2023-14826. Waivers and Alternative Requirements for Community Development Block Grant Disaster Recovery (CDBG-DR) and Community Development Block Grant Mitigation (CDBG-MIT) Grantees

AGENCY:

Office of the Assistant Secretary for Community Planning and Development, HUD.

ACTION:

Notice.

SUMMARY:

This notice governs Community Development Block Grant disaster recovery (CDBG–DR) and Community Development Block Grant mitigation (CDBG–MIT) funds awarded under several appropriations acts identified in the Table of Contents. This notice revises the period of performance and budget period for some grants and allows HUD to extend the period of performance and budget periods administratively for some grants.

DATES:

Applicability Date: July 18, 2023.

FOR FURTHER INFORMATION CONTACT:

Tennille Parker, Director, Office of Disaster Recovery, U.S. Department of Housing and Urban Development, 451 7th Street SW, Room 7282, Washington, DC 20410, telephone number 202–708–3587 (this is not a toll-free number). HUD welcomes and is prepared to receive calls from individuals who are deaf or hard of hearing, as well as individuals with speech or communication disabilities. To learn more about how to make an accessible telephone call, please visit: https://www.fcc.gov/​consumers/​guides/​telecommunications-relay-service-trs. Email inquiries may be sent to [e-mail].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Authority To Grant Waivers and Alternative Requirements

II. Public Law 113–2 Statutory Extensions

III. Public Law 114–113, 114–254, 115–31, 115–56, 115–123, 115–254, and 116–20 Waiver and Alternative Requirements

I. Authority to Grant Waivers and Alternative Requirements

Each of the appropriations acts cited in the Table of Contents authorize the Secretary to waive, or specify alternative requirements for, any provision of any statute or regulation that the Secretary administers in connection with the obligation by the Secretary, or use by the recipient, of grant funds, except for requirements related to fair housing, nondiscrimination, labor standards, and the environment. HUD may also exercise its regulatory waiver authority under 24 CFR 5.110, 91.600, and 570.5.

The waivers and alternative requirements in this notice are designed to create expediency for CDBG–DR and CDBG–MIT grantees related to extending expenditure deadlines. Allowing grantees the flexibility to receive extensions administratively will continue to support a swift recovery following eligible disasters, while ensuring that grantees have enough time to complete projects and that statutory requirements are met. Additionally, these waivers and alternative requirements are consistent with the in 2 CFR part 200 that Federal awards include a period of performance and a budget period. Based on these reasons, the Department has determined that good cause exists for the waiver and alternative requirement authorized in this notice, and that the waivers or alternative requirements are not inconsistent with the overall purposes of title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.) (HCDA).

II. Public Law 113–2 Statutory Extensions

Statutory extensions for grants made available under Public Law 113–2.

Following two short-term statutory extensions (Pub. L. 116–260 and Pub. L. 117–103), section 420(a) of the Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2023 (Pub. L. 117–328) provided that CDBG–DR grant obligations made before September 30, 2017 from funds made available under Public Law 113–2 are to remain available until expended. The requirements at 2 CFR 200.211(b) require all Federal awards to include a period of performance and budget period. Therefore, HUD is revising the period of performance and budget period for open Federal awards made under Public Law 113–2 with an end date of September 30, 2029, when permissible under other applicable requirements that govern the use of funds under Public Law 113–2. The projections reported by Public Law 113–2 grantees indicate that this period is sufficient to allow for the full expenditure of any remaining grant funds.

HUD may extend the time period in this alternative requirement and associated grant period of performance and budget period administratively, when permissible under other applicable requirements that govern the use of funds under Public Law 113–2, if good cause for such an extension exists at that time, as requested by the grantee, and approved by HUD. When the period of performance has ended, HUD will close out the grant and any remaining funds not expended by the grantee for appropriate programmatic purposes will be recaptured by HUD.

III. Public Law 114–113, 114–254, 115–31, 115–56, 115–123, 115–254, and 116–20 Waivers and Alternative Requirements

Waiver and alternative requirement modification to allow HUD to extend certain grantee's period of performance administratively.

