Additional Allocations and Waivers Granted to and Alternative Requirements for 2008 Community Development Block Grant (CDBG) Disaster Recovery Grantees, 41146-41156 [E9-19488]
Download as PDF
<![CDATA[
41146
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
Notice of
this meeting is given under the Federal
Advisory Committee Act, 5 U.S.C. App.
(Pub. L. 92–463).
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
Agenda of the Meeting
Additional Allocations and Waivers
Granted to and Alternative
Requirements for 2008 Community
Development Block Grant (CDBG)
Disaster Recovery Grantees
SUPPLEMENTARY INFORMATION:
The agenda for the September 9
meeting will be as follows:
(1) Opening comments.
(2) Introductions.
(3) Administrative announcements.
(4) Pre-approved presentations from
the public.
(5) Debriefs from each DRBOSAC Subcommittee.
(6) Public comments.
(7) Future Committee business.
(8) Closing.
More information and detail on the
meeting will be available at the
committee Web site, located at https://
homeport.uscg.mil/drbosac. Additional
detail may be added to the agenda up to
September 2, 2009.
Procedural
This meeting is open to the public.
All persons entering the Harbor Room
will need to sign in at the door. Please
note that the meeting may close early if
all business is finished.
The public will be able to make oral
presentations during the meeting when
given the opportunity to do so. Members
of the public may seek pre-approval for
their oral presentations by contacting
the Coast Guard no later than September
2, 2009. The public may file written
statements with the committee; written
material should reach the Coast Guard
no later than September 2, 2009. If you
would like a copy of your material
distributed to each member of the
committee in advance of the meeting,
please submit 35 copies to the Liaison
to the DFO no later than September 2,
2009, and indicate that the material is
to be distributed to committee members
in advance of the September 9 meeting.
Please register your attendance with
the Liaison to the DFO no later than
September 2, 2009.
mstockstill on DSKH9S0YB1PROD with NOTICES
Information on Services for Individuals
with Disabilities
For information on facilities, or
services for individuals with
disabilities, or to request special
assistance at the meeting, contact the
Liaison to the DFO as soon as possible.
Dated: August 6, 2009.
Nakeisha B. Hills,
Lieutenant Commander, U.S. Coast Guard,
Preparedness Officer, Sector Delaware Bay
Acting Designated Federal Officer.
[FR Doc. E9–19550 Filed 8–13–09; 8:45 am]
BILLING CODE 4910–15–P
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
[Docket No. FR–5337–N–01]
Office of the Secretary, HUD.
Notice of allocations, waivers,
and alternative requirements.
AGENCY:
ACTION:
SUMMARY: This Notice advises the public
of the second allocation for grant funds
for CDBG disaster recovery grants for
the purpose of assisting in the recovery
in areas covered by a declaration of
major disaster under title IV of the
Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C.
5121 et seq.) as a result of recent natural
disasters. As described in the
SUPPLEMENTARY INFORMATION section of
this Notice, HUD is authorized by
statute and regulations to waive
statutory and regulatory requirements
and specify alternative requirements for
this purpose, upon the request of the
state grantees. This Notice also
describes: (1) How the allocatees may
implement the common application,
eligibility, and administrative waivers
and the common alternative and
statutory requirements for the grants;
and (2) additional waivers and
alternative requirements for certain
earlier grants.
DATES: Effective Date: August 19, 2009.
FOR FURTHER INFORMATION CONTACT:
Scott Davis, Director, Disaster Recovery
and Special Issues Division, Office of
Block Grant Assistance, Department of
Housing and Urban Development, 451
7th Street, SW., Room 7286,
Washington, DC 20410, telephone
number 202–708–3587. Persons with
hearing or speech impairments may
access this number via TTY by calling
the Federal Information Relay Service at
telephone number 800–877–8339.
Facsimile inquiries may be sent to Mr.
Davis at facsimile number 202–401–
2044. (Except for the ‘‘800’’ number,
these telephone numbers are not toll
free.)
SUPPLEMENTARY INFORMATION:
Authority To Grant Waivers
The Consolidated Security, Disaster
Assistance, and Continuing
Appropriations Act, 2009 (Pub. L. 110–
329, approved September 30, 2008)
(hereinafter, ‘‘Second 2008 Act’’ to
differentiate it from the earlier 2008
Supplemental Appropriations Act) (Pub.
L. 110–252 approved June 30, 2008)
PO 00000
Frm 00039
Fmt 4703
Sfmt 4703
(hereinafter ‘‘First 2008 Act’’),
appropriated $6.5 billion, to remain
available until expended, in CDBG
funds for necessary expenses related to
disaster relief, long-term recovery, and
restoration of infrastructure, housing,
and economic revitalization in areas
affected by hurricanes, floods, and other
natural disasters occurring during 2008,
for which the President declared a major
disaster under title IV of the Robert T.
Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5121 et seq.).
To date, $377,139,920 has been
rescinded, $6,500,000 was set-aside for
HUD administrative costs, and
$2,145,000,000 was allocated by HUD in
November 2008. This Notice allocates
the remaining $3,971,360,080.
The First 2008 Act also appropriated
funds for 2008 disaster recovery
grantees, although it only provided
funds for disasters occurring in May and
June 2008. Both the First 2008 Act and
the Second 2008 Act 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 of
these funds and guarantees by the
recipient, except for requirements
related to fair housing,
nondiscrimination, labor standards, and
the environment (including
requirements concerning lead-based
paint), upon a request by the state
explaining why such waiver is required
to facilitate the use of such funds or
guarantees, and a finding by the
Secretary that such a waiver would not
be inconsistent with the overall purpose
of title I of the Housing and Community
Development Act of 1974 (HCD Act).
Additionally, regulatory waiver
authority is provided by 24 CFR 5.110,
91.600, and 570.5. The following
application and reporting waivers and
alternative requirements are in response
to requests from the states receiving an
allocation under today’s Federal
Register Notice.
The Secretary finds that the following
waivers and alternative requirements, as
described below, are necessary to
facilitate use of the funds for the
statutory purposes and are not
inconsistent with the overall purpose of
title I of the HCD Act or the CranstonGonzalez National Affordable Housing
Act, as amended.
Under the requirements of the First
2008 Act and the Second 2008 Act,
statutory and regulatory waivers must
be published in the Federal Register.
Except as described in this Notice,
statutory and regulatory provisions
governing the CDBG program for states,
including those at 24 CFR part 570,
E:\FR\FM\14AUN1.SGM
14AUN1
41147
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
shall apply to the use of these funds. In
accordance with the First and Second
2008 Acts, HUD will reconsider every
waiver in today’s Federal Register
Notice on the 2-year anniversary of the
day this Notice is published.
Additional Waivers
Each state receiving an allocation may
request additional waivers from the
Department as needed to address the
specific needs related to that state’s
recovery activities. The Department will
respond separately to the state’s
requests for waivers of provisions not
covered in this Notice, after working
with the state to tailor the program to
best meet the unique disaster recovery
needs in its impacted areas. HUD has
included some additional waivers and
alternative requirements for individual
states in this Notice.
Allocations
Today’s Notice makes available the
remainder of the Second Act’s
supplemental appropriation,
$3,971,360,080 for the CDBG program
for necessary expenses related to
disaster relief, long-term recovery, and
restoration of infrastructure, housing,
and economic revitalization in areas
affected by hurricanes, floods, and other
natural disasters occurring in 2008, for
which the President declared a major
disaster under title IV of the Robert T.
Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5121 et seq.).
The Second 2008 Act notes:
That funds provided under this heading
shall be administered through an entity or
entities designated by the Governor of each
state * * * Provided further, that funds
allocated under this heading shall not
adversely affect the amount of any formula
assistance received by a state under the
Community Development Fund: Provided
further, that each state may use up to five
percent of its allocation for administrative
costs.
HUD computes allocations based on
data that are generally available
covering all the eligible affected areas.
The 11 states receiving an allocation in
today’s Notice are indicated in Table 1,
below. Their estimated unmet needs
represent more than 97 percent of the
estimated unmet needs across all 76
disasters that occurred in 2008. The
allocation was based on two factors: (i)
The sum of estimated unmet housing,
infrastructure, and business needs,
adjusted by (ii) a HUD calculated risk
level for recovery challenge. More
detailed information about the data
reviewed, the formula process, and the
possible risks affecting recovery can be
found in Appendix 1 of this Notice.
Initial allocations made under the
Second 2008 Act were announced by
HUD on November 26, 2008, and
published in the Federal Register on
February 13, 2009 (74 FR 7244). Initial
allocations are included in Table 1. The
states of Kentucky, Georgia, and
Mississippi, and the Commonwealth of
Puerto Rico received allocations in the
February 13, 2009, Federal Register
Notice, but are not receiving additional
funds under today’s Notice, bringing to
15 the total number of grantees allocated
funding from the Second 2008 Act.
Table 2 is a reprint from the initial
allocation notice that shows what the
allocations were under the First 2008
Act. Unlike funds allocated under the
Second 2008 Act, which may be used
for recovery from any disaster occurring
during Calendar Year 2008, funds under
the First 2008 Act are available only for
use in areas covered by specific
declarations, so these are also noted.
TABLE 1—SECOND 2008 ACT DISASTER RECOVERY ALLOCATIONS
Initial Second
2008 Act
allocation
(Notice 74 FR
7244)
This Notice’s
Second 2008 Act
allocation
State
Texas .......................................................................................
Louisiana ..................................................................................
Iowa .........................................................................................
Indiana .....................................................................................
Illinois .......................................................................................
Missouri ....................................................................................
Wisconsin .................................................................................
Tennessee ...............................................................................
Arkansas ..................................................................................
Florida ......................................................................................
California ..................................................................................
Kentucky ..................................................................................
Georgia ....................................................................................
Mississippi ................................................................................
Puerto Rico ..............................................................................
$1,743,001,247
620,467,205
516,713,868
253,340,079
127,207,128
78,625,549
75,200,572
71,881,834
70,181,041
63,606,850
39,531,784
0
0
0
0
$1,314,990,193
438,223,344
125,297,142
95,042,622
41,984,121
13,979,941
25,039,963
20,636,056
20,294,857
17,457,005
0
3,217,686
4,570,779
6,283,404
17,982,887
Total Second
2008 Act
allocation
Minimum amount
for affordable
rental housing
$3,057,991,440
1,058,690,549
642,011,010
348,382,701
169,191,249
92,605,490
100,240,535
92,517,890
90,475,898
81,063,855
39,531,784
3,217,686
4,570,779
6,283,404
17,982,887
$342,521,992
118,582,672
71,910,891
39,021,933
18,950,911
10,372,631
11,227,823
10,362,819
10,134,098
9,079,866
4,427,908
341,943
485,736
667,737
1,911,040
TABLE 2—FIRST 2008 ACT DISASTER RECOVERY ALLOCATIONS
mstockstill on DSKH9S0YB1PROD with NOTICES
State
Disaster No.
Mississippi .......................................................
Maine ..............................................................
Oklahoma ........................................................
Arkansas .........................................................
South Dakota ..................................................
Missouri ...........................................................
Colorado ..........................................................
Iowa .................................................................
Indiana ............................................................
Montana ..........................................................
Wisconsin ........................................................
West Virginia ...................................................
Nebraska .........................................................
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
PO 00000
1753
1755
1756
1758
1759
1760
1762
1763
1766
1767
1768
1769
1770
Frm 00040
Incident date
Declared date
3/20 to 5/19 ....................................................
4/28 to 5/14 ....................................................
5/10 to 5/13 ....................................................
5/2 to 5/12 ......................................................
5/1 ..................................................................
5/10 to 5/11 ....................................................
5/21 ................................................................
5/25 and continuing ........................................
5/30 to 6/27 ....................................................
5/1 ..................................................................
6/5 and continuing ..........................................
6/3 to 6/7 ........................................................
5/22 ................................................................
Fmt 4703
Sfmt 4703
E:\FR\FM\14AUN1.SGM
14AUN1
5/8/08
5/9/08
5/14/08
5/20/08
5/22/08
5/23/08
5/26/08
5/27/08
6/8/08
6/13/08
6/14/08
6/19/08
6/20/08
Allocation
$2,281,287
2,187,114
1,793,876
4,747,501
1,987,271
3,519,866
589,651
156,690,815
67,012,966
666,672
24,057,378
3,127,935
5,557,736
41148
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
TABLE 2—FIRST 2008 ACT DISASTER RECOVERY ALLOCATIONS—Continued
State
Disaster No.
mstockstill on DSKH9S0YB1PROD with NOTICES
Illinois ..............................................................
Minnesota ........................................................
Missouri ...........................................................
Congress required that states devote
‘‘not less than $650,000,000’’ of the total
Second 2008 Act to support ‘‘repair,
rehabilitation, and reconstruction
(including demolition, site clearance
and remediation) of the affordable rental
housing stock (including public and
other HUD-assisted housing) in the
impacted areas where there is a
demonstrated need as determined by the
Secretary.’’ Table 1 above shows the
minimum amount each grantee must
spend on affordable rental housing from
its total combined allocation of first and
second round funding under the Second
2008 Act.
Disaster Recovery Enhancement
Allocations. As stated above, HUD
calculates CDBG disaster recovery
allocations, including the above
allocations, to each grantee based on
unmet needs data (see Appendix 1).
These data largely represent an estimate
of the costs for repairs to a pre-disaster
condition. Often, this data does not
adequately reflect the full recovery costs
associated with a disaster. Also, because
of cost considerations, state disaster
recovery grantees may not always
choose recovery activities that are the
most advantageous for long-term
recovery and resilience from a federal
perspective. For example, relocating a
repetitively flooded community from a
floodplain limits future calls on the
National Flood Insurance program and
other federal recovery programs. From a
federal perspective, flood buyouts are
frequently a good idea; locally, they can
be politically difficult and somewhat
more costly to administer than a
traditional rehabilitation program.
Therefore, the Secretary has created a
$311,602,923 Disaster Recovery
Enhancement Fund (DREF) for
secondary allocations to grantees that
anticipate that they will still have
unmet disaster recovery needs after
developing and undertaking forwardthinking recovery strategies and
activities in a timely manner. To be
eligible to receive an additional
allocation, a grantee must budget its
allocated Second 2008 Act funds for the
specific activities listed in this Notice
by programming the funds in an Action
Plan for Disaster Recovery (or an
amendment thereof) submitted to HUD
by June 30, 2010. A state receiving an
additional allocation may use the funds
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
1771
1772
1773
Incident date
6/1 to 7/22 ......................................................
