This rulemaking will address changes to federal regulations that affect the program and provide technical cleanup to the recent rule revision including edits to the forms.

 

DEPARTMENT OF ECONOMIC OPPORTUNITY

Division of Community Development

RULE NOS.RULE TITLES:

73C-23.0041Application Process - General Information

73C-23.0051Grant Administration and Project Implementation

PURPOSE AND EFFECT: This rulemaking will address changes to federal regulations that affect the program and provide technical cleanup to the recent rule revision including edits to the forms.

SUMMARY: The rule covers the application process for Community Development Block Grant funds; the citizen participation requirements that must be met; and the administrative requirements of subgrants, including program implementation, procurement, audit and reporting requirements, and modifying and closing out subgrant agreements.

SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS AND LEGISLATIVE RATIFICATION: The Agency has determined that this will not have an adverse impact on small business or likely increase directly or indirectly regulatory costs in excess of $200,000 in the aggregate within one year after the implementation of the rule. A SERC has not been prepared by the Agency.

The Agency has determined that the proposed rule is not expected to require legislative ratification based on the statement of estimated regulatory costs or if no SERC is required, the information expressly relied upon and described herein: The agency has performed a review of the statutory requirements and has determined that its proposed rules 73C-23.0041, F.A.C. and 73C-23.0051, F.A.C., have no adverse impact or regulatory costs which exceed any of the criteria established in Section 120.541(2)(a), Florida Statutes. The rules are therefore expected be able to take effect without the need of being ratified by the Legislature.

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.

RULEMAKING AUTHORITY: 290.044, 290.046, 290.047, 290.048 FS.

LAW IMPLEMENTED: 290.044, 290.046, 290.047, 290.0475 FS.

IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE SCHEDULED AND ANNOUNCED IN THE FAR.

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Michael Golen, Office of General Counsel, Department of Economic Opportunity, 107 East Madison Street, MSC 110, Tallahassee, Florida 32399, [phone]

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

73C-23.0041 Application Process – General Information.

(1) through (2). No change.

(3)(a) through (b). No change.

(c) The funding limit for Economic Development subgrants shall be based on the number of jobs to be created or retained by the participating parties. The maximum subgrant amount shall be $1,500,000. No more than $34,999 may be requested for each full time equivalent job to be created or retained.

(d) No change.

(4) No change.

(5)(a) through (b). No change.

(c) Citizen participation shall include the following:

1. At least one public hearing shall be held within the 12 month period prior to the date that the application cycle closes to obtain citizens’ views regarding community development needs prior to an Application for Funding being drafted. This shall be known as the First Public Hearing. A public notice shall be published in a local newspaper at least five days and no more than 20 days before the day of the hearing as defined in subsection 73C-23.0031(45), F.A.C. of this rule. The notice shall include the federal fiscal year (FFY) for which an application is being considered, the range of activities that may be undertaken with CDBG funding and the amount for which the community can apply.

The public hearing 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 at a time and location convenient to potential beneficiaries. Citizens shall be allowed to comment at the hearing as required by 24 CFR 570.486(a)(5), and the citizen input from this hearing should be considered when the application is being prepared. The local government must document all citizen participation at the hearing. If the documentation shows that the application was drafted prior to the First Public Hearing, the application shall be rejected

2.a. No change.

(I) through (III). No change.

(IV) For Neighborhood Revitalization, Commercial Revitalization and Economic Development projects, the specific locations of the proposed activities, including street names or road numbers (e.g., County Road 50).

The notice shall also state where and when, other than at the public hearing, a copy of the draft application will be available for citizen review and how citizens can submit written comments on the draft application. Failure to include all of the required information in the public hearing notice shall result in the application being rejected as provided in Section 290.0475(6), F.S.

b. If the notice for the second public hearing is published before the first public hearing is conducted, the application shall be rejected.

c.b. The public hearing on the draft application must be conducted within the 12 month period prior to the date that the application cycle closes by a member of the governing body of the Applicant or by a duly authorized employee of that local government at a time and location convenient to potential beneficiaries. This shall be known as the Second Public Hearing. Citizens shall be allowed to comment on the draft application at the hearing, and the citizen input from this hearing should be considered before the application is finalized and submitted to the Department. The local government must document all citizen participation at the hearing.

d.c. Copies of the public notices, affidavits of publication, certified minutes and sign-in sheets/speaker cards for both public hearings shall be included in Part 9, Appendix D, of the Application for Funding, Form SC-60, which is further described in paragraph (6)(a) below. The application shall be rejected if the affidavit of publication or certified minutes for either public hearing are not provided by the end of the Completeness Period.

