficiaries listed in 24 C.F.R. 570.483(b)(2)(ii)(A), as effective on 00-00-00, will be presumed to meet the national objective of benefit to low and moderate income persons if they are directly related to the job creation or retention activities.

    (g) Program Impact Criteria for the Economic Development Category. Program Impact criteria for Economic Development shall be based on a maximum of 650 points.

    (h) If the contract must be modified because of withdrawal of a Participating Party or a reduction in leverage or job numbers, the local government must amend the contract and remain within the fundable range. Substitution of Participating Parties will be allowed only if the substitute is a business desiring to locate at the proposed job creation location or a location that will use the same infrastructure proposed in the application. The substitute Participating Party shall sign a Participating Party agreement which includes an obligation to create the same number of jobs and expend the same amount of leverage.

    (5) Program Requirements for Planning and Design Subgrants.

    Planning and Design subgrants provide phased funding for a project. Funds are initially provided only for engineering design and related grant administration. After completion of biddable construction plans and specifications, funding is provided for construction phase costs by a subgrant amendment.

    (a) A Planning and Design subgrant may be offered to an applicant in the Neighborhood or Commercial Revitalization category whose score is below the fundable range for full funding and did not receive readiness to proceeds points.

    1. Planning and Design subgrants will be offered based on rank ordered scores, subject to available funding.

    2. Preference for Planning and Design subgrants will be given to applications in the Neighborhood Revitalization category.

    3. Only those local governments whose applications indicate they will consider Planning and Design funding will be offered such a subgrant.

    4. Only those applications which meet all other program requirements will be considered for a Planning and Design subgrant.

    (b) Each Planning and Design subgrant shall not exceed $70,000 and shall fund only the costs of engineering services required for the development of biddable construction plans and specifications and grant administration.

    1. Engineering costs funded from the subgrant shall not exceed the RUS fee schedule for engineering (Table I, Table II, or proration of these tables, depending on the nature of the project) and applicable additional engineering services as defined in this rule.

    2. Grant administrative costs funded by the subgrant shall not exceed six percent of the amount of the Planning and Design subgrant.

    (c) After biddable construction plans and specifications are provided to the Department, the subgrant will be amended, as funds become available, for construction phase costs up to the maximum amount allowed for the jurisdiction.

    (d) If biddable construction plans and specifications cannot be completed, the subgrant shall be closed out.

    Rulemaking Authority 290.048 FS. Law Implemented 290.043, 290.044, 290.046 FS. History–New ________.

     

    (Substantial rewording of Rule 9B-43.0051 follows. See Florida Administrative Code for present text.)

    9B-43.0051 Grant Administration and Project Implementation.

    (1) Environmental Review. CDBG subgrant recipients must comply with the procedures set forth in 24 CFR Part 58, Environmental Review Procedures for Title I Community Development Block Grant Programs and 40 CFR Section 1500-15-8, National Environmental Policy Act Regulations.

    (2) Procurement. CDBG funds shall be used to obtain commodities and services only in accordance with written procurement procedures adopted by the recipient and shall comply with the provisions of 24 C.F.R. Section 85.36, as effective on 00-00-00, and for covered professional services contracts, Section 287.055, F.S., (Consultants Competitive Negotiation Act).

    (a) Any procurement which requires public notice in a newspaper based on the local CDBG procurement policy shall be published in a daily newspaper of general circulation in a nearby OMB designated metropolitan statistical area (MSA). Alternatively, a local government may substitute such notice with any solicitation procedure which generates at least three responsible and responsive bids or proposals which can be considered. Such procedure shall allow at least 12 days for receipt of the proposals or bids.

    (b) The Department must provide written approval prior to the recipient awarding any contract exceeding $25,000 procured as a result of inadequate competition, a sole source, or a non-competitive procurement. For contracts below $25,000, the recipient’s files must document the justification for the procurement which complies with 24 C.F.R. Section 85.36 (b) (4), as effective on 00-00-00. If prior written approval is not obtained, the Department has no obligation to fund the contract unless the Department subsequently approves the procurement.

