SUBCHAPTER 19L ‑ NORTH CAROLINA COMMUNITY DEVELOPMENT
BLOCK GRANT PROGRAM
SECTION .0100 ‑ GENERAL PROVISIONS
04 NCAC 19L .0101 PROGRAM PURPOSE AND OBJECTIVE
The purpose of the North Carolina Community Development
Block Grant Program is to develop viable communities by providing decent
housing and a suitable living environment and by expanding economic
opportunities, principally for persons of low and moderate income. Consistent
with this primary objective, Community Development Block Grant funds will be
directed towards the specific objectives found in the amended Housing and
Community Development Act of 1974, Section 101(c).
The assistance provided under this program is intended to
help local governments meet needs that are not currently being addressed in
their communities. These funds shall not be used to replace local financing of
ongoing community development activities.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C. 5301; 42 U.S.C. 5306(d); 24 C.F.R. 570.489;
Eff. July, 1, 1982;
Amended Eff. March 1, 1986; October 1, 1984; March 1,
1984.
04 NCAC 19L .0102 AUTHORITY
History Note: Authority G.S. 143‑323; 143B‑276;
42 U.S.C.A. 5306(d);
Eff. July 1, 1982;
Amended Eff. March 1, 1984;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0103 DEFINITIONS
(a) "Act" means Title I of the Housing and
Community Development Act of 1974, P.L. 93‑383, as amended.
(b) "Applicant" means a local government which
makes application pursuant to the provisions of this Subchapter.
(c) "CDBG" means the State‑administered
Community Development Block Grant Program.
(d) "Chief Elected Official" of a local
government means either the elected mayor of a city or the chairman of a county
board of commissioners.
(e) "Community Development Program" means the
annual program of projects and activities to be carried out by the applicant
with funds provided under this Subchapter and other resources.
(f) "Department" means the North Carolina
Department of Commerce.
(g) "Division" means the Department of Commerce's
Division of Community Assistance.
(h) "HUD" means the U.S. Department of Housing
and Urban Development.
(i) "Local Government" means any unit of general
city or county government in the State.
(j) Low‑income families are those with a family
income of 50 percent or less of median‑family income. Moderate‑income
families are those with a family income greater than 50 percent and less than
or equal to 80 percent of median‑family income. For purposes of such
terms, the area involved and median income shall be determined in the same
manner as provided for under the Act.
(k) "Low‑ and Moderate‑Income
Persons" means members of families whose incomes are within the income
limits of low‑ and moderate‑income families as defined in Paragraph
(j) of this Rule.
(l) "Metropolitan Area" means a standard
metropolitan statistical area, as established by the U.S. Office of Management
and Budget.
(m) "Metropolitan City" means a city as defined
by Section 102(a)(4) of the Act.
(n) "Project" means one or more activities
addressing either:
(1) community revitalization needs; or
(2) economic development needs; or
(3) development of housing for persons of low‑
and moderate‑income; or
(4)
urgent needs of the applicant; or
(5) infrastructure needs; or
(6) scattered site housing.
(o) "Recipient" means a local government that has
been awarded a Community Development Block Grant and executed a Grant Agreement
with the Department.
(p) "Scattered site" means acquisition,
clearance, relocation, historic preservation and building rehabilitation
activities which benefit low or moderate income persons or eliminate specific
conditions of blight or decay on a spot basis not located in a slum or blighted
area.
(q) "Secretary" means the Secretary of Department
of Commerce or his designee.
(r) "State" means the State of North Carolina.
(s) "Urban County" means a county as defined by
Section 102(a)(6) of the Act.
(t) The definitions in this Rule apply to terms used in
this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.481 ‑ 570.483;
Eff. July 1,
1982;
Amended Eff.
March 1, 1995; June 1, 1993; May 1, 1992; September 1, 1990;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0104 WAIVERS
The Secretary may issue a written waiver of any requirements
of this Subchapter not required by law whenever he determines that undue
hardship to recipients or beneficiaries will result from applying the
requirement and where application of the requirement would adversely affect the
purposes of the Act.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.480;
Eff. July 1, 1982;
Amended Eff. June 1, 1994.
04 NCAC 19L .0105 ELIGIBLE APPLICANTS
Eligible applicants are all local governments excluding
those designated as metropolitan cities or urban counties by Section 102(a)(4)
and (6) of the Act. When two or more local governments submit a single application,
one of them must be identified in the application as the lead entity.
History Note: Authority 143B‑10; 143B‑431;
42 U.S.C.A. 5306(d);
Eff. October 1, 1984;
Amended Eff. March 1, 1995; March 1, 1986.
04 NCAC 19L .0106 AMENDMENTS ADOPTED BY REFERENCE
All referenced federal documents in this Subchapter are
hereby adopted by reference to include any later amendments pursuant to G.S.
150B‑14(c).
History Note: Authority 143B‑10; 143B‑431;
150B‑14;
Eff. April 1, 1989.
SECTION .0200 ‑ ELIGIBLE APPLICANTS
04 NCAC 19L .0201 GENERAL
History Note: Authority 42 U.S.C.A. 5306(d);
Eff. July 1, 1982;
Amended Eff. March 1, 1984; April 1, 1983;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0202 APPLICATION IN BEHALF OF OTHERS
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5306(d); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Repealed Eff. April 1, 1983.
04 NCAC 19L .0203 JOINT APPLICATIONS
04 NCAC 19L .0204 LIMITATIONS
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5306(d); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. April 1, 1983;
Repealed Eff. March 1, 1984.
SECTION .0300 ‑ ELIGIBLE AND INELIGIBLE ACTIVITIES
04 NCAC 19L .0301 ELIGIBLE ACTIVITIES
This Subchapter incorporates by reference as eligible
activities those activities described in the Housing and Community Development
Act of 1974 as amended, including subsequent amendments and editions, under
Section 105 (a), "Eligible Activities," and in 24 CFR 570.482.
Additional general guidance is found in 24 CFR 570.201‑206. Copies of
these sections of federal law and regulation are available for public
inspection from the Division of Community Assistance. Single copies are
available from this Division in Raleigh, North Carolina, for one dollar ($1.00)
each.
History Note: Authority 143B‑10; 143B‑431;
42 U.S.C. 5305;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; March 1,
1986; March 1, 1984.
04 NCAC 19L .0302 INELIGIBLE ACTIVITIES
All activities not defined as eligible in Rule .0301 shall
be considered ineligible for assistance under this Subchapter. A general guide
regarding ineligible activities is found in 24 CFR 570.207. Copies of this federal
regulation are available for public inspection and may be obtained from the
Division of Community Assistance.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. September 1, 1990; March 1, 1986.
section .0400 – distribution of funds
04 NCAC 19L .0401 GENERAL
(a) The Division shall designate specific due dates or open
periods of time for submission of grant applications under each category, based
on the amount of funds available and coordination with other federal program
funding cycles. Urgent Needs applications may be submitted at any time.
(b) In cases where the Division makes a procedural error in
the application selection process that, when corrected, would result in
awarding a score sufficient to warrant a grant award, the Division may
compensate that applicant at the earliest time sufficient funds become
available or with a grant in the next funding cycle.
(c) Applicants may apply for funding under the grant
categories of Community Revitalization, Housing Development, Scattered Site
Housing, Infrastructure, Demonstration Projects, Urgent Needs, and Economic
Development. Applicants shall not apply for Contingency funding. Contingency
awards may be made to eligible applicants in any category.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.483;
Eff. July 1,
1982;
Amended Eff.
August 1, 1998; March 1, 1986; October 1, 1984; March 1, 1984;
Temporary
Amendment Eff. January 1, 2001;
Amended Eff.
August 1, 2002.
04 NCAC 19L .0402 TYPES OF GRANTS
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5304(b)(3); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1984;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0403 SIZE AND USE OF GRANTS MADE TO
RECIPIENTS
(a) There is no minimum grant amount which applicants may
request or be awarded. Grant awards made to any one recipient shall not exceed
the following amount in each grant category: Community Revitalization:
Concentrated Needs subcategory - seven hundred thousand dollars ($700,000),
Infrastructure category ‑ eight hundred fifty thousand dollars
($850,000), and Scattered Site Housing category - four hundred thousand dollars
($400,000) Housing Development ‑ two hundred fifty thousand dollars
($250,000); Urgent Needs ‑ six hundred thousand dollars ($600,000); Contingency ‑ six hundred thousand dollars
($600,000). Applicants shall not have a project or combination of
projects under active consideration for funding which exceeds one million two
hundred fifty thousand dollars ($1,250,000), except for Urgent Needs projects,
Demonstration projects, Capacity Building, and Scattered Site Housing.
Applicants in the Community Revitalization category shall choose to apply for
either a Concentrated Needs award, or a Revitalization Strategy award.
(b) No local government may receive more than a total of
one million two hundred fifty thousand dollars ($1,250,000) in CDBG funds in
the period that the state distributes its annual HUD allocation of CDBG funds;
except that local governments may also receive up to six hundred thousand
dollars ($600,000) for a project that addresses Urgent Needs and funds for one
demonstration project in addition to other grants awarded during the same time
period.
(c) Concentrated Needs subcategory applicants may spend a
portion of their total grant amount to finance local option activities. Up to
15 percent may be spent on eligible activities which do not need to be directly
related to proposed projects. Job creation activities are not eligible local
option activities. Local option activities shall not be competitively rated by
the Division, but may be limited to specific eligible activities. Each local
option project must show that:
(1) At least fifty‑one percent of the
CDBG funds proposed for each activity will benefit low‑ and moderate‑income
persons, except that CDBG funds may be used for acquisition, disposition, or
clearance of vacant units to address the national objective of prevention or
elimination of slums or blight; and
(2) CDBG funds proposed for each activity will
address the national objective of benefiting low‑ and moderate‑income
persons, or aid in the prevention or elimination of slums or blight.
(d) The Division may review grant requests to determine the
reasonableness and appropriateness of all proposed administrative and planning
costs. Notwithstanding Rule .0910 of this Subchapter, grantees may not
increase their approved planning and administrative budgets without prior
Division approval. In no case, may applicants budget and expend more than 18
percent of the sum of funds requested and program income for administrative and
planning activities for each project, except that demonstration funds may be
awarded for projects limited to planning activities only in which case all
funds will be spent for planning and administration.
(e) Applicants may spend CDBG funds in those areas in which
the applicant has the legal authority to undertake project activities.
(f) Grants to specific recipients shall be provided in
amounts commensurate with the size of the applicant's program. In determining
appropriate grant amounts for each applicant, the Division may consider an
applicant's need, proposed activities, all proposed administrative and planning
costs, and ability to carry out the proposed activities.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.483; 42 U.S.C. 5301;
Eff. July 1,
1982;
Amended Eff. August 1, 1998; February 1, 1996; March 1,
1995; June 1, 1994; June 1, 1993;
June 1, 1992.
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0404 GRANT CATEGORY ALLOCATION
Each program year, funds shall be reserved for each grant
category. When authorized by the General Assembly the Division may set aside
up to two percent for demonstration grants. The remaining funds shall be distributed
by the Division to Community Revitalization grant applications unless otherwise
specified in the General Assembly.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C. 5304; 24 C.F.R. 570.482; 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; June 1, 1994; June 1, 1993;
May 1, 1992; April 1, 1990.
04 NCAC 19L .0405 MULTI‑YEAR GRANT COMMITMENTS
History Note: Authority G.S. 143‑323; 24 C.F.R.
570.489; 24 C.F.R. 570.491;
Eff. July 1, 1982;
Repealed Eff. March 1, 1984.
04 NCAC 19L .0406 INDIVIDUAL GRANT AMOUNTS
History Note: Authority G.S. 143‑323; 24 C.F.R.
570.489;
Eff. July 1, 1982;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0407 GENERAL APPLICATION REQUIREMENTS
(a) Local governments shall submit applications as
prescribed by this Rule in order to be considered for funding. Selection of
applications for funding shall be based primarily on information contained in
the application; thus applications must contain sufficient information for the
Division to rate them against the selection criteria. In addition, the
following may be considered: information from any source which regards the
eligibility of the applicant or application; the legality or feasibility of
proposed activities; the applicant's compliance with application procedures
specified in this Subchapter or the accuracy of the information presented in
the application; evaluation of proposed projects by on‑site review; and
category‑specific information described in Sections .0500, .0700, .0800,
.1200, .1300, and .1700 of this Subchapter. All applicants shall address their
projects to one of the following grant categories: Community Revitalization
(either Concentrated Needs, or Revitalization Strategies), Housing Development,
Urgent Needs, Demonstration, Scattered Site Housing, Infrastructure, and
Economic Development. Applicants may apply in more than one grant category,
providing the total grant application and award does not exceed the maximum
limits described in Paragraphs (a) and (b) of Rule .0403 of this Section.
Applicants shall submit an application that describes each project in
sufficient detail to be rated.
(b) Applications must be received by the Division's
administrative offices in Raleigh before 5:00 p.m. on the submission date or
sent by mail and postmarked on the submission date.
(c) Applicants must provide citizens with adequate
opportunity for meaningful involvement in the development of Community
Development Block Grant applications. Specific citizen participation
guidelines are described further in Rule .1002 of this Subchapter. If the
Division is aware of an applicant's failure to meet these citizen participation
requirements, the Division may not rate the application.
(d) The Division may submit all CDBG applications and
environmental review records as may be required by the National Environmental
Policy Act and the State Environmental Policy Act to the State Clearinghouse of
the Department of Administration for review and comments. The Division may
require each applicant to submit a written description of how the applicant
proposes to address each comment received from the State Clearinghouse.
