# Super Notice of Funding Availability (SuperNOFA) for Economic Development and Empowerment Programs

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URL: https://www.frixlaw.com/law-library/documents/fr%3A98-11392

## Record

- **Collection:** Federal Register
- **Document type:** Notice
- **Published:** April 30, 1998
- **Citation:** 63 FR 23876

## Text

SUMMARY: This Super Notice of Funding Availability (SuperNOFA)
announces the availability of approximately $176,000,000 in HUD program
funds covering ten (10) Economic Development and Empowerment Programs
operated and managed by the following HUD Offices: Community Planning
and Development (CPD), Housing-Federal Housing Administration (FHA),
Public and Indian Housing (PIH), and the Office of Lead Hazard Control
(OLHC). The General Section of this SuperNOFA contains the procedures
and requirements applicable to all programs. The applications for
funding for these programs have been consolidated into four
applications. The Programs Section of this SuperNOFA contains a
description of the specific programs for which funding is made
available under this SuperNOFA and additional procedures and
requirements that are applicable to each.
APPLICATION DUE DATES: The information contained in this ``APPLICATION
DUE DATES'' section applies to all programs contained in this
SuperNOFA. Completed applications must be submitted to HUD no later
than the deadline established for the program for which you are seeking
funding. Applications may not be sent by facsimile (FAX). See the
Program Chart for specific application due dates.
ADDRESSES AND APPLICATION SUBMISSION PROCEDURES: Addresses. Completed
applications must be submitted to the location specified in the
Programs Section of this SuperNOFA. When submitting your application,
please refer to the program name for which you are seeking funding.
For Applications to HUD Headquarters. Applications to be submitted
to HUD Headquarters are due at: Department of Housing and Urban
Development, 451 Seventh Street, SW, Room ________ (See Program Chart
or Programs Section for room location), Washington DC 20410.
For Applications to HUD Field Offices. For those programs for which
applications are due to the HUD Field Offices, please see the Programs
Section for the locations for submission.
Applications Procedures--Mailed Applications. Applications will be
considered timely filed if postmarked on or before 12:00 midnight on
the application due date and received by the designated HUD Office on
or within ten (10) days of the application due date.
Applications Sent by Overnight/Express Mail Delivery. Applications
sent by overnight delivery or express mail will be considered timely
filed if received before or on the application due date, or upon
submission of documentary evidence that they were placed in transit
with the overnight delivery service by no later than the specified
application due date.
Hand Carried Applications. For applications submitted to HUD
Headquarters, hand carried applications delivered before and on the
application due date must be brought to the specified location and room
number between the hours of 8:45 am to 5:15 pm, Eastern time.
Applications hand carried on the application due date will be accepted
in the South Lobby of the HUD Headquarters Building at the above
address from 5:15 pm until 12:00 midnight, Eastern time. Applications
due to HUD Field Office or Area Office of Native American Programs
locations must be delivered to the appropriate HUD Field Office or Area
Office of Native American Programs in accordance with the instructions
specified in the Programs Section of the SuperNOFA.
For applications submitted to the HUD Field Offices or Area Offices
of Native American Programs, hand carried applications will be accepted
during normal business hours before the application due date. On the
application due date, business hours will be extended to 6:00 pm.
(Please see the Appendix A to this SuperNOFA listing the hours of
operations for the HUD Field Offices.) COPIES OF APPLICATIONS TO HUD
OFFICES. The Programs Section of this SuperNOFA may specify that, to
facilitate processing and review of your submission, a copy of the
application also be sent to an additional HUD location (for example, a
copy to the HUD Field Office or Area Office of Native American Programs
if the original application is to be submitted to HUD Headquarters, or
a copy to HUD Headquarters, if the original application is to be
submitted to a HUD Field Office or Area Office of Native American
Programs). Please follow the requirements of the Programs Section to
ensure that you submit your application to the proper location. HUD
requests additional copies in order to expeditiously review your
application and appreciates your assistance in providing the copies.
Please note that for those applications for which copies are being
submitted to the local HUD Offices and HUD Headquarters, timeliness of
submission will be based on the time the application is received at HUD
Headquarters.