(d)(1) through (2). No change.

3. The CATF shall conduct at least one meeting prior to an Application for Funding being drafted and prior to the notice for the second public hearing being published to discuss community needs and to provide recommendations to the local governing body. The meeting shall be advertised in accordance with subsection 73C-23.0031(45), F.A.C. A minimum of 51% of the members must participate in the meeting.

If the Applicant is claiming points for having an active CATF, copies of the public notice, affidavit of publication, meeting minutes and sign-in sheet shall be included in Part 9, Appendix D, of the Application for Funding, Form SC-60, which is further described in paragraph (6)(a) below. If the affidavit is not available by the application deadline, it must be provided by the end of the “completeness period” to retain the points.

(6) Applications.

(a) Application Form. The Florida Small Cities Community Development Block Grant Application for Funding, Form SC-60, http://www.flrules.org/Gateway/reference.asp?No=Ref-         ; effective date:_______ April 2015, which is hereby adopted and incorporated by reference. The application form has nine parts, and these parts include scoring guidelines and documentation requirements for the CDBG application. Parts 1-9 of the application are available for download on the Department’s website: www.FloridaJobs.org/CDBGApplicantInfo. Copies of the electronic form will be made available upon request by contacting the Department by email at [e-mail].

(b) No change.

1. One application in either Either Housing Rehabilitation, Neighborhood Revitalization or Commercial Revitalization. If an Applicant submits more than one an Application for Funding in more than one of these categories, only the first application logged in by the Department will be scored. The other application(s) will be rejected; and,

2. One application in Economic Development. If an Economic Development application is rejected or withdrawn, the local government can submit another Economic Development application. A maximum of three Economic Development applications can be submitted during a funding cycle.

(c) through (h). No change.

(7)(a) through (b)1. No change. 

2. Random Sample Survey Methodology – A sample-based survey of the beneficiaries must use the Household Income Certification Form, Form SC-49, http://www.flrules.org/Gateway/reference.asp?No=Ref-05340; effective date: April, 2015, which is hereby adopted and incorporated by reference, and also is available on the CDBG website: www.FloridaJobs.org/CDBGApplicantInfo.com. The survey methodology must correspond with the random sampling requirements established by HUD in Notice CPD-14-013, issued on September 23, 2014, and which can be found at: www.FloridaJobs.org/CDBGApplicantInfo.com, incorporated herein by reference. The survey methodology must include a confidence level of 95%.

a. through c. No change.

3. through 7. No change.

(8) through (13). No change.

Rulemaking Authority 290.044, 290.046, 290.047, 290.048 FS. Law Implemented 290.044, 290.046, 290.047, 290.0475 FS. History–New 5-23-06, Amended 2-26-07, 6-6-10, Formerly 9B-43.0041, Amended 4-21-15,                        .

 

73C-23.0051 Grant Administration and Project Implementation.

(1) Financial Management.

(a) CDBG subgrant Recipients shall establish a financial management system for administering subgrant funds that complies with Section 218.33, F.S., and 2 CFR 200.302 24 CFR 85.20, as incorporated in Rule 73C-23.0031, F.A.C. The system must address the following:

1. Financial reporting,

2. Accounting records,

3. Internal control,

4. Budget control,

5. Allowable cost,

6. Source documentation; and,

7. Cash management.

(b) through (d). No change.

(e) If a Recipient needs to remit funds to the Department, including reimbursement of grant funds, program income or interest income paid on CDBG funds, it shall submit a copy of the Return of Funds Form, DEO Form SC-68, http://www.flrules.org/Gateway/reference.asp?No=Ref-        ; effective date:       , which is hereby adopted and incorporated by reference.

