[Federal Register Volume 60, Number 37 (Friday, February 24, 1995)]
[Notices]
[Pages 10430-10435]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-4448]
[[Page 10429]]
_______________________________________________________________________
Part II
Department of Housing and Urban Development
_______________________________________________________________________
Office of the Assistant Secretary for Community Planning and
Development
_______________________________________________________________________
Economic Development Initiative; Funding Availability and Program
Guidelines; Notice
Federal Register / Vol. 60, No. 37 / Friday, February 24, 1995 /
Notices
[[Page 10430]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Office of the Assistant Secretary for Community Planning and
Development
[Docket No. N-95-3878; FR 3874-N-01]
Notice of Funding Availability (NOFA) and Program Guidelines for
the Economic Development Initiative (EDI)
AGENCY: Office of the Assistant Secretary for Community Planning and
Development, HUD.
SUMMARY: This NOFA announces the availability of funds for grants under
Section 108(q) of the Housing and Community Development Act of 1974, as
amended. HUD reserves the right to award grants under this NOFA up to
the maximum amount authorized by law. As of the date of this NOFA and
subject to funding availability, HUD intends to award up to $50 million
in EDI funds.
Communities that are authorized to obtain Section 108 loan
guarantee commitments to carry out qualifying projects may also be
eligible under this NOFA to receive EDI grants. EDI grants are used to
enhance the security of the Section 108 guaranteed loan or to improve
the feasibility of proposed projects through techniques such as
interest rate subsidies, loan loss reserves, etc. The NOFA sets out
program guidelines that will govern the application, application
review, and award process for this round of EDI grants.
DATES: Applications are due in HUD Headquarters at the address stated
below under ``Addresses,'' by April 28, 1995 (the ``deadline date'').
HUD will not accept applications that are submitted to HUD via
facsimile (FAX) transmission. Applications that are mailed prior to the
deadline date but not received within ten (10) days after that date
will be deemed to have been received by that date if postmarked by the
United States Postal Service by no later than April 25, 1995. Overnight
delivery items received after the deadline date will be deemed to have
been received by that date upon submission of documentary evidence that
they were placed in transit with the overnight delivery service by no
later than April 27, 1995.
ADDRESSES: On and prior to the deadline date, completed applications
will be accepted at the following address: Processing and Control Unit,
Room 7255, Office of Community Planning and Development, Department of
Housing and Urban Development, 451 Seventh Street, SW, Washington, D.C.
20410, Attention: EDI Grant. At close of business on the deadline date,
completed applications will also be received in the South lobby of the
Department of Housing and Urban Development at the above address
(inquire at the security guard desk). However, any application received
by the Office of Community Planning and Development in Headquarters,
Washington, DC, by the deadline date will be accepted.
FOR FURTHER INFORMATION CONTACT: Paul Webster, Director, Financial
Management Division, Office of Block Grant Assistance, Department of
Housing and Urban Development, Room 7178, Washington, DC 20410.
Telephone (202) 708-1871. The TDD number is (202) 708-2565. (These are
not toll-free numbers.)
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act Statement
The information collection requirements related to this program
have been approved by the Office of Management and Budget (OMB) and
assigned the approval number 2506-0153.
I. Purpose and Substantive Description
(A) Authority. Title I, Housing and Community Development Act of
1974, as amended, (42 U.S.C. 5301-5320) (the ``Act''); 24 CFR part 570.
(B) Definitions.
CDBG funds means, in addition to those funds specified at
Sec. 570.3(e), grant funds received pursuant to Section 108(q).
Economic Development Initiative (EDI) means the provision of
economic development grant assistance under Section 108(q) of the Act,
as authorized by Section 232 of the Multifamily Housing Property
Disposition Reform Act of 1994 (P.L. 103-233) (the ``1994 Act'').
Economic development project means an activity or activities
(including mixed use projects with housing components) that are
eligible under the Act and under 24 CFR Sec. 570.703, and that increase
economic opportunity for persons of low- and moderate-income or that
stimulate or retain businesses or jobs or that otherwise lead to
economic revitalization.
Empowerment Zone or Enterprise Community means an urban area so
designated by the Secretary pursuant to 24 CFR part 597 (see January
12, 1995 final rule, 60 FR 3034).