(e) The applicant shall certify to the Division that it
will comply with all applicable federal and state laws, regulations, rules and
Executive Orders. Copies of these federal and state requirements are available
for public inspection from the Division.
(f) Applicants must comply with the Housing and Community
Development Act of 1974 as amended, all applicable federal and state laws,
regulations, rules, and Executive Orders.
(g) Application requirements described in this Rule .0407
do not apply to demonstration grants and Urgent Needs grants, except for
Paragraphs (a), (d), and (f).
(h) For multi‑family rental housing activities, the
applicant must state in the application the standards it has adopted for
determining affordable rents for such activities.
(i) Applicants that receive CDBG funding for projects may
charge the cost of application preparation to prior CDBG programs or to the
current program provided that procurement procedures consistent with 24 CFR
85.36 are followed. No more than three thousand five hundred dollars ($3,500) may
be charged to the CDBG program for application preparation,
(j) Applicants may apply for a Capacity Building grant in
any category except in the Urgent Needs and Demonstration Projects categories.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(a); 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; March 1, 1995; June 1, 1994;
June 1, 1993; June 1, 1992;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0408 SPECIAL ALLOCATIONS FROM HUD
Periodically the Department may receive from HUD special
allocations of CDBG funds that are separate from its annual funding allocation
to meet specific community development needs and priorities. The Division will
consult with local officials and hold at least one public hearing prior to the
distribution of any special CDBG allocation. The provisions of 4 NCAC 19L
shall apply to the administration of any special allocation, except where
otherwise required by a federal statute or regulation applicable to the special
allocation.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C. 5301;
Eff. August 1, 1983.
Amended Eff. June 1, 1993; September 1, 1990; March 1,
1986.
section .0500 – community revitalization projects
04 NCAC 19L .0501 DESCRIPTION
(a) The Community Revitalization category includes
activities in which a majority of funds is directed towards improving,
preserving or developing residential areas. All eligible CDBG activities may
be undertaken for the purpose of community revitalization. Applications for
funding may involve single or multiple activities, addressing one or more needs
in the area. All Community Revitalization activities, must be carried out
within defined project areas. Community Revitalization funds shall be
distributed to eligible units of local government on a competitive basis.
Community Revitalization projects shall be evaluated against other Community
Revitalization project proposals.
(b) The Community Revitalization category includes a
subcategory for Revitalization Strategies activities which provides funds to
selected governments to address multiple need in high poverty areas. This new
subcategory shall provide funding to help carry out a long term revitalization
strategy. Up to three hundred fifty thousand dollars ($350,000) per year,
shall be awarded to eligible local government to carry out a strategy over
three to five years. Revitalization Strategies funds may be used for any of
the following components as part of strategies to address high poverty arrears
in Tier 1/Tier 2 counties and non-entitlement municipalities with State
Development Zones: housing, public services, economic development, public
facilities, infrastructure. Activities must be targeted toward a defined
geographical area that has at least 25% poverty and must involve collaboration
with community/economic development organizations and partners.
(c) The Community Revitalization category includes a subcategory
for concentrated needs activities which provides funds for improving,
preserving, or developing residential neighborhoods. Concentrated Needs may
not include more than one project. A project may have two sub-areas. Projects
may have single or multiple activities except a project may not have only water
and sewer activities. The maximum award amount for a Concentrated Needs
application is seven hundred thousand dollars ($700,000). The highest priority
is given to housing needs, substandard housing, lack of water/sewer, and the
second priority is given to neighborhood needs (streets and drainage).
Concentrated needs funds can be used for rehabilitation, acquisition,
clearance, relocation, disposition, water and wastewater, and streets and drainage.
History Note: Authority
G.S. 143B‑10; 143B‑431; 42 U.S.C.A. 5301; 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; March 1, 1995; June 1, 1994;
June 1, 1993; October 1, 1990;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0502 ELIGIBILITY REQUIREMENTS
(a) Applications for concentrated needs subcategory funds
must show that:
(1) At least 51 percent of the CDBG funds
proposed for each project shall benefit low‑ and moderate‑income
persons, except that CDBG funds proposed for local option activities may be
used for acquisition, disposition, or clearance of vacant units to address the
national objective of prevention or elimination of slums or blight; and
(2) CDBG funds proposed for each activity shall
meet a national objective as specified in HUD regulations previously
incorporated by reference, except that funds shall not be used to meet the
national objective of urgent need which is covered by Rule .0801 of this
Subchapter.
Applications that do not meet these eligibility requirements
shall not be rated or funded. In designing projects which meet these
requirements, applicants must ensure that activities do not benefit moderate‑income
persons to the exclusion of low‑income persons.
(b) Applicants for Revitalization Strategies subcategory
funds must show that:
(1) the defined area
has at least 25% poverty as determined in the most recent decennial census and
defined in HUD CPD NOTICE 97-01 paragraph D section 2 third bullet as all of
census tracts/block numbering areas in the area have at least a 20% poverty
rate, and at least 90% of them have at least a 25% poverty rate; and the area
is primarily residential.
(2) CDBG funds proposed for acquisition,
clearance, and disposition of vacant units shall address a national objective
of preventing or eliminating slums or blight.
(c) Applicants shall have the capacity to administer a CDBG
program. The Division may examine the following areas to determine capacity:
(1) audit and monitoring findings on previously
funded Community Development Block Grant programs, and the applicant's fiscal
accountability as demonstrated in other state or federal programs or local
government financial reports; and
(2) the rate of expenditure of funds and
accomplishments in previously funded CDBG programs. Applicants that show a
lack of capacity shall not be rated or funded.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5301; 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; March 1, 1995; June 1, 1994;
June 1, 1993; September 1, 1990;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0503 APPLICATION CONTENTS
04 NCAC 19L .0504 FUNDING CYCLE
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5304(a)(1); 42 U.S.C.A. 5306; 24 C.F.R. 570.489;
24 C.F.R. 570.490;
Eff. July 1, 1982;
Amended Eff. March 1, 1984; April 1, 1983;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0505 SELECTION CRITERIA
Projects shall be evaluated and rated in accordance with the
following rating factors:
(1) benefit to low and moderate income persons,
(2) project severity of need,
(3) project treatment of need,
(4) appropriateness and feasibility of proposed project
activities, and
(5) local commitment of funds and community efforts.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(a)(1); 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; March 1, 1995; June 1, 1993;
March 1, 1986; March 1, 1984.
04 NCAC 19L .0506 TARGETING
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5301; 24 C.F.R. 570.489;
Eff. July 1, 1982;
Repealed Eff. October 1, 1984.
SECTION .0600 ‑ ECONOMIC DEVELOPMENT PROJECTS
04 NCAC 19L .0601 DEFINITION
04 NCAC 19L .0602 ELIGIBILITY REQUIREMENTS
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5301; 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1984; April 1, 1983;
Repealed Eff. March 1, 1986.
04 NCAC 19L .0603 APPLICATION CONTENTS
04 NCAC 19L .0604 FUNDING CYCLE
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5304(a)(1); 42 U.S.C.A. 5306; 24 C.F.R. 570.489;
24 C.F.R. 570.490;
Eff. July 1, 1982;
Amended Eff. March 1, 1984; April 1, 1983;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0605 SELECTION CRITERIA
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5304(a)(1); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1984; April 1, 1983;
Repealed Eff. March 1, 1986.
04 NCAC 19L .0606 TARGETING
History Note: Authority G.S. 143‑323; 24 C.F.R.
570.489;
Eff. July 1, 1982;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0607 PRELIMINARY AWARDS
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5301;
Eff. March 1, 1984;
Repealed Eff. March 1, 1986.
SECTION .0700 ‑ DEVELOPMENT PLANNING PROJECTS
04 NCAC 19L .0701 DEFINITION
04 NCAC 19L .0702 ELIGIBILITY REQUIREMENTS
History Note: Authority G.S. 143‑323; 143B‑10;
42 U.S.C.A. 5301; 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. September 1, 1990; May 1, 1988; March 1,
1986; February 1, 1985;
Repealed Eff. May 1, 1992.
04 NCAC 19L .0703 APPLICATION CONTENTS
04 NCAC 19L .0704 FUNDING CYCLE
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5304(a)(1); 42 U.S.C.A. 5306; 24 C.F.R. 570.489;
24 C.F.R. 570.490;
Eff. July 1, 1982;
Amended Eff. March 1, 1984; April 1, 1983;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0705 SELECTION CRITERIA
History Note: Authority G.S. 143‑323; 143B‑10;
42 U.S.C.A. 5304(a)(1); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1986; March 1, 1984; April 1, 1983;
Repealed Eff. May 1, 1992.
04 NCAC 19L .0706 DEFINITION
Demonstration grants are provided to assist local
governments to develop innovative strategies for addressing specific community
development needs and priorities.
History Note: Authority G.S. 143-323; 143B-10; 42
U.S.C.A. 5301; 24 C.F.R. 570.489;
Eff. August 1, 1998.
04 NCAC 19L .0707 ELIGIBILITY REQUIREMENTS
(a) Applications for Demonstration Projects must show that:
(1) the proposed project meets a national
objective in accordance with 24 CFR 570.483; and
(2) the proposed project meets the specific
purpose and priorities adopted by the General Assembly.
Applicants that do not meet these eligibility requirements
shall not be considered for funding.
(b) Applicants shall have the capacity to administer a CDBG
program. The Division may examine the following areas to determine capacity:
(1) audit and monitoring findings on previously
funded Community Development Block Grant programs, and the applicant's fiscal
accountability as demonstrated in other state and federal programs or local
government financial reports; and
(2) the rate of expenditure of funds and
accomplishments in previously funded CDBG programs.
Applicants that show a lack of capacity shall not be
considered for funding.
History Note: Authority G.S. 143-323; 143B-10; 42
U.S.C.A. 5301; 24 C.F.R. 570.489;
Eff. August 1, 1998.
04 NCAC 19L .0708 SELECTION CRITERIA
Selection criteria for demonstration grants shall be:
(1) Benefit to low and moderate income people.
(2) Eligibility of activities.
(3) Project feasibility.
History Note: Authority G.S. 143-323; 143B-10; 42
U.S.C.A. 5301; 24 C.F.R. 570.489;
Eff. August 1, 1998.
SECTION .0800 ‑ URGENT NEEDS/CONTINGENCY PROJECTS
04 NCAC 19L .0801 DESCRIPTION
Urgent Needs grants are provided to localities to meet
certain community development needs that have a particular urgency because
conditions pose a serious and immediate threat to the health and welfare of the
community.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(b)(3); 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. March 1, 1986.
04 NCAC 19L .0802 ELIGIBILITY REQUIREMENTS
Urgent Needs grant applicants must meet all four of the
following eligibility requirements:
(1) the need addressed by the application must have
arisen during the preceding 18‑month period and represent an imminent
threat to public health or safety;
(2) the activity is designed to alleviate existing
conditions which pose a serious and immediate threat to the health or welfare
of the community which are of recent origin or which recently became urgent;
(3) the applicant does not have sufficient local
resources; and
(4) other financial resources are not available to
alleviate the urgent need.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(b)(3); 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; March 1, 1995; June 1, 1993;
March 1, 1986; March 1, 1984;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0803 APPLICATION CONTENTS
04 NCAC 19L .0804 FUNDING CYCLE
History Note: Authority G.S. 143‑323; 42 U.S.C.A.
5304(b)(3); 42 U.S.C.A. 5306; 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1984;
Repealed Eff. October 1, 1984.
04 NCAC 19L .0805 SELECTION CRITERIA
Selection of Urgent Needs grant recipients will be based
upon availability of funds and eligibility requirements as presented in Rule
.0802 of this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(a)(1); 24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; March 1, 1986; October 1,
1984; April 1, 1983.
section .0900 – grant administration
04 NCAC 19L .0901 GRANT AGREEMENT
(a) Upon approval of the application by the Division, a
written grant agreement shall be executed between the recipient and the
Division. These Rules, the approved application, and any subsequent amendments
to the approved application shall become a part of the grant agreement.
(b) The grant agreement in its original form and all
modifications thereto shall be kept on file in the office of the recipient in
accordance with Rule .0911 of this Section.
(c) The Division may condition the grant agreement until
the recipient demonstrates compliance with all applicable laws and
regulations. In the case of Housing Development and Revitalization Strategies
projects the grant agreement may be conditioned until legally binding
commitments have been obtained from all participating entities.
(d) Neither CDBG nor non‑CDBG funds involved in a
project may be obligated, nor may any conditioned project activities begin
until the Division releases in writing any and all applicable conditions on the
project. Recipients may incur costs prior to release of conditions with prior
Division approval in accordance with Rule .0908 of this Section.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.483;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; June 1, 1994; June 1, 1983;
September 1, 1990; May 1, 1998;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0902 METHOD OF ADMINISTRATION
(a) Recipients may delegate to statutorily authorized
subrecipients the responsibility of undertaking or carrying out any specified
community development activities. All entities so designated under this Paragraph
by recipients to undertake or carry out community development activities
pursuant to this Subchapter shall be considered subrecipients.
(b) Recipients may contract with any person, association,
or corporation in undertaking specified community development activities. All
contracts, shall be made in conformance with the procurement standards set
forth in Rule .0908 of this Section. Rule .0908 does not apply to recipients
in the selection of subrecipients.
(c) Subrecipients undertaking or carrying out community
development activities shall do so in conformance with Rule .0903, METHOD OF
PAYMENT; Rule .0906, FINANCIAL MANAGEMENT SYSTEMS; Rule .0907, PROGRAM INCOME;
Rule .0908, PROCUREMENT STANDARDS; Rule .0909, PROPERTY MANAGEMENT STANDARDS;
and Rule .0911, RECORDKEEPING.