6/7 to 6/12 ......................................................
6/1 to 8/13 ......................................................
for any activity eligible for assistance
under the Second 2008 Act in
accordance with this Notice.
Note that the Stafford Act and the
Second 2008 Act prohibit use of these
funds as a substitute or match for
Federal Emergency Management Agency
(FEMA) Hazard Mitigation Grant
Program (HMGP) funds. Also note that
CDBG disaster recovery funds must be
used in the counties declared in the
applicable covered disaster(s) for each
state, while HMGP funds may generally
be used statewide.
By setting a specific deadline for the
Action Plan submissions for this DREF
allocation, HUD is signaling that the
Department intends to assist grantees
that will implement these forwardthinking approaches to long-term
recovery in a timely manner. Funds will
be allocated dollar-for-dollar for the first
$15 million budgeted for enhanced
disaster recovery activities for an
individual state and on a pro rata basis
for amounts budgeted above $15 million
as measured by funds budgeted by grant
recipients by June 30, 2010, on the
following specific enhanced disaster
recovery activities that reduce the risk
of damage from a future disaster:
1. Development and adoption of a
forward-thinking land-use plan that will
guide use of long-term recovery efforts
and subsequent land-use decisions
throughout the community and that
reduces existing or future development
in disaster-risk areas;
2. Floodplain or critical fire or seismic
hazard area buyouts programs under an
optional relocation plan that includes
incentives so that families and private
sector employers move out of areas at
severe risk for a future disaster;
3. Individual mitigation measures
(IMM) to improve residential properties
and make them less prone to damage. If
such activities are incorporated into the
grantee’s rehabilitation or new
construction programs generally, the
cost increment attributed to IMM will be
the amount considered for the
additional allocation, not the total
construction amount budget; or
4. Implementation of modern disaster
resistant building codes, including, but
not limited to, training on new
standards and code enforcement.
A grantee must include start and end
dates for each activity in its Action Plan.
PO 00000
Frm 00041
Declared date
Fmt 4703
Sfmt 4703
6/24/08
6/25/08
6/25/08
Allocation
17,341,434
925,926
7,512,572
A grantee must demonstrate in its
Action Plan submission for any
additional allocation that it still has
eligible unmet needs to receive
assistance from the DREF before HUD
will add the additional allocation to the
state’s line of credit. Furthermore, the
Secretary reserves the right to allocate
more or less than $311,602,923 under
this fund, depending on the amount
grantees actually budget on such
activities and any amounts available for
reallocation.
A grantee may reprogram funds from
one of the listed enhanced disaster
recovery activities to another, but if the
grantee reprograms grant funds to any
other activity, HUD may recapture the
DREF allocation, in whole or in part, in
accordance with section 111 of the HCD
Act, 24 CFR part 570, subpart O, and
this Notice.
The Second 2008 Act requires funds
to be used in accordance with its
specific purposes. The statute directs
that each grantee will describe in its
Action Plan for Disaster Recovery
criteria for eligibility and how the use
of grant funds will address long-term
recovery and infrastructure restoration,
housing, and economic revitalization in
the affected areas. HUD will monitor
compliance with this direction and may
be compelled to disallow expenditures
if it finds uses of funds do not meet the
statutory purposes, or duplicate other
benefits. HUD encourages grantees to
contact their assigned HUD offices for
guidance in complying with these
requirements during development of
their Action Plans for Disaster Recovery
or if they have any questions regarding
meeting these requirements.
As provided for in the Second 2008
Act, the funds may not be used for
activities reimbursable by or for which
funds are made available by FEMA or
the Army Corps of Engineers. Further,
none of the funds may be used as the
required match, share, or contribution
for another federal program.
Prevention of Fraud, Abuse, and
Duplication of Benefits
Additionally, the Second 2008 Act
directs the Secretary to:
Establish procedures to prevent
recipients from receiving any
duplication of benefits and report
quarterly to the Committees on
E:\FR\FM\14AUN1.SGM
14AUN1
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
Appropriations with regard to all steps
taken to prevent fraud and abuse of
funds made available under this
heading, including duplication of
benefits.
To meet this directive, HUD is
pursuing four courses of action. First,
the Federal Register Notice published
February 13, 2009 (74 FR 7244),
includes specific reporting, written
procedures, monitoring, and internal
audit requirements for grantees. Second,
to the extent its resources allow, HUD
will institute risk analysis and on-site
monitoring of grantee management of
the grants and of the specific uses of
funds. Third, HUD will be extremely
cautious in considering any waiver
related to basic financial management
requirements. The standard, time-tested
CDBG financial requirements will
continue to apply. Fourth, HUD is
collaborating with the HUD Office of
Inspector General to plan and
implement oversight of these funds.
mstockstill on DSKH9S0YB1PROD with NOTICES
Waiver Justification
The waivers, alternative requirements,
and statutory changes described in the
February 13, 2009, Federal Register
Notice (74 FR 7244) apply to all of the
CDBG supplemental disaster recovery
funds appropriated in the Second 2008
Act (Pub. L. 110–329), but not to funds
provided under the regular CDBG
program. Similarly, the waivers,
alternative requirements, and statutory
changes described in the September 11,
2008, Federal Register Notice (73 FR
52870) apply to the CDBG supplemental
disaster recovery funds appropriated in
the First 2008 Act, not to funds
provided under the regular CDBG
program. These actions, below, provide
additional flexibility in program design
and implementation and implement
statutory requirements. The previous
notices, referenced above, provide
further justification for the waivers.
Common Waivers
Previously published waivers to
streamline application and program
launch. Funds allocated by today’s
Federal Register Notice will be subject
to the waivers, alternative requirements,
and statutory changes described in this
Notice and those previously published
in the February 13, 2009, Federal
Register Notice (74 FR 7244).
General planning activities use
entitlement presumption, all grantees.
Today’s Federal Register Notice notifies
Congress and the public that the states
receiving funds under the First 2008 Act
and/or the Second 2008 Act have
requested this waiver and HUD is
granting the waiver. The annual State
CDBG program requires that local
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
government grant recipients for
planning-only grants must document
that the use of funds meets a national
objective. In the State CDBG program,
these planning grants are typically used
for individual project plans. By contrast,
planning activities carried out by
entitlement communities are more
likely to include nonproject specific
plans such as functional land-use plans,
historic preservation plans,
comprehensive plans, development of
housing codes, and neighborhood plans
related to guiding long-term community
development efforts comprising
multiple activities funded by multiple
sources. In the annual entitlement
program, these more general stand-alone
planning activities are presumed to
meet a national objective under the
requirements at 24 CFR 570.208(d)(4).
The Department notes that almost all
effective CDBG disaster recoveries in the
past have relied on some form of areawide or comprehensive planning
activity to guide overall redevelopment
independent of the ultimate source of
implementation funds. Therefore, the
Department is removing the eligibility
requirement that CDBG disaster
recovery-assisted planning-only grants
or state directly administered planning
activities that will guide recovery in
accordance with the appropriations act
must comply with the State CDBG
program rules at 24 CFR 570.483(b)(5) or
(c)(3). Instead, 24 CFR 570.208(d)(4) will
apply.
State-Specific Waivers
National Objective Documentation for
Economic Development Activities—
States of Iowa, Louisiana, and Texas.
For the national objective
documentation for business assistance
activities, the states of Iowa, Louisiana
and Texas, which have received funds
under the First 2008 Act and Second
2008 Act, have asked to apply
individual salaries or wages-per-job and
the income limits for a household of
one, rather than the usual CDBG
standard of total household income and
the limits by total household size. The
states have asserted that this proposed
documentation would be simpler and
quicker for participating lenders to
administer, easier to verify, and would
not misrepresent the amount of lowand moderate-income benefit provided.
Upon consideration, HUD is granting
this waiver, which also was granted for
recovery in lower Manhattan following
September 11, 2001, and in certain
states following the Gulf Coast
hurricanes of 2005. Due to the
significant breadth of many states’
economic development programs, this
waiver will play a key role in
PO 00000
Frm 00042
Fmt 4703
Sfmt 4703
41149
streamlining the documentation process
because it allows collection of wage data
for each position created or retained
from the assisted businesses, rather than
from each individual household.
Section 414 of the Stafford Act—
States of Louisiana and Texas. In
addition to the above, the states of
Louisiana and Texas have also
requested a waiver of section 414 of the
Robert T. Stafford Disaster Relief and
Emergency Assistance Act, as amended,
for their disaster recovery programs.
Section 414 directs that persons who
were displaced by a disaster be
considered to be displaced by a federal
action, as defined under the Uniform
Relocation Act (URA), if the property in
which they were living prior to the
disaster is assisted with certain federal
funds. Today’s Federal Register Notice
grants, in part, the request that the
Secretary waive that section and
provides alternative requirements more
consistent with the purpose of the
Second 2008 Act, which is to assist and
support disaster recovery in the areas
most affected by the effects of the
disasters in 2008.
Several states suffered significant
destruction in the wake of Hurricanes
Ike and Gustav, and the reconstruction
will likely last for many years to come—
much like in the Gulf Coast states
affected by the hurricanes in 2005. For
programs or projects covered by this
waiver (‘‘covered programs or projects’’)
that are initiated within 3 years after the
applicable disaster, each state receiving
this wavier must comply with one of the
two alternative requirements (for
programs or projects initiated after the
3-year period, the alternative
requirements would not apply; only the
waiver would be applicable):
Alternative One
The state may provide relocation
assistance to a former residential
occupant whose former dwelling is
acquired, rehabilitated, or demolished
for a covered program or project
initiated within 3 years after the
disaster, even though the actual
displacements were caused by the
effects of the disaster. To the extent
practicable, such relocation assistance
should be offered in a manner
consistent with the Uniform Relocation
Assistance and Real Property
Acquisition Policies Act of 1970 (URA),
as amended, and its implementing
regulations, except as modified by
applicable waivers and alternative
requirements.
Alternative Two
If the state determines that the first
alternative would substantially conflict
E:\FR\FM\14AUN1.SGM
14AUN1
41150
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
with meeting the disaster recovery
purposes of the Second 2008 Act, the
state may establish a re-housing plan for
a covered program or project initiated
within 3 years after the disaster. Such
determinations must be made on a
program or project basis (not person or
household). The re-housing plan must
include, at minimum, the following:
1. A description of the class(es) of
persons eligible for assistance, including
all persons displaced from their
residences by particular, enumerated, or
by all, effects of the disaster, and
including all persons still receiving
temporary housing assistance from
FEMA for the covered disaster(s);
2. A description of the types and
amount of financial assistance to be
offered, if any;
3. A description of other services to be
made available, including, at minimum,
outreach efforts to eligible persons and
housing counseling providing
information about available housing
resources. Outreach efforts and housing
counseling information should be
provided in languages other than
English to persons with limited English
proficiency; and
4. Contact information and a
description of any applicable
application process, including any
deadlines.
5. If the program or project involves
rental housing, the re-housing plan must
also include the following:
(i) Placement services for former and
prospective tenants;
(ii) A public registry of available
rental units assisted with CDBG disaster
recovery and/or other funds; and
(iii) Application materials, award
letters, and operating procedures
requiring property owners to make
reasonable attempts to contact their
former residential tenants and offer a
unit, upon completion, to those tenants
meeting the program’s eligibility
requirements.
(iv) Persons in physical occupancy
who are displaced by a HUD-assisted
disaster recovery project will continue
to be eligible for URA assistance.
mstockstill on DSKH9S0YB1PROD with NOTICES
Justification for Waiver
The reasons for granting this waiver
are several, and are ably represented by
the states in their requests. The
principal reasons are highlighted here:
• Hurricanes Ike and Gustav caused
significant destruction that resulted in
massive displacements and decimated
the region’s affordable housing stock.
Continued ambiguity on section 414’s
applicability may cause substantial
delays in long-term recovery,
particularly in Texas and Louisiana; and
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
• Simplify the administration of
disaster recovery projects or programs
initiated years following the disaster.
Persons displaced by the effects of the
disaster may continue to apply for
assistance under the states’ approved
disaster recovery programs, which are
designed to bring affordable housing to
the affected areas. This waiver does not
address programs or projects receiving
other HUD funding, or funding from
other federal sources.
A state may already be performing
some elements of a re-housing plan,
such as providing a public rental
registry or undertaking outreach and
placement services to those former
residents still receiving FEMA housing
assistance. A description in the rehousing plan of how those existing
efforts will be available for covered
programs or projects may be used in
satisfying the requirements of this
Notice.
Eligibility—buildings for the general
conduct of government—States of
Indiana, Louisiana, and Texas. The
states of Indiana, Louisiana, and Texas
requested a limited waiver of the
prohibition on funding buildings for the
general conduct of government. HUD
has considered the request and agrees
that it is consistent with the overall
purposes of the 1974 Act for requesting
states to be able to use the grant funds
under this notice to repair or reconstruct
buildings used for the general conduct
of government and that the states have
selected in accordance with the method
described in their Action Plans for
Disaster Recovery and that they have
determined have substantial value in
promoting disaster recovery. However,
as stated by the Second 2008 Act, funds
allocated under today’s Federal Register
Notice, or the February 13, 2009,
Federal Register Notice (74 FR 7244),
may not be used for activities
reimbursable by or for which funds are
made available by FEMA or the Army
Corps of Engineers. Further, none of the
funds may be used as the required
match, share, or contribution for another
federal program.
Public benefit for certain economic
development activities—States of Iowa,
Louisiana, and Texas. The states of
Iowa, Louisiana, and Texas have
requested a waiver of the public benefit
standards for their economic
development activities. The public
benefit provisions set standards for
individual economic development
activities (such as a single loan to a
business) and for economic
development activities in the annual
aggregate. Currently, public benefit
standards limit the amount of CDBG
assistance per job retained or created, or
PO 00000
Frm 00043
Fmt 4703
Sfmt 4703
the amount of CDBG assistance per lowand moderate-income person to which
goods or services are provided by the
activity. Essentially, the public benefit
standards are a proxy for all the other
possible public benefits provided by an
assisted activity. These dollar
thresholds were set more than a decade
ago and, under disaster recovery
conditions (which often require a larger
investment to achieve a given result),
can be too low and, thus, impede
recovery by limiting the amount of
assistance the grantee may provide to a
critical activity. States requesting this
waiver have made public in their Action
Plans the disaster recovery needs each
activity is addressing and the public
benefits expected.
