Strong Cities, Strong Communities National Resource Network Pilot Program Advance Notice and Request for Comment, 35711-35718 [2012-14503]

Agencies

• DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Federal Register Volume 77, Number 115 (Thursday, June 14, 2012)]
[Notices]
[Pages 35711-35718]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-14503]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5512-N-01]


Strong Cities, Strong Communities National Resource Network Pilot 
Program Advance Notice and Request for Comment

AGENCY: Office of the Assistant Secretary for Policy Development and 
Research, HUD.

ACTION: Notice.

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SUMMARY: This notice announces HUD's intention to launch the Strong 
Cities, Strong Communities National Resource Network pilot program with 
its 19 federal agency and subagency partners of the White House Council 
on Strong Cities, Strong Communities (SC2). Through the SC2 National 
Resource Network, HUD and its partners will offer a central portal to 
connect America's most economically distressed local communities to 
national and local experts with wide-ranging experience and skills. The 
focus of the SC2 Network will be to strengthen the foundation for 
economic growth and resiliency in these communities--namely, local 
capacity, comprehensive planning, and regional collaboration. HUD will 
offer funding competitively through a Notice of Funding Availability 
(NOFA) for an intermediary to assist HUD with establishing and 
administering the program. As part of the Administration's efforts to 
increase transparency in government operations and to expand 
opportunities for stakeholders to engage in decision-making, HUD 
solicits comment through this notice on the proposed structure of the 
SC2 National Resource Network pilot program, and the criteria by which 
HUD and its interagency partners will select an intermediary for the 
pilot program. Feedback received in response to this notice will aid 
HUD and its partners in better understanding how this pilot program may 
help local communities respond to the strains of the current economic 
crisis. HUD is seeking input from local governments, philanthropic 
organizations, private companies, community development entities, and a 
broad range of other stakeholders on how the program should be 
structured in order to have the most meaningful impact in rebuilding 
and growing local government capacity for good governance and economic 
growth.

DATES: Comment Due Date: July 16, 2012.

ADDRESSES: Interested persons are invited to submit comments regarding 
this notice to the Regulations Division, Office of General Counsel, 
Department

[[Page 35712]]

of Housing and Urban Development, 451 7th Street SW., Room 10276, 
Washington, DC 20410-0500. Communications must refer to the above 
docket number and title. There are two methods for submitting public 
comments. All submissions must refer to the above docket number and 
title.
    1. Submission of Comments by Mail. Comments may be submitted by 
mail to the Regulations Division, Office of General Counsel, Department 
of Housing and Urban Development, 451 7th Street SW., Room 10276, 
Washington, DC 20410-0500.
    2. Electronic Submission of Comments. Interested persons may submit 
comments electronically through the Federal eRulemaking Portal at 
www.regulations.gov. HUD strongly encourages commenters to submit 
comments electronically. Electronic submission of comments allows the 
commenter maximum time to prepare and submit a comment, ensures timely 
receipt by HUD, and enables HUD to make them immediately available to 
the public. Comments submitted electronically through the 
www.regulations.gov Web site can be viewed by other commenters and 
interested members of the public. Commenters should follow the 
instructions provided on that site to submit comments electronically.

    Note:  To receive consideration as public comments, comments 
must be submitted through one of the two methods specified above. 
Again, all submissions must refer to the docket number and title of 
the notice. No Facsimile Comments. Facsimile (FAX) comments are not 
acceptable.

    Public Inspection of Public Comments. All properly submitted 
comments and communications submitted to HUD will be available for 
public inspection and copying between 8 a.m. and 5 p.m. weekdays at the 
above address. Due to security measures at the HUD Headquarters 
building, an advance appointment to review the public comments must be 
scheduled by calling the Regulations Division at 202-708-3055 (this is 
not a toll-free number). Individuals with speech or hearing impairments 
may access this number via TTY by calling the Federal Relay Service at 
800-877-8339. Copies of all comments submitted are available for 
inspection and downloading at www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Brittany Gibbs, Office of Policy 
Development and Research, Department of Housing and Urban Development, 
451 7th Street SW., Washington, DC 20410; telephone number 202-402-2826 
(this is not a toll-free number); email address: SC2Network@hud.gov. 
Persons with hearing or speech impairments may access this number 
through TTY by calling the toll-free Federal Relay Service at 800-877-
8339. More information on Strong Cities, Strong Communities and updates 
are also available at https://www.huduser.org/portal/sc2/newsletter.html.