FOR APPLICATION KITS, FURTHER INFORMATION AND TECHNICAL ASSISTANCE: The
information contained in this section is applicable to all programs
contained in this SuperNOFA, unless otherwise specifically provided in
the applicable programs section.
For Application Kits and SuperNOFA User Guide. HUD is pleased to
provide you with application kits and/or a guidebook to all HUD
programs. When requesting an application kit, please refer to the
program name of the application kit you are interested in receiving.
Please be sure to provide your name, address (including zip code), and
telephone number (including area code).
Requests for application kits should be made immediately to ensure
sufficient time for application preparation. We will distribute
application kits as soon as they become available.
The SuperNOFA Information Center (1-800-HUD-8929) can provide you
with assistance, application kits, and guidance in determining which
HUD Office(s) should receive a copy of your application. Persons with
hearing or speech impairments may call the Center's TTY number at 1-
800-HUD-2209.
Consolidated Application Submissions. Where an applicant can apply
for funding under more than one program in this SuperNOFA, the
applicant need only submit one originally signed SF-424 and one set of
original signatures for the other required assurances and
certifications, accompanied by the matrix contained in each application
kit (provided that the required assurances and certifications are
identical). As long as the applicant submits one originally signed set
of these documents with an application, only copies of these documents
are required to be submitted with any additional application submitted
by the applicant. The application should identify the program for which
the original signatures for assurances and certifications is being
submitted.
For Further Information. For answers to your questions about this

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SuperNOFA, you have several options. You may call the HUD Office or
Processing Center serving your area at the telephone number listed in
your program area section to this SuperNOFA, or you may contact the
SuperNOFA Information Center at 1-800-HUD-8929. Persons with hearing or
speech impairments may call the Center's TTY number at 1-800-HUD-2209.
Information on this SuperNOFA also may be obtained through the HUD web
site on the Internet at http://www.HUD.gov.
For Technical Assistance. Before the application due date, HUD
staff will be available to provide general guidance and technical
assistance about this SuperNOFA. Current law does not permit HUD staff
to assist in preparing the application. Following selection of
applicants, but prior to award, HUD staff will be available to assist
in clarifying or confirming information that is a prerequisite to the
offer of an award or Annual Contributions Contract (ACC) by HUD.

Introduction To The SuperNOFA Process

To further HUD's objective, under the direction of Secretary Andrew
Cuomo, of improving customer service and providing the necessary tools
for revitalizing communities and improving the lives of people within
those communities, HUD will publish three SuperNOFAs in 1998, which
coordinate program funding for 40 competitive programs and cut across
traditional program lines.
(1) The first is the SuperNOFA and consolidated application process
for Housing and Community Development Programs, covering 19 Housing and
Community Development Programs. This SuperNOFA was published in the
Federal Register on March 31, 1998.
(2) The second is the SuperNOFA and consolidated application
process for Economic Development and Empowerment Programs, published in
today's Federal Register. This second SuperNOFA includes funding for
the following programs and initiatives: Brownfields; Economic
Development Initiative; Youthbuild; three Tenant Opportunity Programs;
Economic Development and Supportive Services; Mark to Market Outreach
and Training; Mark to Market Technical Assistance Intermediaries Grant
Administration; and the Local Lead Hazard Awareness Campaign.
(3) The third is the SuperNOFA and consolidated application process
for Targeted Housing and Homeless Assistance Programs. This third
SuperNOFA includes the following programs and initiatives: Housing
Opportunities for Persons with AIDS; Continuum of Care Homeless
Assistance Programs; Section 202 Supportive Housing for the Elderly;
and Section 811 Supportive Housing for Persons with Disabilities. This
third SuperNOFA is published elsewhere in today's Federal Register.
All three SuperNOFAs and all consolidated applications, to the
greatest extent possible, given statutory, regulatory and program
policy distinctions, will have one set of rules that, together, offer a
``menu'' of approximately 40 programs. From this menu, communities will
be made aware of funding available for their jurisdictions. Nonprofits,
public housing agencies, local and State governments, tribal
governments and tribally designated housing entities, veterans service
organizations, faith-based organizations and others will be able to
identify the programs for which they are eligible for funding.