After consideration, today’s Federal
Register Notice waives the public
benefit standards for the cited activities,
except that each requesting state shall
report and maintain documentation on
the creation and retention of: (a) Total
jobs, (b) number of jobs within certain
salary ranges, (c) the average amount of
assistance per job and activity or
program, and (d) the types of jobs. As a
conforming change for the same
activities or programs, HUD is also
waiving paragraph (g) of 24 CFR 570.482
to the extent its provisions are related to
public benefit.
Housing incentives to encourage
housing resettlement consistent with
local recovery plans; States of Louisiana
and Texas. The states of Louisiana and
Texas may offer disaster recovery or
mitigation housing incentives to
promote suitable housing development
or resettlement in particular geographic
areas. By ‘‘resettlement,’’ HUD is
referring to resettling the community as
a whole, which may include buyouts
and relocation, as well as repopulation
initiatives if part of a recovery plan. In
the past, the state of New York
successfully used an incentive program
to induce rapid and stable resettlement
of lower Manhattan following
September 11, 2001. Also, the city of
Grand Forks, North Dakota, provided a
very affordable soft-second loan as an
incentive to help induce households to
resettle within the city during its
recovery. Any state choosing to provide
incentives must maintain
documentation, at least at a
programmatic level, describing how the
amount of assistance was determined to
be necessary and reasonable. Generally,
incentives are offered in addition to
other programs or funding (such as
insurance), to try to influence
individual residential location
decisions, when these decisions are in
doubt. For example, a grantee may offer
an incentive payment (possibly in
E:\FR\FM\14AUN1.SGM
14AUN1
mstockstill on DSKH9S0YB1PROD with NOTICES
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
addition to buyouts) for households that
volunteer to relocate within a particular
period of time, or who choose to resettle
outside a 100- or 500-year floodplain.
Note, however, that if the grantee
requires the funds to be used for a
particular purpose by the household
receiving the assistance, then the
activity will be that required use, not an
eligible incentive. The Department is
waiving 42 U.S.C. 5305(a) and
associated regulations to make these
uses of grant funds eligible.
Compensation for disaster-related
losses. The states of Louisiana and
Texas plan to provide compensation to
certain homeowners whose homes were
affected during the covered disasters, if
the homeowners agree to meet the
stipulations of the state’s or
subawardee’s published program
design. Such stipulations may not
include requirements related to how the
homeowner may use the funds, because
then the assisted activity would be that
required use, not compensation. Such
programs were carried out by the states
of Louisiana and Mississippi following
the 2005 hurricanes. A strength of these
compensation programs is that they may
be able to disburse funding more
quickly than traditional CDBG
rehabilitation programs. However, a
major weakness is the lack of certainty
about whether an assisted homeowner
will use the granted assistance in a way
that supports the community’s longterm recovery goals. Very little data
exists to verify the degree to which
compensation funds have been used for
reconstruction or rehabilitation. Existing
data suggest that a certain percentage of
those receiving assistance fail to comply
with the program stipulations. By
contrast, a rehabilitation program is
typically able to demonstrate that all or
nearly all of its assisted households
reside (after receiving assistance) in
reconstructed or rehabilitated homes,
according to the grantee’s standards.
Therefore, HUD is granting this
compensation waiver together with
alternative requirements. HUD will
disapprove an action plan if a
compensation program is not adequately
justified in accordance with these
alternative requirements. Any state
deciding to assist a compensation
activity must address in its action plan
and program design:
(1) How the state will ensure that
compensation payments will result in
disaster recovery or economic
revitalization;
(2) Why a housing rehabilitation or
reconstruction or buyouts program is
not a more appropriate choice; and
(3) How the state determined the
appropriate compensation amount(s).
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
Further, any state choosing to provide
compensation assistance must also carry
out an evaluation of outcomes of the
program, for a statistically valid sample
of the program participants, within a
year of providing the final payment.
Three-month limitation on emergency
grant payments. In response to the state
of Iowa’s request, HUD is waiving 42
U.S.C. 5305(a) to allow it to extend
interim mortgage assistance to qualified
individuals for up to 20 months. The
state is currently operating an Interim
Mortgage Assistance Program, limited to
a maximum of 3 months and a
maximum of $1,000 per month. It has
now been almost 12 months since the
original flooding event occurred but
many families still require this
assistance. Furthermore, it will still be
several months before FEMA buyout
decisions will be made and
implemented. Therefore, to permit the
state of Iowa to adequately assist
households through this period, and to
be consistent with the state funding that
has been supplied separately for this
purpose, HUD will waive the normal 3month limitation, to provide a total of
20 months of Interim Mortgage
Assistance to qualified individuals.
Summary of States Receiving Waivers
Texas. Texas has requested and HUD
has approved the following waivers and
alternative requirements for funds
provided to the state under the Second
2008 Act (Pub. L. 110–329): (1)
Documentation of job retention, (2)
section 414 of the Stafford Act, (3)
eligibility of buildings for the general
conduct of government, (4) public
benefit for certain economic
development activities, and (5)
compensation for disaster-related losses
or housing incentives to resettle in
disaster-affected communities. Texas
has justified each request and
documented the need for each waiver.
Iowa. Iowa has requested and HUD
has approved the following waivers and
alternative requirements: (1)
Documentation of job retention, (2)
public benefit for certain economic
development activities, and (3) threemonth limitation on emergency grant
payments. Iowa has justified each
request and documented the need for
each waiver. The waivers granted by
this Notice will apply to funds received
under the First 2008 Act (Pub. L. 110–
252), and to all funds received under the
Second 2008 Act (Pub. L. 110–329).
Louisiana. Louisiana has requested
and HUD has approved the following
waivers and alternative requirements for
funds provided to the state under the
Second 2008 Act: (1) Documentation of
job retention, (2) section 414 of the
PO 00000
Frm 00044
Fmt 4703
Sfmt 4703
41151
Stafford Act, (3) eligibility of buildings
for the general conduct of government,
(4) public benefit for certain economic
development activities, and (5)
compensation for disaster-related losses
or housing incentives to resettle in
disaster-affected communities.
Louisiana has justified each request and
documented the need for each waiver.
Indiana. Indiana has requested and
HUD has approved a waiver regarding
the eligibility of buildings for the
general conduct of government for all
funds received under the First 2008 Act,
2008 (Pub. L. 110–252). Note, this
waiver has been neither requested nor
approved for funds received under the
Second 2008 Act (Pub. L. 110–329).
Application for Allocations Under the
Second 2008 Act
The waivers and alternative
requirements streamline the pre-grant
process and set the guidelines for states’
applications for their allocations. Each
grantee receiving an allocation under
the Second 2008 Act (which includes
allocations made under this Notice, as
well as those made under the February
13, 2009, Notice) is required, with the
exception of California, to submit and/
or amend its Action Plan for Disaster
Recovery to program all of each state’s
allocations by September 30, 2009. The
state of California (which did not
receive an allocation under the February
13, 2009, Notice) is required to submit
an Action Plan for Disaster Recovery by
December 30, 2009. Any allocation not
applied for by these dates may be added
to the funds available under the DREF
and reallocated. If any grantee fails to
meet the requirement to program its
allocations within the relevant
timelines, HUD, on the first business
day after that deadline, will commence
an action to recapture the funds.
Applicable Rules, Statutes, Waivers,
and Alternative Requirements
1. General note. Prerequisites to a
grantee’s receipt of CDBG disaster
recovery assistance include adoption of
a citizen participation plan; publication
of its proposed Action Plan for Disaster
Recovery; public notice and comment;
and submission to HUD of an Action
Plan for Disaster Recovery, including
certifications. Except as described in
this Notice, statutory and regulatory
provisions governing the CDGB program
for states, including those at 42 U.S.C.
5301 et seq. and 24 CFR part 570, shall
apply to the use of these funds.
2. The waivers provided in the
February 13, 2009, Federal Register
Notice (74 FR 7244) are granted and the
alternative requirements of that Notice
apply to all the states receiving an
E:\FR\FM\14AUN1.SGM
14AUN1
mstockstill on DSKH9S0YB1PROD with NOTICES
41152
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
allocation of grant funds under this
Notice. Each of the states has requested,
in writing, that HUD grant it the waivers
and alternative requirements of that
Notice.
3. Planning activities. For CDBG
disaster recovery-assisted general
planning activities that will guide
recovery in accordance with the First
2008 Act (Pub. L. 110–252) and the
Second 2008 Act (Pub. L. 110–329), the
State CDBG program rules at 24 CFR
570.483(b)(5) and (c)(3) are waived and
the presumption at 24 CFR
570.208(d)(4) applies for all First 2008
Act and Second 2008 Act grantees.
4. National Objective Documentation
for Economic Development Activities.
24 CFR 570.483(b)(4)(i) is waived to
allow the states of Texas, Iowa, and
Louisiana to establish low- and
moderate-income jobs benefit by
documenting, for each person
employed, the name of the business,
type of job, and the annual wages or
salary of the job. HUD will consider the
person income-qualified if the annual
wages or salary of the job is at or under
the HUD-established income limit for a
one-person family.
5. Section 414 of the Stafford Act.
Section 414 of the Stafford Act, 42
U.S.C. 5181 (including its implementing
regulation at 49 CFR 24.403(d)), is
waived to the extent that it would apply
to CDBG disaster recovery-funded
programs or projects initiated within 3
years of the incident-date of Hurricane
Ike or Hurricane Gustav (as applicable)
by the states of Texas and Louisiana
under an approved Action Plan for
Disaster Recovery for its grants under
the Second 2008 Act, provided that
such program or project was not
planned, approved, or otherwise under
way prior to the disaster.
a. For all programs or projects covered
by this waiver (‘‘covered programs or
projects’’) that are within 3 years after
the applicable disaster, the states of
Texas and Louisiana must comply with
one of the following two alternative
requirements (for programs or projects
initiated after the 3-year period, the
alternative requirements would not
apply; only the waiver would be
applicable): (1) Relocation Assistance.
The state may provide relocation
assistance to a former residential
occupant whose former dwelling is
acquired, rehabilitated, or demolished
for a covered program or project
initiated within 3 years after the
disaster, even though the actual
displacements were caused by the
effects of the disaster. To the extent
practicable, such relocation assistance
must be offered in a manner consistent
with the URA, as amended, and its
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
implementing regulations, except as
modified by prior waivers and
alternative requirements granted to the
states. (2) Re-housing Plan. If the state
determines that the first alternative
would substantially conflict with
meeting the disaster recovery purposes
of the Second 2008 Act, the grantee may
establish a re-housing plan for a covered
program or project initiated within 3
years after the disaster. Such a
determination must be made on a
program or project basis (not person or
household). The re-housing plan must
include, at minimum, the following:
(i) A description of the class(es) of
persons eligible for assistance, including
all residents displaced from their
residences by either certain enumerated
or all effects of the covered disaster, and
including all disaster-displaced
residents still receiving temporary
housing assistance from FEMA for the
covered disasters;
(ii) A description of the types and
amount of financial assistance to be
provided, if any;
(iii) A description of other services to
be made available, including, at a
minimum, outreach efforts to eligible
persons and housing counseling, that
provide information about available
housing resources;
(iv) Contact information for additional
program information;
(v) A description of any applicable
application process, including any
deadlines; and
(vi) If the program or project covered
by this waiver involves rental housing,
the grantee shall establish procedures
for the following:
A. Application materials, award
letters, and operating procedures that
require property owners to make
reasonable attempts to contact their
former tenants and to offer a unit, upon
completion, to those tenants meeting the
program’s eligibility requirements;
B. Placement services for former and
prospective tenants; and
C. A public registry of available rental
units assisted with CDBG disaster
recovery and/or other funds.
b. Eligible Project Costs. The costs of
relocation assistance and the
reoccupancy plan are eligible project
costs in the same manner and to the
same extent as other project costs
authorized under the Second 2008 Act.
For covered programs or projects
involving affordable rental housing, the
relocation and planning costs required
by this Notice may be paid from funds
reserved for the affordable rental
housing stock in the impacted areas
under the Second 2008 Act.
c. Persons in physical occupancy who
are displaced by a HUD-assisted disaster
PO 00000
Frm 00045
Fmt 4703
Sfmt 4703
recovery project will continue to be
eligible for URA assistance.
6. Buildings for the general conduct of
government. 42 U.S.C. 5305(a) is waived
to the extent necessary to allow the
states of Texas and Louisiana to fund
the rehabilitation or reconstruction of
public buildings that are otherwise
ineligible and that the state selects in
accordance with its approved Action
Plan for Disaster Recovery and that the
state has determined have substantial
value in promoting disaster recovery.
The state of Indiana may use funds
allocated under the September 11, 2008,
Federal Register Notice (73 FR 52870)
or December 19, 2008, Federal Register
Notice (73 FR 77818) to fund the
rehabilitation or reconstruction of
public buildings that are otherwise
ineligible.
7. Public benefit for certain economic
development activities. For economic
development activities designed to
create or retain jobs or businesses
(including, but not limited to, long-term,
short-term, and infrastructure projects),
the public benefit standards at 42 U.S.C.
5305(e)(3) and 24 CFR 570.482(f)(1), (2),
(3), (4)(i), (5), and (6) are waived for the
states of Texas, Louisiana, and Iowa,
except that these states shall report and
maintain documentation on the creation
and retention of total jobs; the number
of jobs within certain salary ranges; the
average amount of assistance provided
per job, by activity or program; and the
types of jobs. Paragraph (g) of 24 CFR
570.482 is also waived for these states
to the extent its provisions are related to
public benefit.
8. Compensation for disaster-related
losses. HUD is granting a compensation
waiver together with alternative
requirements for the states of Louisiana
and Texas. Either state deciding to assist
a compensation activity must address
the following in its action plan and
program design:
a. How the state will ensure that
compensation payments will result in
disaster recovery or economic
revitalization;
b. Why a housing rehabilitation or
reconstruction or buyouts program is
not a more appropriate choice than
providing housing compensation. The
state must compare and contrast
schedules, delivery costs, and projected
recovery resulting from each type of
activity; and
c. How the state determined the
appropriate compensation amount(s).
Further, any state choosing to provide
compensation assistance must also carry
out and publish an evaluation of
outcomes of the program for a
statistically valid sample of the program
participants within a year of providing
E:\FR\FM\14AUN1.SGM
14AUN1
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
the final compensation payment. If the
state also provides rehabilitation
assistance, it must include in its
evaluation a comparison of the results of
the compensation and rehabilitation
activities.