SUPPLEMENTARY INFORMATION:

I. SC2 Network Pilot Program Overview

    In July of 2011, the Obama Administration launched Strong Cities, 
Strong Communities (SC2), a new and customized pilot initiative to 
strengthen local capacity and spark economic growth in distressed local 
communities while ensuring taxpayer dollars are used wisely and 
efficiently. SC2 evolved from ongoing conversations with mayors, 
foundations, nonprofits, and Members of Congress working in 
economically distressed communities,who consistently highlight strains 
on local governments, the way disjointed programs do not work well for 
them, and a strong and clear desire for a coordinated, ongoing 
relationship with the federal government. SC2 focuses on five goals to 
change this:
     Improve the relationship between local and federal 
government: SC2 seeks to break down traditional local and federal 
government silos, allowing the federal government to partner more 
effectively with localities that have faced significant long-term 
challenges.
     Provide coordination and support: SC2 provides on-the-
ground technical assistance and planning resources tailored to a city's 
needs, while also assisting them to use federal funds more efficiently 
and effectively. SC2 provides the necessary technical expertise to help 
cities focus efforts around populations served by both federal and 
local programs.
     Partner for economic growth: SC2 assists cities in 
developing critical partnerships that focus on job creation, workforce 
improvement and economic development with key local and regional 
stakeholders that include municipal and state governments, the business 
community, non-profits, faith-based institutions, and other public, 
private, and philanthropic leaders. SC2 provides a customized approach 
to supporting communities on the ground in their efforts to create jobs 
and revitalize their economies.
     Enhance local capacity: Every community is unique, with 
its own set of challenges and opportunities. The key to winning the 
future is empowering communities to frame their own economic vision and 
then partnering with them to identify, strengthen and leverage the 
tremendous physical, commercial, and social assets that they possess. 
SC2 provides a number of local capacity-building tools to test various 
models of place-based technical assistance to help cities and regions 
maximize the benefits from the federal funds they already receive and 
build resilient communities.
     Encourage regional collaboration: SC2 helps build regional 
relationships and foster new connections in order to strengthen 
regional economies to compete in an increasingly globalized world.

On March 15, 2012, President Obama signed an Executive Order 
establishing a White House Council on Strong Cities, Strong Communities 
composed of the heads of 19 agencies and sub-agencies along with 11 
White House offices. Among other functions, the Council will:
     Coordinate agency efforts to ensure communities have 
access to comprehensive, localized technical assistance and planning 
resources to develop and execute their economic vision and strategies 
(including, where appropriate, efforts of existing committees or task 
forces related to providing technical assistance to local governments 
and improving their capacity to address economic issues);
     Provide recommendations to the President, through the Co 
Chairs on:
    (i) Policies for building local expertise in strengthening local 
economies;
    (ii) Changes to Federal policies and programs to address issues of 
special importance to cities and local governments that pertain to 
local capacity and economic growth;
    (iii) Implementing best practices from the SC2 initiative 
Government-wide to better support cities and local governments; and
    (iv) Opportunities to increase the flexible utilization of existing 
Federal program resources across agencies to enable more performance 
and outcome-based funding;
     Encourage the development of technical assistance, 
planning, and financing tools and implementation strategies that can be 
coordinated or aligned across agencies to assist communities in 
building local capacity to address economic issues, engaging in 
comprehensive planning, and advancing regional collaboration; and
     Facilitate the exchange of ideas and strategies to help 
communities address economic challenges and create sustained economic 
opportunity.

There are four complementary components of the Strong Cities, Strong 
Communities initiative:

[[Page 35713]]