(2) No change.

(3) Procurement.

(a) Procurement Policy.  Each subgrant Recipient shall adopt a local CDBG Procurement Policy that complies with the provisions of 2 CFR 200.317 – 200.326 24 CFR section 85.36, as incorporated in Rule 73C-23.0031, F.A.C. For covered professional services contracts, the policy shall also comply with Section 287.055, F.S. (Consultants Competitive Negotiation Act).

1. No change.

2. The Recipient shall submit procurements being paid with CDBG funds to the Department for desk monitoring. Submission shall be made in accordance with the requirements outlined in the Recipient’s subgrant agreement. The following forms shall be included with construction procurement documentation:

a. Bidding Information and Contractor Eligibility, DEO Form SC-51, http//www.flrules.org/Gateway/reference.asp?No=Ref-05342; effective date: April, 2015, which is hereby adopted and incorporated by reference;

b. Certification Regarding Debarment, Suspension, and Other Responsibility Matters (Primary Covered Transactions). DEO Form SC-37, http://www.flrules.org/Gateway/reference.asp?No=Ref-05335; effective date: April, 2015, which is hereby adopted and incorporated by reference; and,

c. Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion (Subcontractor), DEO Form SC-38, http://www.flrules.org/Gateway/reference.asp?No=Ref-05336; effective date: April, 2015, which is hereby adopted and incorporated by reference.

3. 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 procured through bids, as required by 2 CFR section 200.319(a).

(b) Public Notice.  Professional services. Any procurement which requires public notice in a newspaper based on the local CDBG procurement policy, shall be published in a newspaper of general circulation in the county where the Recipient is located. The following public notice criteria apply for the procurement process to be approved:

1. through 3. No change.

4. The procurement policy shall require at least 12 days for receipt of the proposals or bids after the date of publishing. For construction activities, the policy shall conform to Section 255.0525, F.S. with regard to the numbers of days between publishing the notice and bid opening.

5. Nothing in paragraphs (3)(b)1., 2., or 3. shall preclude a local government from using other media to solicit bids related to procurement of professional services and construction activities.

(c) Construction. Public notice for construction procurement shall conform to Section 255.0525, F.S. If fewer than three responsible and responsive bids are received and the notice was not published in a MSA newspaper as described in subparagraph (3)(b)1. above, the procurement must be readvertised.

1. Prior to procuring construction activities, the Recipient shall request a wage decision for each funded activity that is covered by the Davis-Bacon Act, which is available at www.dol.gov/whd/regs/statutes/dbra.htm, using the Wage Decision Request, DEO Form SC-56, http://www.flrules.org/Gateway/reference.asp?No=Ref-05347; effective date: April, 2015, which is hereby adopted and incorporated by reference.

(d) Nothing in paragraphs (3)(b) or (c) shall preclude a local government from using other media to solicit bids related to procurement of professional services and construction activities.

(e) The Department must provide written approval prior to the Recipient awarding any contract exceeding $25,000 resulting from a single source, 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 CFR 85.36(b)(4).

If prior written approval is not obtained, the Department has no obligation to fund the contract unless the Department subsequently approves the procurement. Cost analysis is required for single and sole source contracts to comply with 24 CFR 85.36(f) and establish the reasonableness of the price even if competitive procurement was used.

(c) Professional Services.

1. 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 (3) below. Each advertisement for procurement of CDBG professional services, except for application preparation, must identify either the CDBG funding cycle 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.

2.(f) In procuring services for subgrant administration, the Recipient Recipients shall publish a Request for Proposals that includes all of the criteria that will be used to evaluate and score the proposals.  Any firm that assists the Recipient in developing or drafting criteria used in the Request for Proposals shall be excluded from competing for the procurement as required by 2 CFR 200.319(a).  The Recipient does not have publish a Request for Proposals if it decides to use its Regional Planning Council for subgrant administration. 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.

3.(g) 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. Different 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.

4.(h) All contracts for professional services shall conform to the following:

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

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

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

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

b.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 (3)(i) 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.