9. Housing incentives to encourage
housing resettlement consistent with
local recovery plans. The states of
Louisiana and Texas may offer disaster
recovery or mitigation housing
incentives to promote suitable housing
development or resettlement in
particular geographic areas. Any state
choosing to provide incentives must
maintain documentation at least at a
programmatic level describing how the
amount of assistance was determined to
be necessary and reasonable. Note that
if the grantee requires the funds to be
used for a particular purpose by the
household receiving the assistance, then
the activity will be that required use,
not an eligible incentive. The
Department is waiving 42 U.S.C. 5305(a)
and associated regulations to make these
uses of grant funds eligible.
10. Three-month limitation on
emergency grant payments. 42 U.S.C.
5305(a) is waived so that Iowa may
extend interim mortgage assistance to
qualified individuals for up to 20
months. This waiver applies to funds
received under the First 2008 Act (Pub.
L. 110–252), and to funds received
under the Second 2008 Act (Pub. L.
110–329).
Duration of Funding
Availability of funds provisions in 31
U.S.C. 1551–1557, added by section
1405 of the National Defense
Authorization Act for Fiscal Year 1991
(Pub. L. 101–510), limit the availability
of certain appropriations for
expenditure. This limitation may not be
waived. However, the Second 2008 Act
directs that these funds be available
until expended unless, in accordance
with 31 U.S.C. 1555, the Department
determines that the purposes for which
the appropriation has been made have
been carried out and no disbursement
has been made against the appropriation
for 2 consecutive fiscal years. In such a
case, the Department shall close out the
grant prior to expenditure of all funds.
mstockstill on DSKH9S0YB1PROD with NOTICES
Catalog of Federal Domestic Assistance
The Catalog of Federal Domestic
Assistance numbers for the disaster recovery
grants under this Notice are as follows:
14.219; 14.228.
Finding of No Significant Impact
A Finding of No Significant Impact
(FONSI) with respect to the
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
environment has been made in
accordance with HUD regulations at 24
CFR part 50, which implement section
102(2)(C) of the National Environmental
Policy Act of 1969 (42 U.S.C. 4332). The
FONSI is available for public inspection
between 8 a.m. and 5 p.m. weekdays in
the Regulations Division, Office of
General Counsel, Department of
Housing and Urban Development, 451
7th Street, SW., Room 10276,
Washington, DC 20410–0500. Due to
security measures at the HUD
Headquarters building, an advance
appointment to review the docket file
must be scheduled by calling the
Regulations Division at telephone
number 202–708–3055 (this is not a tollfree number). Hearing- or speechimpaired individuals may access this
number through TTY by calling the tollfree Federal Information Relay Service
at 800–877–8339.
Dated: July 20, 2009.
´
Mercedes Marquez,
Assistant Secretary for Community Planning
and Development.
Appendix 1—Allocation Methodology
Detail
The Consolidated Security, Disaster
Assistance, and Continuing
Appropriations Act, 2009 (Pub. L. 110–
329), enacted on September 30, 2008,
appropriated $6.5 billion through the
CDBG program for ‘‘necessary expenses
related to disaster relief, long-term
recovery, and restoration of
infrastructure, housing, and economic
revitalization in areas affected by
hurricanes, floods, and other natural
disasters occurring during 2008 for
which the President declared a major
disaster.’’
It went on to say that ‘‘such funds
may not be used for activities
reimbursable by, or for which funds are
made available by, the Federal
Emergency Management Agency or the
Army Corps of Engineers’’ and that
‘‘none of the funds * * * may be used
* * * as a matching requirement, share,
or contribution for any other Federal
program.’’ It also stated that ‘‘not less
than $650,000,000 from funds made
available on a pro-rata basis according
to the allocation made to each State’’
shall be used for affordable rental
housing.
Finally, the statute called for ‘‘not
less’’ than 33 percent of the funds to be
allocated within 60 days of enactment
(that is, by November 28th) based ‘‘on
the best estimates available of relative
damage and anticipated assistance from
other Federal sources.’’
PO 00000
Frm 00046
Fmt 4703
Sfmt 4703
41153
Schedule for Allocations
While Congress appropriated $6.5
billion, $377,139,920 has been
rescinded, $6.5 million has been set
aside for HUD administrative costs, and
$2,145,000,000 was allocated in
November 2008. This allocation
distributes the remaining
$3,971,360,080, with a $311,603,923 setaside to the Disaster Recovery
Enhancement Fund.
Disasters in 2008
There were 76 major disasters that
occurred in 2008 in 35 states, Puerto
Rico, and the Virgin Islands. Data on
damaged housing are available for 36
disasters from FEMA and Small
Business Administration (SBA);
business loss data are available for 39
disasters from SBA; and 72 disasters
have data on the cost FEMA and states
are estimated to spend on infrastructure
and other Public Assistance costs.
Available Data
The data HUD staff have identified as
being available to calculate ‘‘relative
damage and anticipated assistance from
Federal sources’’ at this time for the
targeted disasters come from the
following data sources:
• FEMA Individual Assistance
program data concerning housing unit
damage;
• SBA for management of its disaster
assistance loan program for housing
repair and replacement;
• SBA for management of its disaster
assistance loan program for business
real estate repair and replacement, as
well as content loss; and
• FEMA estimated and obligated
amounts under its Public Assistance
program, including the federal and state
cost share.
Formula
This formula ‘‘allocates’’ the full
$6,116,360,080 available for allocation
under this appropriation and then
subtracts out the $2,145,000,000 that
was previously allocated and the
$311,602,923 set-aside reserve fund (on
a pro-rata basis). HUD has adopted this
practice to adjust grants to reflect better
data than were available at the time of
the November 2008 allocation and to
treat disasters occurring after November
equally with disasters that occurred
earlier in the year.
The formula mechanics are as follows:
$6,116,360,080
E:\FR\FM\14AUN1.SGM
14AUN1
41154
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
⎡ (State sum of HUD-calculated unmet housing, business, and infrastructure needs)
d
∗ ⎢
⎣ (All disaster sum of HUD-calculated unmet housing, business, and infrastructure needs)
⎤
(State Per Seriously Damaged Home Challenge Score)a
∗ (20% power) b ⎥
(Basic Allocation National Weighted Challenge Score)
⎦
—State total: November $2.145 billion
allocation
* Pro-rata adjustment after minimum grant
threshold and reserve grant set-aside
a No state can have its grant adjusted up or
down by more than 10 percent using this
factor.
b Mathematically, each state’s challenge
factor is divided by the weighted national
rate (14.7) and multiplied by 0.2 (that is, if
a state’s ratio was above 1; for example, 1.5
would become 1.10, [1 + ((1 ¥ 0.5) * 0.2)];
if the ratio was below 1, for example, 0.5
would become 0.9 [1 – ((1 ¥ 0.5) * 0.2)].
This allocation does not duplicate
funding already provided under the
Supplemental Appropriations Act of
2008 (Pub. L. 110–252, 122 Stat. 2323),
enacted on June 30, 2008, which
appropriated $300 million for disasters
that were declared and occurred in May
and June of 2008. This current
allocation subtracts out of the unmet
housing and business need estimates the
amount of funds allocated for housing
and business under the 2008 June
appropriation.
mstockstill on DSKH9S0YB1PROD with NOTICES
Calculating Unmet Housing Needs
The core data on housing damage for
both the unmet housing needs
calculation and the concentrated
damage are based on home inspection
data for FEMA’s Individual Assistance
program. For unmet housing needs, the
FEMA data are supplemented by SBA
data from its Disaster Loan Program.
HUD calculates ‘‘unmet housing needs’’
as the number of housing units with
unmet needs, multiplied by the
estimated cost to repair those units,
minus the amount of repair funding
already provided by FEMA, where:
• The number of owner-occupied
units with unmet needs are units FEMA
housing inspectors determined would
require more than $3,000 to become
habitable and were determined by
FEMA to be eligible for a repair or
replacement grant (now up to $30,300,
earlier disasters in the year had a cap of
$28,800). In general, when HUD refers
to units ‘‘seriously damaged,’’ it is
referring to units with a FEMA damage
assessment of $3,000 or greater.
• The number of rental units with
unmet needs are units FEMA housing
inspectors determined would require
more than $3,000 to become habitable
AND are occupied by households with
an income reported to FEMA of less
than $20,000. The use of the $20,000
income cut-off for calculating rental
unmet needs is in response to the
statutory language that emphasized the
use of the funds for affordable rental
housing.
• Each of the FEMA inspected units
are categorized by HUD into one of five
categories:
Æ Minor-Low: Less than $3,000 of
FEMA-inspected damage
Æ Minor-High: $3,000 to $7,999 of
FEMA-inspected damage
Æ Major-Low: $8,000 to $14,999 of
FEMA-inspected damage
Æ Major-High: $15,000 to $28,800 of
FEMA-inspected damage
Æ Severe: Greater than $28,800 of
FEMA-inspected damage or -determined
destroyed.
Note: FEMA has recently raised its
maximum grant to $30,300. For this first
round allocation, HUD continues to use the
$28,800 as the threshold, because it applied
for most of the declared disasters.
• The average cost to fully repair a
home for a specific disaster within each
of the damage categories noted above is
calculated using the average real
property damage repair costs
determined by the SBA for its disaster
loan program for the subset of homes
inspected by both SBA and FEMA.
Because SBA is inspecting for full repair
costs, it is presumed to reflect the full
cost to repair the home, which is
generally more than FEMA estimates on
the cost to make the home habitable. If
fewer than 100 SBA inspections are
made for homes within a FEMA damage
category, the estimated damage amount
in the category for that disaster has a
cap applied at the 75th percentile of all
damaged units for that category for all
disasters and has a floor applied at the
25th percentile.
• The base amount of unmet housing
needs is then increased by 20 percent to
reflect an assumed premium associated
with the additional costs needed to run
a repair program with CDBG funding.
Calculating Infrastructure Needs
As noted above, the statute for this
allocation states that ‘‘such funds may
not be used for activities reimbursable
by, or for which funds are made
available by, the Federal Emergency
Management Agency or the Army Corps
of Engineers’’ and that ‘‘none of the
funds * * * may be used * * * as a
matching requirement, share, or
contribution for any other Federal
program.’’ In past disasters, unmet
infrastructure need has been calculated
at the required match portion for the
public assistance program. Because
these funds cannot be used as match, we
must identify a proxy for what
infrastructure activities are likely to
require funding beyond FEMA’s Public
Assistance funding and the state match
requirement. To best proxy unmet needs
that would exceed what FEMA and state
match will pay for under the Public
Assistance program, this allocation uses
only a subset of the Public Assistance
damage estimates reflecting the
categories of activities most likely to
require CDBG funding above the Public
Assistance and State Match
requirement. Those activities are the
following categories: C—Roads and
Bridges; D—Water Control Facilities;
E—Public Buildings; F—Public Utilities;
and G—Recreational—Other. Categories
A (Debris Removal) and B (Protective
Measures) are largely expended
immediately after a disaster and reflect
interim recovery measures, rather than
the long-term recovery measures the
CDBG funds are generally used for.
‘‘Unmet’’ infrastructure needs assume
that the subset categories of Public
Assistance needs will have state
aggregate costs 25 percent higher than
that covered by FEMA or the state
match requirement.
Disasters with
project(s)
Public Assistance Total .............................................................................................
A_Debris_Removal ....................................................................................................
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
PO 00000
Frm 00047
Fmt 4703
Sfmt 4703
75
71
E:\FR\FM\14AUN1.SGM
Total estimate
$5,322,992,430
1,185,035,209
14AUN1
Percent
22
EN14AU09.012</MATH>
∗
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
Disasters with
project(s)
B_Protective_Measures .............................................................................................
C_Roads_Bridges ......................................................................................................
D_Water_Control_Facilities ........................................................................................
E_Public_Buildings .....................................................................................................
F_Public_Utilities ........................................................................................................
G_Recreational_Other ...............................................................................................
FEMA Extract: April 14, 2009.
Calculating Economic Revitalization
Needs
Based on SBA disaster loans to
businesses, HUD used the sum of real
property and real content loss of small
businesses not receiving an SBA
disaster loan. This is adjusted upward
by the proportion of applications that
were received for a disaster for which
content and real property loss were not
calculated because the applicant had
inadequate credit or income. For
example, if a state had 160 applications
for assistance, and if 150 had calculated
needs and 10 were denied in the preprocessing stage for not enough income
or poor credit, the estimated unmet
need calculation would be increased as
(1 + 10/160), multiplied by the
calculated unmet real content loss.
SBA business loan data shows that
verified real estate damage and content
loss not approved for an SBA loan
equaled $972 million. Across all of the
disasters there were 17,157 applications
for a business disaster loan from SBA.
No inspections were done (and loss
calculated) for 14 percent of those
applications. SBA maintains
information on why an application was
denied. There are dozens of reasons for
such denials, but the most common
relate to income and credit. Of those
denied at the pre-processing stage 59
percent were denied because of a low
credit score and 10 percent for not being
able to establish repayment ability. The
remaining applications denied in preprocessing are largely denied for being
ineligible for the program or similar
reasons. For the applications that get
75
73
43
69
74
64
processed and a loss determined but are
subsequently not approved, the reasons
for not being approved are 38 percent
for inability to repay, 2 percent for poor
credit, and dozens of other reasons, but
mostly because the applications are
withdrawn by the applicant.
Because applications denied for poor
credit or inadequate income are the
most likely measure of requiring the
type of assistance available with CDBG
recovery funds, the calculated unmet
business needs for each state are
adjusted upwards by the proportion of
total applications that were denied at
the pre-process stage because of poor
credit or inability to show repayment
ability.
Calculating Challenge To Recover
The 2005 hurricanes damaged more
than 1.2 million homes. One year after
the disaster, 90 percent of those homes
were occupied. It is in the areas that
homes were vacant a year after the
storms that the recovery has been
especially slow, and a large number of
those homes vacant a year after the
storms continue to remain vacant. As
described in more detail below, two
variables are very strong predictors of
whether a home becomes vacant and
remains vacant over an extended period
of time. Those variables are the percent
of homes with serious damage within
the neighborhood (Census Tract is the
proxy) and if a home received very
severe damage.
The vast majority of households
impacted by a disaster are able to return
to their homes within a relatively short
time frame. For those households
displaced longer than a year and for the
neighborhoods where that displacement
Unstandardized
coefficients
mstockstill on DSKH9S0YB1PROD with NOTICES
Dependent Variable: A time weighted
average vacancy risk due to the
2005 Hurricanes =
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
Percent
995,171,090
494,369,300
57,455,582
1,509,980,683
837,448,078
243,532,488
19
9
1
28
16
5
occurs, the recovery challenges are
much more pronounced. For example,
areas may decide not to build back and
to build elsewhere, using buyout
programs and other strategies.