The National Competition NOFA

In addition to the three SuperNOFAs, HUD is publishing elsewhere in
today's Federal Register a single NOFA for three national competitions:
the Fair Housing Initiatives Program National Competition; the National
Lead Hazard Awareness Campaign; and the Housing Counseling National
Competition.
Assisting Communities To Make Better Use of Available Resources
These SuperNOFAs represent a marked departure from, and HUD
believes a significant improvement over, HUD's past approach to the
funding process. In the past, HUD has issued as many as 40 separate
NOFAs, all with widely varying rules and application processing
requirements. This individual program approach to funding, with NOFAs
published at various times throughout the fiscal year, did not
encourage and, at times, unintentionally impeded local efforts directed
at comprehensive planning and development of comprehensive local
solutions. Additionally, the old approach seemed to require communities
to respond to HUD's needs rather than HUD responding to local needs.
Secretary Cuomo brings to the leadership of HUD the experience of
successfully implementing a consolidated planning process in HUD's
community development programs. As Assistant Secretary for Community
Planning and Development, Secretary Cuomo consolidated the planning,
application, and reporting requirements of several community
development programs. The Consolidated Plan rule, published in 1995,
established a renewed partnership among HUD, State, and local
governments, public and private agencies, tribal governments, and the
general citizenry by empowering field staff to work with other entities
in fashioning creative solutions to community problems.
The SuperNOFA approach builds upon Consolidated Planning
implemented by Secretary Cuomo in HUD's community development programs,
and also reflects the Secretary's organizational changes for HUD, as
described in the Secretary's management reform plan. On June 26, 1997,
Secretary Cuomo released the HUD 2020 Management Reform Plan, which
calls for significant consolidation of like programs to maximize
efficiency and dramatically improve customer service. The plan also
calls for HUD to improve customer service by adopting a principle of
``menus not mandates.''
By announcing the funding of these ten programs in one NOFA, HUD
hopes to assist communities in making better use of available resources
to address their economic development needs and the needs of those
living within the communities in a holistic and effective fashion.
These funds are available for eligible applicants to support individual
program objectives, as well as cross-cutting and coordinated approaches
to improving the overall effective use of available HUD program funds.
To date, HUD has been consolidating and simplifying the submission
requirements of many of its formula grant and discretionary grant
programs to offer local communities a better opportunity to shape
available resources into effective and coordinated neighborhood housing
and community development strategies that will help revitalize and
strengthen their communities, physically, socially and economically. To
complement this overall consolidation and simplification effort, HUD
designed this process to increase the ability of applicants to consider
and apply for funding under a wide variety of HUD programs in response
to a single NOFA. Everyone interested in HUD's grant programs can
benefit from having this information made available in one NOFA.
Coordination, Flexibility, and Simplicity in the HUD Funding Process
The SuperNOFA approach places heavy emphasis on the coordination of
activities to provide (1) greater flexibility and responsiveness in
meeting local housing and community development needs, and (2) greater
flexibility to eligible applicants to determine what HUD program
resources

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best fit the community's needs, as identified in local Consolidated
Plans and Analysis of Impediments to Fair Housing Choice (``Analysis of
Impediments'' (AI)).
The SuperNOFA approach is designed to simplify the application
process; promote effective and coordinated use of program funds in
communities; reduce duplication in the delivery of services and
economic development and empowerment programs; allow interested
applicants to seek to deliver a wider, more integrated array of
services; and improve the system for potential grantees to be aware of,
and compete for program funds.
HUD encourages applicants to work together to coordinate and, to
the maximum extent possible, join their activities to form a seamless
and comprehensive program of assistance to meet identified needs in
their communities, and address barriers to fair housing and equal
opportunity that have been identified in the community's Consolidated
Plan and Analysis of Impediments in the geographic area(s) in which
they are seeking assistance.
As part of the simplification of this funding process, and to avoid
duplication of effort, the SuperNOFA provides for consolidated
applications for several of the programs for which funding is available
under this NOFA. HUD programs that provide assistance for, or
complement similar activities, for example, the economic development
initiative (EDI) and the brownfields economic development initiative
(BEDI), or the tenant opportunity and economic development supportive
services programs, have consolidated applications that reduce the
administrative and paperwork burden applicants may otherwise encounter
in submitting an application for each program.
The funding of these ten programs through this SuperNOFA will not
affect the ability of eligible applicants to seek HUD funding. Eligible
applicants are able, as they have been in the past, to apply for
funding under as few as one or as many as all programs for which they
are eligible.
The specific statutory and regulatory requirements of each of the
ten separate programs continue to apply to each program. The SuperNOFA
reflects, where necessary, the statutory requirements and differences
applicable to the specific programs. Please pay careful attention to
the individual program requirements that are identified for each
program. Also, you will note that not all applicants are eligible to
receive assistance under all ten programs identified in this SuperNOFA.
The SuperNOFA contains two major sections. The General Section of
the SuperNOFA contains the procedures and requirements applicable to
all applications. The Programs Section of the SuperNOFA describes each
program for which funding is made available in the NOFA. As in the
past, each program provides a description of eligible applicants,
eligible activities, factors for award, and any additional requirements
or limitations that apply to the program. Please read carefully both
the General Section and the Programs Section of the SuperNOFA for the
program(s) to which you are applying. This will ensure that you apply
for program funding for which your organization is eligible to receive
funds and you fulfill all the requirements for that program(s).