Qualifying Empowerment Zone or Enterprise Community area means an
urban area designated as an Empowerment Zone or Enterprise Community
pursuant to 24 CFR part 597 or nominated by one or more local
governments and the State or States in which it is located for
consideration of designation as an Empowerment Zone or Enterprise
Community pursuant to 24 CFR part 597. The area need not have been
designated an Empowerment Zone or Enterprise Community by the Secretary
to be a qualifying empowerment zone or enterprise community area, but
if it was not so designated it must meet the eligibility requirements
for a nominated area pursuant to 24 CFR part 597, subpart B.
Strategic Plan means a strategy developed and agreed to by the
nominating local government(s) and State(s) and submitted in partial
fulfillment of the application requirements for designation as an
Empowerment Zone or Enterprise Community pursuant to 24 CFR Part 597.
Unless otherwise defined herein, terms defined in 24 CFR part 570
and used in this NOFA shall have the respective meanings given thereto
in that part.
(C) Background.
EDI is intended to complement and enhance the Section 108 Loan
Guarantee program (see 24 CFR Secs. 570.700-710 for regulations
governing the Section 108 program). This provision of the Community
Development Block Grant (CDBG) program provides communities with a
source of financing for economic development, housing rehabilitation,
and large scale physical development projects. HUD is authorized
pursuant to Section 108 to guarantee notes issued by CDBG entitlement
communities and non-entitlement units of general local government
eligible to receive funds under the State CDBG program. Regulations
governing the Section 108 program are found at 24 CFR part 570, subpart
M.
The Section 108 program is authorized at $2.054 billion in loan
guarantee authority in Fiscal Year 1995. Under this program communities
(and States, if applicable) pledge future years' CDBG allocations as
security for loans guaranteed by HUD. The full faith and credit of the
United States is pledged to the payment of all guarantees made under
Section 108. The Section 108 program, however, does not require CDBG
funds to be escrowed for loan repayment. This means that a community
can continue to spend its existing allocation for other CDBG purposes,
unless needed for loan repayment. The purpose of EDI grant funds is to
further minimize the [[Page 10431]] potential loss of future CDBG
allocations:
(1) By strengthening the economic feasibility of the projects
financed with Section 108 funds (and thereby increasing the probability
that the project will generate enough cash to repay the guaranteed
loan),
(2) By directly enhancing the security of the guaranteed loan, or
(3) Through a combination of these or other risk mitigation
techniques.
HUD envisions that the following project structures could be
typical:
Funding reserves--The cash flow generated by an economic
development project may be expected to be relatively ``thin'' in the
early stages of the project. The EDI grant can make it possible for
debt service or operating reserves to be established in a way that does
not jeopardize the economic feasibility of the project.
An example is a supermarket or neighborhood shopping center that is
designed to provide basic services and jobs for residents in a
distressed neighborhood. The public entity must be prepared for the
Section 108 loan repayments required during the time period after
completion of construction and during the lease-up phase when the
shopping center is not fully leased and generating sufficient revenues
to support the Section 108 loan repayments. It may therefore require
the developer to establish with a trustee a reserve account (or
accounts) that would be available to cover operating expenses and/or
debt service during this lease-up period. While such reserves are
commonplace, their cost may be so high as to make an already risky
neighborhood shopping center project economically infeasible. The
increased cost resulting from establishing such reserves may be
defrayed by the EDI grant. As with the letter of credit example below,
such reserves protect the CDBG program against the risk that CDBG funds
will have to be used to cover shortfalls in the intended source for
repayment of the Section 108 loan.
Another example would be a community that used EDI grant funds and
Section 108 loan funds to create an economic development loan fund
administered by a community based development organization, such as a
community development financial institution (CDFI) when eligible to
undertake the proposed Section 108/EDI eligible activities. Under this
example, a CDFI could use EDI grant funds together with Section 108
funds to capitalize the CDFI to make community economic development
loans, and/or the EDI grant could serve as security for any defaults in
loans made with the Section 108 proceeds.