5.4. Each professional services contract must identify the CDBG contract 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).

6.(i) Engineering and Administration Services.

a.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 additional 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.

b.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 and the Request for Proposals specifically included services during construction in the scope of work.

(d)(j) Construction Contracts.

1. Prior to procuring construction activities, the Recipient shall request a wage decision for each funded activity that is covered by the Davis-Bacon Act, which is available at www.dol.gov/whd/regs/statutes/dbra.htm, using the Wage Decision Request, DEO Form SC-56, http://www.flrules.org/Gateway/reference.asp?No=Ref-05347; effective date: April, 2015, which is hereby adopted and incorporated by reference.

2. If fewer than three responsible and responsive bids are received and the notice was not published in a MSA newspaper as described in subparagraph (3)(b) above, the procurement must be readvertised.

3.1. 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 the bid proposal identifies the CDBG activities and the amount of a contract to be paid from CDBG.

4.2. 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.

5.3. All contracts in excess of $100,000 covered by Section 3 regulations shall contain the language required in 24 CFR 135.38, incorporated by reference in Rule 73C-23.0031, F.A.C., and in CDBG Supplemental Conditions for Construction Contracts, DEO Form SC-66, http://www.flrules.org/Gateway/reference.asp?No=Ref-05353; effective date: April, 2015, which is hereby adopted and incorporated by reference.

6.4. The Recipient shall have all contractors and subcontractors complete all of the following Forms that are applicable:

a. Through c. No change.

7.5. All contracts in excess of the Simplified Acquisition Threshold as listed in 2 CFR 200.88, which can be found at http://www.gpo.gov/fdsys/pkg/CFR-2014-title2-vol1/xml/CFR-2014-title2-vol1-subtitleA-chapII.xml, $100,000 shall include the following:

a. Through b. No change.

8.6. All contracts shall include liquidated damages clause establishing a predetermined amount that must be paid if the contractor fails to perform as promised.

9. The following forms shall be included with construction procurement documentation:

a. Bidding Information and Contractor Eligibility, DEO Form SC-51, http://www.flrules.org/Gateway/reference.asp?No=Ref-05342; effective date: April, 2015, which is hereby adopted and incorporated by reference;

b. Certification Regarding Debarment, Suspension, and Other Responsibility Matters (Primary Covered Transactions). DEO Form SC-37, http://www.flrules.org/Gateway/reference.asp?No=Ref-05335; effective date: April, 2015, which is hereby adopted and incorporated by reference; and,

c. Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion (Subcontractor), DEO Form SC-38, http://www.flrules.org/Gateway/reference.asp?No=Ref-05336; effective date: April, 2015, which is hereby adopted and incorporated by reference.

10.7. If it is determined that the Davis-Bacon Act wage decision that was previously obtained from the Department does not contain a job classification needed to complete a construction activity, the Recipient shall request an additional classification using the following forms:

a. through b. No change.

(e)(k) 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.

(4) through (5). No change.

(6) Performance.

(a) Reporting. The local government shall provide the Department with:

1. By the dates listed in the Subgrant Agreement, a Quarterly Progress Report, DEO Form SC-65, http://www.flrules.org/Gateway/reference.asp?No=Ref-      ; effective date: _______ April, 2015, which is hereby adopted and incorporated by reference.

2. through 4. No change.

(b) through (c). No change.

(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 the subgrant agreement. in 24 CFR Part 570.910(b), “Corrective and Remedial Actions” and 24 CFR Part 570.911, “Reduction, withdrawal, or adjustment of grant or other appropriate action,” as incorporated in Rule 73C-23.0031, F.A.C.

2. No change.

(e) No change.

(7) through (12). No change.

Rulemaking Authority 290.048 FS. Law Implemented 290.044, 290.046, 290.047, 290.0475 FS. History–New 5-23-06, Amended 2-26-07, 6-6-10, Formerly 9B-43.0051, Amended 4-21-15, _______________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Michael Golen, Office of General Counsel

NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Jesse Panuccio

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: December 4, 2015

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: 6/19/2015