    (c) In procuring services for subgrant administration, recipients shall evaluate in writing any economies of scale or other means of securing efficiency that may be available as a result of the type, number and geographic distribution of subgrants to be administered by the recipient or by a prospective subgrant administrator.

    (d) Under Section 290.047(5), F.S., a local government is permitted to contract with the same entity for more than one service, provided that the local government can document that the entity is either (i) the sole source or (ii) was determined, through the Request for Proposals process, to be the proposer most advantageous to the local government. Unlike services, such as, program administration, and engineering services, shall not be combined in a single contract except for design-build contracts procured in accordance with Section 287.055, F.S. If separate procurements result in one firm selected for application and administration services, those services may be combined into one contract provided there are separate scopes of work and a separate fee for each service.

    (e) All contracts for professional services shall conform to the following:

    1. Any Request for Proposals which includes more than one service shall provide that:

    a. Proposals may be submitted for one or more of the services;

    b. Qualifications and proposals shall be separately stated for each service; and

    c. The evaluation of the proposals shall be separate for each service.

    2. A written evaluation, such as a ranking sheet or narrative, shall be prepared for each proposal, ranking or comparing each proposal to the criteria in the published Request for Proposals. Based on those criteria, the written evaluation will document why the successful proposal was selected.

    3. A separate professional services contract must be procured and executed between the local government and any professional services consultant for each CDBG subgrant, except as provided in paragraph (f) below. Each advertisement for procurement of CDBG professional services, except for application preparation, must identify either the CDBG funding cycle by federal fiscal year or the CDBG subgrant number. In the absence of any identifier, the procurement will be presumed to be for the CDBG funding cycle closest to the publication date of the advertisement or, if there is no advertisement, the date of receipt for proposals.

    4. Each professional services contract must identify the CDBG subgrant number to which it is applicable.

    5. No firm shall be precluded from submitting a bid or proposal for any work funded partially or wholly with CDBG funds based on a minimum experience requirement. A firm’s experience can be addressed as an evaluation factor in the ranking for professional services and is a consideration in determining the “responsibility” of a firm when the determining the “low, responsive, responsible bidder” for services procurement through bids, as required by 24 CFR 85.36(d)(2)(ii)(D).

    (f) Engineering and Administration Services.

    1. If the procurement for administration or engineering services for a subgrant initially funded only for planning and design was accepted by the Department and the public notice or Request for Proposals stated that the firm awarded a contract for planning and design services would also, at the discretion of the local government, provide the services during project construction, then a procurement for those services during construction is not required. If the Request for Proposals specifically included services during construction in the scope of work, then no additional procurement is required for those services.

    2. A recipient whose application received “readiness to proceed” points may use the design engineer for services during construction if the Department determines that the procurement for design services was competitive or authorizes a non-competitive procurement.

    (g) Construction Contracts.

    1. If CDBG and other sources of funding are jointly used to fund activities under a single contract, the activities to be paid for with CDBG funds must be shown separately so that in the bid proposal identifies the CDBG activities and the amount of a contract to be paid from CDBG.

    2. If after applying any specified deductive alternates, construction bids exceed available funds, the local government shall not negotiate with the low bidder unless there is only one bidder or unless all bidders are allowed to submit revised bids for the revised project. If the construction cost can be reduced by deleting entire bid line items or reducing quantities based on unit prices identified in the bid, the effect of such deletions or reduction on all bidders’ prices shall be determined. Contract award shall be made to the low, responsive and responsible bidder for the revised project.

    3. All contracts in excess of $100,000 covered by Section 3 regulations shall contain the language required in 24 C.F.R. 135.38, as effective on 00-00-00.

    (h) The provisions of this subsection shall not be construed to conflict with or supersede the requirements of Section 287.055, F.S., or any other applicable State or federal law.

    (3) Fund Distribution.