Over-collateralizing the Section 108 loan--The use of EDI grant
funds may be structured in appropriate cases so as to improve the
chances that cash flow will be sufficient to cover debt service on the
Section 108 loan and directly to enhance the guaranteed loan. One
technique for accomplishing this approach is over-collateralization of
the Section 108 loan.
An example is the creation of a loan pool made up of Section 108
and EDI grant funds. The community would make loans to various
businesses at an interest rate equal to or greater than the rate on the
Section 108 loan. The total loan portfolio would be pledged to the
repayment of the Section 108 loan. If the total loan repayments from
the loan fund were twice the amount of the debt service on the Section
108 loan, the community could accumulate a loan loss reserve that would
mitigate virtually any risk to future CDBG funds.
Direct enhancement of the security of the Section 108 loan--The EDI
grant can be used to cover the cost of providing enhanced security. An
example of how the EDI grant can be used for this purpose is by using
the grant funds to cover the cost of a standby letter of credit, issued
in favor of HUD. This letter of credit will be available to fund
amounts due on the Section 108 loan if other sources fail to
materialize and will, thus, serve to protect the public entity's future
CDBG funds.
Provision of financing to for-profit businesses at a below market
interest rate--While the rates on loans guaranteed under Section 108
are only slightly above the rates on comparable U.S. Treasury
obligations, they may nonetheless be higher than can be afforded by
businesses in severely economically distressed neighborhoods. The EDI
grant can be used to make Section 108 financing affordable.
For example, a community's strategic plan to stabilize the economic
viability of a severely distressed neighborhood may include providing
loan assistance to both new and existing businesses at very low
interest rates for some period of time until each business has reached
a stabilized and profitable level of operation. EDI grant funds could
serve to ``buy down'' the interest rate up front, or make full or
partial interest payments, allowing the businesses to be financially
viable in the early start-up period not otherwise possible with Section
108 alone. This strategy would be particularly useful where a community
was undertaking a large commercial/retail project in a distressed
neighborhood to act as a catalyst for other development in the area.
The use of EDI/Section 108 funds for financing the commercial/retail
project along with providing financial assistance to neighboring new or
existing businesses within the target area would create complementary
economic activity and enhance the financial viability of all assisted
activities.
A combination of these techniques--An applicant could employ a
combination of these or other techniques in order to implement a
strategy that carries out an economic development project.
Additionally, assistance provided under this NOFA is subject to the
requirements of section 3 of the Housing and Urban Development Act of
1968, and the implementing regulations in 24 CFR part 135, as amended
by an interim rule published on June 30, 1994 (59 FR 33866). Section 3
requires that to the greatest extent feasible, and consistent with
Federal, State, and local laws and regulations, job training,
employment and other contracting opportunities generated from certain
HUD financial assistance be directed to low- and very-low income
persons. The eligible activities for which funding is provided under
this NOFA are consistent with the objectives of section 3. Public
entities awarded funds under this NOFA and that intend to use the funds
for housing rehabilitation, housing construction, or other public
construction must comply with the applicable requirements of the
interim regulations published on June 30, 1994.
(D) Timing of Grant Awards.
To the extent a full Section 108 application is submitted with the
EDI grant application, the Section 108 application will be evaluated
concurrently with the request for EDI grant funds. Note that EDI grant
assistance cannot be used to support a Section 108 loan guarantee
approved prior to the date of the publication of this NOFA. (See II.B.
of this NOFA.) However, the EDI grant may be awarded prior to HUD
approval of the Section 108 commitment if HUD determines that such
award will further the purposes of the Act. HUD notification to the
grantee of the amount and conditions (if any) of EDI funds awarded
based upon review of the EDI application shall constitute an obligation
of grant funds, subject to compliance with the conditions of award and
execution of a grant agreement.
(E) Limitations on Grant Amounts.
HUD expects to approve EDI grant amounts for approvable
applications at a range of ratios of EDI grant funds awarded to new
Section 108 loan [[Page 10432]] guarantee commitments. For example, an
applicant could request an EDI grant of $1 million and propose to
leverage $10 million in new Section 108 loan guarantee commitments.