Alternatively, homes built back might
need to be built to a higher standard of
construction to better resist future
disasters. These are factors not
accounted for in the basic repair costs
calculated in the needs calculations for
housing, infrastructure, and economic
revitalization. To account for these
above normal recovery needs that are
associated with only the most severe of
disasters, HUD has used data from
Hurricanes Katrina, Rita, and Wilma to
develop a model for estimating if a
home is at a high or low risk for
overcoming these recovery challenges.
There are many reasons why a recovery
might not happen for a particular house,
but just two factors can predict 34
percent of the variance between homes.
According to the model, any home with
serious damage (FEMA-estimated
damage of greater than $5,200 in a 2005
disaster) had about a one percent risk
for being vacant for some period during
the 43 months following the disaster. A
home with severe damage (more than 50
percent damaged) had an additional 20
percent risk, and if that home was in a
Census Tract where many other homes
had major or severe damage, it had an
additional risk of that proportion of
homes affected, multiplied by 34
percent. Such a risk factor can be a
useful tool for adjusting grants so that
states with a higher per-damaged home
risk score get relatively more than states
with a relatively lower per-damaged
home risk score.
Standardized
coefficients
Std. Error
B
(Constant) ........................................................
Percent of homes in Census Tract with serious damage ..................................................
Home with severe damage ..............................
Total estimate
41155
t
Sig.
Beta
0.010695
0.000909
............................
11.76848
5.77E–32
0.347154
0.195913
0.001615
0.001158
0.375916
0.295827
214.9506
169.1555
0
0
[16 * (1 ¥ ratio of 12–2006 active
address rate to 2005 pre-storm
active address rate)
PO 00000
Frm 00048
Fmt 4703
Sfmt 4703
14 * (1 ¥ ratio of 2–2008 active address
rate to 2005 pre-storm active
address rate)
E:\FR\FM\14AUN1.SGM
14AUN1
41156
Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Notices
10 * (1 ¥ ratio of 12–2008 active
address rate to 2005 pre-storm
active address rate)
3 * (1 ¥ ratio of 3–2009 active address
rate to 2005 pre-storm active
address rate)]
Divided by 43 months. (the longer the
vacancy the higher the average
score)
R-square: 0.340
N: 287,190
To adjust for this greater recovery
challenge, the results of the analysis
above are used in the following model
for 2008:
Vacancy Risk Score =
0.010695 (Constant)
+ 0.347154 Percent of homes in
Census Tract with serious damage
+ 0.195913 Home with major-high or
severe damage
The risk score is then aggregated for
each disaster and divided by the total
number of housing units with more than
very minor damage. That is, we
determine a per-damaged home
recovery challenge risk score. Such a
risk factor can be a useful tool for
adjusting grants so that states with a
higher risk for long-term recovery
challenges get a somewhat higher grant
because of this risk.
[FR Doc. E9–19488 Filed 8–13–09; 8:45 am]
BILLING CODE 4210–67–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
[Docket No. FR–5282–N–04]
Notice of Proposed Information
Collection: Comment Request;
Community Development Block Grant
Recovery (CDBG–R) Program
mstockstill on DSKH9S0YB1PROD with NOTICES
AGENCY: Office of Community Planning
and Development, Department of
Housing and Urban Development.
ACTION: Notice of proposed information
collection.
SUMMARY: The proposed information
collection requirement described below
will be submitted to the Office of
Management and Budget (OMB) for
review as required by the Paperwork
Reduction Act. The Department is
soliciting public comments on the
subject proposal.
DATES: Comments Due Date: October 13,
2009.
ADDRESSES: Interested persons are
invited to submit comments regarding
this proposal. Comments should refer to
the proposal by name and/or OMB
Control Number and should be sent to:
Lillian L. Deitzer, Reports Management
VerDate Nov<24>2008
16:27 Aug 13, 2009
Jkt 217001
Officer, QDAM, Department of Housing
and Urban Development, 451 7th Street,
SW., Room 4176, Washington, DC
20410; telephone 202–402–8048 (this is
not a toll-free number) or e-mail Ms.
Deitzer at Lillian.L.Deitzer@hud.gov for
a copy of the proposed form and other
available information.
FOR FURTHER INFORMATION CONTACT:
Steve Johnson, Director, Entitlement
Communities Division, Office of Block
Grant Assistance, 451 7th Street, SW.,
Room 7282, Washington, DC 20410;
telephone (202) 708–1577 (this is not a
toll-free number).
SUPPLEMENTARY INFORMATION: The
Department is submitting the proposed
information collection to OMB for
review, as required by the Paperwork
Reduction Act of 1995 (44 U.S.C.
Chapter 35, as amended). The
Department submitted to OMB for
emergency processing a proposed
information collection for the
Community Development Block Grant
Recovery (CDBG–R) program. It was
approved by OMB on April 17, 2009
and expires on October 31, 2009. Since
HUD will be using the form (SF 424)
beyond the emergency clearance time
period, this is a resubmission to OMB
under the normal paperwork clearance
process for a three-year approval.
This Notice is soliciting comments
from members of the public and affected
agencies concerning the proposed
collection of information to: (1) Evaluate
whether the proposed collection of
information is necessary for the proper
performance of the functions of the
agency, including whether the
information will have practical utility;
(2) Evaluate the accuracy of the agency’s
estimate of the burden of the proposed
collection of information; (3) Enhance
the quality, utility, and clarity of the
information to be collected; and (4)
Minimize the burden of the collection of
information on those who are to
respond; including through the use of
appropriate automated collection
techniques or other forms of information
technology, e.g., permitting electronic
submission of responses.
This Notice also lists the following
information:
Title of Proposal: Community
Development Block Grant Recovery
Program.
OMB Control Number, if Applicable:
2506–0184.
Description of the Need for the
Information and Proposed Use: This
request identifies the estimated
reporting burden associated with
information that CDBG–R grantees will
report in IDIS for CDBG–R assisted
activities, recordkeeping requirements,
PO 00000
Frm 00049
Fmt 4703
Sfmt 4703
and reporting requirements. Section
1512 of the Recovery Act requires that
not later than 10 days after the end of
each calendar quarter, each recipient
that received recovery funds from a
Federal agency shall submit a report to
that agency that contains: (1) The total
amount of recovery funds received from
that agency; (2) the amount of recovery
funds received that were expended or
obligated to projects or activities; and
(3) a detailed list of all projects or
activities for which recovery funds were
expended or obligated, including the
name of the project or activity; a
description of the project or activity; an
evaluation of the completion status of
the project or activity; an estimate of the
number of jobs created and the number
of jobs retained by the project or
activity; and for infrastructure
investments made by State and local
governments, the purpose, total cost,
and rationale of the agency for funding
the infrastructure investment with funds
made available under the Recovery Act
and name of the person to contact at the
agency if there are concerns with the
infrastructure investment. Not later than
30 calendar days after the end of each
calendar quarter, each agency that made
Recovery Act funds available to any
recipient shall make the information in
reports submitted publicly available by
posting the information on a Web site.
Agency Form Numbers: Not
applicable.
Members of the Affected Public:
Eligible CDBG grantees (metropolitan
cities, urban counties, nonentitlement
counties in Hawaii, and States).
Estimation of the total numbers of
hours needed to prepare the information
collection including number of
responses, frequency of responses, and
hours of responses: The number of
respondents is 1,196. The proposed
frequency of the response to the
collection is on a quarterly basis. The
total estimated burden is 28,704
quarterly hours.
Status of the proposed information
collection: This submission is an
extension of a previously approved
emergency information collection. The
current OMB approval expires on
October 31, 2009.
Authority: The Paperwork Reduction Act
of 1995, 44 U.S.C. Chapter 35, as amended.
Dated: August 6, 2009.
´
Mercedes Marquez,
Assistant Secretary for Community Planning
and Development.
[FR Doc. E9–19485 Filed 8–13–09; 8:45 am]
BILLING CODE 4210–67–P
E:\FR\FM\14AUN1.SGM
14AUN1
]]>Agencies
[Federal Register Volume 74, Number 156 (Friday, August 14, 2009)]
[Notices]
[Pages 41146-41156]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-19488]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5337-N-01]
Additional Allocations and Waivers Granted to and Alternative
Requirements for 2008 Community Development Block Grant (CDBG) Disaster
Recovery Grantees
AGENCY: Office of the Secretary, HUD.
ACTION: Notice of allocations, waivers, and alternative requirements.
-----------------------------------------------------------------------
SUMMARY: This Notice advises the public of the second allocation for
grant funds for CDBG disaster recovery grants for the purpose of
assisting in the recovery in areas covered by a declaration of major
disaster under title IV of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5121 et seq.) as a result of recent
natural disasters. As described in the SUPPLEMENTARY INFORMATION
section of this Notice, HUD is authorized by statute and regulations to
waive statutory and regulatory requirements and specify alternative
requirements for this purpose, upon the request of the state grantees.
This Notice also describes: (1) How the allocatees may implement the
common application, eligibility, and administrative waivers and the
common alternative and statutory requirements for the grants; and (2)
additional waivers and alternative requirements for certain earlier
grants.
DATES: Effective Date: August 19, 2009.
FOR FURTHER INFORMATION CONTACT: Scott Davis, Director, Disaster
Recovery and Special Issues Division, Office of Block Grant Assistance,
Department of Housing and Urban Development, 451 7th Street, SW., Room
7286, Washington, DC 20410, telephone number 202-708-3587. Persons with
hearing or speech impairments may access this number via TTY by calling
the Federal Information Relay Service at telephone number 800-877-8339.
Facsimile inquiries may be sent to Mr. Davis at facsimile number 202-
401-2044. (Except for the ``800'' number, these telephone numbers are
not toll free.)
SUPPLEMENTARY INFORMATION:
Authority To Grant Waivers
The Consolidated Security, Disaster Assistance, and Continuing
Appropriations Act, 2009 (Pub. L. 110-329, approved September 30, 2008)
(hereinafter, ``Second 2008 Act'' to differentiate it from the earlier
2008 Supplemental Appropriations Act) (Pub. L. 110-252 approved June
30, 2008) (hereinafter ``First 2008 Act''), appropriated $6.5 billion,
to remain available until expended, in CDBG funds for necessary
expenses related to disaster relief, long-term recovery, and
restoration of infrastructure, housing, and economic revitalization in
areas affected by hurricanes, floods, and other natural disasters
occurring during 2008, for which the President declared a major
disaster under title IV of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5121 et seq.). To date,
$377,139,920 has been rescinded, $6,500,000 was set-aside for HUD
administrative costs, and $2,145,000,000 was allocated by HUD in
November 2008. This Notice allocates the remaining $3,971,360,080.
The First 2008 Act also appropriated funds for 2008 disaster
recovery grantees, although it only provided funds for disasters
occurring in May and June 2008. Both the First 2008 Act and the Second
2008 Act 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 of these funds and guarantees by the recipient, except
for requirements related to fair housing, nondiscrimination, labor
standards, and the environment (including requirements concerning lead-
based paint), upon a request by the state explaining why such waiver is
required to facilitate the use of such funds or guarantees, and a
finding by the Secretary that such a waiver would not be inconsistent
with the overall purpose of title I of the Housing and Community
Development Act of 1974 (HCD Act). Additionally, regulatory waiver
authority is provided by 24 CFR 5.110, 91.600, and 570.5. The following
application and reporting waivers and alternative requirements are in
response to requests from the states receiving an allocation under
today's Federal Register Notice.
The Secretary finds that the following waivers and alternative
requirements, as described below, are necessary to facilitate use of
the funds for the statutory purposes and are not inconsistent with the
overall purpose of title I of the HCD Act or the Cranston-Gonzalez
National Affordable Housing Act, as amended.
Under the requirements of the First 2008 Act and the Second 2008
Act, statutory and regulatory waivers must be published in the Federal
Register. Except as described in this Notice, statutory and regulatory
provisions governing the CDBG program for states, including those at 24
CFR part 570,
[[Page 41147]]
shall apply to the use of these funds. In accordance with the First and
Second 2008 Acts, HUD will reconsider every waiver in today's Federal
Register Notice on the 2-year anniversary of the day this Notice is
published.
Additional Waivers
Each state receiving an allocation may request additional waivers
from the Department as needed to address the specific needs related to
that state's recovery activities. The Department will respond
separately to the state's requests for waivers of provisions not
covered in this Notice, after working with the state to tailor the
program to best meet the unique disaster recovery needs in its impacted
areas. HUD has included some additional waivers and alternative
requirements for individual states in this Notice.
Allocations
Today's Notice makes available the remainder of the Second Act's
supplemental appropriation, $3,971,360,080 for the CDBG program for
necessary expenses related to disaster relief, long-term recovery, and
restoration of infrastructure, housing, and economic revitalization in
areas affected by hurricanes, floods, and other natural disasters
occurring in 2008, for which the President declared a major disaster
under title IV of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5121 et seq.).
The Second 2008 Act notes:
That funds provided under this heading shall be administered
through an entity or entities designated by the Governor of each
state * * * Provided further, that funds allocated under this
heading shall not adversely affect the amount of any formula
assistance received by a state under the Community Development Fund:
Provided further, that each state may use up to five percent of its
allocation for administrative costs.
HUD computes allocations based on data that are generally available
covering all the eligible affected areas. The 11 states receiving an
allocation in today's Notice are indicated in Table 1, below. Their
estimated unmet needs represent more than 97 percent of the estimated
unmet needs across all 76 disasters that occurred in 2008. The
allocation was based on two factors: (i) The sum of estimated unmet
housing, infrastructure, and business needs, adjusted by (ii) a HUD
calculated risk level for recovery challenge. More detailed information
about the data reviewed, the formula process, and the possible risks
affecting recovery can be found in Appendix 1 of this Notice. Initial
allocations made under the Second 2008 Act were announced by HUD on
November 26, 2008, and published in the Federal Register on February
13, 2009 (74 FR 7244). Initial allocations are included in Table 1. The
states of Kentucky, Georgia, and Mississippi, and the Commonwealth of
Puerto Rico received allocations in the February 13, 2009, Federal
Register Notice, but are not receiving additional funds under today's
Notice, bringing to 15 the total number of grantees allocated funding
from the Second 2008 Act. Table 2 is a reprint from the initial
allocation notice that shows what the allocations were under the First
2008 Act. Unlike funds allocated under the Second 2008 Act, which may
be used for recovery from any disaster occurring during Calendar Year
2008, funds under the First 2008 Act are available only for use in
areas covered by specific declarations, so these are also noted.