    Payment from the Department shall not be for an amount less than $5,000, unless it is a recipient’s final Request for Funds.

    (4) Amendments. All proposed amendments must be approved by the Department. Amendments reducing the number of intended beneficiaries or the accomplishments from the original application shall require review by the recipient’s Citizens Advisory Task Force and a public hearing with public notice. Any amendment which would reduce the score below the fundable range shall not be approved by the Department.

    (a) Documentation Required. Requests for amendments shall include the following written documentation for review by the Department.

    1. A cover letter signed by the Chief Elected Official or his or her designee which describes the need for the proposed changes and their effect upon the approved project. If the amendment involves an extension of time, the recipient must provide a justification for the extension.

    2. All application forms that would be changed by the proposed amendment.

    3. If applicable, a revised work plan.

    4. If applicable, a revised budget showing the current and amended budget.

    5. If there is a change in activity location, a map indicating the proposed changes.

    6. If applicable, a copy of the minutes of the meeting of the Citizen’s Advisory Task Force at which the proposed amendment was reviewed.

    7. If applicable, a copy of the public notice for the public hearing at which the amendment was approved, which shall evidence compliance with subsection 9B-43.0031(35), F.A.C.

    (b) To allow the Department adequate time to ensure the amendment is processed before the subgrant termination date, amendments requests must be received at least 45 days prior to the end of the subgrant. Time extension requests must be received at least 90 days before the end of the subgrant.

    (c) Department approval or rejection of an amendment request shall be noticed to the local government within 45 days of the Department’s receipt of the request. If additional information is requested by the Department to act on the amendment request, the Department shall notice the local government within 30 days of receipt of the additional information required for the approval or rejection of the request.

    (d) If the local government requests administrative closeout prior to the termination date of the subgrant, any amendment affecting closeout must be included with the closeout documents.

    (e) If a subgrant must be amended after the termination date, the local government or the Department may request in writing that the subgrant be reopened for the purpose of amending the subgrant. This request must be in addition to other documentation that may be required based upon the purpose of the amendment.

    (5) Subgrant Agreement Closeout.

    (a) At the time the closeout report is submitted, the local government must have available documentation to verify its certification that all construction has been completed, inspected and approved by all parties prior to the subgrant end date and submission of the administrative closeout. All funds drawn from the Department and not expended must be returned to the Department prior to or with the submission of the closeout.

    (b) Upon completion of the activities contained in the local government’s CDBG subgrant, including any amendments, the local government shall submit to the Department a closeout report which gives the final statement of costs, certifies that the project and all non-administrative activities are completed and accepted, that all costs except those reflected on the closeout report have been paid, and reports demographics of the program’s beneficiaries. Economic Development projects in which the cost per job exceeds $10,000 shall not submit an administrative closeout until one year after the date CDBG funded activities were completed.

    1. If any change has been made since the application map or the last map amendment in Commercial Revitalization or Neighborhood Revitalization, the closeout shall also contain a revised map of the completed activities.

    2. The closeout report in Housing shall include a list of the homes assisted and certify that each housing unit was within the local government’s jurisdiction.

    (c) The closeout report must contain original signatures. Facsimile (FAX) submissions are not acceptable to meet submission requirements.

    (d) If a recipient fails to meet contractual requirements on time, the Department reserves the right to require that a recipient financially (not administratively) close out a subgrant to meet federal requirements for the timely distribution of funds set by HUD.

    (6) Performance.

    (a) Reporting. At a minimum, the local government shall provide the Department with a final closeout report.

    (b) Monitoring by the Recipient. Recipients shall constantly monitor their own performance of project activities to ensure that time schedules are met, projected milestones are accomplished, and other performance goals are achieved.

    (c) Monitoring by the Department. The Department shall review each subgrant periodically to determine whether the recipient is implementing the subgrant as described in the approved application, the subgrant contract and in compliance with the requirements of Sections 290.0401-.049, F.S., this rule, and other applicable State laws and federal regulations.