The Programs of This SuperNOFA and the Amount of Funds Allocated

The ten programs for which funding availability is announced in
this SuperNOFA are identified in the following chart. The approximate
available funds for each program are listed as expected funding levels
based on appropriated funds. Should recaptured or other funds become
available for any program, HUD reserves the right to increase the
available program funding amounts by the amount available.
The chart also includes the application due date for each program,
the OMB approval number for the information collection requirements
contained in the specific program, and the Catalog of Federal Domestic
Assistance (CFDA) number.

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Paperwork Reduction Act Statement

For those programs listed in the chart above which have OMB
approval numbers, the information collection requirements contained in
this SuperNOFA for those programs have been approved by the Office of
Management and Budget (OMB) in accordance with the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501-3520). For those programs listed in the
chart for which an OMB approval number is pending, the approval number
when received will be announced by HUD in the Federal Register. An
agency may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless the collection displays
a valid control number.

General Section of the SuperNOFA

I. Authority; Purpose; Amount Allocated; Eligible Applicants and
Eligible Activities

(A) Authorities
Unless otherwise specified in the Programs Section of the
SuperNOFA, the authority for Fiscal Year 1998 funding availability
under this SuperNOFA is the Department of Veterans Affairs and Housing
and Urban Development and Independent Agencies Appropriations Act, 1998
(Pub.L. 105-65, approved October 27, 1997) (FY 1998 HUD Appropriations
Act). Where applicable, additional authority for each program in this
SuperNOFA is identified in the Programs Section.
(B) Purpose
The purpose of this SuperNOFA is to:
(1) Make funding available through a variety of programs to empower
communities and their residents, particularly the poor and
disadvantaged, to develop viable communities, provide decent housing
and a suitable living environment for all citizens, without
discrimination in order to improve themselves both as individuals and
as a community.
(2) Simplify and streamline the application process for funding
under HUD programs. By making available to State and local governments,
public housing agencies, tribal governments, non-profit organizations
and others, the application requirements for HUD housing and community
development programs in one NOFA, HUD hopes that the result will be a
less time consuming and less complicated application process. This new
process also allows an applicant to submit one application for funds
for several programs. Except where statutory or regulatory requirements
or program policy mandate differences, the SuperNOFA strives to provide
for one set of rules, standardized rating factors, and uniform and
consolidated application procedures.
(3) Enhance the ability of applicants to make more effective and
efficient use of housing and community development funding when
addressing community needs and implementing coordinated housing and
community development strategies established in local Consolidated
Plans, which is the single application for HUD housing and community
development and other formula funds submitted by the local or State
government. Through this SuperNOFA process, applicants are encouraged
to: (i) create opportunities for strategic planning and citizen
participation in a comprehensive context at the local level in order to
establish a full continuum of housing and services; and (ii) promote
methods for developing more coordinated and effective approaches to
dealing with urban, suburban, and rural problems by recognizing the
interconnections among the underlying problems and ways to address them
through layering of available HUD programs;
(4) Promote the ability of eligible non-profit organizations to
participate in many of the programs contained in this SuperNOFA;
provide an increased opportunity to assist communities in developing
job training, economic development and empowerment programs, directed
at revitalizing neighborhoods and obtaining self-sufficiency for low
and moderate income families; and
(5) Recognize and make better use of the expertise that each of the
programs, and organizations eligible for funding under this SuperNOFA,
can contribute when developing and implementing local housing and
community development plans, the Consolidated Plan, and the HUD
required Analysis of Impediments to Fair Housing Choice.
(C) Amounts Allocated
The amounts allocated to specific programs in this SuperNOFA are
based on appropriated funds. Should recaptured funds become available
in any program, HUD reserves the right to increase the available
funding amounts by the amount of funds recaptured.
(D) Eligible Applicants and Eligible Activities
The eligible applicants and eligible activities for each program
are identified and described for the program in the Programs Section of
the SuperNOFA.