Table 1--Second 2008 Act Disaster Recovery Allocations
----------------------------------------------------------------------------------------------------------------
Initial Second
This Notice's 2008 Act Minimum amount
State Second 2008 Act allocation Total Second 2008 for affordable
allocation (Notice 74 FR Act allocation rental housing
7244)
----------------------------------------------------------------------------------------------------------------
Texas............................... $1,743,001,247 $1,314,990,193 $3,057,991,440 $342,521,992
Louisiana........................... 620,467,205 438,223,344 1,058,690,549 118,582,672
Iowa................................ 516,713,868 125,297,142 642,011,010 71,910,891
Indiana............................. 253,340,079 95,042,622 348,382,701 39,021,933
Illinois............................ 127,207,128 41,984,121 169,191,249 18,950,911
Missouri............................ 78,625,549 13,979,941 92,605,490 10,372,631
Wisconsin........................... 75,200,572 25,039,963 100,240,535 11,227,823
Tennessee........................... 71,881,834 20,636,056 92,517,890 10,362,819
Arkansas............................ 70,181,041 20,294,857 90,475,898 10,134,098
Florida............................. 63,606,850 17,457,005 81,063,855 9,079,866
California.......................... 39,531,784 0 39,531,784 4,427,908
Kentucky............................ 0 3,217,686 3,217,686 341,943
Georgia............................. 0 4,570,779 4,570,779 485,736
Mississippi......................... 0 6,283,404 6,283,404 667,737
Puerto Rico......................... 0 17,982,887 17,982,887 1,911,040
----------------------------------------------------------------------------------------------------------------
Table 2--First 2008 Act Disaster Recovery Allocations
----------------------------------------------------------------------------------------------------------------
State Disaster No. Incident date Declared date Allocation
----------------------------------------------------------------------------------------------------------------
Mississippi........................... 1753 3/20 to 5/19............ 5/8/08 $2,281,287
Maine................................. 1755 4/28 to 5/14............ 5/9/08 2,187,114
Oklahoma.............................. 1756 5/10 to 5/13............ 5/14/08 1,793,876
Arkansas.............................. 1758 5/2 to 5/12............. 5/20/08 4,747,501
South Dakota.......................... 1759 5/1..................... 5/22/08 1,987,271
Missouri.............................. 1760 5/10 to 5/11............ 5/23/08 3,519,866
Colorado.............................. 1762 5/21.................... 5/26/08 589,651
Iowa.................................. 1763 5/25 and continuing..... 5/27/08 156,690,815
Indiana............................... 1766 5/30 to 6/27............ 6/8/08 67,012,966
Montana............................... 1767 5/1..................... 6/13/08 666,672
Wisconsin............................. 1768 6/5 and continuing...... 6/14/08 24,057,378
West Virginia......................... 1769 6/3 to 6/7.............. 6/19/08 3,127,935
Nebraska.............................. 1770 5/22.................... 6/20/08 5,557,736
[[Page 41148]]
Illinois.............................. 1771 6/1 to 7/22............. 6/24/08 17,341,434
Minnesota............................. 1772 6/7 to 6/12............. 6/25/08 925,926
Missouri.............................. 1773 6/1 to 8/13............. 6/25/08 7,512,572
----------------------------------------------------------------------------------------------------------------
Congress required that states devote ``not less than $650,000,000''
of the total Second 2008 Act to support ``repair, rehabilitation, and
reconstruction (including demolition, site clearance and remediation)
of the affordable rental housing stock (including public and other HUD-
assisted housing) in the impacted areas where there is a demonstrated
need as determined by the Secretary.'' Table 1 above shows the minimum
amount each grantee must spend on affordable rental housing from its
total combined allocation of first and second round funding under the
Second 2008 Act.
Disaster Recovery Enhancement Allocations. As stated above, HUD
calculates CDBG disaster recovery allocations, including the above
allocations, to each grantee based on unmet needs data (see Appendix
1). These data largely represent an estimate of the costs for repairs
to a pre-disaster condition. Often, this data does not adequately
reflect the full recovery costs associated with a disaster. Also,
because of cost considerations, state disaster recovery grantees may
not always choose recovery activities that are the most advantageous
for long-term recovery and resilience from a federal perspective. For
example, relocating a repetitively flooded community from a floodplain
limits future calls on the National Flood Insurance program and other
federal recovery programs. From a federal perspective, flood buyouts
are frequently a good idea; locally, they can be politically difficult
and somewhat more costly to administer than a traditional
rehabilitation program.
Therefore, the Secretary has created a $311,602,923 Disaster
Recovery Enhancement Fund (DREF) for secondary allocations to grantees
that anticipate that they will still have unmet disaster recovery needs
after developing and undertaking forward-thinking recovery strategies
and activities in a timely manner. To be eligible to receive an
additional allocation, a grantee must budget its allocated Second 2008
Act funds for the specific activities listed in this Notice by
programming the funds in an Action Plan for Disaster Recovery (or an
amendment thereof) submitted to HUD by June 30, 2010. A state receiving
an additional allocation may use the funds for any activity eligible
for assistance under the Second 2008 Act in accordance with this
Notice.
Note that the Stafford Act and the Second 2008 Act prohibit use of
these funds as a substitute or match for Federal Emergency Management
Agency (FEMA) Hazard Mitigation Grant Program (HMGP) funds. Also note
that CDBG disaster recovery funds must be used in the counties declared
in the applicable covered disaster(s) for each state, while HMGP funds
may generally be used statewide.
By setting a specific deadline for the Action Plan submissions for
this DREF allocation, HUD is signaling that the Department intends to
assist grantees that will implement these forward-thinking approaches
to long-term recovery in a timely manner. Funds will be allocated
dollar-for-dollar for the first $15 million budgeted for enhanced
disaster recovery activities for an individual state and on a pro rata
basis for amounts budgeted above $15 million as measured by funds
budgeted by grant recipients by June 30, 2010, on the following
specific enhanced disaster recovery activities that reduce the risk of
damage from a future disaster:
1. Development and adoption of a forward-thinking land-use plan
that will guide use of long-term recovery efforts and subsequent land-
use decisions throughout the community and that reduces existing or
future development in disaster-risk areas;
2. Floodplain or critical fire or seismic hazard area buyouts
programs under an optional relocation plan that includes incentives so
that families and private sector employers move out of areas at severe
risk for a future disaster;
3. Individual mitigation measures (IMM) to improve residential
properties and make them less prone to damage. If such activities are
incorporated into the grantee's rehabilitation or new construction
programs generally, the cost increment attributed to IMM will be the
amount considered for the additional allocation, not the total
construction amount budget; or
4. Implementation of modern disaster resistant building codes,
including, but not limited to, training on new standards and code
enforcement.
A grantee must include start and end dates for each activity in its
Action Plan. A grantee must demonstrate in its Action Plan submission
for any additional allocation that it still has eligible unmet needs to
receive assistance from the DREF before HUD will add the additional
allocation to the state's line of credit. Furthermore, the Secretary
reserves the right to allocate more or less than $311,602,923 under
this fund, depending on the amount grantees actually budget on such
activities and any amounts available for reallocation.
A grantee may reprogram funds from one of the listed enhanced
disaster recovery activities to another, but if the grantee reprograms
grant funds to any other activity, HUD may recapture the DREF
allocation, in whole or in part, in accordance with section 111 of the
HCD Act, 24 CFR part 570, subpart O, and this Notice.
The Second 2008 Act requires funds to be used in accordance with
its specific purposes. The statute directs that each grantee will
describe in its Action Plan for Disaster Recovery criteria for
eligibility and how the use of grant funds will address long-term
recovery and infrastructure restoration, housing, and economic
revitalization in the affected areas. HUD will monitor compliance with
this direction and may be compelled to disallow expenditures if it
finds uses of funds do not meet the statutory purposes, or duplicate
other benefits. HUD encourages grantees to contact their assigned HUD
offices for guidance in complying with these requirements during
development of their Action Plans for Disaster Recovery or if they have
any questions regarding meeting these requirements.
As provided for in the Second 2008 Act, the funds may not be used
for activities reimbursable by or for which funds are made available by
FEMA or the Army Corps of Engineers. Further, none of the funds may be
used as the required match, share, or contribution for another federal
program.
Prevention of Fraud, Abuse, and Duplication of Benefits
Additionally, the Second 2008 Act directs the Secretary to:
Establish procedures to prevent recipients from receiving any
duplication of benefits and report quarterly to the Committees on
[[Page 41149]]
Appropriations with regard to all steps taken to prevent fraud and
abuse of funds made available under this heading, including duplication
of benefits.
To meet this directive, HUD is pursuing four courses of action.
First, the Federal Register Notice published February 13, 2009 (74 FR
7244), includes specific reporting, written procedures, monitoring, and
internal audit requirements for grantees. Second, to the extent its
resources allow, HUD will institute risk analysis and on-site
monitoring of grantee management of the grants and of the specific uses
of funds. Third, HUD will be extremely cautious in considering any
waiver related to basic financial management requirements. The
standard, time-tested CDBG financial requirements will continue to
apply. Fourth, HUD is collaborating with the HUD Office of Inspector
General to plan and implement oversight of these funds.
Waiver Justification
The waivers, alternative requirements, and statutory changes
described in the February 13, 2009, Federal Register Notice (74 FR
7244) apply to all of the CDBG supplemental disaster recovery funds
appropriated in the Second 2008 Act (Pub. L. 110-329), but not to funds
provided under the regular CDBG program. Similarly, the waivers,
alternative requirements, and statutory changes described in the
September 11, 2008, Federal Register Notice (73 FR 52870) apply to the
CDBG supplemental disaster recovery funds appropriated in the First
2008 Act, not to funds provided under the regular CDBG program. These
actions, below, provide additional flexibility in program design and
implementation and implement statutory requirements. The previous
notices, referenced above, provide further justification for the
waivers.
Common Waivers
Previously published waivers to streamline application and program
launch. Funds allocated by today's Federal Register Notice will be
subject to the waivers, alternative requirements, and statutory changes
described in this Notice and those previously published in the February
13, 2009, Federal Register Notice (74 FR 7244).
General planning activities use entitlement presumption, all
grantees. Today's Federal Register Notice notifies Congress and the
public that the states receiving funds under the First 2008 Act and/or
the Second 2008 Act have requested this waiver and HUD is granting the
waiver. The annual State CDBG program requires that local government
grant recipients for planning-only grants must document that the use of
funds meets a national objective. In the State CDBG program, these
planning grants are typically used for individual project plans. By
contrast, planning activities carried out by entitlement communities
are more likely to include nonproject specific plans such as functional
land-use plans, historic preservation plans, comprehensive plans,
development of housing codes, and neighborhood plans related to guiding
long-term community development efforts comprising multiple activities
funded by multiple sources. In the annual entitlement program, these
more general stand-alone planning activities are presumed to meet a
national objective under the requirements at 24 CFR 570.208(d)(4). The
Department notes that almost all effective CDBG disaster recoveries in
the past have relied on some form of area-wide or comprehensive
planning activity to guide overall redevelopment independent of the
ultimate source of implementation funds. Therefore, the Department is
removing the eligibility requirement that CDBG disaster recovery-
assisted planning-only grants or state directly administered planning
activities that will guide recovery in accordance with the
appropriations act must comply with the State CDBG program rules at 24
CFR 570.483(b)(5) or (c)(3). Instead, 24 CFR 570.208(d)(4) will apply.
State-Specific Waivers
National Objective Documentation for Economic Development
Activities--States of Iowa, Louisiana, and Texas. For the national
objective documentation for business assistance activities, the states
of Iowa, Louisiana and Texas, which have received funds under the First
2008 Act and Second 2008 Act, have asked to apply individual salaries
or wages-per-job and the income limits for a household of one, rather
than the usual CDBG standard of total household income and the limits
by total household size. The states have asserted that this proposed
documentation would be simpler and quicker for participating lenders to
administer, easier to verify, and would not misrepresent the amount of
low- and moderate-income benefit provided. Upon consideration, HUD is
granting this waiver, which also was granted for recovery in lower
Manhattan following September 11, 2001, and in certain states following
the Gulf Coast hurricanes of 2005. Due to the significant breadth of
many states' economic development programs, this waiver will play a key
role in streamlining the documentation process because it allows
collection of wage data for each position created or retained from the
assisted businesses, rather than from each individual household.
Section 414 of the Stafford Act--States of Louisiana and Texas. In
addition to the above, the states of Louisiana and Texas have also
requested a waiver of section 414 of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act, as amended, for their disaster
recovery programs. Section 414 directs that persons who were displaced
by a disaster be considered to be displaced by a federal action, as
defined under the Uniform Relocation Act (URA), if the property in
which they were living prior to the disaster is assisted with certain
federal funds. Today's Federal Register Notice grants, in part, the
request that the Secretary waive that section and provides alternative
requirements more consistent with the purpose of the Second 2008 Act,
which is to assist and support disaster recovery in the areas most
affected by the effects of the disasters in 2008.
Several states suffered significant destruction in the wake of
Hurricanes Ike and Gustav, and the reconstruction will likely last for
many years to come--much like in the Gulf Coast states affected by the
hurricanes in 2005. For programs or projects covered by this waiver
(``covered programs or projects'') that are initiated within 3 years
after the applicable disaster, each state receiving this wavier must
comply with one of the two alternative requirements (for programs or
projects initiated after the 3-year period, the alternative
requirements would not apply; only the waiver would be applicable):
Alternative One
The state may provide relocation assistance to a former residential
occupant whose former dwelling is acquired, rehabilitated, or
demolished for a covered program or project initiated within 3 years
after the disaster, even though the actual displacements were caused by
the effects of the disaster. To the extent practicable, such relocation
assistance should be offered in a manner consistent with the Uniform
Relocation Assistance and Real Property Acquisition Policies Act of
1970 (URA), as amended, and its implementing regulations, except as
modified by applicable waivers and alternative requirements.