    1. Recipients shall be required to supply data and make available records as are necessary to complete an accurate evaluation of contracted activities. Recipients shall respond to any monitoring finding, and to any concern identified as requiring a response, within (35) days of the receipt of the Department’s letter. Otherwise, the Department will reject any Request for Funds. The Department will grant one 15-day extension to the response period upon request by the recipient.

    2. If the Department must take formal action under the terms of the subgrant to terminate it for cause, the recipient will be assessed 150 penalty points against the score of future applications. This penalty expires two years from final closeout (not administrative closeout) of the terminated grant.

    (d) Remedies. When the Department determines on the basis of a review of the recipient’s performance that the terms of the subgrant are not being met, the Department shall:

    1. Initiate actions as prescribed in 24 C.F.R. 570.910(b), “Corrective and Remedial Actions” and 570.911, “Reduction, Withdrawal, or Adjustment of Grant or other appropriate action,” both as effective on________.

    2. If at any time after the effective date of a subgrant the Department determines that a funded activity is not eligible pursuant to 24 C.F.R. Part 570, as effective on 00-00-00, the Department may unilaterally modify the agreement to delete the ineligible activity and deobligate any unencumbered funds.

    (e) Submission of inaccurate information by the recipient may be subject to one or more of the following penalties. This applies to inaccurate information in monitoring report responses; audit or audit finding responses; quarterly, closeout, program income, or other reports; or Requests for Funds if this inaccuracy results in subsequent official Department action (such as the granting of administrative or final closeout status, releasing funds, or clearance of findings). These penalties are:

    1. In the case of monitoring or audit responses, it shall result in the revocation of closeout status, audit clearance, and/or monitoring report clearance.

    2. In the case of an action, which avoids a penalty, the penalty will be assessed.

    3. In the case of an administrative closeout status, it shall result in the nullification of the eligibility of the recipient to apply for and receive additional CDBG funding in accordance with Section 290.046(2)(c)(i), Florida Statutes. Such revocation of administrative closeout status would also affect subsequent Department actions made on that basis, including the cancellation of any subsequent subgrant and repayment by the recipient of any funds previously expended under the nullified subgrant.

    (7) Audit Requirements.

    (a) The annual financial audit report should be accompanied by management letters and the recipient’s response to all findings, including corrective actions to be taken. A Single Audit under OMB Circular A-133, or an attestation statement that a Single Audit is not required, must be received from a local government with either an open or administratively closed contract by the June 30 deadline date, or a penalty will be assessed. A 25 point penalty will be assessed for audits not received by the June 30 deadline. A 10 point penalty will be assessed for attestation statements not received by the June 30 deadline. The penalty will expire two years from the date that the audit or attestation statement was received.

    (b) The annual financial audit report shall include a schedule of financial assistance specifically identifying all agreement and grant revenue by sponsoring department and agreement number.

    (c) The complete financial audit report, including all items specified in paragraph (a) or (b) above, shall be sent directly to the addresses specified in the subgrant.

    (d) If the audit shows that the entire funds, or any portion thereof, were not spent in accordance with the conditions of a CDBG subgrant or this Rule, the recipient shall be held liable for reimbursement to the Department of all funds not spent in accordance with applicable regulations and subgrant provisions within thirty (30) days after the Department has notified the recipient of such noncompliance.

    (e) The recipient shall retain all financial records, supporting documents, statistical records, and any other documents pertinent to a CDBG subgrant for a period of six years after the date of final closeout submission of the final expenditures report. However, if litigation or an audit has been initiated prior to the expiration of the six year period, the records shall be retained until the litigation or audit findings have been resolved.

    (f) The recipient shall have all audits completed by an independent certified public accountant (ICPA) who shall either be a certified public accountant or a public accountant licensed under Chapter 473, Fla. Stat. The ICPA shall state that the audit complied with the applicable provisions noted above.

    (8) Displacement and Relocation.

