9B-43.0051. Grant Administration and Project Implementation (Transferred)

(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, incorporated herein by reference, and 40 CFR s. 1500-1508, National Environmental Policy Act Regulations, incorporated herein by reference, both as effective on 6-6-10.

(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. s. 85.36, incorporated herein by reference, as effective on 6-610, 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 federal Office of Management and Budget (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. s. 85.36 (b)(4), as effective on 6-6-10.

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. 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.

(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 (2)(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 C.F.R. s. 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. s. 135.38, incorporated by reference, as effective on 6-6-10.

(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. s. 570.910(b), “Corrective and Remedial Actions” and 570.911, “Reduction, Withdrawal, or Adjustment of Grant or other appropriate action,” both as effective on 6-6-10.

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 6-6-10, 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 Sections 290.046(2)(c), (i), F.S. 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 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.

(a) The annual financial audit report shall  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, incorporated by reference on 6-6-10, 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 (7)(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, F.S. 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 project involves the acquisition of real property by the local government, regardless of whether such acquisition is funded from the CDBG grant, or causes displacement of persons or businesses, the local government shall comply with 49 C.F.R. Section 24 (the implementing regulation of the federal “Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970) incorporated herein by reference, as effective on 6-6-10. 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 6-6-10. Sections 290.046-.049, F.S., 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. s. 570.489(h)(3), as effective on 6-6-10, or listed in Section 112.312 (21), F.S., who is subject to a conflict described in 24 C.F.R. s. 570.489(h)(2), as effective on 6-6-10, a waiver of that conflict shall first be requested pursuant to 24 C.F.R. s. 570.489(h)(4), as effective on 6-6-10. 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 documentation of household income and source(s) regardless of the value of the direct benefit.

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.