II. Requirements and Procedures Applicable to all Programs

Except as may be modified in the Programs Section of this Super
NOFA, or as noted within the specific provisions of this Section II,
the following principles apply to all programs. Please be sure to read
the program area section of the SuperNOFA for additional requirements
or information.
(A) Statutory Requirements
All applicants must meet and comply with all statutory and
regulatory requirements applicable to the program for which they are
seeking funding in order to be awarded funds. Copies of the regulations
are available from the SuperNOFA Information Center or through the
Internet at http://www.HUD.gov. HUD may reject an application from
further funding consideration if the activities or projects proposed
are ineligible, or HUD may eliminate the ineligible activities from
funding consideration and reduce the grant amount accordingly.
(B) Threshold Requirements--Compliance With Fair Housing and Civil
Rights Laws
All applicants, with the exception of Federally recognized Indian
tribes, must comply with all Fair Housing and civil rights laws,
statutes, regulations and executive orders as enumerated in 24 CFR
5.105(a). Federally recognized Indian tribes must comply with the Age
Discrimination Act of 1975, Section 504 of the Rehabilitation Act of
1973, and the Indian Civil Rights Act. If an applicant (1) has been
charged with a violation of the Fair Housing Act by the Secretary; (2)
is the defendant in a Fair Housing Act lawsuit filed by the Department
of Justice; or (3) has received a letter of noncompliance findings
under Title VI of the Civil Rights Act, Section 504 of the
Rehabilitation Act, or Section 109 of the Housing and Community
Development Act, the applicant is not eligible to apply for funding
under this SuperNOFA until the applicant resolves such charge, lawsuit,
or letter of findings to the satisfaction of the Department.
(C) Additional Nondiscrimination Requirements
Applicants must comply with the Americans with Disabilities Act,
and Title IX of the Education Amendments Act of 1972.