Other applicants could request an EDI grant of $1 million and propose
to only leverage $1 million in new Section 108 loan guarantee
commitments. However, in no event will HUD make an award in which the
amount of EDI funds awarded exceeds the amount of new Section 108
commitments. Of course, even in the first example above, applicants
remain free to propose a greater leverage ratio of new Section 108 to
EDI grant funds, for example $12 million of new Section 108 to $1
million of EDI grant funds. Those requesting the higher ratios of EDI
grant funds to new Section 108 loan guarantee commitments should
indicate in their application why the higher ratio is necessary for
their proposed project. This explanation will be considered as part of
the rating for need under the selection criterion at paragraph
II.(C)((2).
HUD reserves the right to determine a minimum and a maximum amount
of any EDI award or 108 award per applicant, application or project and
to modify requests accordingly. In the case of an applicant that has
received a prior EDI grant award, the Department reserves the right to
consider the amount of the previous EDI award and the grant amount
requested in response to this NOFA and to adjust the amount of an EDI
award under this NOFA, including, if appropriate, not making an award.
In the event the applicant is awarded an EDI grant that has been
reduced below the original request, the applicant will be required to
modify its project plans and application to conform to the terms of HUD
approval before execution of a grant agreement. HUD reserves the right
to reduce or de-obligate the EDI award if approvable Section 108 loan
guarantee applications are not submitted by the grantee in the required
amounts on a timely basis. Any requested modifications must be within
the scope of the original EDI application. If any additional EDI grant
monies from this or previous EDI NOFAs become available, HUD may fund
additional applicants in accordance with this NOFA during Fiscal Year
1995 or may add any deobligated funds to funds available for any future
EDI competitions.
In the case of requested amendments to an approved Section 108 loan
guarantee commitment (as further discussed in paragraph II.B.), the EDI
assistance approved will be based on the increased amount of Section
108 loan guarantee assistance.
(F) Eligibility to apply for grant assistance.
Any public entity eligible to apply for Section 108 loan guarantee
assistance pursuant to Sec. 570.702 may apply for grant assistance
under Section 108(q). ELIGIBLE APPLICANTS ARE CDBG ENTITLEMENT UNITS OF
GENERAL LOCAL GOVERNMENT AND NON-ENTITLEMENT UNITS OF GENERAL LOCAL
GOVERNMENT ELIGIBLE TO RECEIVE LOAN GUARANTEES UNDER Sec. 570.702. Note
that effective January 25, 1995, non-entitlement communities in the
states of New York and Hawaii were authorized to apply to HUD for
Section 108 loans (see 59 FR 47,510, published December 27, 1994). Thus
non-entitlement communities in all 50 states are now eligible to
participate in the Section 108 and EDI programs.
(G) Eligible activities.
EDI grant funds may be used for:
(1) Activities listed at Sec. 570.703, provided such activities are
carried out as part of an economic development project. If the
applicant is awarded points for activities and projects under selection
criterion II.(C)(6)(b) (Proposals Addressing Special Need), the
applicant is required to continue to use any funds awarded for such
activities and projects under this NOFA and Program Guidelines to
benefit the Qualifying Empowerment Zone or Enterprise Community area.
(2) Payment of costs of private financial guaranty insurance
policies, letters of credit, or other credit enhancements for the notes
or other obligations guaranteed by HUD pursuant to Section 108,
provided such notes or obligations are used to finance an economic
development project. Such enhancements shall be specified in the
contract required by Sec. 570.705(b)(1), and shall be satisfactory in
form and substance to HUD for security purposes.
(3) The payment of principal or interest due (including such
servicing, underwriting, or other costs as may be authorized by HUD) on
the notes or other obligations guaranteed pursuant to the Section 108
loan guarantee program.
(H) Catalogue of Federal Domestic Assistance (CFDA). The EDI
program has not been assigned a CFDA number as of the date of this
NOFA. Please insert the letters ``EDI'' on the SF 424 as appropriate.
II. The Application Process
Public entities seeking EDI assistance must make a specific request
for that assistance, in accordance with this NOFA. The EDI application
shall be accompanied by a request for a Section 108 loan guarantee
commitment, as further described in Section II.B. of this NOFA below.
Application guidelines for the Section 108 program are found at
Sec. 570.704.
(A) Timing of submission.