    1. SC2 Community Solutions Teams: Community Solutions Teams 
comprised of federal employees from several different agencies are 
working directly with cities to support mayors in Chester, PA; Detroit, 
MI; Fresno, CA; Memphis, TN; New Orleans, LA; and the Northeast Ohio 
region, including Cleveland and Youngstown, OH. Community Solutions 
Teams assist cities with issues mayors have identified as vital to 
their economic strategies, including efforts to build on local assets, 
strengthen regional economies, develop transportation infrastructure, 
improve job-training programs and support community revitalization.
    2. SC2 Fellowship Program will select, train, and place early- to 
mid-career professionals in local government positions within the same 
six cities/regions to serve two-year terms and build additional 
``bench-strength'' capacity. The German Marshall Fund was selected in 
December 2011 to run the fellowship program and will competitively 
select Fellows for a planned deployment in the fall of 2012. The 
Program is funded by the Rockefeller Foundation, which donated $2.5 
million in initial funding to HUD.
    Community Solutions teams and the Fellowship program are operating 
in the same six SC2 pilot cities/regions, which were selected on the 
basis of economic need, strong local leadership and collaboration, 
potential for economic growth, geographic diversity, and the ability to 
test the SC2 model across a range of environments. Federal assessment 
teams spent time on the ground working directly with mayors and other 
local officials to determine needs, opportunities and gather input for 
the pilot initiative.
    3. SC2 Economic Visioning Challenge: In addition to the six pilot 
locations, later this year SC2 will launch an Economic Visioning 
Challenge designed to help additional cities develop economic 
blueprints. This national grant competition will enable cities to adopt 
and implement innovative economic development strategies to support 
comprehensive city and regional planning efforts. Six additional cities 
will be competitively selected to receive a grant of approximately $1 
million that they will use to administer an ``X-prize style'' 
competition, whereby they will challenge multi-disciplinary teams of 
experts to develop comprehensive economic and land use proposals for 
their city. The Challenge will be administered by the Economic 
Development Administration (EDA) through a Federal Funding Notice (FFO) 
later this year, and EDA will assist cities in the administration of 
the competition.
    4. SC2 National Resource Network (SC2 Network): The SC2 Network 
will take the model of Strong Cities, Strong Communities to a wider 
assortment of local governments, offering a single portal to a wide 
range of technical experts for shorter-term engagements. This resource 
will be available to governments who apply, prioritized by distress and 
readiness to act on the recommendations the SC2 Network provides to 
implement changes required. The extent of each engagement will be 
scaled to ensure a measurable impact, both for the community's growth 
and resilience and the efficiency of public funds, particularly the 
federal funding streams they already receive.
    To maximize the resources flowing to local governments, an 
intermediary will be competitively selected to run the SC2 Network's 
daily operations. Using an outside platform can leverage the federal 
government's investment with considerable private and philanthropic 
resources and pro bono services--similar efforts have annually 
leveraged more than six times their base investment. It also taps 
existing philanthropic and non-profit expertise to engage with and help 
improve federal programs. HUD will retain oversight through a 
cooperative agreement.
    The SC2 model reflects the idea that local issues do not stop at 
federal agency boundaries, and that effective technical assistance must 
also target issues that cross federal funding sources. HUD was chosen 
to host the SC2 Network, but the Network can help cities find expertise 
across the range of SC2 agencies and outside partners, and efforts will 
be coordinated with the three other components of SC2 and numerous 
other federal programs as appropriate. As an example, HUD, the 
Department of Justice (DOJ), the city government, and local 
philanthropy are working jointly in Youngstown, OH. Coordination and 
technical assistance through SC2/HUD helped the city partner with 
philanthropy to assess opportunities for effiency in the city's 
operations. SC2 then linked Youngstown to the DOJ's Diagnostic Center, 
which helps mayors, policymakers, and other local leaders identify 
their public safety needs and implement evidence-based strategies. 
Similarly, HUD and the EDA are leveraging mutual investments in SC2. 
EDA plans to offer $6 million to fund creation of economic blueprints 
for cities through the SC2 Economic Visioning Challenge, and the SC2 
Network will provide each city with assessments and technical 
assistance needed to help move from plans to implementation, described 
further under Section IV.
    SC2 Network assistance is not intended to replace any technical 
assistance already provided by the federal government or another party, 
but aims to build general local capacity to effectively access these 
programs. Through a comprehensive lens that crosses city departments 
and topics, the Network can help cities identify and coordinate 
simulataneous help from more specific programs such as DOJ's Diagnostic 
Center for public safety issuese or HUD's OneCPD program to deal with 
Community Development Block Grant (CDBG), HOME, Investment Partnerships 
(HOME), and homelessness programs, and address the city's underlying 
fiscal or operational capacity needs to make the best use of both. An 
SC2 Network engagement might also help a city government solve and move 
beyond internal fiscal problems so it can begin engaging with its 
neighbors in regional growth and planning efforts to eventually join 
the Sustainable Communities Initiative of HUD, Department of 
Transportation (DOT), and Environmental Protection Agency (EPA).

II. Background

    Rising costs and declining revenues bring local governments closer 
to bankruptcy and further from solutions to the ever more complex 
challenges their communities face. Almost all state and local 
governments are required to balance their budgets, leaving no buffer 
during these very tough economic times.
    Local governments have many partners to help, but a major 
impediment to supporting and developing the capacity of places with 
chronic challenges is the limited number of organizations with 
expertise in turning whole regions and cities around. The field is rich 
with organizations and intermediaries with experience in neighborhood 
development and revitalization, but very thin in organizations that 
take a holistic approach to urban and regional economic development. 
Much of this expertise is spread across a variety of organizations that 
play niche roles--public management, fiscal reform, land use 
development, business attraction and retention, workforce development, 
etc.
    There are a number of federal programs dedicated to improving urban 
economic conditions, in some cases through a capacity-building 
strategy. Most of these efforts are not responsive to local needs and 
conditions. They require an extended time frame, and it