    (a) Recipients are required to develop a written plan for assisting persons or businesses that may be displaced as a result of activities assisted with CDBG funds. The plan shall include actions that the recipient shall take to mitigate any adverse effects resulting from CDBG funded activities that may cause such displacement. This plan shall be in accordance with Section 104(d) of Title I of the Housing and Community Development Act of 1974, as amended and is required even if displacement is not anticipated.

    (b) If the CDBG funded activity involves the acquisition of real property by the local government or causes displacement of persons or businesses, the federal “Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,” as amended, shall apply. For activities resulting in displacement of persons or businesses that do not involve the acquisition of real property, and thus not subject to the “Uniform Act,” the local government’s local written policy shall identify the assistance it elects to provide for such persons or businesses.

    (c) The recipient shall make its displacement and relocation policy available to the public.

    (9) Records. The local government shall maintain all subgrant files and records within a readily accessible site within its jurisdiction and under its control at all times until six years after receipt of final closeout notification from the Department. The local government shall provide all interested citizens with reasonable access to the subgrant records during normal business hours.

    (10) Program and Non-Program Income.

    (a) Liquidated damages, rebates, refunds, or any other “non-program income” received from any party previously paid (or from whom payment was withheld) shall be used to conduct additional eligible activities or returned to the Department. Additional direct and quantifiable costs (i.e., legal fees, court costs, engineering fees or administrative fees as defined in this rule) generated by the incident creating the liquidated damages may be deducted from the total liquidated damages prior to undertaking additional activities or returning funds to the Department. Use of the funds for additional eligible CDBG activities must be preceded by an amendment to the CDBG subgrant detailing their use.

    (b) Program income generated after closeout shall be returned to the Department. Program income generated prior to closeout of a subgrant shall be returned to the Department unless:

    1. The program income is used to fund additional units of CDBG activities referenced in the subgrant under which the program income was generated; and

    2. The recipient amends the subgrant to encompass expenditure of the program income prior to administrative closeout; and

    3. The funds are to be expended pursuant to the provisions of 24 C.F.R. Part 570, as effective on 00-00-00, Sections 290.046-.049, Florida Statutes, and this rule.

    (11) Conflict of Interest. If CDBG funds are to be expended to assist or benefit any person listed in 24 C.F.R. Section 570.489(h)(3), as effective on 00-00-00, or listed in Section 112.312 (21), Florida Statutes who is subject to a conflict described in 24 C.F.R. Section 570.489(h)(2), as effective on 00-00-00, a waiver of that conflict shall first be requested pursuant to 24 C.F.R. Section 570.489(h)(4), as effective on 00-00-00. Should CDBG funds be expended prior to the Department’s approval of the waiver of the conflict of interest, the funds expended will not be considered an eligible expense and shall be subject to repayment.

    (12) Direct Benefit. The eligibility of households receiving direct benefit, including water or sewer hookups, shall be established no earlier than one year before the work is performed. Eligibility documentation shall include third party verification of household income and source(s) regardless of the value of the direct benefit.

    Rulemaking Specific Authority 290.048 FS. Law Implemented 290.044, 290.046, 290.047, 290.0475 FS. History–New 5-23-06, Amended 2-26-07, ________.

     

    (Substantial rewording of Rule 9B-43.0061. See Florida Administrative Code for present text.)

    9B-43.0061 Emergency Set-Aside Assistance.

    Applications will be accepted for the Emergency Assistance Set-aside in accordance with the following criteria:

    (1) The maximum funds available under this set-aside from each federal fiscal year’s allocation shall be five percent of the funds and shall be for 12 months from the award date of the federal grant.

    (2) Any funds in this set-aside for which a notice of intent to submit an emergency application has not been received prior to the date established in subsection (1) above shall be reallocated in accordance with Section 290.044(4), F.S.

    (3) Applications will only be accepted from eligible local governments, as defined in Section 290.042(5), F.S, which have been declared by executive order of the Governor to be in a state of emergency as provided under Section 252.36, F.S., and any subsequent emergency rule criteria prepared by the Department to address the emergency. A local government with an open subgrant in any other category is not precluded from applying for or receiving Emergency Set-aside funds because of the open subgrant or its status.