Applications for EDI assistance shall be received at HUD
Headquarters in the manner described under ``Dates'' and ``Addresses''
above.
(B) Submission requirements.
(1) The EDI application (an original and two copies) shall be
accompanied by a request for loan guarantee assistance under Section
108. The request for Section 108 loan guarantee can be either one or
more of the following:
(a) A formal application for Section 108 loan guarantee(s),
including the documents listed at Sec. 570.704(b);
(b) A brief description (not to exceed three pages) of a Section
108 loan guarantee application(s) to be submitted within 60 days (with
HUD reserving the right to extend such period for good cause on a case-
by-case basis) of a notice of EDI selection (EDI awards will be
conditioned on approval of actual Section 108 loan commitments). This
description must be sufficient to support the basic eligibility of the
proposed project or activities for Section 108 assistance;
(c) If applicable, a copy of a Section 108 loan guarantee approval
document with grant number and date of approval (which was approved
after the date of this NOFA, except in conjunction with a previous EDI
award); or
(d) A request for a Section 108 loan guarantee amendment (analogous
to subparagraph (a) or (b) above) that proposes to increase the amount
of a previously approved application. However, any amount of Section
108 loan guarantee authority approved before the date of this NOFA is
not eligible to be used in conjunction with an EDI grant under this
NOFA. Further, a Section 108 loan guarantee amount that is required to
be used in conjunction with a prior EDI grant award, whether or not the
Section 108 loan guarantee has been approved as of the date of this
NOFA, is not eligible for an EDI award under this NOFA. For example, if
a community has a previously approved Section 108 loan guarantee
commitment of $12 million, even if none of the funds have been
utilized, or if the community had previously been awarded an EDI grant
of $1 million and had certified that it will submit a Section 108 loan
application for $10 million in support of that EDI grant, the
community's application under this NOFA must propose to increase the
amount of its total Section [[Page 10433]] 108 loan guarantee
commitments beyond those amounts (the $12 million or $10 million in
this example) to which it has previously agreed.
(2) In addition, an application for EDI grant funds shall include
the following:
(a) SF 424, Application for Federal Assistance.
(b) The certification regarding lobbying required under 24 CFR part
87 (Appendix A). The applicant may use the lobbying certification
published with this NOFA.
(c) A narrative statement describing the activities that will be
carried out with the EDI grant funds and explaining how the use of EDI
grant funds meets the criteria in paragraph II.(C) below. The narrative
statement shall not exceed two 8.5'' by 11'' pages for the description
of the activities to be carried out with the EDI grant funds and one
page for each of the listed selection criteria.
(3) Where relevant, applications shall be deemed to include a copy
of the strategic plan for community revitalization previously submitted
to HUD as part of a Federal Empowerment Zone or Enterprise Community
application pursuant to a Notice inviting applications, published on
January 18, 1994 at 59 FR 2711.
(C) Selection Criteria.
All applications will be considered for selection based on the
following criteria that demonstrate the quality of the proposed project
or activities, and the applicant's creativity, capacity and commitment
to obtain maximum benefit from the EDI funds, in accordance with the
purposes of the Act.
(1) Distress--(up to 20 points). In evaluating this criterion, HUD
will consider the level of distress in the immediate community to be
served by the project and the jurisdiction applying for assistance.
Note that in the first EDI competition in September 1994, the poverty
rate was often considered the best indicator of distress levels,
although the applicant may demonstrate the level of distress with other
factors indicative of distress such as income, unemployment, drug use,
homelessness and other indicators of distress.
(2) Extent of need for EDI assistance to financially support the
Section 108 loan and the project-- (up to 15 points). In evaluating
this criterion, HUD will consider the extent to which the applicant's
response demonstrates the financial need and feasibility of the project
and the leverage ratio of EDI grant funds to Section 108 loan proceeds.
Additionally, the score may be increased within this criterion to the
extent other funds (public or private) are leveraged. This may include
factors such as:
(i) Project costs and financial requirements.
(ii) The amount of any debt service or operating reserve accounts
to be established in connection with the economic development project.
(iii) The reasonableness of the costs of any credit enhancement
paid with EDI grant funds.
(iv) The amount of program income (if any) to be received each year
during the repayment period for the guaranteed loan.