[[Page 35714]]

can be difficult for local governments to determine which agency and 
program to approach for aid when their challenges cut across agency 
topics. The SC2 Network will coordinate these separate pools of deep 
expertise with the needs of each community, deploying the tool that is 
actually needed and making the overall investment more effective and 
efficient. HUD will serve this coordinating role, building on its 
direct relationships with communities and founding mandate in the 1965 
Department of Housing and Urban Development Act to ``Exercise 
leadership at the direction of the President in coordinating activities 
affecting housing and urban development; provide technical assistance 
and information, including a clearinghouse service to aid State, 
county, town, village, or other local governments in developing 
solutions to community and metropolitan development problems.'' \1\
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    \1\ 42 U.S.C. 44 3532(b).
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III. SC2 Network Pilot Program Objectives

    To achieve the goals of the program, HUD intends to select an 
intermediary through a competitive process. This intermediary must:
     Build and manage a team of expert technical service 
providers, potentially including consulting firms, practitioners, 
academics, intermediaries, and peer localities that represent the 
breadth of relevant expertise. Capacities should include, but are not 
limited to: Public budgeting, governance reform, system and process 
management, grants management, human capital policies and procedures, 
finance, economic development and redevelopment, staff capacity 
assessment, relationship assessment, and federal funding regulations;
     Effectively leverage philanthropic resources, both through 
building upon existing connections between foundations, issue area 
experts, and local governments and through forging new linkages and 
partnerships;
     Enlist the support of both paid and pro bono technical 
service providers, maximizing the program's reach;
     Carefully document and evaluate interventions to build a 
series of best practice strategies that can benefit places with similar 
challenges, and develop forums for sharing this knowledge;
     Create and support a peer-to-peer network to share lessons 
learned;
     Increase the capacity of participating governments in the 
area of intervention, not just provide a one-time service that they 
cannot replicate, including investing in an initial alignment effort 
for communities with potential private and philanthropic resources to 
sustain local capacity building over a longer term;
     Align with other federal, state, and, local programs to 
enhance coordination and avoid duplicating efforts--for example, 
regional planning through DOT/EPA/HUD Sustainable Communities 
Initiative, the Neighborhood Revitalization Initiative of HUD, 
Department of Education (ED), DOJ, Department of Health and Human 
Services (HHS), EDA's Regional Innovation Clusters, DOJ's Diagnostic 
Center, Federal Emergency Management Agency (FEMA) preparedness 
technical assistance, or HUD's OneCPD technical assistance;
     Identify for the SC2 Council how federal policy changes 
could help local governments better achieve their economic development 
visions, and other policies, systems, and practices that support 
holistic and sustainable economic development; and
     Generate a sustainable model that could, under appropriate 
conditions, be spun off into an independent entity.

IV. General SC2 Network Pilot Program Parameters

    Final funding levels are not yet established, but HUD currently 
plans to launch the National Resource Network (SC2 Network) using 
approximately $5,000,000 from its fiscal year 2012 appropriation for 
the Transformation Initiative and will publish a Notice of Funding 
Availability (NOFA) later this year to select an intermediary who will 
administer the program. HUD's fiscal year 2013 budget also requests 
additional funds to serve more communities, subject to appropriations.
    HUD intends to select a single grantee to administer the SC2 
Network (``SC2 Network Administrator'') and will fund the successful 
SC2 Network grantee under a cooperative agreement. The comments 
received from this notice will inform the NOFA HUD publishes later this 
year, which will detail the program and application requirements for 
potential intermediary organizations. HUD anticipates having 
substantial involvement in the work being conducted under this 
forthcoming award to ensure that the purposes of the SC2 Network are 
being carried out and that technical service providers and units of 
local government are following through on their commitments to local 
and regional development. HUD's involvement includes monitoring that 
progress is being made in meeting established performance metrics and 
ensuring consistency in projects across participating jurisdictions.
    To be able to respond to the varying needs of different localities, 
the SC2 Network will leverage the expertise of multiple federal 
agencies, the philanthropic community, the business community, anchor 
institutions, and lessons learned by other local governments. A primary 
focus of the Network's direct assistance will be basic operational 
issues such revenue/service analysis and performance management. 
Building capacity in these areas without necessarily focusing on a 
specific federal program is not targeted by any other federal technical 
assistance (TA) program, and since SC2 specifically targets low-
capacity governments, HUD expects budget shortfalls and operational/
program efficiency issues to be common across most, if not all, cities 
assisted. This also provides a solid base from which the Network can 
clearly identify other TA needs. It will also assist across a wide 
range of basic capacity issues as local needs dictate, connecting to 
existing programs whenever possible, such as: Economic Development 
(economic visioning, job market analysis, cluster analysis and 
engagement); Workforce Development (job training strategies, industry 
needs analysis, cradle-to-career education reform); Public Safety 
(juvenile justice, corrections restructuring, policing strategies); and 
Sustainable Land Use (brownfield redevelopment, corridor planning, 
consolidated transportation & housing plans).
    As an example, a city might come to the SC2 Network for help with a 
structural budget deficit. The Network would tap its contracted or 
private partner experts in public management who would work with city 
leadership to develop sustainable revenue and spending plans. These 
plans might suggest a redevelopment of vacant industrial areas into 
technology parks, open space, or housing, requiring revisions to land 
use and zoning. The SC2 Network would identify whether HUD, EPA, or 
Commerce, for example, might be available to advise the city. If not 
and this was a crucial step for the city to reach its goals, the SC2 
Network could directly engage a land use expert to assist with the 
physical layout, while ensuring coordination with its public management 
experts.