Alternative Two
If the state determines that the first alternative would
substantially conflict
[[Page 41150]]
with meeting the disaster recovery purposes of the Second 2008 Act, the
state may establish a re-housing plan for a covered program or project
initiated within 3 years after the disaster. Such determinations must
be made on a program or project basis (not person or household). The
re-housing plan must include, at minimum, the following:
1. A description of the class(es) of persons eligible for
assistance, including all persons displaced from their residences by
particular, enumerated, or by all, effects of the disaster, and
including all persons still receiving temporary housing assistance from
FEMA for the covered disaster(s);
2. A description of the types and amount of financial assistance to
be offered, if any;
3. A description of other services to be made available, including,
at minimum, outreach efforts to eligible persons and housing counseling
providing information about available housing resources. Outreach
efforts and housing counseling information should be provided in
languages other than English to persons with limited English
proficiency; and
4. Contact information and a description of any applicable
application process, including any deadlines.
5. If the program or project involves rental housing, the re-
housing plan must also include the following:
(i) Placement services for former and prospective tenants;
(ii) A public registry of available rental units assisted with CDBG
disaster recovery and/or other funds; and
(iii) Application materials, award letters, and operating
procedures requiring property owners to make reasonable attempts to
contact their former residential tenants and offer a unit, upon
completion, to those tenants meeting the program's eligibility
requirements.
(iv) Persons in physical occupancy who are displaced by a HUD-
assisted disaster recovery project will continue to be eligible for URA
assistance.
Justification for Waiver
The reasons for granting this waiver are several, and are ably
represented by the states in their requests. The principal reasons are
highlighted here:
Hurricanes Ike and Gustav caused significant destruction
that resulted in massive displacements and decimated the region's
affordable housing stock. Continued ambiguity on section 414's
applicability may cause substantial delays in long-term recovery,
particularly in Texas and Louisiana; and
Simplify the administration of disaster recovery projects
or programs initiated years following the disaster.
Persons displaced by the effects of the disaster may continue to
apply for assistance under the states' approved disaster recovery
programs, which are designed to bring affordable housing to the
affected areas. This waiver does not address programs or projects
receiving other HUD funding, or funding from other federal sources.
A state may already be performing some elements of a re-housing
plan, such as providing a public rental registry or undertaking
outreach and placement services to those former residents still
receiving FEMA housing assistance. A description in the re-housing plan
of how those existing efforts will be available for covered programs or
projects may be used in satisfying the requirements of this Notice.
Eligibility--buildings for the general conduct of government--
States of Indiana, Louisiana, and Texas. The states of Indiana,
Louisiana, and Texas requested a limited waiver of the prohibition on
funding buildings for the general conduct of government. HUD has
considered the request and agrees that it is consistent with the
overall purposes of the 1974 Act for requesting states to be able to
use the grant funds under this notice to repair or reconstruct
buildings used for the general conduct of government and that the
states have selected in accordance with the method described in their
Action Plans for Disaster Recovery and that they have determined have
substantial value in promoting disaster recovery. However, as stated by
the Second 2008 Act, funds allocated under today's Federal Register
Notice, or the February 13, 2009, Federal Register Notice (74 FR 7244),
may not be used for activities reimbursable by or for which funds are
made available by FEMA or the Army Corps of Engineers. Further, none of
the funds may be used as the required match, share, or contribution for
another federal program.
Public benefit for certain economic development activities--States
of Iowa, Louisiana, and Texas. The states of Iowa, Louisiana, and Texas
have requested a waiver of the public benefit standards for their
economic development activities. The public benefit provisions set
standards for individual economic development activities (such as a
single loan to a business) and for economic development activities in
the annual aggregate. Currently, public benefit standards limit the
amount of CDBG assistance per job retained or created, or the amount of
CDBG assistance per low- and moderate-income person to which goods or
services are provided by the activity. Essentially, the public benefit
standards are a proxy for all the other possible public benefits
provided by an assisted activity. These dollar thresholds were set more
than a decade ago and, under disaster recovery conditions (which often
require a larger investment to achieve a given result), can be too low
and, thus, impede recovery by limiting the amount of assistance the
grantee may provide to a critical activity. States requesting this
waiver have made public in their Action Plans the disaster recovery
needs each activity is addressing and the public benefits expected.
After consideration, today's Federal Register Notice waives the
public benefit standards for the cited activities, except that each
requesting state shall report and maintain documentation on the
creation and retention of: (a) Total jobs, (b) number of jobs within
certain salary ranges, (c) the average amount of assistance per job and
activity or program, and (d) the types of jobs. As a conforming change
for the same activities or programs, HUD is also waiving paragraph (g)
of 24 CFR 570.482 to the extent its provisions are related to public
benefit.
Housing incentives to encourage housing resettlement consistent
with local recovery plans; States of Louisiana and Texas. The states of
Louisiana and Texas may offer disaster recovery or mitigation housing
incentives to promote suitable housing development or resettlement in
particular geographic areas. By ``resettlement,'' HUD is referring to
resettling the community as a whole, which may include buyouts and
relocation, as well as repopulation initiatives if part of a recovery
plan. In the past, the state of New York successfully used an incentive
program to induce rapid and stable resettlement of lower Manhattan
following September 11, 2001. Also, the city of Grand Forks, North
Dakota, provided a very affordable soft-second loan as an incentive to
help induce households to resettle within the city during its recovery.
Any state choosing to provide incentives must maintain documentation,
at least at a programmatic level, describing how the amount of
assistance was determined to be necessary and reasonable. Generally,
incentives are offered in addition to other programs or funding (such
as insurance), to try to influence individual residential location
decisions, when these decisions are in doubt. For example, a grantee
may offer an incentive payment (possibly in
[[Page 41151]]
addition to buyouts) for households that volunteer to relocate within a
particular period of time, or who choose to resettle outside a 100- or
500-year floodplain. Note, however, that if the grantee requires the
funds to be used for a particular purpose by the household receiving
the assistance, then the activity will be that required use, not an
eligible incentive. The Department is waiving 42 U.S.C. 5305(a) and
associated regulations to make these uses of grant funds eligible.
Compensation for disaster-related losses. The states of Louisiana
and Texas plan to provide compensation to certain homeowners whose
homes were affected during the covered disasters, if the homeowners
agree to meet the stipulations of the state's or subawardee's published
program design. Such stipulations may not include requirements related
to how the homeowner may use the funds, because then the assisted
activity would be that required use, not compensation. Such programs
were carried out by the states of Louisiana and Mississippi following
the 2005 hurricanes. A strength of these compensation programs is that
they may be able to disburse funding more quickly than traditional CDBG
rehabilitation programs. However, a major weakness is the lack of
certainty about whether an assisted homeowner will use the granted
assistance in a way that supports the community's long-term recovery
goals. Very little data exists to verify the degree to which
compensation funds have been used for reconstruction or rehabilitation.
Existing data suggest that a certain percentage of those receiving
assistance fail to comply with the program stipulations. By contrast, a
rehabilitation program is typically able to demonstrate that all or
nearly all of its assisted households reside (after receiving
assistance) in reconstructed or rehabilitated homes, according to the
grantee's standards. Therefore, HUD is granting this compensation
waiver together with alternative requirements. HUD will disapprove an
action plan if a compensation program is not adequately justified in
accordance with these alternative requirements. Any state deciding to
assist a compensation activity must address in its action plan and
program design:
(1) How the state will ensure that compensation payments will
result in disaster recovery or economic revitalization;
(2) Why a housing rehabilitation or reconstruction or buyouts
program is not a more appropriate choice; and
(3) How the state determined the appropriate compensation
amount(s). Further, any state choosing to provide compensation
assistance must also carry out an evaluation of outcomes of the
program, for a statistically valid sample of the program participants,
within a year of providing the final payment.
Three-month limitation on emergency grant payments. In response to
the state of Iowa's request, HUD is waiving 42 U.S.C. 5305(a) to allow
it to extend interim mortgage assistance to qualified individuals for
up to 20 months. The state is currently operating an Interim Mortgage
Assistance Program, limited to a maximum of 3 months and a maximum of
$1,000 per month. It has now been almost 12 months since the original
flooding event occurred but many families still require this
assistance. Furthermore, it will still be several months before FEMA
buyout decisions will be made and implemented. Therefore, to permit the
state of Iowa to adequately assist households through this period, and
to be consistent with the state funding that has been supplied
separately for this purpose, HUD will waive the normal 3-month
limitation, to provide a total of 20 months of Interim Mortgage
Assistance to qualified individuals.
Summary of States Receiving Waivers
Texas. Texas has requested and HUD has approved the following
waivers and alternative requirements for funds provided to the state
under the Second 2008 Act (Pub. L. 110-329): (1) Documentation of job
retention, (2) section 414 of the Stafford Act, (3) eligibility of
buildings for the general conduct of government, (4) public benefit for
certain economic development activities, and (5) compensation for
disaster-related losses or housing incentives to resettle in disaster-
affected communities. Texas has justified each request and documented
the need for each waiver.
Iowa. Iowa has requested and HUD has approved the following waivers
and alternative requirements: (1) Documentation of job retention, (2)
public benefit for certain economic development activities, and (3)
three-month limitation on emergency grant payments. Iowa has justified
each request and documented the need for each waiver. The waivers
granted by this Notice will apply to funds received under the First
2008 Act (Pub. L. 110-252), and to all funds received under the Second
2008 Act (Pub. L. 110-329).
Louisiana. Louisiana has requested and HUD has approved the
following waivers and alternative requirements for funds provided to
the state under the Second 2008 Act: (1) Documentation of job
retention, (2) section 414 of the Stafford Act, (3) eligibility of
buildings for the general conduct of government, (4) public benefit for
certain economic development activities, and (5) compensation for
disaster-related losses or housing incentives to resettle in disaster-
affected communities. Louisiana has justified each request and
documented the need for each waiver.
Indiana. Indiana has requested and HUD has approved a waiver
regarding the eligibility of buildings for the general conduct of
government for all funds received under the First 2008 Act, 2008 (Pub.
L. 110-252). Note, this waiver has been neither requested nor approved
for funds received under the Second 2008 Act (Pub. L. 110-329).
Application for Allocations Under the Second 2008 Act
The waivers and alternative requirements streamline the pre-grant
process and set the guidelines for states' applications for their
allocations. Each grantee receiving an allocation under the Second 2008
Act (which includes allocations made under this Notice, as well as
those made under the February 13, 2009, Notice) is required, with the
exception of California, to submit and/or amend its Action Plan for
Disaster Recovery to program all of each state's allocations by
September 30, 2009. The state of California (which did not receive an
allocation under the February 13, 2009, Notice) is required to submit
an Action Plan for Disaster Recovery by December 30, 2009. Any
allocation not applied for by these dates may be added to the funds
available under the DREF and reallocated. If any grantee fails to meet
the requirement to program its allocations within the relevant
timelines, HUD, on the first business day after that deadline, will
commence an action to recapture the funds.
Applicable Rules, Statutes, Waivers, and Alternative Requirements
1. General note. Prerequisites to a grantee's receipt of CDBG
disaster recovery assistance include adoption of a citizen
participation plan; publication of its proposed Action Plan for
Disaster Recovery; public notice and comment; and submission to HUD of
an Action Plan for Disaster Recovery, including certifications. Except
as described in this Notice, statutory and regulatory provisions
governing the CDGB program for states, including those at 42 U.S.C.
5301 et seq. and 24 CFR part 570, shall apply to the use of these
funds.
2. The waivers provided in the February 13, 2009, Federal Register
Notice (74 FR 7244) are granted and the alternative requirements of
that Notice apply to all the states receiving an
[[Page 41152]]
allocation of grant funds under this Notice. Each of the states has
requested, in writing, that HUD grant it the waivers and alternative
requirements of that Notice.
3. Planning activities. For CDBG disaster recovery-assisted general
planning activities that will guide recovery in accordance with the
First 2008 Act (Pub. L. 110-252) and the Second 2008 Act (Pub. L. 110-
329), the State CDBG program rules at 24 CFR 570.483(b)(5) and (c)(3)
are waived and the presumption at 24 CFR 570.208(d)(4) applies for all
First 2008 Act and Second 2008 Act grantees.
4. National Objective Documentation for Economic Development
Activities. 24 CFR 570.483(b)(4)(i) is waived to allow the states of
Texas, Iowa, and Louisiana to establish low- and moderate-income jobs
benefit by documenting, for each person employed, the name of the
business, type of job, and the annual wages or salary of the job. HUD
will consider the person income-qualified if the annual wages or salary
of the job is at or under the HUD-established income limit for a one-
person family.
5. Section 414 of the Stafford Act. Section 414 of the Stafford
Act, 42 U.S.C. 5181 (including its implementing regulation at 49 CFR
24.403(d)), is waived to the extent that it would apply to CDBG
disaster recovery-funded programs or projects initiated within 3 years
of the incident-date of Hurricane Ike or Hurricane Gustav (as
applicable) by the states of Texas and Louisiana under an approved
Action Plan for Disaster Recovery for its grants under the Second 2008
Act, provided that such program or project was not planned, approved,
or otherwise under way prior to the disaster.
a. For all programs or projects covered by this waiver (``covered
programs or projects'') that are within 3 years after the applicable
disaster, the states of Texas and Louisiana must comply with one of the
following two alternative requirements (for programs or projects
initiated after the 3-year period, the alternative requirements would
not apply; only the waiver would be applicable): (1) Relocation
Assistance. The state may provide relocation assistance to a former
residential occupant whose former dwelling is acquired, rehabilitated,
or demolished for a covered program or project initiated within 3 years
after the disaster, even though the actual displacements were caused by
the effects of the disaster. To the extent practicable, such relocation
assistance must be offered in a manner consistent with the URA, as
amended, and its implementing regulations, except as modified by prior
waivers and alternative requirements granted to the states. (2) Re-
housing Plan. If the state determines that the first alternative would
substantially conflict with meeting the disaster recovery purposes of
the Second 2008 Act, the grantee may establish a re-housing plan for a
covered program or project initiated within 3 years after the disaster.
Such a determination must be made on a program or project basis (not
person or household). The re-housing plan must include, at minimum, the
following:
(i) A description of the class(es) of persons eligible for
assistance, including all residents displaced from their residences by
either certain enumerated or all effects of the covered disaster, and
including all disaster-displaced residents still receiving temporary
housing assistance from FEMA for the covered disasters;
(ii) A description of the types and amount of financial assistance
to be provided, if any;
(iii) A description of other services to be made available,
including, at a minimum, outreach efforts to eligible persons and
housing counseling, that provide information about available housing
resources;
(iv) Contact information for additional program information;
(v) A description of any applicable application process, including
any deadlines; and
(vi) If the program or project covered by this waiver involves
rental housing, the grantee shall establish procedures for the
following:
A. Application materials, award letters, and operating procedures
that require property owners to make reasonable attempts to contact
their former tenants and to offer a unit, upon completion, to those
tenants meeting the program's eligibility requirements;
B. Placement services for former and prospective tenants; and
C. A public registry of available rental units assisted with CDBG
disaster recovery and/or other funds.
b. Eligible Project Costs. The costs of relocation assistance and
the reoccupancy plan are eligible project costs in the same manner and
to the same extent as other project costs authorized under the Second
2008 Act. For covered programs or projects involving affordable rental
housing, the relocation and planning costs required by this Notice may
be paid from funds reserved for the affordable rental housing stock in
the impacted areas under the Second 2008 Act.
c. Persons in physical occupancy who are displaced by a HUD-
assisted disaster recovery project will continue to be eligible for URA
assistance.