History Note: Authority G.S. 143B‑10; 143B‑431;
153A‑376(b); 160A‑456(b); 24 C.F.R. 570.488;
24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1995; June 1, 1993; March 1, 1986;
April 1, 1983.
04 NCAC 19L .0903 METHOD OF PAYMENT
(a) Advance payments will be made by the Department to
recipients when the following conditions are met:
(1) The recipient has
demonstrated to the Secretary, initially through certification in a form
prescribed by the Department and subsequently through performance, that
procedures have been established to insure a maximum of three banking days time
elapsing between the receipt of funds to it and its disbursement of such funds.
(2) The recipient's financial
management system meets the standards for fund control and accountability
prescribed in Rule .0906 FINANCIAL MANAGEMENT SYSTEMS of this Subchapter.
(3) No payment to the recipient
from the Department shall be for an amount less than one hundred dollars
($100.00).
(4) All requests for advance
payments are required to meet immediate disbursing needs.
(b) Recipients who do not meet or adhere to the conditions
in Paragraph (a) of this Rule will not receive advance payments. Those
recipients will receive grant payments on a reimbursement basis.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489; 42 U.S.C.A. 5304(g);
Eff. July 1, 1982;
Amended Eff. March 1, 1995; June 1, 1993; September 1,
1990; April 1, 1989.
04 NCAC 19L .0904 ESCROW ACCOUNTS
History Note: Authority G.S. 143B‑10; 143B‑431;
159‑7 through 159‑38; 24 C.F.R. 570.494;
24 C.F.R. 570.496; 42 U.S.C.A. 5304(b),(d),(e);
Eff. July 1, 1982;
Amended Eff. May 1, 1992; March 1, 1984; April 1, 1983;
Repealed Eff. March 1, 1995.
04 NCAC 19L .0905 LUMP SUM DRAWDOWN FOR PROPERTY
REHABILITATION
History Note: Authority G.S. 143‑323; 143B‑10;
42 U.S.C.A. 5304(g); 24 C.F.R. 570.489;
24 C.F.R. 570.494;
Eff. July 1, 1982;
Amended Eff. September 1, 1990; May 1, 1988; March 1,
1984; April 1, 1983;
Repealed Eff. June 1, 1993.
04 NCAC 19L .0906 FINANCIAL MANAGEMENT SYSTEMS
Recipient financial management systems shall provide for
accurate, current and complete disclosure of the financial results of each
grant program in accordance with fiscal control and reporting requirements set
forth in G.S. 159, Article III, the Local Government Budget and Fiscal Control
Act. Recipients shall meet the following requirements:
(1) All grant funds shall be expended in accordance
with a budget ordinance or project ordinance adopted under G.S. 159‑8 and
G.S. 159‑13.2 respectively;
(2) A recipient may deposit or invest all or part of
the cash balance of any grant fund; however, all interest earned shall be
returned to the Department in accordance with Rule .0907(c) of this Section;
(3) Investment deposits shall be secured as provided in
G.S. 159‑31(b);
(4) The recipient shall designate as its official
depositories one or more banks or trust companies in the State in accordance
with G.S. 159‑31(a);
(5) All budgetary accounting for appropriations of grant
funds shall be in accordance with the procedures for incurring obligations and
disbursements as set forth in G.S. 159‑28;
(6) Each recipient shall establish an accounting system
in accordance with G.S. 159‑26;
(7) The recipient's finance officer, and each officer,
employee, or agent who handles or has in his custody more than one hundred
dollars ($100.00) of grant funds at any time, or who handles or has access to
the recipient's inventories, shall be bonded in accordance with G.S. 159‑29;
(8) Each recipient shall maintain records that identify
adequately the source and application of funds for grant‑supported
activities. These records shall contain information pertaining to federal
awards and authorizations, obligations, unobligated balances, assets,
liabilities, outlays, and income;
(9) A system for procedures for procurement and
property management shall be provided in accordance with Rule .0908 and Rule
.0909 of this Section;
(10) All cash receipts must be deposited with, or to the
credit of, the finance officer. This includes program revenues, reimbursements
of travel, vendor payments or other items previously recorded as expenditures,
and all other grant monies from the Department;
(11) Recipients must develop a systematic method to
assure timely and appropriate resolution of audit findings and recommendations;
(12) Recipients shall require subgrantees to adopt the
standards set forth in this Rule;
(13) Recipients shall comply with the Office of
Management and Budget Circular A‑87, entitled Cost Principles for State
and Local government, which is incorporated in these Rules by reference
including subsequent amendments and editions. A copy of this circular is
available from the Division of Community Assistance, Raleigh, North Carolina.
In applying OMB A‑87 the term "federal agency" shall mean the
Department;
(14) Recipients shall record the receipt and expenditure
of project revenues from taxes, special assessments, evies, fines, etc., in
accordance with generally accepted accounting principles;
(15) Subrecipients shall comply with the Office of
Management and Budget Circular A‑110, entitled Uniform Administrative
Requirements for Grants and other Agreements with Institutions of Higher
Education, Hospitals, and other Nonprofit Organizations which is incorporated
in these Rules by reference including subsequent amendments and editions. A
copy of this circular is available from the Division of Community Assistance,
Raleigh, North Carolina.
History Note: Authority G.S. 14‑234; 143B‑10;
143B‑431; 24 C.F.R. 570.489; 24 C.F.R. 570.496; 42 U.S.C.A.
5304(b),(d),(e);
Eff. July 1, 1982;
Amended Eff. August 1, 1998; June 1, 1994; June 1, 1993;
September 1, 1991; September 1, 1990.
04 NCAC 19L .0907 PROGRAM INCOME
(a) Definition. Program Income is defined as gross income
earned by the recipient from grant supported activities. Such earnings may
include, but not be limited to, sale of property, interest received from a loan
program, and the return of sales taxes on purchases made during the program.
Receipts derived from the operation of a public work or facility, the
construction of which was assisted by this program, do not constitute program
income. Income generated under the Development Loan Fund program, including
loan repayments, fees, lease payments does not constitute program income.
(b) Unless the grant agreement provides otherwise,
recipients shall have no obligation to the Department with respect to royalties
received as a result of copyrights or patents produced under the grant or other
agreement. Recipients must however, follow the procedures set forth in Rule
.0909 PROPERTY MANAGEMENT STANDARDS.
(c) All interest earned on grant funds prior to
distribution shall be returned to the Department, except recipients may keep
one hundred dollars ($100.00) per year for administrative expenses in
accordance with 24 CFR 570.489(c)(2).
(d) Recipients shall record the receipt and expenditure of
revenues (such as taxes, special assessments, levies, fines, etc.) as a part of
grant project transactions when such revenues are specifically earmarked for a
grant project in accordance with the grant agreement.
(e) Unless otherwise required, program income generated by
a pre‑1986 grant may be retained by the recipient. Program income is
identified by the grant year in which the activities which generated the
program income were funded. Pre‑1986 program income shall be added to
funds committed to a current project and used for activities approved in the
project's application. Pre‑1986 program income shall be expended prior
to requesting additional funds from the Department or shall be used in future
CDBG projects.
(f) Program Income generated by grants made in 1986 or
afterwards shall be returned to the Department except when:
(1) the recipient shall propose at the time of
application or at the time the program income is anticipated, a use or uses for
the projected program income, and
(2) the Department determines that, at the time
of the proposal, the use of the projected program income meets federal
requirements prohibiting the state from recapturing the program income; or
(3) the recipient, designated at the time of
the preliminary grant award as a "severely distressed county" pursuant
to G.S. 105‑130.40(c), or a city in such a county, wishes to retain the
program income to establish a local economic development revolving loan fund.
Any activities that are eligible under Title I of the federal Housing and
Community Development Act of 1974, as amended, and that meet at least one of
the three national objectives of the Housing and Community Development Act may
be undertaken. If the designation, pursuant to G.S. 105‑130.40(c), as a
"severely distressed county" is removed from a county, projects
having received at least a preliminary grant award prior to the removal of the
designation may continue to retain program income resulting from that grant as
provided in this subsection. Provisions of 4 NCAC 19L .0913 apply at the time
of closeout; or
(4) the program income is generated from an
Entrepreneurial Empowerment project, and the Department has approved the plan
for re-use of program income.
(g) Income after closeout and not subject to Rule .0907(e)
and (f) of this Subchapter.
(1) Except as may be otherwise provided under
the terms of the grant agreement or any closeout agreement, program income of
twenty-five thousand dollars ($25,000) or more received annually subsequent to
the CDBG Program closeout shall be used for any eligible activity pursuant to
Rule .0301 of this Subchapter. Recipients must receive Division approval in
writing prior to obligation of program income under this Paragraph to determine
if the proposed use is plainly appropriate to meeting the recipient's needs and
objectives. When income received is less than twenty-five thousand dollars
($25,000) annually, the recipient may spend the funds at the end of the 12
month period according to its own needs; and
(2) Accurate records shall be kept on all
program income and reported annually to the Division when the annual amount
exceeds twenty-five thousand dollars ($25,000) and to determine when the
twenty-five thousand dollars ($25,000) threshold is exceeded subsequent to
grant closeout.
(h) Program income generated under the Development Loan
Fund program, including loan repayments, fees, lease payments shall meet all
the requirements outlined in 24 CFR 570.489(e) and the contract between the
unit of local government and the Department of Housing and Urban Development.
History Note: Filed as Temporary Amendment Eff. August
19, 1988 for a period of 180 days to expire on February 15, 1989;
Authority G.S. 143B-431; 153A-376; 160A-456; 24 C.F.R.
570.489(e);
Eff. July 1, 1982;
Amended Eff. August 1, 1998; March 1, 1995; June 1, 1993;
September 1, 1991; September 1, 1990.
04 NCAC 19L .0908 PROCUREMENT STANDARDS
(a) Local governments shall follow the procurement
standards established in the Administrative Requirements for Grants and
Cooperative Agreements to State, Local and Federally Recognized Indian Tribal
Governments (24 C.F.R., Part 85) and HUD implementing regulations contained in
24 CFR 570.489(g), which explicitly prohibit cost plus a percentage of cost and
percentage of construction cost methods of contracting. This Subchapter
incorporates by reference the federal law and regulations described in 24 CFR,
Part 85, 24 CFR 570.489(g), and 24 CFR 570.489(h), including subsequent
amendments and editions. Copies of these sections of federal law and
regulation are available for public inspection from the Division of Community
Assistance. Single copies are available from this Division in Raleigh, North
Carolina, for one dollar ($1.00) each.
(b) Recipients may incur costs with written approval of the
Division for the procurement of supplies, equipment, construction and services
before the Grant Agreement between the recipient and the Division has been
executed. In the case of program amendments, recipients may not incur costs
for the procurement of supplies, equipment, construction and services that are
the subject of the program amendment until the program amendment has been
approved in writing by the Division. Recipients that incur costs prior to
execution of the grant agreement must ensure that the activities are eligible
and meet requirements of 24 CFR Part 58, Environmental Review.
(c) Recipients must also comply with the North Carolina
General Statutes applicable to the procurement of supplies, equipment,
construction and services. Relevant state laws include:
(1) Conflict of Interest, G.S.
14‑234 (cities and counties);
(2) Public Building Contracts,
G.S. 143‑128 through 135 (cities and counties); and
(3) Model payment and
performance bond, G.S. 44A‑25 through 33 (cities and Counties).
(d) Additional rules governing property acquisition are
found in this Subchapter under Rule .1003 ACQUISITION AND RELOCATION; Rule
.0907 PROPERTY MANAGEMENT STANDARDS; Rule .1001 EQUAL OPPORTUNITY; and Rule
.1006 LABOR STANDARDS.
(e) The requirements of the Office of Management and Budget
Circular No. A‑87, Cost Principles for State and Local Governments, shall
apply to the procurement of materials and services funded in whole or in part
with CDBG funds.
History Note: Authority G.S. 14‑234; 143‑128
through 143‑135; 143B‑431; 153A‑158;
153A‑163 through 153A‑165; 159‑15; 42
U.S.C.A. 5304(b)(4); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; April 1,
1989; March 1, 1984.
04 NCAC 19L .0909 PROPERTY MANAGEMENT STANDARDS
This Rule prescribes uniform standards governing the use and
disposition of property acquired in whole or in part with Community Development
Block Grant funds.
(1) Definitions.
(a) "Real property"
means land, including land improvements, structures and appurtenances thereto,
excluding movable machinery and equipment.
(b) "Personal property"
means any kind of property except real property. It may be tangible ‑
having physical existence, or intangible ‑ having no physical existence,
such as patents, inventions, and copyrights.
(c) "Nonexpendable personal
property" means tangible personal property having a useful life of more
than one year and an acquisition cost of one thousand dollars ($1,000.00) or
more per unit.
(d) "Expendable personal
property" refers to all tangible personal property other than
nonexpendable property.
(e) "Acquisition cost of
purchased nonexpendable personal property" means the net invoice unit
price of the property including the cost of modifications, attachments,
accessories, or auxiliary apparatus necessary to make the property useable for
the purpose for which it was acquired. Other charges such as the cost of
installation, transportation, taxes, duty, or protective in‑transit insurance,
shall be included or excluded from the unit acquisition cost in accordance with
the regular accounting practices.
(2) Real Property.
(a) Title to real property shall
vest in the recipient subject to the condition that the recipient shall use the
real property for the authorized purpose of the original grant as long as
needed.
(b) The recipient shall obtain
prior approval by the Division for the use of the real property in other
projects when the recipient determines that the property is no longer needed
for the original grant purposes. Use in other projects will be limited to
those under other federal and state grant programs, or programs that have
purposes consistent with those authorized for support by the Department.