The Federal Register notices governing the use of funds for disasters occurring in 2015 and 2016 under Public Laws 114–113, 114–254, and 115–31 require each grantee to expend 100 percent of its total allocation of CDBG–DR funds on eligible activities within six years of HUD's execution of the grant agreement. The provisions governing the timely distribution of funds for these CDBG–DR appropriations can be found in the following Federal Register notices: June 17, 2016 (81 FR 39702) and November 21, 2016 (81 FR 83268).

Additionally, Public Laws 115–56 and 115–123, as amended, require that CDBG–DR funds for disasters occurring in 2017, 2018, and 2019 be expended within two years of the date that HUD obligates funds to a grantee, but also authorizes the Office of Management and Budget (OMB) to provide a waiver of this requirement. OMB has waived this requirement for a combined total of $35,390,000,000 of CDBG–DR funds appropriated under these acts. However, the Federal Register notices governing the use of those funds require each grantee to expend 100 percent of its total allocation of CDBG–DR funds on eligible activities within six years of HUD's initial obligation of funds. The provisions governing the timely distribution of funds for these CDBG–DR appropriations can be found in the February 9, 2018 (83 FR 5860) in the Federal Register notice.

Additionally, the Federal Register notices governing the use of CDBG–MIT funds require each grantee to expend fifty percent of its CDBG–MIT grant on eligible activities within six years of HUD's execution of the grant agreement and one hundred percent of its grant within twelve years of HUD's execution of the agreement absent a waiver and alternative requirement as requested by the grantee and approved by HUD. The provisions governing the timely distribution of funds for these CDBG–MIT funds can be found in the August 30, 2019 (84 FR 45862) Federal Register notice.

The Federal Register notices governing the use of CDBG–DR funds under Public Laws 114–113, 114–254, 115–31, 115–56, 115–123, 115–254, and 116–20 require each grantee to expend 100 percent of its CDBG–DR grant on eligible activities within 6 years of HUD's obligation of funds pursuant to an executed grant agreement. The provisions governing the duration of funding for these CDBG–DR appropriations can be found in the following Federal Register notices: June 17, 2016 (81 FR 39708); November 21, 2016 (81 FR 83274); January 18, 2017 (82 FR 5594); August 7, 2017 (82 FR 36815); February 9, 2018 (83 FR 5868); August 14, 2018 (83 FR 40323); January 27, 2020 (85 FR 4688); January 6, 2021 (86 FR 568); and January 6, 2021 (86 FR 575).

For funds appropriated under these seven appropriations acts for CDBG–DR and CDBG–MIT grants, HUD waived the timely distribution of funds requirements in 24 CFR 570.494 and 570.902 and imposed an alternative requirement. HUD is now modifying the waiver and alternative requirement that replaces 570.494 and 570.902 governing the timely distribution of CDBG–DR funds, by adding the following sentence at the end of the paragraphs at section VI.A.28. of the June 17, 2016 notice (81 FR 39702); section VI.A.24. of the November 21, 2016 notice (81 FR 83268); section V.A.28. of the February 9, 2018 notice (83 FR 5860); and section V.A.26. of the August 30, 2019 notice (84 FR 45862):

HUD may extend the time period in this alternative requirement and associated grant period of performance administratively, if good cause for such an extension exists at that time, as requested by the grantee, and approved by HUD.

HUD is also adding the following two sentences to the end of the Duration of Funding paragraphs at sections VII of the June 17, 2016 notice (81 FR 39708) and the November 21, 2016 notice (81 FR 83274); section V of the January 18, 2017 notice (82 FR 5594); section I.E. of the August 7, 2017 notice (82 FR 36815); section VII of the February 9, 2018 notice (83 FR 5868); section V of the August 14, 2018 notice (83 FR 40323); section VII of the August 30, 2019 notice (84 FR 45870); and section V of the January 27, 2020 notice (85 FR 4688):

HUD may extend the period of performance administratively, in accordance with the provisions of the waiver and alternative requirement governing the timely distribution of funds. When the period of performance has ended, HUD will close out the grant and any remaining funds not expended by the grantee on appropriate programmatic purposes will be recaptured by HUD.

Adrianne Todman,

Deputy Secretary.