6. Buildings for the general conduct of government. 42 U.S.C.
5305(a) is waived to the extent necessary to allow the states of Texas
and Louisiana to fund the rehabilitation or reconstruction of public
buildings that are otherwise ineligible and that the state selects in
accordance with its approved Action Plan for Disaster Recovery and that
the state has determined have substantial value in promoting disaster
recovery. The state of Indiana may use funds allocated under the
September 11, 2008, Federal Register Notice (73 FR 52870) or December
19, 2008, Federal Register Notice (73 FR 77818) to fund the
rehabilitation or reconstruction of public buildings that are otherwise
ineligible.
7. Public benefit for certain economic development activities. For
economic development activities designed to create or retain jobs or
businesses (including, but not limited to, long-term, short-term, and
infrastructure projects), the public benefit standards at 42 U.S.C.
5305(e)(3) and 24 CFR 570.482(f)(1), (2), (3), (4)(i), (5), and (6) are
waived for the states of Texas, Louisiana, and Iowa, except that these
states shall report and maintain documentation on the creation and
retention of total jobs; the number of jobs within certain salary
ranges; the average amount of assistance provided per job, by activity
or program; and the types of jobs. Paragraph (g) of 24 CFR 570.482 is
also waived for these states to the extent its provisions are related
to public benefit.
8. Compensation for disaster-related losses. HUD is granting a
compensation waiver together with alternative requirements for the
states of Louisiana and Texas. Either state deciding to assist a
compensation activity must address the following in its action plan and
program design:
a. How the state will ensure that compensation payments will result
in disaster recovery or economic revitalization;
b. Why a housing rehabilitation or reconstruction or buyouts
program is not a more appropriate choice than providing housing
compensation. The state must compare and contrast schedules, delivery
costs, and projected recovery resulting from each type of activity; and
c. How the state determined the appropriate compensation amount(s).
Further, any state choosing to provide compensation assistance must
also carry out and publish an evaluation of outcomes of the program for
a statistically valid sample of the program participants within a year
of providing
[[Page 41153]]
the final compensation payment. If the state also provides
rehabilitation assistance, it must include in its evaluation a
comparison of the results of the compensation and rehabilitation
activities.
9. Housing incentives to encourage housing resettlement consistent
with local recovery plans. The states of Louisiana and Texas may offer
disaster recovery or mitigation housing incentives to promote suitable
housing development or resettlement in particular geographic areas. Any
state choosing to provide incentives must maintain documentation at
least at a programmatic level describing how the amount of assistance
was determined to be necessary and reasonable. Note that if the grantee
requires the funds to be used for a particular purpose by the household
receiving the assistance, then the activity will be that required use,
not an eligible incentive. The Department is waiving 42 U.S.C. 5305(a)
and associated regulations to make these uses of grant funds eligible.
10. Three-month limitation on emergency grant payments. 42 U.S.C.
5305(a) is waived so that Iowa may extend interim mortgage assistance
to qualified individuals for up to 20 months. This waiver applies to
funds received under the First 2008 Act (Pub. L. 110-252), and to funds
received under the Second 2008 Act (Pub. L. 110-329).
Duration of Funding
Availability of funds provisions in 31 U.S.C. 1551-1557, added by
section 1405 of the National Defense Authorization Act for Fiscal Year
1991 (Pub. L. 101-510), limit the availability of certain
appropriations for expenditure. This limitation may not be waived.
However, the Second 2008 Act directs that these funds be available
until expended unless, in accordance with 31 U.S.C. 1555, the
Department determines that the purposes for which the appropriation has
been made have been carried out and no disbursement has been made
against the appropriation for 2 consecutive fiscal years. In such a
case, the Department shall close out the grant prior to expenditure of
all funds.
Catalog of Federal Domestic Assistance
The Catalog of Federal Domestic Assistance numbers for the
disaster recovery grants under this Notice are as follows: 14.219;
14.228.
Finding of No Significant Impact
A Finding of No Significant Impact (FONSI) with respect to the
environment has been made in accordance with HUD regulations at 24 CFR
part 50, which implement section 102(2)(C) of the National
Environmental Policy Act of 1969 (42 U.S.C. 4332). The FONSI is
available for public inspection between 8 a.m. and 5 p.m. weekdays in
the Regulations Division, Office of General Counsel, Department of
Housing and Urban Development, 451 7th Street, SW., Room 10276,
Washington, DC 20410-0500. Due to security measures at the HUD
Headquarters building, an advance appointment to review the docket file
must be scheduled by calling the Regulations Division at telephone
number 202-708-3055 (this is not a toll-free number). Hearing- or
speech-impaired individuals may access this number through TTY by
calling the toll-free Federal Information Relay Service at 800-877-
8339.
Dated: July 20, 2009.
Mercedes M[aacute]rquez,
Assistant Secretary for Community Planning and Development.
Appendix 1--Allocation Methodology Detail
The Consolidated Security, Disaster Assistance, and Continuing
Appropriations Act, 2009 (Pub. L. 110-329), enacted on September 30,
2008, appropriated $6.5 billion through the CDBG program for
``necessary expenses related to disaster relief, long-term recovery,
and restoration of infrastructure, housing, and economic revitalization
in areas affected by hurricanes, floods, and other natural disasters
occurring during 2008 for which the President declared a major
disaster.''
It went on to say that ``such funds may not be used for activities
reimbursable by, or for which funds are made available by, the Federal
Emergency Management Agency or the Army Corps of Engineers'' and that
``none of the funds * * * may be used * * * as a matching requirement,
share, or contribution for any other Federal program.'' It also stated
that ``not less than $650,000,000 from funds made available on a pro-
rata basis according to the allocation made to each State'' shall be
used for affordable rental housing.
Finally, the statute called for ``not less'' than 33 percent of the
funds to be allocated within 60 days of enactment (that is, by November
28th) based ``on the best estimates available of relative damage and
anticipated assistance from other Federal sources.''
Schedule for Allocations
While Congress appropriated $6.5 billion, $377,139,920 has been
rescinded, $6.5 million has been set aside for HUD administrative
costs, and $2,145,000,000 was allocated in November 2008. This
allocation distributes the remaining $3,971,360,080, with a
$311,603,923 set-aside to the Disaster Recovery Enhancement Fund.
Disasters in 2008
There were 76 major disasters that occurred in 2008 in 35 states,
Puerto Rico, and the Virgin Islands. Data on damaged housing are
available for 36 disasters from FEMA and Small Business Administration
(SBA); business loss data are available for 39 disasters from SBA; and
72 disasters have data on the cost FEMA and states are estimated to
spend on infrastructure and other Public Assistance costs.
Available Data
The data HUD staff have identified as being available to calculate
``relative damage and anticipated assistance from Federal sources'' at
this time for the targeted disasters come from the following data
sources:
FEMA Individual Assistance program data concerning housing
unit damage;
SBA for management of its disaster assistance loan program
for housing repair and replacement;
SBA for management of its disaster assistance loan program
for business real estate repair and replacement, as well as content
loss; and
FEMA estimated and obligated amounts under its Public
Assistance program, including the federal and state cost share.
Formula
This formula ``allocates'' the full $6,116,360,080 available for
allocation under this appropriation and then subtracts out the
$2,145,000,000 that was previously allocated and the $311,602,923 set-
aside reserve fund (on a pro-rata basis). HUD has adopted this practice
to adjust grants to reflect better data than were available at the time
of the November 2008 allocation and to treat disasters occurring after
November equally with disasters that occurred earlier in the year.
The formula mechanics are as follows:
$6,116,360,080
[[Page 41154]]
[GRAPHIC] [TIFF OMITTED] TN14AU09.012
--State total: November $2.145 billion allocation
* Pro-rata adjustment after minimum grant threshold and reserve
grant set-aside
\a\ No state can have its grant adjusted up or down by more than
10 percent using this factor.
\b\ Mathematically, each state's challenge factor is divided by
the weighted national rate (14.7) and multiplied by 0.2 (that is, if
a state's ratio was above 1; for example, 1.5 would become 1.10, [1
+ ((1 - 0.5) * 0.2)]; if the ratio was below 1, for example, 0.5
would become 0.9 [1 - ((1 - 0.5) * 0.2)].
This allocation does not duplicate funding already provided under
the Supplemental Appropriations Act of 2008 (Pub. L. 110-252, 122 Stat.
2323), enacted on June 30, 2008, which appropriated $300 million for
disasters that were declared and occurred in May and June of 2008. This
current allocation subtracts out of the unmet housing and business need
estimates the amount of funds allocated for housing and business under
the 2008 June appropriation.
Calculating Unmet Housing Needs
The core data on housing damage for both the unmet housing needs
calculation and the concentrated damage are based on home inspection
data for FEMA's Individual Assistance program. For unmet housing needs,
the FEMA data are supplemented by SBA data from its Disaster Loan
Program. HUD calculates ``unmet housing needs'' as the number of
housing units with unmet needs, multiplied by the estimated cost to
repair those units, minus the amount of repair funding already provided
by FEMA, where:
The number of owner-occupied units with unmet needs are
units FEMA housing inspectors determined would require more than $3,000
to become habitable and were determined by FEMA to be eligible for a
repair or replacement grant (now up to $30,300, earlier disasters in
the year had a cap of $28,800). In general, when HUD refers to units
``seriously damaged,'' it is referring to units with a FEMA damage
assessment of $3,000 or greater.
The number of rental units with unmet needs are units FEMA
housing inspectors determined would require more than $3,000 to become
habitable AND are occupied by households with an income reported to
FEMA of less than $20,000. The use of the $20,000 income cut-off for
calculating rental unmet needs is in response to the statutory language
that emphasized the use of the funds for affordable rental housing.
Each of the FEMA inspected units are categorized by HUD
into one of five categories:
[cir] Minor-Low: Less than $3,000 of FEMA-inspected damage
[cir] Minor-High: $3,000 to $7,999 of FEMA-inspected damage
[cir] Major-Low: $8,000 to $14,999 of FEMA-inspected damage
[cir] Major-High: $15,000 to $28,800 of FEMA-inspected damage
[cir] Severe: Greater than $28,800 of FEMA-inspected damage or -
determined destroyed.
Note: FEMA has recently raised its maximum grant to $30,300. For
this first round allocation, HUD continues to use the $28,800 as the
threshold, because it applied for most of the declared disasters.
The average cost to fully repair a home for a specific
disaster within each of the damage categories noted above is calculated
using the average real property damage repair costs determined by the
SBA for its disaster loan program for the subset of homes inspected by
both SBA and FEMA. Because SBA is inspecting for full repair costs, it
is presumed to reflect the full cost to repair the home, which is
generally more than FEMA estimates on the cost to make the home
habitable. If fewer than 100 SBA inspections are made for homes within
a FEMA damage category, the estimated damage amount in the category for
that disaster has a cap applied at the 75th percentile of all damaged
units for that category for all disasters and has a floor applied at
the 25th percentile.
The base amount of unmet housing needs is then increased
by 20 percent to reflect an assumed premium associated with the
additional costs needed to run a repair program with CDBG funding.
Calculating Infrastructure Needs
As noted above, the statute for this allocation states that ``such
funds may not be used for activities reimbursable by, or for which
funds are made available by, the Federal Emergency Management Agency or
the Army Corps of Engineers'' and that ``none of the funds * * * may be
used * * * as a matching requirement, share, or contribution for any
other Federal program.'' In past disasters, unmet infrastructure need
has been calculated at the required match portion for the public
assistance program. Because these funds cannot be used as match, we
must identify a proxy for what infrastructure activities are likely to
require funding beyond FEMA's Public Assistance funding and the state
match requirement. To best proxy unmet needs that would exceed what
FEMA and state match will pay for under the Public Assistance program,
this allocation uses only a subset of the Public Assistance damage
estimates reflecting the categories of activities most likely to
require CDBG funding above the Public Assistance and State Match
requirement. Those activities are the following categories: C--Roads
and Bridges; D--Water Control Facilities; E--Public Buildings; F--
Public Utilities; and G--Recreational--Other. Categories A (Debris
Removal) and B (Protective Measures) are largely expended immediately
after a disaster and reflect interim recovery measures, rather than the
long-term recovery measures the CDBG funds are generally used for.
``Unmet'' infrastructure needs assume that the subset categories of
Public Assistance needs will have state aggregate costs 25 percent
higher than that covered by FEMA or the state match requirement.
----------------------------------------------------------------------------------------------------------------
Disasters with
project(s) Total estimate Percent
----------------------------------------------------------------------------------------------------------------
Public Assistance Total................................ 75 $5,322,992,430
A--Debris--Removal..................................... 71 1,185,035,209 22
[[Page 41155]]
B--Protective--Measures................................ 75 995,171,090 19
C--Roads--Bridges...................................... 73 494,369,300 9
D--Water--Control--Facilities.......................... 43 57,455,582 1
E--Public--Buildings................................... 69 1,509,980,683 28
F--Public--Utilities................................... 74 837,448,078 16
G--Recreational--Other................................. 64 243,532,488 5
----------------------------------------------------------------------------------------------------------------
FEMA Extract: April 14, 2009.
Calculating Economic Revitalization Needs
Based on SBA disaster loans to businesses, HUD used the sum of real
property and real content loss of small businesses not receiving an SBA
disaster loan. This is adjusted upward by the proportion of
applications that were received for a disaster for which content and
real property loss were not calculated because the applicant had
inadequate credit or income. For example, if a state had 160
applications for assistance, and if 150 had calculated needs and 10
were denied in the pre-processing stage for not enough income or poor
credit, the estimated unmet need calculation would be increased as (1 +
10/160), multiplied by the calculated unmet real content loss.
SBA business loan data shows that verified real estate damage and
content loss not approved for an SBA loan equaled $972 million. Across
all of the disasters there were 17,157 applications for a business
disaster