(c) When the real property is no
longer needed as provided in (a) and (b) of this Paragraph, the recipient shall
request disposition instructions from the Division, according to the following
rules:
(i) The recipient may be
permitted to retain title after it compensates the program budget in an amount
computed by applying the CDBG percentage of participation in the cost of the
original project to the current fair market value of the property.
(ii) The recipient may be
directed to sell the property under guidelines provided by the Division.
(3) Nonexpendable Personal Property.
Title to nonexpendable personal property whose acquisition cost is borne in
whole or part by Community Development Block Grant funds shall be vested in the
recipient subject to the following restrictions:
(a) Use. The recipient shall use
the property as long as there is a need for such property to accomplish the
objectives of the Housing and Community Development Act of 1974, as amended,
whether or not the recipient is supported by funds appropriated under this Act.
(b) Disposition. When the
recipient no longer needs the property as provided in this Rule, the property
may be used in accordance with the following standards:
(i) Nonexpendable personal
property with a unit acquisition cost of less than one thousand dollars
($1,000) may be retained by the recipient for other programs or sold by the
recipients without reimbursement to the program budget.
(ii) Nonexpendable personal
property with a unit acquisition cost of one thousand dollars ($1,000) or more
may be retained by the recipient for other uses provided that compensation is
made as program income in accordance with Rule .0907. The amount of
compensation shall be computed by applying the percentage of CDBG participation
in the cost of the original project or program to the current fair market value
of the property. If the recipient has no need for the property then it shall
dispose of the property in accordance with State law and proceeds shall be
considered as program income.
(c) Property records shall be maintained
accurately and shall include:
(i) a description of the
property;
(ii) manufacturer's serial
number, model number, federal stock number, national stock number, or other
identification number;
(iii) source of the property
including grant or other agreement number;
(iv) acquisition date;
(v) percentage of CDBG
participation in the cost of the project for which the property was acquired;
(vi) location, use, and condition
of the property and the date the information was reported;
(vii) unit acquisition cost; and
(viii) ultimate disposition data,
including date of disposal and sales price or the method used to determine
current fair market value where a recipient compensates the Department for its
share.
(d) A physical inventory of
property shall be taken annually to verify the existence, current utilization
and continued need for the property. The results shall be reconciled with the
property records at least once every two years. Any differences between the
quantities determined by the physical inspections and those shown in the
accounting records shall be investigated to determine the causes of the
differences.
(e) Adequate maintenance
procedures shall be implemented to keep the property in good condition.
(f) A control system shall be in
effect to insure adequate safeguards to prevent loss, damage, or theft of the
property. Any loss, damage, or theft of nonexpendable property shall be
investigated and fully documented.
(g) Where the recipient is
authorized or required to sell the property, proper sales procedures shall be
established which would provide for competition to the extent practicable and
result in the highest possible return.
(4) Expendable Personal Property. Title
to expendable personal property shall vest in the recipient upon acquisition.
If there is a residual inventory of such property exceeding one thousand
dollars ($1,000) in total aggregate fair market value, upon termination or
completion of the grant and if the property is not needed for any other
federally sponsored project or program, the recipient shall retain the property
for use on nonfederally sponsored activities, or sell it, but must in either
case, compensate the program for its share. The amount of compensation will be
computed in the same manner as nonexpendable personal property.
(5) Intangible Property.
(a) Inventions and patents. If
any program produces patentable items, patent rights, processes, or inventions,
in the course of work sponsored by the Department, such fact shall be promptly
and fully reported to the Department. Unless there is a prior agreement
between the recipient and the Department on disposition of such items, the
Department shall determine whether protection on the invention or discovery
shall be sought. The Department will also determine how the rights in the
invention or discovery, including rights under any patent issued thereon, shall
be allocated and administrated in order to protect the public interest
consistent with "Government Patent Policy" (President's memorandum
for Heads of Executive Departments and Agencies, August 23, 1971, and Statement
of Government Patent Policy as printed in 36 FR 16889); and
(b) Copyrights. Except as
otherwise provided in the terms and conditions of the agreement, the author or
the recipient is free to copyright any books, publications, or other
copyrightable materials developed in the course of or under a Departmental
agreement, but the Department shall reserve a royalty‑free nonexclusive
and irrevocable right to reproduce, publish, or otherwise use, and to authorize
others to use, the work for government purposes.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(b)(4),(d)(2),(e); 24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; May 1,
1988; April 1, 1983.
04 NCAC 19L .0910 PROGRAM AMENDMENTS
(a) Community development program amendments. Recipients
shall request prior Division approval for all program amendments when:
(1) The recipient proposes to
change the approved project budget amount for any activity by more than 10
percent of the total project amount;
(2) The recipient proposes to
add or delete any activity or activities, change project locations, or change
the scope of the program or class of beneficiaries of previously approved
activities; and
(3) The cumulative effect of a
number of smaller changes involving the approved activities exceeds 10 percent
of the total project amount. In such instances, the recipient shall include in
its request for an amendment documentation describing the smaller changes
previously made, as well as those being proposed. After the amendment is
approved by the Division, the accrual of smaller changes begins again.
(b) Citizen Participation. Recipients proposing amendments
and other changes to the approved application which require prior Division
approval pursuant to Paragraph (a) of this Rule shall hold one public hearing
in accordance with Paragraph (f) of Rule .1002, CITIZEN PARTICIPATION.
(c) Citizen objections to the amendment. Persons wishing
to object to the approval of an amendment by the Division shall make such
objection in writing to the Division in accordance with Paragraph (f) of Rule
.1002 CITIZEN PARTICIPATION.
(d) Budget ordinance amendment. Any amendment to the grant
program that involves a financial transaction shall comply with the provisions
set forth in G.S. 159‑15, Amendments to the Budget Ordinance.
(e) All requests for program amendments that require prior
Division approval shall be submitted to the Division and include the following:
(1) copy of the current budget
and proposed changes;
(2) detailed narrative
description of the proposed changes and their effect upon the approved project;
(3) maps showing any change in
location;
(4) signature of approval by the
recipient's chief elected official on a form prescribed by the Division; and
(5) other information
appropriate for evaluating the proposed amendment.
(f) All requests for program amendments that require prior
Division approval may be submitted by the Division to the appropriate agency or
agencies for clearinghouse review. Procedures for this review shall be in
accordance with Rule .1012 of this Subchapter.
(g) All records of program amendments shall be kept on file
in accordance with Rule .0911 of this Section.
(h) Division Review of Amendments. In approving or denying
proposed amendments pursuant to Paragraph (a) of this Rule .0910, the Division
may consider the following factors:
(1) amendments which include new
or significantly altered activities may be rated in accordance with the selection
criteria applicable at the time the original application was rated;
(2) whether the proposed
amendment activities can be completed within the scheduled duration of the
project;
(3) feasibility of the proposed
amendment; and
(4) appropriateness of the
proposed amendment.
History Note: Authority G.S. 143B‑10; 143B‑431;
159‑15; 159‑34; 42 U.S.C.A. 5304(a)(2),(d)(2);
24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; April 1,
1989; March 1, 1984.
04 NCAC 19L .0911 RECORDKEEPING
(a) The Secretary of the Department of Commerce, the
Secretary of the Department of Housing and Urban Development, or any of their
duly authorized representatives shall have access to all books, accounts,
records, reports, files, and other papers or property of recipients or their
subgrantees and contractors pertaining to funds provided under this Subchapter
for the purpose of making surveys, audits, examinations, excerpts and
transcripts.
(b) All Community Development Program records that are
public under G.S. 132 shall be made accessible to interested individuals and
groups during normal working hours, and shall be maintained at all times at the
recipient's local government office.
(c) Financial records, supporting documents and all other
reports and records required under this Subchapter, and all other records
pertinent to the Community Development Program shall be retained by the
recipient for a period of five years from the date of the closeout of the
program, except as follows:
(1) Records that are the subject of audit
findings shall be retained for five years or until such audit findings have
been resolved, whichever is later;
(2) Records for nonexpendable property which
was acquired with Federal grant funds shall be retained for five years after
its final disposition;
(3) Records for any displaced person shall be
retained for five years after he/she has received final payment;
(4) Records pertaining to each real property
acquisition shall be retained for five years after settlement of the
acquisition, or until disposition of the applicable relocation records in
accordance with Subparagraph (3) of this Section, whichever is later; and
(5) If a litigation, claim or audit is started
before the expiration of the five-year period, the records shall be retained
until all litigations, claims, or audit findings involving the records have
been resolved.
(d) All records shall be sufficient to determine compliance
with the requirements and primary objectives of the Community Development Block
Grant Program and all other applicable laws and regulations. All accounting
records shall be supported by source documentation and shall be in compliance
with Rule .0906 of this Section.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(d)(2),(e); 24 C.F.R. 570.490;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; June 1, 1993; September 1,
1990; May 1, 1988; April 1, 1983;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0912 AUDIT
(a) The recipient's financial management systems shall
provide for audits to be made by the recipient or at the recipient's direction,
in accordance with the following:
(1) The recipient shall provide for an audit of
its CDBG program on an annual basis for any fiscal year in which twenty‑five
thousand ($25,000) or more in CDBG funds are received in accordance with the
annual independent audit procedures set forth in G.S. 159‑34;
(2) The CDBG program audit shall be performed
in conjunction with the regular annual independent audit of the recipient and
shall contain an examination of all financial aspects of the CDBG program as
well as a review of the procedures and documentation supporting the recipient's
compliance with applicable statutes and regulations;
(3) CDBG program funds may only be used to pay
for the CDBG portion of the audit costs if more than three hundred thousand
dollars ($300,000) in all Federal Programs are used;
(4) The recipient shall submit the Annual Audit
Report to the Division, including the information identified in Paragraph (b)
of this Rule, along with an Annual Performance Report as required by Rule .1101
of this Subchapter; and
(5) The Division may require separate closeout
audits to be prepared by the recipient in accordance with Paragraph .0913(e) of
this Section.
(b) Audits shall comply with the requirements set forth in
this Paragraph:
(1) Audits shall include, at a minimum, an
examination of the systems of internal control, systems established to insure
compliance with laws and regulations affecting the expenditure of grant funds,
financial transactions and accounts, and financial statements and reports of
recipient organizations;
(2) Financial statements shall include
footnotes, comments which identify the statements examined, the period covered,
identification of the various programs under which the recipient received CDBG
funds, and the amount of the awards received;
(3) Audits shall be made in accordance with the
GENERAL ACCOUNTING OFFICE STANDARDS FOR AUDIT OF GOVERNMENTAL ORGANIZATIONS,
PROGRAMS, ACTIVITIES AND FUNCTIONS, THE GUIDELINES FOR FINANCIAL AND COMPLIANCE
AUDITS OF FEDERALLY ASSISTED PROGRAMS, any compliance supplements approved by
the Federal Office of Management and Budget (OMB), and generally accepted
auditing standards established by the American Institute of Certified Public
Accountants;
(4) The audit shall include the auditor's
opinion as to whether the financial statements are fairly presented in
accordance with generally accepted accounting principles. If an unqualified
opinion cannot be expressed, the auditor shall state the nature of the
qualification;
(5) The auditors' comments on compliance and
internal control shall:
(A) Include comments on weaknesses in and noncompliance
with the systems of internal control, separately identifying material
weaknesses;
(B) Identify the nature and impact of any noted
instances of noncompliance with the terms of agreements and those provisions of
State or Federal laws and regulations that could have a material effect on the
financial statements and reports;
(C) Contain an expression of positive assurance with
respect to compliance with requirements for tested items and negative assurance
for untested items;
(D) Comment on the accuracy and completeness of
financial reports and claims for advances or reimbursement to Federal agencies;
(E) Comment on corrective action taken or planned by
the recipient;
(6) Work papers and reports shall be retained
for a minimum of five years from the date of the audit report unless the
auditor is notified in writing by the Division of the need to extend the
retention period based on changes in Federal regulations. The audit work
papers shall be made available upon request to the Division and the General
Accounting Office or its designees;
(7) If during the course of the audit, the
auditor becomes aware of irregularities in the recipient organization the
auditor shall promptly notify the Division and recipient management officials
about the level of involvement. Irregularities include such matters as
conflicts of interest, falsification of records or reports, and
misappropriation of funds or other assets;
(8) Selection of an independent auditor shall
be in accordance with Rule .0908 of this Section.
(c) A "single audit," in which the regular
independent auditor will perform an audit of all compliance aspects for all
federal grants along with the regular financial audit of the recipient, is
permissible. Where feasible, the recipient shall use the same auditor so that the
audit will include the financial and compliance work under a single plan in the
most economical manner.
(d) Small audit firms and audit firms owned and controlled
by socially and economically disadvantaged individuals shall have the maximum
practicable opportunity to participate in the performance of contracts awarded
with CDBG funds. Recipients shall take the following affirmative action to
further this goal:
(1) Assure that small audit firms and audit
firms owned and controlled by socially and economically disadvantaged
individuals as defined in P.L. 95‑507 are used to the fullest extent
practicable;
(2) Make information on forthcoming
opportunities available, and arrange time frames for the audit so as to
encourage and facilitate participation by small or disadvantaged firms;
(3) Consider in the contract process whether
firms competing for larger audits intend to subcontract with small or
disadvantaged firms;
(4) Encourage contracting with small or
disadvantaged audit firms which have traditionally audited government programs,
and in such cases where this is not possible, assure that these firms are given
consideration for audit subcontracting opportunities;
(5) Encourage contracting with consortiums of
small or disadvantaged audit firms when a contract is too large for an
individual small or disadvantaged audit firm; and
(6) Use the services and assistance, as
appropriate, of the Small Business Administration, and the Minority Business
Development Agency of the U.S. Department of Commerce in the solicitation and
utilization of small or disadvantaged audit firms.