    (4) The purpose of funds shall be to meet serious, urgent community needs of low and moderate income residents resulting from the disaster. Sufficient documentation must exist to show that the need for the activities being undertaken is directly related to a specific disaster event covered by an executive order. The amount of funds requested shall be limited to that amount necessary to address the emergency need.

    (5) All other provisions of this rule chapter shall apply to the Emergency Assistance Set-aside unless otherwise stated in the Notice of Funding Availability.

    (6) If the total requests for funding exceed the amount of available funds, the Department shall allocate funds among all applicants with eligible activities but not to exceed the amount requested by any applicant.

    (a) A prorated allocation shall be calculated by dividing the available funding by the total eligible costs requested by all applicants. Each applicant shall be offered an amount, rounded to the nearest dollar, equal to the percentage developed from this calculation.

    (b) Any funds remaining after the procedure in (a) shall be allocated to the applicant with the lowest eligible request. If two or more applicants have the same lowest eligible request, the remaining funds shall be allocated equally between them.

    (c) If an applicant chooses not to accept the amount offered, that amount shall be redistributed equally among all applicants who accepted their offer.

    Rulemaking Specific Authority 290.044 FS. Law Implemented 290.044 FS. History–New 5-23-06, Amended_________.

     

    (Substantial rewording of Rule 9B-43.0071 follows. See Florida Administrative Code for present text.)

    9B-43.0071 Section 108 Loan Guarantee Program.

    (1) Application Process.

    (a) Projects which propose loans to a third party or parties shall include letters of commitment from all funding sources evidencing sufficient funds to complete the project. For economic development projects, these commitments shall include at a minimum those stated in the Economic Development section of the Florida Small Cities CDBG Application Manual under “Initial Participating Party Commitments.”

    (b) Following the receipt of a formal invitation to submit an application, the local government (Applicant/Borrower) shall have a third party conduct and complete a detailed underwriting analysis in accordance with 24 C.F.R. 570.482(e)(2) and Appendix A of 24 C.F.R. Part 570. The Department may, as necessary, require additional underwriting standards, criteria or review.

    (c) The Department shall retain the right of approval of the third party underwriter, the method of analysis and adherence to the guidelines in 24 C.F.R. 570.482(e)(2) and Appendix A.

    (d) The local government shall submit the underwriting analysis with the final application package. The Department reserves the right to require additional information from the local government, the underwriter and/or the third party to whom a loan is proposed. Once a financial underwriting analysis and other required documentation has been provided by the local government, any material change, including changes in corporate or ownership structure, which affects the underlying assumptions upon which the local government relied will require that the underwriting analysis be re-evaluated by the local government and any assistance requested for the Participating Party must be adjusted if a material change has occurred.

    (2) Site Visit and Contracting Period.

    (a) The Department will conduct a site visit following review and acceptance of the final application package. For projects which propose loans to a third party or parties, a representative of the third party(ies) shall attend the site visit or must meet with Department staff within 30 days after the site visit at the Department of Community Affairs.

    (b) The local government shall submit a fully executed Participating Party Agreement meeting the requirements set out in the Economic Development section of the Florida Small Cities CDBG Application Manual.

    (3) Administration and Reporting.

    (a) The local government shall copy the Department on all written correspondence with HUD, the underwriter, the Participating Party and all other involved parties.

    (b) The local government shall at a minimum provide the Department with quarterly progress reports until such time as the project is administratively closed. This report shall include documentation in a form acceptable to the Department of the project’s draws and repayments, accomplishments to date and updates on previous areas of concern as determined by the Department.

    Rulemaking Specific Authority 290.048 FS. Law Implemented 290.0455 FS. History–New 5-23-06, Amended________.

     

    9B-43.0081 Nonrecurring CDBG Funding.