(v) Interest rates on those loans to third parties (other than
subrecipients) (either as an absolute rate or as a plus/minus spread to
the Section 108 rate).
(vi) Underwriting guidelines used (or expected to be used) in
determining project feasibility.
(vii) The extent to which federal funds provided as a result of the
Federal Empowerment Zone/Enterprise Community designation process may
be utilized for the proposed EDI project.
(viii) The extent to which the EDI grant is proposed to leverage
the proposed Section 108 loan guarantee commitments and other economic
development activities. Applicants that use their EDI grant to leverage
more 108 commitments are expected to receive more points under this
subcriterion (viii).
(ix) Other relevant information.
Note that if the applicant proposes a generic loan fund to assist a
certain category of project or businesses, the applicant should
demonstrate why the use of Section 108 loans to assist such businesses
would not be financially feasible without EDI grant assistance.
(3) The extent to which the proposed activities effectively support
important National interests-- (up to 15 points). These activities
include:
(i) The provision of jobs for low- and moderate-income individuals
with special consideration for participants in any of the following
programs: Jobs Training Partnership Act (JTPA), Jobs Opportunities for
Basic Skills (JOBS), or Aid to Families with Dependent Children (AFDC);
(ii) The provision of jobs for participants in Unemployment
Insurance programs;
(iii) The provision of jobs for residents of Public and Indian
Housing or other assisted housing units;
(iv) The provision of jobs for homeless persons;
(v) The provision of jobs that provide clear opportunities for
promotion for low- and moderate-income individuals, such as through the
provision of training;
(vi) The establishment, stabilization, or expansion of
microenterprises that employ low- and moderate-income individuals;
(vii) The stabilization or revitalization of a neighborhood that
is predominantly low- and moderate-income;
(viii) The provision of assistance to a community development
financial institution whose service area is predominantly low- and
moderate-income;
(ix) The provision of assistance to a neighborhood-based nonprofit
organization serving a neighborhood that is predominantly low- and
moderate-income;
(x) The provision of employment opportunities that are an integral
component of a community's strategy to promote spatial deconcentration
of low- and moderate-income and minority families;
(xi) The provision of assistance to business(es) that operate(s)
within a census tract (or block numbering area) that has at least 20
percent of its residents who are in poverty; or
(xii) Other innovative approaches that provide substantial benefit
to low- and moderate-income persons.
(4) Quality of the plan--(up to 60 points). HUD will consider the
quality of the applicant's plan for the use of EDI funds and Section
108 loans, including the extent to which the applicant's proposed plan
for the effective use of EDI grant/Section 108 loan guarantee will
address its described need in the applicant's immediate community and/
or its jurisdiction, and the extent to which the plan is logically,
feasibly, and substantially likely to achieve its stated purpose.
(5) The capacity or potential of the public entity to successfully
carry out the plan--(up to 15 points). This may include factors such as
the applicant's performance in the administration of its CDBG program;
its previous experience, if any, in administering a section 108 loan
guarantee; its performance and capacity in carrying out economic
development projects; its ability to conduct prudent underwriting; its
capacity to manage and service loans made with the guaranteed loan
funds or EDI grant funds; and, if applicable, its capacity to manage
projects under this NOFA along with any federal funds awarded as a
result of a federal urban Empowerment Zone/Enterprise Community
designation.
(6) Applicants will be rated on both criteria (a) and (b) (if
applicable) below, but will receive points for only the higher rated
criterion of the two, but not both. [[Page 10434]]
(a) The extent to which the proposed plan follows a comprehensive
and coordinated approach in addressing the community and economic
development needs of the public entity and furthers neighborhood
revitalization--(up to 20 points).
OR
(b) Proposals Addressing Special Need --(Applicants to which this
criterion does not apply need not respond thereto.) (up to 20 points).
Of the 20 points under this factor, one point will be awarded to
applicants that received a federal urban Empowerment Zone or Enterprise
Community designation and up to 19 additional points will be awarded to
applicants that propose EDI and Section 108 loan assisted activities
that will benefit the applicant's Qualifying Empowerment Zone or
Enterprise Community area and are consistent with the applicant's
Strategic Plan; and
(7) Innovation and creativity--(up to 20 points). The extent to
which the applicant incorporated innovation and/or creativity in the
design and proposed implementation of the proposed activities carried
out with Section 108/EDI funds.