(e) All records, data, audit reports and files shall be
maintained in accordance with Rule .0909 of this Section, unless otherwise
stated in this Rule.
(f) The provisions of this Rule do not limit the authority
of the Department to make audits of recipients' organizations.
History Note: Authority G.S. 143B‑10; 143B‑431;
159‑34; 42 U.S.C.A. 5304(d)(2),(e); 24 C.F.R. 44.6; 24 C.F.R. 85.36(e);
24 C.F.R. 570.492;
Eff. April 1, 19983;
Amended Eff. June 1, 1994; June 1, 1993; September 1,
1990; May 1, 1988;
Temporary Amendment Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .0913 GRANT CLOSEOUTS
(a) Initiation of closeout. The Division will advise the
recipient to initiate closeout procedures when the Division determines, in
consultation with the recipient, that there are no impediments to closeout and
that the following criteria have been met or will be met shortly:
(1) All costs to be paid with grant funds have
been incurred with the exception of closeout costs such as payment for the
final audit and any unsettled third‑party claims against the recipient.
Costs are incurred when goods and services are received or contract work is
performed. With respect to activities (such as rehabilitation of privately
owned properties) which are carried out by means of revolving loan accounts,
loan guarantee accounts, or similar mechanisms, costs shall be considered as
incurred at the time funds for such activities are drawn from the Department
and initially used for the purposes described in the approved Community
Development Program. The phrase "initially used for the purposes
described in the approved Community Development Program" means the payment
of such funds for work actually performed and is not intended to mean the
initial deposit(s) of funds into the revolving loan account, loan guarantee
account, or similar mechanism (such as loan or grant escrow account);
(2) The recipient shall submit to the Division
within 90 days after the date of completion of the grant all financial,
performance, and other reports required as a condition of the grant;
(3) With respect to any grant for which an
Annual Performance Report is required pursuant to Rule .1101, for purposes of
the closeout, and has not been submitted or updated, the failure of a recipient
to submit or update as required will not preclude the Division from effecting a
grant closeout when such action is determined to be in the best interest of the
Division. The failure or refusal by a recipient to comply with such
requirement shall be taken into account in the performance determination by the
Division in reviewing any future grant applications from the recipient. Any
excess grant amount which is otherwise authorized to be retained by the
recipient shall be refunded to the Division in the event of a recipient's
failure to furnish the Annual Performance Report or update it as required under
this Rule;
(4) Other responsibilities of the recipient
under the grant agreement and closeout agreement, applicable laws and
regulations appear to have been carried out satisfactorily, or the Division has
no further interest in keeping the grant agreement open for the purpose of
securing performance. A final review of the recipient's compliance with the
grant agreement and any closeout agreement, applicable laws and regulations
will be made during the final audit or Division review in lieu of the final
audit pursuant to Paragraph (e) of this Rule.
(b) Program Income. The recipient shall account for any
program income in accordance with Rule .0907 of this Section.
(c) Disposition of nonexpendable personal property. The
recipient shall account for any nonexpendable personal property acquired with
grant funds in accordance with Rule .0909 of this Section entitled PROPERTY
MANAGEMENT STANDARDS and Rule .0907 of this Section entitled PROGRAM INCOME.
(d) Disposition of real property. Disposition of real
property shall be in accordance with the requirements of Rules .0909 and .0907
of this Section.
(e) Audit. Upon notification from the Division to initiate
closeout procedures, the recipient shall arrange for a final audit to be made
of its grant accounts and records in accordance with Rule .0912 of this
Section, and any other audit requirements of the Department hereafter in
effect. The Division may determine that, due to the nature of the recipient's
program or the relatively small amount of funds which have not been audited, a
final audit is not required. In such instances, the Division will notify the
recipient that the Department will perform necessary review of documentation
and activities to determine that claimed costs are valid program expenses and
that the recipient has met its other responsibilities under the grant
agreement.
(f) Certificate of completion and final cost. Upon
resolution of any findings in the final audit or, if the final audit is waived,
after the Division has performed the review of documentation described in
Paragraph (e) of this Rule, the recipient shall prepare a certificate of
completion and final cost, on a form prescribed by the Division, and submit it
to the Division.
(g) Refund of excess grant funds. Recipients shall refund
to the Department any cash advance in excess of the final grant amount, as
shown on the certificate of completion approved by the Division. However,
recipients may request Division approval to use any excess grant funds to complete
additional eligible activities where at least fifty‑one percent of the
funds benefit low‑ and moderate‑income persons. Division approval
must be obtained prior to such use of excess funds.
(h) Termination of grant for mutual convenience. Grant
assistance provided under this part may be cancelled, in whole or in part, by
the Division or the recipient, prior to the completion of the approved
Community Development Program, when both parties agree that the continuation of
the program no longer is feasible or would not produce beneficial results
commensurate with the further expenditure of funds. The Division shall
determine whether an environmental review of the cancellation is required, and
if a review is required it shall be performed by the recipient. The two
parties shall agree upon the termination conditions, including the effective
date and, in the case of partial terminations, the portion to be terminated.
The recipient shall not incur new obligations for the terminated portion after
the effective date, and shall cancel as many outstanding obligations as
possible. The Department shall allow full credit to the recipient for the
noncancelable obligations properly incurred by the recipient in carrying out
the program prior to termination. The closeout policies and procedures
contained in this Rule shall apply in all such cases except where the total
grant is cancelled in its entirety, in which event only the provisions of
Paragraph (f) and (g) of this Rule shall apply.
(i) Termination for cause. In cases in which the Secretary
terminates the recipient's entire grant, or the remaining balance thereof, in
accordance with Rule .1103 of this Subchapter, provisions of Paragraphs (f) and
(g) of this Rule shall apply.
(j) The recipient shall hold a public hearing prior to
closeout of the CDBG program to assess the performance of the recipient in
accordance with Rule .1002 of this Subchapter.
(k) All records of the closeout process shall be maintained
in accordance with Rule .0911 of this Section.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Eff. April 1, 1983;
Amended Eff. June 1, 1993; September 1, 1990; May 1,
1988; March 1, 1984.
04 NCAC 19L .0914 CONFLICT OF INTEREST
In all cases not governed under Rule .0908 of this Section
regarding procurement procedures, recipients shall meet the requirements of HUD
implementing regulations contained in 24 CFR 570.489(h). For the purposes of
this Rule, the following definitions apply:
(1) "family ties" means
spouse, parents, children, brother, sister, grandparents, grandchildren and the
step, half, and in‑law relationships;
(2) "business ties" means an
officer, employee, agent, or any stockholder or shareholder holding at least 10
percent ownership of any firm, contract, or subcontract which benefits from
funding assistance under the grant agreement.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Eff. June 1, 1993.
SECTION .1000 ‑ COMPLIANCE REQUIREMENTS
04 NCAC 19L .1001 EQUAL OPPORTUNITY AND
NONDISCRIMINATION
No person shall on the grounds of race, color, national
origin, sex, religion, handicap or familial status be excluded from
participation in, be denied the benefit of, or be subjected to discrimination
under any program or activity funded in whole or in part with funds available
under this Subchapter.
(1) Recipients shall meet the
requirements of:
(a) The Civil Rights Act of 1964
(P.L. 88‑352) and specifically Title VI which provides that no person in
the United States shall on the grounds of race, color, or national origin, be
excluded from participation in, be denied the benefits of, or be otherwise
subject to discrimination under any program or activity which receives federal
funds;
(b) The Civil Rights Act of 1968
(P.L. 90‑284) as amended, and specifically Title VIII which requires
recipients to administer all programs and activities relating to housing and
community development in a manner to affirmatively further fair housing, and
take action to affirmatively further fair housing in the sale and rental of
housing, the financing of housing, and the provision of brokerage services;
(c) Section 109 of the Housing
and Community Development Act of 1974, as amended (P.L. 93‑383) which
provides that no person in the United States shall, on the grounds of race,
color, national origin, or sex, be excluded from participation in, be denied
the benefits of, or be subjected to discrimination under any program or
activity funded in whole or in part with funds provided under this Subchapter.
Any prohibition against discrimination on the basis of age under the Age
Discrimination Act of 1975, as amended (42 U.S.C. 6101 et. seq.) or with
respect to any otherwise qualified handicapped individual as provided in
Section 504 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794),
shall also apply to any such program or activity;
(d) Executive Order 11063, as
amended by Executive Order 12259, Leadership and Coordination of Fair Housing
in Federal Programs, requiring that programs and activities relating to housing
and urban development be administered in a manner to affirmatively further the
goals of Title VIII of the Civil Rights Act of 1968;
(e) Executive order 11246, as
amended, which provides that no person shall be discriminated against on the
basis of race, color, religion, sex, or national origin in all phases of
employment during the performance of federal and federally assisted
construction contracts, and that affirmative action will be taken in all
aspects of personnel negotiations; and
(f) Section 3, of the Housing
and Urban Development Act of 1968, (P.L. 90‑448) as amended, which
requires that to the greatest extent feasible, opportunities for training and
employment arising in connection with the planning and carrying out of any
project assisted under any federal block grant program be given to lower‑income
residents of the unit of local government, metropolitan area or nonmetropolitan
county in which the project is located and contracts for work in connection
with the project be awarded to eligible business concerns which are located in,
or owned in substantial part by persons residing in, the same metropolitan area
or nonmetropolitan county as of the project.
(2) Recipients shall meet the
implementing requirements of:
(a) Regulations under Title VI of
the Civil Rights Act of 1964, 24 C.F.R., Part 1 and 2;
(b) Equal Employment Opportunity
under HUD Contracts and HUD Assisted Construction, 24 C.F.R. Part 130;
(c) Employment Opportunities for
Businesses and Lower Income Persons In Connection With Assisted Projects, 24
C.F.R. 135; and
(d) HUD implementing regulations
contained in 24 C.F.R. Part 107.
(3) Local government recipients shall
meet the requirements of Title II of the Americans with Disabilities Act of
1990 (P.L. 101‑336) and its implementing regulations (28 CFR Part 35).
(4) Recipients shall maintain records
and data and document compliance efforts as required by the laws and
regulations in this Rule including data on the racial, ethnic, and gender
characteristics of persons who are applicants for, participants in, or
beneficiaries of the program and shall comply with Rule .0911 of this
Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489; 24 C.F.R. 570‑490;
24 C.F.R. 570.496; 42 U.S.C.A. 1982; 42 U.S.C.A. 2000d et
seq.; 42 U.S.C. 5309;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; March 1, 1984.
04 NCAC 19L .1002 CITIZEN PARTICIPATION
(a) Each applicant and recipient shall provide citizens
with an opportunity for meaningful involvement on a continuing basis and for
participation in the planning, implementation and assessment of the program. Each
applicant and recipient shall provide information to citizens, hold public
hearings, provide for timely responses to citizens' complaints, and certify
that it is following a detailed Citizen Participation Plan as in (b) through
(h) of this Rule. All public hearings shall be held by the governing board of
the applicant or recipient.
(b) Citizen participation in the application process.
(1) Each applicant for CDBG funds shall:
(A) Solicit and respond in a timely manner to views and
proposals of citizens, particularly low‑ and moderate‑income
persons, members of minority groups, and residents of blighted areas where
activities are proposed. Applicants shall respond in writing to written
citizen comments. Responses shall be made within 10 calendar days of receipt
of the citizen comment, when practicable.
(B) Provide technical assistance to facilitate citizen
participation, where requested. The technical assistance shall be provided to
groups representative of persons of low‑ and moderate‑income that
request such assistance in developing proposals. The level and type shall be
determined by the applicant.
(C) Provide notices of public hearings in a timely
manner to all citizens and in such a way as to make them understandable to non‑English
speaking persons. Hearings must be held at times and locations convenient to
potential or actual beneficiaries and with accommodations for persons with
disabilities. A notice of the public hearing shall be published at least once
in the nonlegal section of a newspaper having general circulation in the area.
The notice shall be published not less than ten days nor more than 25 days
before the date fixed for the hearing. The notice of public hearing to obtain
citizens' views after the application has been prepared, but prior to the
submission of the application to the Division, shall contain a description of
the proposed project(s) including the proposed project location, activities to
be carried out, and the total costs of activities. The notice of the public
hearing shall also contain the language for submitting objections contained in
the Part (b)(2)(A) of this Rule.
(D) Schedule hearings to obtain citizens' views and to
respond to citizen proposals at times and locations which permit broad
participation, particularly by low‑ and moderate‑income persons,
members of minority groups, handicapped persons, and residents of blighted
neighborhoods and project areas.
(E) Conduct one public hearing during the planning
process to allow citizens the opportunity to express views and proposals prior
to formulation of the application, except that applicants in the Urgent Needs
category are exempt from holding this public hearing.
(F) Conduct one public hearing after the application
has been prepared but prior to submission of the application to the Division.
(2) Submitting objections to the Division.
(A) Persons wishing to object to the approval of an
application by the Division shall submit to the Division their objections in
writing. The Division shall consider objections made only on the following
grounds:
(i) The applicant's description of the needs and
objectives is plainly inconsistent with available facts and data,
(ii) The activities to be undertaken are plainly
inappropriate to meeting the needs and objectives identified by the applicant,
and
(iii) The application does not comply with the
requirements of this Subchapter or other applicable laws.
(B) All objections shall include an identification of
the requirements not met. In the case of objections made on the grounds that
the description of needs and objectives is plainly inconsistent with available
facts and data, the objection shall include the facts and data upon which the
objection is based.