V. Eligible Applicants To Be SC2 Network Administrator

    HUD plans that eligible applicants for the SC2 Network 
Administrator will include: Nonprofit organizations, foundations, 
educational institutions, for-profit companies, or consortia of

[[Page 35715]]

these entities with demonstrated ability to raise philanthropic 
support. The Administrator must have a demonstrated ability to engage 
and maintain relationships with a diverse group of technical service 
providers across a broad range of disciplines and partner with 
philanthropies and units of general local government to advance the 
objectives of the SC2 Network program. The Administrator must also have 
a demonstrated ability to obtain other community, private sector, and 
federal resources that can be combined with HUD's program resources to 
achieve program objectives.
    In addition, under the NOFA process, applicants to become the 
Administrator will be required to meet all threshold requirements 
contained in HUD's Fiscal Year 2012 NOFA General Section, including 
requirements addressing civil rights and other cross-cutting 
requirements applicable to federal funding.\2\
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    \2\ See https://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/grants/fundsavail/nofa12/gensec and https://portal.hud.gov/hudportal/documents/huddoc?id=2012gensecNOFA.pdf.
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VI. Eligible Activities

    The SC2 Network will carry out three categories of activities. The 
first involves establishing the organization, its procedures, and 
operationalizing further activities. The second involves limited-length 
engagements with individual local communities--the core of the SC2 
Network's work. The third category targets a limited number of cities 
or counties where an alignment of organizations can sustain local 
capacity building over a longer term through Local Resource Networks. 
Applicants to be the SC2 Network Administrator will not be limited to 
the activities described below and may suggest additions within these 
categories.

Category 1: Establishing the SC2 Network

    As a pilot, SC2 Network must establish its operating procedures to 
truly be a place-based single portal for technical assistance. HUD 
expects this category will form no more than 30 percent of the SC2 
Network's activities in this first pilot phase, but would drop to no 
more than 15 percent after the first year of funding.
    (1) Identify technical experts that can fulfill anticipated needs 
of applicants for SC2 Network services. Determine structures necessary 
to obtain, support and nurture a roster of both paid and pro-bono 
experts.
    (2) Advertise the SC2 Network's availability to eligible local 
communities;
    (3) Manage requests for assistance based on the priorities outlined 
in the applicant's proposal and agreed upon with HUD, working with the 
applicant to fully understand and document the scope of their proposed 
challenges, determining whether SC2 Network assistance is appropriate, 
and documenting recommendations;
    (4) Identify and maintain a catalog of other technical assistance 
programs eligible to local governments, regularly communicate with 
staff of major programs on potentially alignment with the SC2 Network, 
and refer applying governments to them as applicable;
    (5) Document and evaluate the effectiveness of the individual 
interventions and the SC2 Network as a whole;
    (6) Maintain an easily accessible online resource bank of all 
materials generated that could have utility for other governments and 
practitioners and create a strong peer-to-peer network so information 
and experiences can be routinely transmitted and shared; and
    (7) Regularly report to HUD and its interagency partners on 
potential regulatory barriers to be addressed and other potential 
improvements to federal programs identified through SC2 Network 
projects.

The peer-to-peer network is a particularly important part of this 
category for the goals of SC2. HUD envisions it would utilize three 
mediums--meetings, webinars and an online forum--to aggregate and 
distribute information and resources. Cities will have the opportunity 
to participate in various meetings and webinars, as well as have access 
to an online forum that will house relevant information and resources 
on the SC2 Initiative. In addition, these mediums will facilitate peer 
exchanges that help to promote knowledge sharing among cities and 
stakeholders that are working to devise solutions to address their 
economic challenges.