Selection Process--Once scores are assigned, all applications will
be ranked in order of points assigned, with the applications receiving
more points ranking above those receiving fewer points. Applications
will be funded in rank order, however, HUD, in its sole discretion, may
choose to award EDI assistance to a lower rated approvable application
over a higher rated application in order to increase the level of
geographic diversity of grants approved under this part. As discussed
in paragraph I.E. above, HUD reserves the right to determine a minimum
and a maximum amount of any EDI award or Section 108 commitment per
applicant, application or project and to modify requests accordingly.
In addition, if HUD determines that an application rated, ranked and
fundable could be funded at a lesser EDI grant amount than requested
consistent with feasibility of the funded project or activities and the
purposes of the Act, HUD reserves the right to reduce the amount of the
EDI award and/or increase the Section 108 loan guarantee commitment, if
necessary, in accordance with such determination.
HUD may decide not to award the full amount of EDI grant funds
available under this NOFA and may make any remaining amounts available
under a future NOFA.
Timing of grant awards--To the extent full Section 108 applications
are submitted concurrently with the EDI grant application, HUD's
approval of the related Section 108 loan guarantee commitment will in
most cases be granted contemporaneously with EDI grant approval.
However, the EDI grant may be awarded prior to HUD approval of the
Section 108 commitment if HUD determines that such award will further
the purposes of the Act. EDI funds shall not be disbursed to the public
entity before the issuance of the related Section 108 guaranteed
obligations.
III. Technical Assistance
To the extent permitted by law, HUD may advise applicants of
technical deficiencies in the EDI applications after submission and
permit them to be corrected. Technical deficiencies relate only to
items, such as a failure to submit or sign a required certification,
that would not improve the substantive quality of the application
relative to the selection criteria . Applicants will have 14 calendar
days from the date HUD notifies the applicant of any such technical
deficiency to submit the appropriate information in writing to HUD. At
any time during the selection process, which began with preparation of
this NOFA, HUD staff is limited in the assistance it is permitted to
provide regarding applications for EDI grants, due to the requirements
of the HUD Reform Act. The assistance and advice that can be provided
includes such activities as explaining and responding to questions
about program regulations, identification of those parts of an
application that need substantive improvement, the dates by which
decisions will be made and the procedures that are required to be
performed to process an application. The term ``technical assistance''
however, does not include advising the applicant how to make
substantive improvements in its application that will affect ratings.
In addition, any information published in the Federal Register and
in this NOFA, and any information that has been made public through a
means other than the Federal Register or NOFA, may be discussed.
HUD staff will be available throughout the EDI application period
to provide extensive advice and assistance, as is currently provided,
to develop 108 loan applications since the 108 program is not subject
to the HUD Reform Act. Staff providing such assistance may provide
technical advice to the EDI selection panel but in no case will such
staff participate in the panel's voting process for EDI awards under
this NOFA.
IV. Other Matters
Environmental Impact
A Finding of No Significant Impact with respect to the environment
has been made in accordance with HUD regulations at 24 CFR part 50,
implementing section 102(2)(C) of the National Environmental Policy Act
of 1969 (42 U.S.C. 4332). The Finding of No Significant Impact is
available for public inspection and copying between 7:30 am and 5:30 pm
weekdays at the Office of the Rules Docket Clerk, 451 Seventh Street,
SW, Room 10276, Washington, DC 20410.
Federalism
The General Counsel, as the Designated Official under section 6(a)
of Executive Order 12612, Federalism, has determined that this NOFA
will not have substantial, direct effects on States, on their political
subdivisions, or on their relationship with the Federal Government, or
on the distribution of power and responsibilities between them and
other levels of government. While the NOFA offers financial assistance
to units of general local government, none of its provisions will have
an effect on the relationship between the Federal Government and the
States, or the States' political subdivisions.