(c) Citizen Participation Plan. Recipients shall develop
and adopt, by resolution of their governing board, a written citizen
participation plan developed in accordance with all provisions of this Rule and
which:
(1) provides for and encourages citizen
participation with particular emphasis on participation by persons of low‑
and moderate‑income who are residents of slum and blight areas and of
areas in which CDBG funds are proposed to be used;
(2) provides citizens with reasonable and
timely access to local meetings, information, and records relating to the
recipient's proposed and actual use of funds;
(3) provides for technical assistance to groups
representative of persons of low‑ and moderate‑income that request
such assistance in accordance with Part (b)(1)(B) of this Rule;
(4) provides for public hearings to obtain
citizen views and to respond to proposals and questions at all stages of the
community development program in accordance with Paragraphs (b), (f), and (g)
of this Rule;
(5) provides a procedure for developing written
responses to written complaints and grievances within ten calendar days of
receipt of the complaint. The procedure shall include all provisions of
Paragraph (d) of this Rule; and
(6) identifies how the needs of non‑English
speaking residents will be met in the case of public hearings where a
significant number of non‑English speaking residents can be reasonably
expected to participate.
(d) The recipient shall develop and adopt a written
complaint procedure to respond to citizen complaints involving the CDBG
program. The complaint procedure shall be applicable through the life of the
grant and available to the general public. It shall specify that the recipient
will respond in writing to written citizen complaints within 10 calendar days
of receipt of the complaint. The procedure shall include a phone number for
further information or clarification on the complaint procedure and shall
identify any local procedures or appeals process that would normally be used by
the recipient to address citizen complaints. The complaint procedure shall
also state that if a citizen lodging a complaint is dissatisfied with the local
response, then that person may direct the complaint to the North Carolina
Division of Community Assistance.
(e) Citizen participation during program implementation.
Citizens shall have the opportunity to comment on the implementation of a
Community Development Program throughout the term of the program. Recipients
shall solicit and respond to the views and proposals of citizens in the same
manner as in Part (b)(1)(A) of this Rule.
(f) Citizen participation in the program amendment process.
(1) Recipient procedures.
(A) Recipients proposing amendments which require prior
Division approval in accordance with Rule .0910 of this Subchapter shall to
conduct one public hearing prior to submission of the amendment to the Division
in the same manner as in Part (b)(1)(C) of this Rule.
(B) Each recipient shall respond to citizen objections
and comments in the same manner as in Part (b)(1)(A) of this Rule.
(2) Submitting Objections to the Division.
(A) Persons wishing to object to the approval of an
amendment by the Division shall make such objection in writing. The Division
shall consider objections made only on the following grounds:
(i) The recipient's description of needs and
objectives is plainly inconsistent with available facts and data,
(ii) The activities to be undertaken are plainly
inappropriate to meeting the needs and objectives identified by the recipient,
and
(iii) The amendment does not comply with the
requirements of this Section or other applicable laws and regulations.
(B) All objections shall include an identification of
the requirements not met. In the case of objections made on the grounds that
the description of needs and objectives is plainly inconsistent with available
facts and data, the objection shall include the facts and data upon which the
objection is based.
(g) Citizen participation in the program closeout process.
(1) Recipients shall conduct one public hearing
to assess program performance during the grant closeout process and prior to
the actual closeout of the grant in the same manner as in Part (b)(1)(C) of
this Rule.
(2) Recipients shall continue to solicit and
respond to citizen comment in the same manner as in Part (b)(1)(A) of this Rule
until such time as the grant program is closed.
(h) Persons may submit written comments to the Division at
any time concerning the applicant's or recipient's failure to comply with the
requirements contained in this Subchapter.
(i) All records of public hearings, citizens' comments,
responses to comments and other relevant documents and papers shall be kept in
accordance with Rule .0911 of this Subchapter. All program records shall be
accessible to citizens in accordance with Rule .0911(b) of this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(a)(2); 24 C.F.R. 570.486;
Eff. July 1,
1982;
Amended Eff.
August 1, 1998; June 1, 1993; September 1, 1990; May 1, 1988; March 1, 1984;
Temporary
Amendment Eff. January 1, 2001;
Amended Eff.
August 1, 2002.
04 NCAC 19L .1003 ACQUISITION AND RELOCATION
(a) The purpose of this Rule is to insure that owners of
real property to be acquired under the provisions of this Subchapter are
treated fairly and consistently, to encourage and expedite acquisition by agreements
with such owners, to minimize litigation and relieve congestion in the courts,
and to promote public confidence in governmental land acquisition; and to
insure that persons displaced as a result of CDBG‑assisted projects are
treated equitably so that such persons will not suffer disproportionate
injuries as a result of projects designed for the benefit of the public as a
whole. Recipients shall follow the requirements of the Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970 (P.L. 91‑646),
Sections 104(d) and 106(d)(5)(A) of Title I of the Housing and Community
Development Act of 1974, as amended, and HUD implementing regulations [24 CFR
570.488 and 570.496(a)]. This Subchapter incorporates by reference the federal
regulations described in 24 CFR 570.488 and 24 CFR 570.496(a), including
subsequent amendments and editions. Copies of these laws and regulations are
available for public inspection from the Division of Community Assistance.
Single copies are available from this Division in Raleigh, North Carolina, for
one dollar ($1.00) each. The following definitions shall apply:
(1) "HUD" means the
Department.
(2) "Federal agency"
means the Department.
(3) "State agency"
means the recipient of CDBG funds as defined in this Subchapter.
(b) The recipient may provide relocation payments and
assistance for individuals, families, businesses, non profit organizations and
farm operations displaced by an activity that is not subject to the Uniform
Act. The recipient also may provide relocation payments and other assistance
at levels above those established under the Uniform Act. All such relocation
assistance not required by the Uniform Act must be determined by the recipient
to be appropriate to its community development program. The recipient shall
adopt a written policy available to the public setting forth the relocation
payments and assistance it elects to provide and providing for equal payments,
and assistance within each class of displacees.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5301 and 5304(b)(4); 24 C.F.R. 570.488;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; April 1,
1983.
04 NCAC 19L .1004 ENVIRONMENTAL REVIEW
(a) Applicants and recipients shall comply with the
policies of the National Environmental Policy Act of 1969 and all other
applicable provisions of Federal and State law which further the purposes of
such act (as specified in 24 C.F.R. Part 58). This Subchapter incorporates by
reference 24 CFR Part 58, including subsequent amendments and editions. Copies
of this federal regulation are available for public inspection from the
Division of Community Assistance. Single copies are available from this
Division in Raleigh, North Carolina, for one dollar ($1.00) each.
(b) Applicants and recipients shall assume the
responsibilities for environmental review, decision‑making, and other
actions which would otherwise apply to the Secretary, under NEPA and other
provisions of law which further the purposes of NEPA in accordance with section
104(f)(4) of Title I of the Housing and Community Development Act of 1974, as
amended and the implementing regulations at 24 C.F.R. Part 58.
(c) Applicants and recipients shall meet the requirements
of the following Federal laws and regulations:
(1) The National Environmental Policy Act of
1969 ("NEPA", 42 U.S.C. 4321 et seq., P.L. 91‑190) which
establishes national policy, goals, and procedures for protecting, restoring
and enhancing environmental quality;
(2) Environmental Review Procedures for Title I
Community Development Block Grant Programs, (24 C.F.R. Part 58), which sets
forth the procedures for carrying out the environmental responsibilities under
NEPA;
(3) Executive Order 11988, Floodplain
Management, May 24, 1977 (42 F.R. 26951 et seq.);
(4) Executive Order 11990, Protection of
Wetlands, May 24, 1977 (42 F.R. 26961 et seq.);
(5) The Coastal Zone Management Act of 1972,
(16 U.S.C. 1451 et seq.), as amended;
(6) The Safe Drinking Water Act of 1974 (42
U.S.C. 201, 300(f) et seq., and 21 U.S.C. 349), as amended, particularly
concerning sole source aquifers;
(7) The Endangered Species Act of 1973 (16
U.S.C. 1531 et seq.), as amended;
(8) The Wild and Scenic Rivers Act of 1968 (16
U.S.C. 1271 et seq.), as amended;
(9) The Clean Air Act (42 U.S.C. 7401 et seq.);
(10) The Fish and Wildlife Coordination Act of
1958 as amended, (16 U.S.C. 661 et seq);
(11) The Federal Water Pollution Control Act
(P.L. 92‑500);
(12) HUD environmental criteria and standards (24
C.F.R. Part 51), and the Council on Environmental Quality Standards at 40
C.F.R. Part 1500‑1508;
(13) The National Historic Preservation Act of
1966 (16 U.S.C. 470 et seq.) as amended;
(14) Procedures for the Protection of Historic
and Cultural Properties, 36 CFR 800;
(15) Executive Order 11593, Protection and
Enhancement of the Cultural Environment. May 13, 1971 (36 F.R. 8921 et seq.);
(16) The Reservoir Salvage Act of 1960 (16 U.S.C.
469 et seq.); as amended by the Archaeological and Historic Preservation Act of
1974; and
(17) The Flood Disaster Protection Act of 1973
(42 U.S.C. 4001 et seq.), as amended.
(d) The recipient shall meet the requirements of the
following State laws and rules where they are applicable to the provisions of
this Subchapter:
(1) Chapter 113A of the General Statutes of
North Carolina, entitled Pollution Control and Environment;
(2) G.S. 143‑215.108 which designates the
Environmental Management Commission as the issuing authority for air quality
permits;
(3) G.S. 143‑215.1 which governs water
pollution permits and designates the Environmental Management Commission as the
issuing authority;
(4) G.S. 121‑12, Protection of Properties
on the National Register, which requires consideration of project impact on any
property listed in the National Register; and
(5) G.S. 70‑1 through 70‑3, Indian
Antiquities laws, which urges private landowners to refrain from excavation and
other actions leading to the destruction of Indian archaeological sites on
their property. It also requires local governments to report the discovery of
artifacts and refrain from further excavation or construction when excavating
or constructing on public lands.
(e) The recipient shall obtain all air pollution and water
pollution permits for a CDBG program pursuant to Paragraph (d) of this Rule.
(f) All records and data shall be maintained pursuant to
Rule .0911 of this Subchapter.
History Note: Authority G.S. 143‑215.1; 143‑215.108;
143B‑10; 143B‑431; 24 C.F.R. Part 58; 24 C.F.R.
570.487; 42 U.S.C.A. 4321 through 4370; 42 U.S.C.A.
5304(b)(4);
Eff. July 1, 1982;
Amended Eff. August 1, 1998; June 1, 1993; September 1,
1990; May 1, 1988; October 1, 1984.
04 NCAC 19L .1005 HISTORIC PRESERVATION
History Note: Authority G.S. 70‑1 through 70‑3;
113A; 121‑12; 143‑323; 24 C.F.R. 570‑496;
42 U.S.C.A. 5304(b)(4); 42 U.S.C.A. 5321;
Eff. July 1, 1982;
Amended Eff. April 1, 1983;
Repealed Eff. October 1, 1984.
04 NCAC 19L .1006 LABOR STANDARDS
(a) The following labor standards provisions outline the
responsibilities of the recipient concerning the payment of wages, contract
work hours, safety, health standards, and equal opportunity for programs
governed under this Subchapter. Recipients must comply with the following
federal laws and regulations:
(1) Davis‑Bacon Act (40
U.S.C.A. 276a). This act requires that prevailing local wage levels be paid to
laborers and mechanics employed on construction work assisted with CDBG funds.
(2) Contract Work Hours and
Safety Standards Act (40 U.S.C.A. 327 through 333). Under this act, laborers
and mechanics employed by contractors and subcontractors on construction work
assisted with CDBG funds must receive overtime compensation at a rate not less
than one and one‑half the basic rate of pay for all hours worked in
excess of forty hours in any workweek.
Violators shall be liable for the unpaid wages and in
addition for liquidated damages computed in respect to each laborer or mechanic
employed in violation of the act.
(3) Fair Labor Standards Act (29
U.S.C. 201 et seq.), requiring that covered employees be paid at least the
minimum prescribed wage, and also that they be paid one and one‑half
times their basic wage rate for all hours worked in excess of the prescribed
work‑week.
(4) Federal anti‑kickback
laws (18 U.S.C. 874 and 40 U.S.C. 276a), which outlaws and prescribes criminal
penalties for "kickbacks" of wages in federally financed or assisted
construction activities. Weekly statements of compliance and weekly payrolls
must be provided by all contractors and subcontractors.
(b) The U.S. Secretary of Labor shall have the authority
and functions set forth in Reorganization Plan Number 14 of 1950 (15 F.R. 3176;
64 Stat. 1267 and Section 2 of the Act of June 13, 1934, (48 Stat. 948, Ch.
482) (40 U.S.C. 276c).
(c) All contracts shall contain labor standards provisions
as required in this Rule.
(d) Subparagraph (a)(1) and (4) of this Rule shall apply to
the rehabilitation of residential property only if such property is designed
for residential use of eight or more families or if eight or more single family
dwellings in the project area are owned in common and are located on contiguous
lots or parcels.
(e) Recipients shall maintain records regarding compliance
with the laws and regulations cited in this Rule in accordance with Rule .0911
of this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.487; 40 U.S.C. 276(a) and 276(c); 40 U.S.C.A. 328; 42 U.S.C.A.
5310;
Eff. July 1, 1982;
Amended Eff. May 1, 1988; April 1, 1983.
04 NCAC 19L .1007 ARCHITECTURAL BARRIERS
All buildings or facilities (other than privately owned
residential structures) designed, constructed or altered with CDBG funds shall
be made accessible and useable to the physically handicapped.