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(D) Affirmatively Furthering Fair Housing
Unless otherwise specified in the Programs Section of this
SuperNOFA, each successful applicant will have a duty to affirmatively
further fair housing. Where directed by the applicable program section,
applicants should include in their work plans the specific steps that
they will take to (1) address the elimination of impediments to fair
housing that were identified in the jurisdiction's Analysis of
Impediments (AI) to Fair Housing Choice; (2) remedy discrimination in
housing; or (3) promote fair housing rights and fair housing choice.
Further, applicants have a duty to carry out the specific activities
cited in their responses to the rating factors that address
affirmatively furthering fair housing in the Programs Section of this
SuperNOFA.
(E) Economic Opportunities for Low and Very Low-Income Persons (Section
3).
Certain programs in this SuperNOFA require recipients of HUD
assistance to comply with section 3 of the Housing and Urban
Development Act of 1968, 12 U.S.C. 1701u (Economic Opportunities for
Low and Very Low-Income Persons) and the HUD regulations at 24 CFR part
135, including the reporting requirements subpart E. Section 3 provides
that recipients shall ensure that training, employment and other
economic opportunities, to the greatest extent feasible, be directed to
(1) low and very low income persons, particularly those who are
recipients of government assistance for housing and (2) business
concerns which provide economic opportunities to low and very low
income persons. Section 3 is applicable to the following programs in
this SuperNOFA: Brownfields Economic Development; Economic Development
Initiative; Economic Development and Supportive Services; Tenant
Opportunity Program; and Youthbuild.
(F) Relocation
Any person (including individuals, partnerships, corporations or
associations) who moves from real property or moves personal property
from real property as a direct result of a written notice to acquire or
the acquisition of the real property, in whole or in part, for a HUD-
assisted activity is covered by acquisition policies and procedures and
the relocation requirements of the Uniform Relocation Assistance and
Real Property Acquisition Policies Act of 1970, as amended (URA), and
the implementing governmentwide regulation at 49 CFR part 24. Any
person who moves permanently from real property or moves personal
property from real property as a direct result of rehabilitation or
demolition for an activity undertaken with HUD assistance is covered by
the relocation requirements of the URA and the governmentwide
regulation.
(G) Forms, Certifications and Assurances
Each applicant is required to submit signed copies of the standard
forms, certifications, and assurances, listed in this section, unless
the Programs Section specifies otherwise. Additionally, the Programs
Section may specify additional forms, certifications, assurances, or
other information, that may be required for a particular program in
this SuperNOFA.
(1) Standard Form for Application for Federal Assistance (SF-424);
(2) Standard Form for Budget Information--Non-Construction Programs
(SF-424A) or Standard Form for Budget Information-Construction Programs
(SF-424C), as applicable;
(3) Standard Form for Assurances--Non-Construction Programs (SF-
424B) or Standard Form for Assurances--Construction Programs (SF-424D),
as applicable;
(4) Drug-Free Workplace Certification (HUD-50070);
(5) Certification and Disclosure Form Regarding Lobbying (SF-LLL);
(Tribes and tribally designated housing entities (THDEs) established by
an Indian tribe as a result of the exercise of the tribe's sovereign
power are not required to submit this certification. Tribes and TDHEs
established under State law are required to submit this certification.)
(6) Applicant/Recipient Disclosure Update Report (HUD-2880);
(7) Certification that the applicant will comply with the
requirements of the Fair Housing Act, Title VI of the Civil Rights Act
of 1964, section 504 of the Rehabilitation Act of 1973, and the Age
Discrimination Act of 1975, and will affirmatively further fair
housing. CDBG recipients also must certify to compliance with section
109 of the Housing and Community Development Act. Federally recognized
Indian tribes must certify that they will comply with the requirements
of the Age Discrimination Act of 1975, section 504 of the
Rehabilitation Act of 1973, and the Indian Civil Rights Act.
(8) Certification required by 24 CFR 24.510. (The provisions of 24
CFR part 24 apply to the employment, engagement of services, awarding
of contracts, subgrants, or funding of any recipients, or contractors
or subcontractors, during any period of debarment, suspension, or
placement in ineligibility status, and a certification is required.)
(H) OMB Circulars
The policies, guidances, and requirements of OMB Circular No. A-87
(Cost Principles Applicable to Grants, Contracts and Other Agreements
with State and Local Governments), OMB Circular No. A-122 (Cost
Principles for Nonprofit Organizations), 24 CFR part 84 (Grants and
Agreements with Institutions of Higher Education, Hospitals, and other
Non-Profit Organizations) and 24 CFR part 85 (Administrative
Requirements for Grants and Cooperative Agreements to State, Local, and
Federally recognized Indian tribal governments) apply to the award,
acceptance and use of assistance under the programs of this SuperNOFA,
and to the remedies for noncompliance, except when inconsistent with
the provisions of the FY 1998 HUD Appropriations Act, other Federal
statutes or the provisions of this SuperNOFA. Compliance with
additional OMB Circulars may be specified for a particular program in
the Programs Section of the SuperNOFA. Copies of the OMB Circulars may
be obtained from EOP Publications, Room 2200, New Executive Office
Building, Washington, DC 10503, telephone (202) 395-7332 (this is not a
toll free number).
(I) Environmental Requirements
For programs under this SuperNOFA that assist physical development
activities or property acquisition, grantees are generally prohibited
from acquiring, rehabilitating, converting, leasing, repairing or
constructing property, or committing or expending HUD or non-HUD funds
for these program activities, until one of the following has occurred:
(1) HUD has completed an environmental review in accordance with 24 CFR
part 50; or (2) for programs subject to 24 CFR part 58, HUD has
approved a grantee's Request for Release of Funds (HUD Form 7015.15)
following a Responsible Entity's completion of an environmental review.
Applicants should consult the Programs Section for the applicable
program to determine the procedures for, timing of, and any exclusions
from environmental review under a particular program.
(J) Conflicts of Interest
Consultants or experts assisting HUD in rating and ranking
applicants for funding under this SuperNOFA are subject to 18 U.S.C.
208, the Federal criminal conflict of interest statute, and