    (1) When nonrecurring CDBG funds are awarded to the State of Florida by the U.S. Department of Housing and Urban Development (HUD) to address disaster recovery needs in Presidentially declared disaster areas, the Department will adhere to the following process:

    (a) Submit an Action Plan to HUD which describes the proposed use of the funds.

    (b) Notify eligible applicants of the availability of the funds, the eligible uses, and the manner in which they can be accessed.

    (c) Evaluate local government proposals for the use of the funds and make on-site visits to ensure compliance with federal guidelines.

    (d) Execute subgrant agreements with the local governments.

    (2) The objective of nonrecurring disaster funding is to address disaster relief, long-term recovery, and to restore housing and infrastructure, particularly that which affects persons who are of low and moderate income that suffered damage or loss as a result of the disaster. Funds may be made available to both Urban Entitlements and participants of the Florida Small Cities CDBG Program, federally designated Indian Tribes and nonprofit organizations.

    (3) Rule 9B-43.0031, F.A.C. (Definitions, except the definition of “service area”) and subsections 9B-43.0051(2), (3), (4) and (8), F.A.C. (Selected portions of Subgrant Administration and Project Implementation) will apply to CDBG disaster recovery funding. All other portions of Rule Chapter 9B-43, F.A.C., are waived.

    (4) Service area. “Service area” is defined as the total geographical area to be served by an activity. A service area will encompass all beneficiaries who are reasonably served or would be reasonably served by an activity.

    (5) Interlocal Agreements. Eligible applicants proposing eligible activities in other eligible jurisdictions will enter into an Interlocal Agreement with the following provisions or submit documentation of an established relationship between eligible jurisdictions which includes the following provisions:

    (a) Includes as parties all local governments whose jurisdictions are included in the project and/or service area(s);

    (b) Authorizes the applicant to undertake the activities in all jurisdictions included in the interlocal agreement; and

    (c) Affirms that all activities are consistent with each local government’s comprehensive plan and provides applicable excerpts of each local government’s comprehensive plan in the supporting documentation section of the application.

    (6) Administrative Costs. The State’s Action Plan will limit the amount of funds that local governments may use for the administrative costs specified in 24 CFR 570.206. This does not include staff and administrative costs directly related to carrying out activities eligible under 24 CFR 570 since those costs are eligible as part of those activities.

    (7) Program Income. Any program income earned as a result of activities funded under a CDBG disaster recovery subgrant must be reported to the Department, but may be retained for the life of the subgrant by the local government and used to continue the activities from which the funds were generated. Contractual agreements will provide additional guidelines for utilization of program income funds.

    (8) Other Funds. Applicants and/or beneficiaries must provide documentation of funds received from other sources which were applied toward the costs of the project funded by CDBG disaster recovery funds.

    (9) Beneficiaries of Public Improvements. For activities where hookups or connections are required for beneficiary access to CDBG-funded infrastructure, low and moderate income benefit shall be determined by the number of low and moderate income persons in households connected to and able to use the water, sewer or other infrastructure at the time of administrative closeout. For activities where hookups or connections are required as a condition for beneficiary access to a CDBG funded infrastructure, no hookup or connection fees shall be charged to very-low, low or moderate-income beneficiaries. Further, no portion of the project construction costs shall be charged to very-low, low or moderate-income beneficiaries.

    (10) Amendments. All proposed subgrant agreement amendments must be approved by the Department.

    (a) Documentation Required. All requests for amendments shall include the following written documentation for review by the Department:

    1. A cover letter signed by the Chief Elected Official or their designee which describes the need for the proposed changes and their effect upon the approved project.

    2. All application forms that would be changed by the proposed amendment.

    3. If applicable, a revised activity work plan.

    4. If applicable, a revised budget showing the current and amended budget.

    5. If there is a change in activity location, a legible map which indicates the proposed change.

    6. A copy of the minutes of the meeting at which the amendment was approved.

    7. Signature of the Chief Elected Official on Form DCA 07.02, Request for Amendment, provided by the Department upon request, which is hereby incorporated by reference, or documentation from the local governing body authorizing the proposed amendment.