Category 2: Individual Local Government Engagements

    Individual engagements with local communities are the core of the 
SC2 Network's work. While Category 1 will be emphasized in the first 
pilot phase starting in 2012, the SC2 Network must also use a minimum 
of 50 percent of its funds to perform the following Category 2 
activities in local communities during the pilot. Category 2 is 
envisioned to become the bulk of the SC2 Network's activities after the 
first pilot year.
    (8) Work with the technical assistance providers to help an 
applicant government articulate what it is trying to achieve from its 
request;
    (9) Build a reasonable technical assistance plan to achieve those 
results;
    (10) Provide funds to the appropriate technical assistance 
providers sufficient to administer the services set out in the 
technical assistance plan;
    (11) Facilitate the deployment of permanent or part-time staff 
temporarily to the locality (fellows, volunteers, etc.), if available;
    (12) Document the request, proposed scope of work, and expected 
result via a technical assistance plan; and
    (13) Assist the local government in identifying other federal, 
state, local, and privately-funded programs and services that could be 
appropriate to support follow-on work.

Within Category 2, the SC2 Network must include assessments for all six 
cities receiving grants from EDA through the Economic Visioning 
Challenge. The Network will determine where outside expertise can best 
help these six cities act on their new economic blueprints, and will 
also advise and help connect cities to technical assistance programs 
they could engage. These assessments should comprise no more than 50 
percent of resources used for Category 2 activities.

Category 3: Local Resource Networks

    In a limited number of cities or regions, the SC2 Network may also 
create and support Local Resource Networks. HUD recognizes that some 
places have community or local foundations and engaged private 
industries able to provide resources that, if properly aligned, might 
replicate the objectives of the SC2 National Resource Network on a 
local level. These scaled versions of the SC2 Network would sustainably 
support local government capacity, and might free the SC2 Network and 
other federal resources to serve other economically-distressed 
communities. As described in Soundness of Approach section below, the 
SC2 Network must insure these places meet certain requirements. The SC2 
Network may elect to use a small portion of its resources in this 
category, with no more than $500,000 provided to an individual city or 
region for the following activities.
    (14) Identify cities or regions where LRNs may be viable and 
recruit potential local lead organizations;
    (15) Provide funds to a local lead organization to create a 
business plan for the Local Resource Network, support assembling a 
leadership team from the public, private, and non-profit sectors, and 
recruit private or non-profit partners to dedicate pro bono teams;

[[Page 35716]]

VII. Selection Criteria for SC2 Administrator

    HUD is not proposing a fixed model for the SC2 Network, but will 
seek proposals for its structure from applicants. The SC2 Network 
Administrator will be selected through a competition that prioritizes 
prior experience in assisting economically-distressed cities across a 
wide range of places and issues, and delivering results to these 
communities on a specific timetable. The successful Administrator 
should be:
    1. Place-based. The selected organization, buoyed by support of 
agencies and the philanthropic community, will already have experience 
working in many distressed cities, and will be able to match these 
cities to relevant technical experts quickly and efficiently.
    2. Resource-maximizing. The selected organization will have a 
national scope and will be well-accustomed to the challenge of 
distributing scarce resources across cities with distinct needs. The 
ability to effectively evaluate requests for service will be paramount 
to using the SC2 Network's resources to their greatest potential. 
Maximizing resources means successfully obtaining philanthropic 
resources and pro bono services, balanced with paid consultants as 
needed.
    3. Nimble, responsive, and service-oriented for cities. The SC2 
Network will be designed to provide very timely assistance that can 
thoroughly understand and adapt to needs on the ground. Its deep team 
of technical experts will allow for subject area experts to be assigned 
quickly and, when necessary, for partnerships between experts on issues 
that require multiple skill sets and excellent customer service skills.
    4. Objective. In some cases, procedures or regulations may be a 
barrier to local capacity-building action. The SC2 Network's external 
operation will grant a layer of objectivity to facilitate local 
partnering and honest feedback to HUD and the other SC2 agencies for 
relieving burdens on local governments, while retaining accountability 
for results.
    5. Sustainable. The intermediary selected will have the nonprofit 
management expertise required to make the SC2 Network financially 
sustainable, and as an outside entity, this organization can attract 
philanthropic funding and potentially multiply HUD's investment several 
times over. This structure intentionally allows the SC2 Network to 
continue supporting local governments on as minimal an investment as 
possible.
Rating factors for selecting the SC2 Administrator will therefore focus 
on the following criteria:

Capacity and Relevant Organizational Experience

    HUD will carefully evaluate descriptions of the organizational 
structure of Administrator applicants for a demonstration that it can 
successfully implement the proposed activities in a timely manner. 
Applicants will need to describe their capacity to perform the 
activities of the SC2 Network and relevant experience within the last 3 
years.
    HUD is particularly interested in the Administrator's experience in 
leveraging philanthropic support, contracting with technical service 
providers, understanding available federal government resources, and 
working with local governments. The SC2 Network should create a balance 
of engaging paid experts when necessary while maximizing contributions 
of pro bono services to maximize the services the SC2 Network can 
provide.
    The Administrator will need to demonstrate they either have 
sufficient personnel or the ability to procure qualified experts or 
professionals with the requisite knowledge, skills, and abilities in 
preparing and coordinating the development of the SC2 Network. The 
Administrator should be prepared to initiate eligible activities 
according to a specific timetable they propose and negotiate with HUD.