(1) Recipients must comply with the
following:
(a) Architectural Barriers Act of
1968 (P.L. 90‑480). This act requires recipients to insure that
buildings constructed or altered with CDBG funds (except private residential
structures) are readily accessible to the physically handicapped.
(b) Minimum Guidelines and
Requirements for Accessible Design 36 C.F.R. Part 1190. These regulations
establish guidelines for implementing the federal acts described in
Subparagraph (a) of this Paragraph. The regulations provide technical
standards which must be met by recipients.
(c) Americans with Disabilities
Act Accessibility Guidelines for Buildings and Facilities or the Uniform
Federal Accessibility Standards.
(2) Recipients must comply with
provisions of the North Carolina Building Code, Volume I, Chapter 11‑X.
These provisions describe minimum standards recipients must meet in
constructing or altering building and facilities, to make them assessable to
and useable by the physically handicapped.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.487; 29 U.S.C.A. 792;
36 C.F.R. Part 1190; 42 U.S.C.A. 4151 through 4157; 42
U.S.C.A. 5304 (b)(4);
28 C.F.R. 35.15;
Eff. July 1, 1982;
Amended Eff. June 1, 1993.
04 NCAC 19L .1008 HATCH ACT
All recipients shall comply with the Hatch Act (P.L. 76‑252)
as amended, which limits the political activities of employees. This act
prevents recipients, local CDBG program officials or other personnel employed
by a CDBG program from undertaking certain political activities or from using
CDBG funds for political activities. Generally, these activities include the
use of official authority to affect the results of an election or to coerce
employees to contribute to a political party or organization. In addition,
personnel covered under this act may not be a candidate for elected office
unless candidacies are non‑partisan.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.487; 5 U.S.C.A. 1501 through 1508;
42 U.S.C.A. 5304 (b)(4);
Eff. July 1, 1982.
04 NCAC 19L .1009 HOUSING REHABILITATION
(a) Grant assistance may be used for housing rehabilitation
activities eligible under Rule .0301 of this Subchapter.
(b) The local government shall provide a work write up
which precisely defines the rehabilitation work to be undertaken to bring the
dwelling up to the following standards. The dwelling:
(1) shall contain a room or defined area for
the safe, sanitary storage and preparation of food.
(2) shall contain a bathroom with permanently
affixed and properly operating fixtures.
(3) shall have a one time treatment for insects
and pests.
(4) shall have a structurally sound building
foundation system.
(5) shall have structurally sound flooring
systems.
(6) shall have structurally sound wall systems.
(7) shall have a structurally sound roofing
system.
(8) shall have at least two remotely located
doors for means of egress.
(9) shall have electrical wiring and fixtures
that are safe and operating properly.
(10) shall have plumbing fixtures and piping that
are safe and operating properly.
(11) shall have a heating source capable of
heating the entire dwelling unit to 70 degrees Fahrenheit when the outside
temperature is 0 degrees.
(12) shall contain a U.L. approved smoke detector
wired directly to the electrical panel with battery back up.
(c) Construction or rehabilitation work on all dwelling
units, assisted entirely or partially with CDBG funds, shall comply with the
North Carolina State Building Code, Volumes I-X, as applicable.
(d) Section 8 Housing Quality Standards shall not be
applicable when work is funded under Local Option Activities as described in
Rule .0403(c) of this Subchapter.
(e) Housing rehabilitation activities must comply with the
following standards required under this Subchapter:
(1) Lead‑based paint (Rule .1011); and
(2) Equal opportunity (Rule .1001).
(f) The recipient shall provide for benefits to any person
involuntarily and permanently displaced as a result of the use of CDBG
assistance to substantially rehabilitate property in accordance with 49 CFR
Part 24.
(g) Homes inhabited by disabled or elderly persons must be
analyzed as to the physical needs of such persons. Improvements such as
widened doorways, ramps, level entry and doorways, and grab bars in bath areas
must be installed if appropriate.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.487; 42 U.S.C.A. 5305(a);
Eff. July 1, 1982;
Amended Eff. August 1, 1998; May 1, 1988; March 1, 1984;
April 1, 1983.
04 NCAC 19L .1010 NATIONAL FLOOD INSURANCE PROGRAM
(a) No CDBG funds shall be used for acquisition or
construction purposes as defined under section 3(a) of the Flood Disaster
Protection Act of 1973 (P.L. 93‑234) in any area that has been identified
as an area having special flood hazards, unless the recipient in such an area
is participating in the National Flood Insurance Program.
(b) Recipients must comply with the Regulations
implementing the Flood Disaster Protection Act of 1973 (44 C.F.R. 60.3), unless
the recipient is participating in the National Flood Insurance Program.
(c) The use of CDBG funds governed by this Subchapter for
acquisition or construction shall be subject to the mandatory purchase of flood
insurance requirements of Section 102(a) of the Flood Disaster Protection Act
of 1973 (P.L. 93‑234).
(d) Records of participation in the National Flood
Insurance Program shall be maintained by the recipient pursuant to Rule .0911
of this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. Chapter X; 24 C.F.R. 570.487;
42 U.S.C.A. 4002 through 4027; 42 U.S.C.A. 5304(b)(4);
Eff. July 1, 1982;
Amended Eff. March 1, 1984.
04 NCAC 19L .1011 LEAD‑BASED PAINT
(a) The recipient must comply with the Lead‑Based
Paint Poisoning Prevention Act [42 U.S.C. 4831(b)], 24 CFR Part 570.608, and 24
CFR Part 35, including provisions and subsequent amendments of the above:
(1) prohibiting the use of lead‑based
paint;
(2) requiring elimination of lead‑based
paint hazards; and
(3) requiring notification of the hazards of
lead‑based paint poisoning to purchasers, owners and tenants of housing
constructed prior to 1978 which was acquired or rehabilitated with CDBG
assistance.
(b) All construction contracts as described in this Rule
shall contain a provision prohibiting the use of lead based paint.
(c) In lieu of the testing procedures set forth in the 1996
HUD Guidelines, the recipient may forego testing and abate all applicable
surfaces in accordance with the methods set out in the HUD regulations.
(d) Lead-based paint hazard evaluation and abatement
activities financed with CDBG funds must be conducted by individuals and firms
that are certified in accordance with the applicable EPA and HUD requirements
for Lead Based Paint activities.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(b)(4); 42 U.S.C.A. 4821 through 4846;
Eff. July 1, 1982;
Amended Eff. August 1, 1998; June 1, 1994; June 1, 1993;
May 1, 1988.
04 NCAC 19L .1012 CLEARINGHOUSE REVIEW
(a) Applications for funding under this Subchapter may be
submitted by the Division to the appropriate state clearinghouse agencies.
(b) Comments containing any findings of inconsistency with
state or local plans, significant adverse urban impacts, noncompliance with
environmental laws, failure to provide equal opportunity or other comments that
require a response may result in disapproval or conditional approval of the
application by the Division. Applicants must consider all findings and submit
to the Division a written statement indicating what action they plan to take as
a result of these findings.
(c) Program amendments which must receive Division approval
pursuant to Rule .0910 Paragraph (a) of this Subchapter, may be submitted to
clearinghouse review in accordance with Paragraph (a) of this Rule.
(d) All clearinghouse comments and responses shall be kept
in accordance with Rule .0911 of this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Eff. July 1, 1982;
Amended Eff. March 1, 1995; June 1, 1993; September 1,
1990; March 1, 1984.
04 NCAC 19L .1013 COMMUNITY DEVELOPMENT PLAN
(a) Recipients shall develop a Community Development Plan
that identifies community development and housing needs, including the needs of
low‑ and moderate‑income persons, and activities to be undertaken
to meet such needs.
(b) The Community Development Plan shall be maintained in
accordance with Rule .0911 of this Subchapter.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C. 5301;
Eff. March 1, 1984.
SECTION .1100 ‑ PERFORMANCE
04 NCAC 19L .1101 REPORTING
(a) Recipients shall submit an Annual Performance Report at
the close of each fiscal year concurrently with the annual audit of the program
required by Rule .0912 of this Subchapter. Failure to provide the APR and
audit within 60 days of the end of the fiscal year may be grounds for
withholding further grant payments until the APR and audit have been
submitted. A performance report may also be required of the recipient prior to
the grant closeout pursuant to Rule .0913 of this Subchapter.
(b) The Annual Performance Report and any other performance
report required prior to the grant closeout shall contain completed copies of
all forms and narratives requested by the Department.
(c) Between the required performance reporting dates,
events may occur which have significant impact upon the project or program. In
such cases, the recipient shall inform the Department as soon as the following
types of conditions become known:
(1) Problems, delays, or adverse conditions
which will materially affect the ability to attain program objectives', prevent
the meeting of time schedules and goals, or preclude the attainment of project
work units by established time periods. This disclosure shall be accompanied by
a statement of the action taken, or contemplated, and any Departmental
assistance needed to resolve the situation.
(2) Favorable developments or events which
enable meeting time schedules and goals sooner than anticipated or producing
more work units than originally projected.
(d) For both construction and nonconstruction grants,
recipients shall notify the Department promptly whenever the amount of CDBG
authorized funds is expected to exceed the needs of the recipient by more than
five thousand dollars ($5,000) or five percent of the Community Development
grant, whichever is greater.
(e) Recipients shall submit such reports as may be
necessary, pursuant to the rules and regulations under Title VI, Civil Rights
Act of 1964; Title VIII, Civil Rights Act of 1968; Section 3 of the Housing and
Urban Development Act of 1968; Section 109 of the Housing and Community
Development Act of 1974, as amended; Executive Order 11246, as amended; and
Executive Order 11063.
(f) Recipients will be required to report data annually as
specified by the Division for the state's Comprehensive Housing Affordability
Strategy (CHAS) for response by the Division to 24 CFR Part 91, State and Local
Housing Affordability Strategies.
(g) Recipients shall submit other reports as outlined in
this Subchapter or as may be further required by the Division.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(b)(4); 24 C.F.R. Part 91;
24 C.F.R. 570.490; 24 C.F.R. 570.491;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; March 1,
1984.
04 NCAC 19L .1102 MONITORING BY THE RECIPIENT
Recipients shall constantly monitor the performance under
grant‑supported activities to assure that time schedules are being met,
projected work units by time periods are being accomplished, and other performance
goals are being achieved. This review shall be made for each program,
function, or activity of each grant as set forth in the approved grant
application.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(d)(2),(e);
Eff. July 1, 1982.
04 NCAC 19L .1103 MONITORING BY THE DIVISION
(a) The Secretary shall, in addition to the annual audit,
evaluate programs conducted under this Subchapter and their effectiveness in
meeting the objectives of the CDBG Program.
(b) The Secretary may conduct such evaluation using
Division personnel, or by contract or other arrangement with public or private
agencies. The evaluations will consist of site visits as frequently as
practical to:
(1) Review Program accomplishments and
management control systems as outlined in Paragraph (d) of this Rule; and
(2) Provide such technical assistance as may be
required.
(c) Recipients may be required to supply data or make
available such records as are necessary for the accurate completion of these
evaluations, including, but not limited to the following:
(1) the approved CDBG application and any
amendments thereto;
(2) reports prepared by the recipient including
the performance report described in Rule .1101;
(3) records maintained by the recipient
pursuant to Rule .0911;
(4) results of the Division's monitoring of
recipient performance;
(5) audit reports;
(6) records of drawdowns; and
(7) records of comments and complaints by
citizens and/or other organizations, or litigation.
(d) Review criteria:
(1) Substantial progress. The Division will
review a recipient's performance to determine the recipient's progress in
carrying out approved activities and will take into account such factors as
expenditure of funds, obligation of funds, award of third party contracts, and
other measures of progress. The Division will compare a recipient's progress
with that of other recipients of comparable size with similar activities and
grant amounts. If a recipient's progress lags substantially behind that of
other similar recipients, further reviews may be conducted to determine the
reasons for a lack of progress.
(2) Conformance with approved program. The
Division will review a recipient's performance to determine whether the
activities undertaken during the period under review conform substantially to
the Community Development Program described in the application, including any
amendments approved by the Division.
(3) Compliance. The Division will review a
recipient's performance to determine whether the program carried out complies with
the requirements of the Act, this Subchapter, and other applicable laws and
regulations.
(4) Continuing Capacity. The Division will
review a recipient's performance to determine whether the recipient has a
continuing capacity to carry out the approved program in a timely manner.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(d)(2),(e); 24 C.F.R. 570.492;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; March 1,
1984.
04 NCAC 19L .1104 REMEDIES
(a) When the Secretary determines on the basis of a review
of a recipient's performance that the objectives of the program, as well as the
objectives as described in its application, have not been met, the Secretary
may take one or more of the actions authorized in Paragraph (b) of this Rule.
In each instance, the action taken will be designed to first, prevent a
continuance of the deficiency (lack of progress, nonconformance, noncompliance,
lack of continuing capacity); second, mitigate any adverse effects or
consequences of the deficiency to the extent possible under the circumstances;
and third, prevent a recurrence of the same or similar deficiencies.
(b) The action that the Department or Division may take in
response to a negative review of a recipient's performance include:
(1) Require the recipient to submit additional
information:
(A) concerning the administrative, planning, budgeting,
management and evaluation functions to determine any reasons for lack of
progress;
(B) explaining any actions being taken to correct or
remove the causes for delay;
(C) documenting that activities undertaken were not in
conformance with the approved program or were in noncompliance with applicable
laws or regulations; and
(D) demonstrating that the recipient has a continuing
capacity to carry out the approved program in a timely manner.