    (b) The amendment must be received by the Department at least 45 days prior to the end of the subgrant agreement. If the amendment is extending the subgrant agreement period, it must be received by the Department at least 90 days prior to the end of the subgrant agreement.

    (c) If the local government requests administrative closeout prior to the termination date of the subgrant agreement, any amendment affecting closeout and requiring Department approval must be included with the closeout.

    (d) Time Extensions to Subgrant Agreements. Any proposed amendment extending the termination date of the subgrant agreement must be approved by the Department. The local government must explain any delay affecting project completion and must justify the need for the extension.

    (12) Subgrant Closeout.

    (a) At the time of submission of the closeout report, the local government must have available documentation which verifies its certification that all construction has been completed, inspected and approved by all parties prior to the subgrant agreement end date and submission of the administrative closeout.

    (b) An administrative closeout may be submitted only when the local government has no funds on hand. All funds drawn from the Department and not expended must be returned to the Department prior to, or with, the submission of the closeout.

    (c) Upon completion of the activities contained in the local government’s CDBG subgrant agreement (including any amendments), the local government shall submit to the Department a closeout which, at a minimum, gives the final statement of costs, certifies that the project and all non-administrative activities are completed and accepted, certifies that all costs except those reflected on the closeout have been paid and reports demographics of the program’s beneficiaries.

    (d) If any change has been made since the application map or the last map amendment, the closeout shall also contain a revised map of the activities completed during the term of the CDBG contract.

    (e) When housing assistance is provided, the closeout must, at a minimum, include a list of the households assisted by the contract. Additional information required by HUD may be requested by the Department at any time.

    (f) For activities where hookups or connections are required for beneficiary access to the public improvement, evidence at the time of closeout must show:

    1. The total number of persons in all households in the service area;

    2. The number of low and moderate income persons in households connected to the infrastructure; and

    3. Projects required to meet the LMI national objective must document that the number of LMI persons in households connected to the infrastructure divided by the total number of beneficiaries in the service area equals at least 51 percent or higher or the percentage required by HUD at the time of the application.

    (g) The closeout must contain original signatures. Facsimile (FAX) submissions are not acceptable.

    (h) If a local government fails to meet contractual requirements on time, the Department reserves the right to require that a local government financially (not administratively) close out a subgrant agreement in order to meet federal requirements for the timely distribution of funds set by HUD.

    (i) All closeout documentation is due within 45 days after expiration or termination of the subgrant agreement.

    Rulemaking Authority 290.048 FS. Law Implemented 290.043 FS. History–New ________.

     

    NAME OF PERSON ORIGINATING PROPOSED RULE: Jacquelyn Dupree, Community Program Manager

    NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Thomas G. Pelham, Secretary

    DATE PROPOSED RULE APPROVED BY AGENCY HEAD: February 10, 2010

    DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAW: December 4, 2009

Document Information

Comments Open:
2/19/2010
Summary:
Rule Chapter 9B-43, F.A.C., has been revised to include two new sections (Specific Requirements for Competitive Categories and Nonrecurring CDBG Funding). Existing sections have also been revised. Revisions have also been made to the application manual, including scoring criteria, which is incorporated by reference.
Purpose:
This is a substantial rewrite of the rule.
Rulemaking Authority:
290.048 FS.
Law:
290.043, 290.044, 290.0455, 290.046, 290.047, 290.0475, 290.048 FS.
Contact:
Jacquelyn Dupree, Community Program Manager, Division of Housing and Community Development, 2555 Shumard Oak Boulevard, Tallahassee, Florida 32399-2100, (850)487-3644
Related Rules: (7)
9B-43.0031. Definitions
9B-43.0041. Application and Administrative Requirements
9B-43.0045. Specific Requirements for Competitive Categories.
9B-43.0051. Grant Administration and Project Implementation
9B-43.0061. Emergency Set-Aside Assistance
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