Need/Extent of the Problem

    The SC2 Network Administrator must have an understanding of the 
problems necessitating assistance from the SC2 Network based on 
thorough, credible, and appropriate data and information. HUD will 
evaluate applicants on their documented description of significant 
obstacles to capacity building at the local government level. 
Applicants will be evaluated on their understanding of existing models 
of technical assistance provision and capacity building for local 
governments that might inform the SC2 Network, along with the 
limitations of these models.

Soundness of Approach

    The structure for the SC2 Network proposed by Administrator 
applicants will be a major factor in HUD's selection. Applicants must 
propose how they will structure the SC2 Network and how the activities 
they will pursue address the problems identified in local government 
capacity. The Administrator will be required to develop a work plan 
that includes specific, measurable, and time-phased objectives for each 
activity.

Process To Develop and Maintain a Network of Expert Technical Service 
Providers

    The SC2 Network Administrator will require in-house expertise and a 
process for obtaining the services of other qualified experts with the 
requisite knowledge, skills, and abilities as needed. The ability to 
work on a wide range of issues will be important, as well as the 
ability to work in a wide range of locations. In particular, the 
applicant should demonstrate an ability to collaborate and coordinate 
with other organizations, experts, and sectors in delivering assistance 
to local communities through the SC2 Network. Also important is the 
leverage of pro bono services from the private or non-profit sectors to 
serve these functions, but the plan must balance these with paid 
consultants from the non-profit and private sectors when local needs 
require them. The Administrator must develop plans for evaluating their 
team of experts, including measures that will be taken if an 
individual's work proves unsatisfactory.

Strategy for Evaluating Requests for Service

    HUD expects that more local governments will request the services 
of the SC2 Network than the SC2 Network is able to engage, particularly 
in the first year. SC2 Network Administrator applicants must propose a 
prioritization system in their applications that could include:
     The community's ranking on a relative distress scale 
(using data provided by HUD and other SC2 agencies and from other 
sources as appropriate);
     Scope/cost of request;
     Letters of commitment for support/staff time from 
directors of offices;
     Willingness of the government to commit to attaining 
certain performance standards;
     Demonstration of partnerships/collaboration between local 
government offices;
     Referral from another SC2 agency technical assistance 
program that is assisting the local government but recommends broader 
assistance beyond its allowed scope;
     Evidence that the government has made/is making efforts to 
address the issue; and
     Other criteria the applicant deems important to creating 
the greatest impact in improved local capacity and use of funds, with a 
justification of its importance.

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    The criteria proposed should allow the SC2 Network to provide 
assistance to as many governments as possible while providing a 
meaningful intervention according to the program's objectives. 
Administrator applicants' descriptions of criteria should relate to the 
existing models of technical assistance provision and capacity building 
they describe under Need/Extent of the Problem. Applicants should 
describe why each criterion will succeed in targeting and overcoming 
the capacity problems they have documented.
    Administrator applicants also must propose criteria for engaging in 
Category 3 activities to establish Local Resource Networks. At a 
minimum, these must include:
     Demonstration of sufficient private sector or non-profit 
partners with appropriate pro bono technical services to contribute;
     Demonstration of matching funds from a local non-profit or 
private source; and
     Demonstration of support from the local government.

Leverage

    HUD has reoriented a part of its technical assistance funds to 
create the single comprehensive clearinghouse, and other agencies on 
the White House SC2 Council have identified linked technical assistance 
support. HUD and the SC2 Council cannot, and are not intending to, 
provide the full technical assistance resources necessary given the 
scope of local needs. This is intentional to make the investment go 
further through private leverage and make the SC2 Network less 
dependent on a single stream of funds. Moreover, leveraging outside 
investments builds in engagement of the expertise that already exists 
in the philanthropic, non-profit, and private sectors for this work, 
and creates a relationship between these efforts and government 
programs to encourage mutual improvement rather than working around 
each other and duplicating efforts. Applicants will be scored on firm 
commitments from other community, private sector, and federal resources 
that can be combined with HUD's program resources to achieve program 
objectives, and that are contingent only on the applicant's selection 
as the SC2 Network Administrator. Greater collaboration between 
government and other sectors is an SC2 Network goal, so resources must 
include in-kind pro bono contributions of services allocated to the 
proposed program and may also include cash. Financial resources must be 
shown to be dedicated solely to the efforts of the SC2 Network. In 
evaluating this factor, HUD will consider the extent to which the 
Administrator applicant has established working partnerships with other 
entities to get additional resources or commitments that increase the 
effectiveness of the proposed program activities. Resources may be 
provided by governmental entities, public or private organizations, or 
other entities.