Family
The General Counsel, as the Designated Official for Executive Order
12606, The Family, has determined that the policies announced in this
NOFA would not have the potential for significant impact on family
formation, maintenance and general well-being within the meaning of the
Order. No significant change in existing HUD policies and programs will
result from issuance of this NOFA, as those policies and programs
relate to family concerns.
Prohibition Against Lobbying Activities
The use of funds awarded under this NOFA is subject to the
disclosure requirements and prohibitions of section 319 of the
Department of Interior and Related Agencies Appropriations Act for
Fiscal Year 1990 (31 U.S.C. 1352) and the implementing regulations at
24 CFR part 87. These authorities prohibit recipients of Federal
contracts, grants, or loans from using appropriated funds for lobbying
the Executive or Legislative Branches of the Federal Government in
connection with a specific contract, grant, or loan. The prohibition
also covers the awarding of contracts, grants, cooperative agreements,
or loans unless the recipient has made an acceptable
[[Page 10435]] certification regarding lobbying. Under 24 CFR part 87,
applicants, recipients, and subrecipients of assistance exceeding
$100,000 must certify that no Federal funds have been or will be spent
on lobbying activities in connection with the assistance.
Prohibition Against Lobbying of HUD Personnel
Section 13 of the Department of Housing and Urban Development Act
(42 U.S.C. 3537b) contains two provisions dealing with efforts to
influence HUD's decisions with respect to financial assistance. The
first imposes disclosure requirements on those who are typically
involved in these efforts--those who pay others to influence the award
of assistance or the taking of a management action by the Department
and those who are paid to provide the influence. The second restricts
the payment of fees to those who are paid to influence the award of HUD
assistance, if the fees are tied to the number of housing units
received or are based on the amount of assistance received, or if they
are contingent upon the receipt of assistance. HUD's regulation
implementing section 13 is codified at 24 CFR part 86. If readers are
involved in any efforts to influence the Department in these ways, they
are urged to read the final rule, particularly the examples contained
in Appendix A of the rule.
Any questions concerning the rule should be directed to the Office
of Ethics, Room 2158, Department of Housing and Urban Development, 451
Seventh Street, SW., Washington DC 20410-3000. Telephone: (202) 708-
3815 (voice/TDD). (This is not a toll-free number.) Forms necessary for
compliance with the rule may be obtained from the local HUD Office.
Dated: February 16, 1995.
Andrew Cuomo,
Assistant Secretary for Community Planning and Development.
Certification Regarding Lobbying
Certification for Contracts, Grants, Loans and Cooperative
Agreements
The undersigned certifies, to the best of his or her knowledge
and belief, that:
(1) No Federal appropriated funds have been paid or will be
paid, by or on behalf of the undersigned, to any person for
influencing or attempting to influence an officer or employee of an
agency, a Member of Congress, an officer or employee of Congress, or
an employee of a Member of Congress in connection with the awarding
of any Federal contract, the making of any Federal grant, the making
of any Federal loan, the entering into of any cooperative agreement,
and the extension, continuation, renewal, amendment, or modification
of any Federal contract, grant, loan, or cooperative agreement.
(2) If any funds other than Federal appropriated funds have been
paid or will be paid to any person for influencing or attempting to
influence an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or an employee of a
Member of Congress in connection with this Federal contract, grant,
loan, or cooperative agreement, the undersigned shall complete and
submit Standard Form-LLL, ``Disclosure Form to Report Lobbying,'' in
accordance with its instructions.
(3) The undersigned shall require that the language of this
certification be included in the award documents for all subawards
at all tiers (including subcontracts, subgrants, and contracts under
grants, loans, and cooperative agreements) and that all
subrecipients shall certify and disclose accordingly.
This certification is a material representation of fact upon
which reliance was placed when this transaction was made or entered
into. Submission of this certification is a prerequisite for making
or entering into this transaction imposed by section 1352, title 31,
U.S. Code. Any person who fails to file the required certification
shall be subject to a civil penalty of not less than $10,000 and not
more than $100,000 for each such failure.
Signed:----------------------------------------------------------------
Date:------------------------------------------------------------------
----------------------------------------------------------------------
(Print name and title)
24 CFR Part 87, Appendix A
[FR Doc. 95-4448 Filed 2-21-95; 8:45 am]
BILLING CODE 4210-29-P