(2) Require the recipient to submit progress
schedules for completing approved activities;
(3) Issue a letter of warning that advises the
recipient of the deficiency and puts the recipient on notice that more serious
sanctions will be taken if the deficiency is not corrected or is repeated;
(4) Instruct the recipient that a certification
will no longer be acceptable and that additional information or assurances will
be required;
(5) Instruct the recipient to suspend,
discontinue or not incur costs for the affected activity;
(6) Instruct the recipient to reprogram funds
from affected activities to other eligible activities; provided, that such
action shall not be taken in connection with any substantial violation of Rule
.1004 Environmental Requirements;
(7) Instruct the recipient to reimburse the
recipient's program account or the Department in any amounts improperly
expended;
(8) Change the method of payment from advance
payment to a reimbursement basis;
(9) Condition the approval of a succeeding
year's application if there is substantial evidence of a lack of progress,
nonconformance, noncompliance, or a lack of continuing capacity. In such
cases, the reasons for the conditional approval and the actions necessary to
remove the condition shall be as specified by the Division; and
(10) Reduce the recipient's annual grant by up to
the amount conditionally approved where such condition or conditions have not
been satisfied.
(c) When the Secretary determines, on the basis of a review
of a recipient's performance that objectives of the program as described in its
application have not been met, the Secretary may reduce, withhold funds or
withdraw the grant, except for funds already expended on otherwise eligible
activities which may not be recaptured or deducted from future grants.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.492;
Eff. July 1, 1982;
Amended Eff. June 1, 1993; September 1, 1990; April 1,
1983.
04 NCAC 19L .1105 ADMINISTRATIVE HEARINGS
(a) Recipients may contest Departmental actions with
respect to this Subchapter under the Contested Case Hearing Procedures set
forth in G.S. 150B and 26 NCAC 3 ‑ Office of Administrative Hearings,
Hearings Division.
(b) The Department may also commence contested case hearing
procedures against recipients pursuant to G.S. 150B and 26 NCAC 3 ‑
Office of Administrative Hearings, Hearings Division.
History Note: Authority G.S. 143B‑10; 143B‑431;
Eff. July 1, 1982;
Amended Eff. September 1, 1990.
SECTION .1200 ‑ CONTINGENCY PROJECTS
04 NCAC 19L .1201 DESCRIPTION
Contingency projects are those projects which, in the
judgment of the Secretary, are deemed to meet community development needs of
the applicant.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.482;
Eff. March 1, 1986.
04 NCAC 19L .1202 ELIGIBILITY REQUIREMENTS
Applicants must meet the eligibility requirements described
in Rule .0502.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.482;
Eff. March 1, 1986;
Amended Eff. June 1, 1994; May 1, 1992.
04 NCAC 19L .1203 SELECTION CRITERIA
Consideration for contingency grants will be given to
applications at the discretion of the Secretary. Applicants will be selected
for consideration by the Department.
History Note: Authority G.S. 143B‑10; 143B‑431;
42 U.S.C.A. 5304(a)(1); 24 C.F.R. 570.482;
Eff. March 1, 1986;
Amended Eff. September 1, 1990.
section .1300 - HOUSING DEVELOPMENT PROJECTS
04 NCAC 19L .1301 dESCRIPTION
04 NCAC 19l .1302 ELIGIBILITY REQUIREMENTS
04 NCAC 19L .1303 SELECTION CRITERIA
History Note: Authority G.S. 143B-10; 143B-431; 24
C.F.R. 570.482; 24 C.F.R. 570.483; 24 C.F.R. 570.489;
Eff. March 1, 1986;
Amended Eff. August 1, 1998; June 1, 1994 (Rule .1302,
.1303); June 1, 1993 (Rule .1302, .1303); May 1, 1992 (Rule .1301); September
1, 1990 (Rule .1302); April 1, 1990 (Rule .1302, .1303);
Repealed Eff. July 1, 2012.
SECTION .1400 ‑ ECONOMIC DEVELOPMENT PROJECTS
04 NCAC 19L .1401 DEFINITION
04 NCAC 19L .1402 ELIGIBILITY REQUIREMENTS
04 NCAC 19L .1403 SELECTION CRITERIA
04 NCAC 19L .1404 PRELIMINARY AWARDS
History Note: Filed as a Temporary Repeal Eff. July 20,
1992 for a period of 180 days or until the
permanent rule becomes effective, whichever is sooner;
Authority G.S. 143‑323; 143B‑10; 42 U.S.C.A.
5301; 42 U.S.C.A. 5304(a)(1);
24 C.F.R. 570.489;
Eff. March 1, 1986;
Amended Eff. September 1, 1990; April 1, 1989; May 1,
1988;
Repealed Eff. November 2, 1992.
04 NCAC 19L .1405 SELECTION CRITERIA ‑ SMALL
BUSINESS LOAN PROGRAM
History Note: Filed as a Temporary Repeal Eff. July 20,
1992 for a period of 180 days or until the
permanent rule becomes effective, whichever is sooner;
Authority G.S. 143‑323; 42 U.S.C.A. 5301; 24 C.F.R.
570.489;
Eff. April 1, 1989;
Repealed Eff. November 2, 1992.
SECTION .1500 ‑ INTERIM ASSISTANCE
04 NCAC 19L .1501 DESCRIPTION
04 NCAC 19L .1502 ELIGIBILITY REQUIREMENTS
04 NCAC 19L .1503 SELECTION CRITERIA
04 NCAC 19L .1504 FUNDS AVAILABLE
04 NCAC 19L .1505 PRELIMINARY AWARDS
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.482;
Eff. May 1, 1988;
Amended Eff. June 1, 1993; September 1, 1990;
Repealed Eff. June 1, 1994.
SECTION .1600 ‑ COMMUNITY INVESTMENT FOR ECONOMIC
OPPORTUNITY
04 NCAC 19L .1601 DESCRIPTION
04 NCAC 19L .1602 ELIGIBILITY REQUIREMENTS
04 NCAC 19L .1603 SELECTION CRITERIA
04 NCAC 19L .1604 PRELIMINARY AWARDS
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.482;
Eff. June 1, 1990;
Amended Eff. June 1, 1993;
Repealed Eff. June 1, 1994.
SECTION .1700 - SCATTERED SITE HOUSING CATEGORY
04 NCAC 19L .1701 DESCRIPTION
Grants under the Scattered Site Housing Category direct
activities toward one hundred percent low‑ and moderate‑income
persons. Scattered Site Housing projects are limited to housing
rehabilitation, acquisition, disposition, clearance, and relocation
activities. Scattered Site Housing activities may be carried out in any
location throughout the recipient's jurisdiction. Scattered Site Housing funds
shall be distributed to eligible units of local governments in a three year
rotating basis and periodically based on distribution plans and prior
performance.
History Note: Authority G.S. 143B‑10; 143B-431;
24 C.F.R. 570.483;
Eff. March 1,
1995;
Amended Eff.
August 1, 1998;
Temporary
Amendment Eff. January 1, 2001;
Amended Eff.
August 1, 2002.
04 NCAC 19L .1702 ELIGIBILITY REQUIREMENTS
(a) Applications for Scattered Site Housing funds must show
that:
(1) 100 percent of the CDBG funds proposed for
each project will benefit low‑ and moderate‑income persons; and
(2) CDBG funds proposed for each activity shall
meet a national objective as specified in HUD regulations previously
incorporated by reference, except that funds shall not be used to meet the
national objective of urgent need which is covered by Rule .0801 of this
Subchapter.
(b) The Division may examine the following areas to
determine capacity:
(1) audit and monitoring findings on previously
funded Community Development Block Grant programs, and the applicant’s fiscal
accountability as demonstrated in other state or federal programs or local
government financial reports; and
(2) the rate of expenditure of funds and
accomplishments in previously funded CDBG programs.
Applicants that show a lack of capacity will not be rated or
funded.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.482; 24 C.F.R. 570.483;
Eff. March 1,
1995;
Amended Eff.
August 1, 1998;
Temporary
Amendment Eff. January 1, 2001;
Amended Eff.
August 1, 2002.
04 NCAC 19L .1703 SELECTION CRITERIA
Criteria for Scattered Site Housing awards are:
(1) community need;
(2) community impact;
(3) project design;
(4) financial feasibility;
(5) year of eligibility;
(6) distribution plan; and
(7) participation process.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Eff. March 1,
1995;
Amended Eff.
August 1, 1998;
Temporary
Amendment Eff. January 1, 2001;
Amended Eff.
August 1, 2002.
SECTION .1800 - NORTH CAROLINA DEVELOPMENT LOAN FUND
04 ncac 19l .1801 GENERAL
(a) The North Carolina Development Loan Fund is a loan
program for non-entitlement communities participating in the Small Cities
Community Development Block Grant program to access the Department of Housing
and Urban Development's Section 108 Guaranteed Loan Program. The funds under
this program are loaned to units of local governments for projects meeting one
of the national objectives of benefitting low and moderate income persons,
eliminating slums and blight or addressing a community's urgent needs, as
defined in the Housing and Community Development Act of 1974 as amended.
(b) The Division shall review applications from local
governments to the Department of Housing and Urban Development under the
Development Loan Fund program. The review and approval must be made to pledge
future state CDBG allocation as additional collateral for the Development Loan
fund program.
(c) The Division shall review applications for projects
with housing, commercial and mixed use components. The Commerce Finance Center
shall review and approve economic development projects.
History Note: Authority G.S. 143B-431; 153A-376;
160A-456; 24 C.F.R. 570 Subpart M;
Eff. August 1, 1998.
04 NCAC 19L .1802 ELIGIBLE ACTIVITIES
(a) This section incorporates by reference as eligible
activities those activities described in the Housing and Community Development
Act of 1974, as amended, including subsequent amendments and editions under Section
108 and in 24 CFR 570.703.
(b) G.S. 143B-431(d)(3) - further limits eligibility by
finding that hotels, motels, private recreational facilities, private
entertainment facilities and convention centers are ineligible for Development
Loan Funds.
(c) Copies of these sections of state and federal law and
regulation are available for public inspection from the Division of Community
Assistance.
History Note: Authority G.S. 143B-431; 24 C.F.R.
570.703;
Eff. August 1, 1998.
04 NCAC 19L .1803 ELIGIBILITY REQUIREMENTS
(a) Applications for Development Loan Funds must show that:
(1) All activities are eligible under state and
federal regulations; and
(2) Development Loan Funds proposed for each
activity meet a national objective as specified by HUD regulations incorporated
by prior reference; and
(3) The applicant has the capacity to
administer a Development Loan Fund project.
(b) The Division must make the following findings prior to
an award:
(1) A loan loss reserve is in place equal to
10% of the amount of the outstanding balance.
(2) The approved loan may not take the total
amount of outstanding obligations under the Development Loan Fund to more than
twice the amount of the annual CDBG allocation.
History Note: Authority G.S. 143B-431; 24 C.F.R. 570
Subpart M;
Eff. August 1, 1998.
04 NCAC 19L .1804 SIZE OF LOAN APPROVALS
(a) Maximum and minimum loan amounts as set by the General
Assembly shall be published by the Division in the annual CDBG Consolidated
Plan Action Plan, part of the North Carolina Consolidated Plan.
(b) Development Loan Funds approved shall not count toward
a community's receipt of CDBG funds in any program year as outlined in Rule
.0403 of this Subchapter.
History Note: Authority G.S. 143B-431; 24 C.F.R. 570
Subpart M;
Eff. August 1, 1998.
04 NCAC 19L .1805 SELECTION CRITERIA
Projects will be evaluated and maybe approved in accordance
with the following selection factors:
(1) Public benefit,
(2) Project feasibility,
(3) Cash flow of the project,
(4) Collateral of the project.
History Note: Authority G.S. 143B-431; 24 C.F.R. 570
Subpart M;
Eff. August 1, 1998.
SECTION .1900 - HURRICANE FLOYD RECOVERY ASSISTANCE
Codifier's Note: This Section, 04 NCAC 19L .1900, has been
transferred and recodified as 14B NCAC 14 .0100, effective June 1, 2013. See
Executive Order 8, Governor Michael Easley, July 6, 2001.
section .2000 - infrastructure
04 NCAC 19L .2001 DESCRIPTION
The infrastructure category includes activities in which
funds are directed toward improving existing infrastructure or providing new
infrastructure to existing neighborhoods with environmental or health problems;
and providing public infrastructure to low- and moderate-income persons.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Temporary Adoption Eff. January 1, 2001;
Amended Eff. August 1, 2002.
04 NCAC 19L .2002 ELIGIBILITY REQUIREMENTS
(a) The only eligible activities in infrastructure are
related to public water and public wastewater (sewer) to benefit homes in
residential neighborhoods. Street repairs only to the extent necessary to
repair surfaces dug up in laying pipe may be included in the public water sewer
budget line items. Infrastructure may not include more than one project.
Projects may carry out either public water or public wastewater (sewer)
activities or both.
(b) Applicants must insure that each Infrastructure
activity benefits at least 51% low and moderate income persons. Additionally,
applicants must ensure that activities do not benefit moderate income persons
to the exclusion of low income persons, and that all funds are spent in support
of a national objective.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Temporary
Adoption Eff. January 1, 2001;
Eff. August 1,
2002.
04 NCAC 19L .2003 SELECTION CRITERIA
Criteria for Infrastructure awards are:
(1) severity of needs;
(2) benefit to low and moderate income persons;
(3) local commitment;
(4) treatment of needs; and
(5) appropriateness and feasibility.
History Note: Authority G.S. 143B‑10; 143B‑431;
24 C.F.R. 570.489;
Temporary
Adoption Eff. January 1, 2001;
Eff. August 1,
2002.