Achieving Results and Program Evaluation

    Because the SC2 Network seeks support to develop and implement 
long-range capacity improvements for local governments, not all 
outcomes will be realized during the duration of the grant period. 
Rather, Administrator applicants will be evaluated on their ability to 
identify the outcomes they seek to achieve and the specificity of the 
benchmarks that they establish to measure progress toward a completed 
product that guides all of the necessary work.
    The White House SC2 Council is working to track the outcomes of its 
work on all components of SC2, and the SC2 Network Administrator will 
be required to coordinate with these efforts and track comparable 
outputs and outcomes in its work. These might include the number of 
Network recommendations implemented and how quickly, the pace of 
expenditure of federal funds, the number of successful applications for 
federal funds, and the extent of collaborative stakeholder network 
supporting implementation of the city's comprehensive economic 
strategy. The Network Administrator will be expected to develop and 
track specific measures for its works, including progress on budget 
deficits and municipal bond ratings. For every engagement, the Network 
Administrator must create a clear logic model describing issues 
targeted, what it seeks to achieve, the benchmarks that show success, 
and the steps the Network will take to reach success.

VIII. Solicitation of Comments on Proposed Program Structure

    As noted above, HUD and its SC2 agency partners are soliciting 
comments through this Advance Notice on how the SC2 Network pilot 
program should be structured, what funding categories and activities 
are most appropriate to support, which entities should be eligible for 
SC2 Network Administrator, and how best to evaluate proposed SC2 
Network structures in order to have the most meaningful impact in 
rebuilding and growing local government capacity for good governance 
and economic growth. The discussion below outlines in general terms the 
key questions HUD is considering in preparing the final NOFA for the 
program and identifies some specific issues for comment.

A. Eligible Activities

    a. Given the limited resources available and potentially large 
demand for services from cities, are there certain activities the SC2 
Network should focus on or prioritize, either by topic or by the four 
types of activities described: (1) Operational/program/fiscal 
assessments, (2) connection/clearinghouse for federal TA, (3) direct TA 
provision when necessary, and (4) Local Resource Networks?
    b. Are there specific activities or criteria for funding Local 
Resource Networks that would increase the success of these efforts, and 
why?
    c. Given limited funding for an initial pilot, what is a minimum 
funding amount necessary to make the Local Resource Network activities 
described viable for this stage of the program?
    d. Are there currently efforts underway or proposed in individual 
cities or regions that would meet the criteria for Local Resource 
Networks, and if so, in which places?

B. Selection Criteria

    a. What are the top capacity challenges governments in distressed 
communities face, and on what issues do they most require technical 
assistance?
    b. What is an appropriate minimum level of assistance to make a 
meaningful impact for a given local government? Given the proposed 
funding levels, what is an appropriate maximum level of assistance, or 
how many governments might be assisted given the $5,000,000 total 
funding HUD has proposed?
    c. What are current successful organizational models similar to the 
SC2 Network that might serve as guides for its structure? Which aspects 
of these models contribute most to their success (e.g., leveraging 
philanthropic support, engaging pro bono services, working in diverse 
communities, working on diverse topics)?
    d. What are current successful technical assistance and/or capacity 
building models for local government and specific city case studies 
that the SC2 Network might use as best practices?
    e. What are feasible 6-month, 1-year, 2-year, 5-year, and 10-year 
outcomes for local communities assisted by the SC2 Network? Are any of 
these outcomes universal for all sizes and places, or will they vary by 
the individual circumstances of each government?

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What type of shorter-term benchmarks are most appropriate for 
evaluating success?
    f. Which of the criteria listed for prioritizing requests from 
local governments are most important, and what are additional criteria 
that should be included?
    g. What type of information will the Network need from cities to 
understand need and readiness, and to determine the proper extent of 
engagement with the Network?
    While these are issues of particular interest, HUD encourages 
meaningful input on the proposed SC2 Network program more generally as 
well. If providing comments and addressing the comments for which HUD 
specificially solicits feedback, HUD requests that commenters please 
respond to the specified questions first in addition to other comments 
you would like to provide. HUD has provided the avenues for input in 
the ADDRESSES section of this notice.

    Dated: June 7, 2012.
Erika C. Poethig,
Acting Assistant Secretary for Policy Development and Research.
[FR Doc. 2012-14503 Filed 6-13-12; 8:45 am]
BILLING CODE 4210-67-P