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to the Standards of Ethical Conduct for Employees of the Executive
Branch regulation published at 5 CFR part 2635. As a result,
individuals who have assisted or plan to assist applicants with
preparing applications for this SuperNOFA may not serve on a selection
panel or as a technical advisor to HUD for this SuperNOFA. All
individuals involved in rating and ranking this SuperNOFA, including
experts and consultants, must avoid conflicts of interest or the
appearance of conflicts. If the selection or non-selection of any
applicant under this NOFA affects the individual's financial interests
set forth in 18 U.S.C. 208 or involves any party with whom the
individual has a covered relationship under 5 CFR 2635.502, that
individual must, prior to participating in any matter regarding this
NOFA, disclose this fact to the General Counsel or the Ethics Law
Division.

III. Application Selection Process

(A) General
To review and rate applications, HUD may establish panels including
persons not currently employed by HUD to obtain certain expertise and
outside points of view, including views from other Federal agencies.
(1) Rating. All applications for funding in each program listed in
this SuperNOFA will be evaluated and rated against the criteria in this
SuperNOFA. The rating of the ``applicant'' or the ``applicant's
organization and staff'' for technical merit or threshold compliance,
unless otherwise specified, will include any sub-contractors,
consultants, sub-recipients, and members of consortia which are firmly
committed to the project.
(2) Ranking. Applicants will be ranked within each program.
Applicants will be ranked only against others that applied for the same
program funding and where there are set-asides within the competition,
the applicant would only compete against applicants in the same set-
aside competition.
(B) Threshold Requirements
HUD will review each application to determine whether the
application meets all of the threshold criteria described for program
funding made available under this SuperNOFA. Applications that meet all
of the threshold criteria will be eligible to be rated and ranked,
based on the criteria described, and the total number of points to be
awarded.
(C) Factors for Award Used To Evaluate and Rate Applications
For all of the programs for which funding is available under this
SuperNOFA, the points awarded for the factors total 100. Where
applicable (as provided in the Programs Section of the SuperNOFA),
applicants may be eligible for additional points as discussed in this
Section III(C).
(1) Bonus Points. The SuperNOFA provides for the award of up to two
bonus points for eligible activities/projects that are proposed to be
located in federally designated Empowerment Zones, Enterprise
Communities, or Urban Enhanced Enterprise Communities, and serve the
EZ/EC residents, and are certified to be consistent with the strategic
plan of the EZs and ECs. The application kit contains a certification
which must be completed for the applicant to be considered for EZ/EC
bonus points. In the BEDI competition, two bonus points are available
for federally designated Brownfields Showcase Communities. (Please see
BEDI section of this SuperNOFA for additional information). A listing
of the federally designated EZs, ECs, Enhanced ECs and Brownfields
Showcase Communities are available from the SuperNOFA Information
Center, or through the HUD web site on the Internet at http://
www.HUD.gov.
(2) Court-Ordered Consideration. Due to an order of the U.S.
District Court for the Northern District of Texas, Dallas, Division,
with respect to any application by the City of Dallas, Texas, for HUD
funds, HUD shall consider the extent to which the strategies or plans
in an application or applications submitted by the City of Dallas for
any program under this SuperNOFA will be used to eradicate the vestiges
of segregation in the Dallas Housing Authority's low income housing
programs. The City of Dallas should address the effect, if any, that
vestiges of racial segregation in Dallas Housing Authority's low income
housing programs have on potential participants in the programs covered
by this NOFA, and identify proposed actions for remedying those
vestiges. HUD may add up to 2 points to the score for any program based
on this consideration, as provided in Factor 3 by the individual
programs in the Programs Section of this SuperNOFA. (The points
provided in this Section III(C)(2) is limited to applications submitted
by the City of Dallas.)
(3) The Five Standard Rating Factors. The factors for rating and
ranking applicants are listed in this Section III(c)(2) and maximum
points for each factor, are provided in the Programs Section of the
SuperNOFA. Each applicant should carefully read the factors for award
as described in the program area section that they are seeking funding.
While HUD has established the following basic factors for award, these
may have been modified or adjusted to take into account specific
program needs, or statutory or regulatory limitations imposed on a
program. The standard factors for award, except as modified in the
program area section are:

Factor 1: Capacity of the Applicant and Relevant Organizational Staff
Factor 2: Need/Extent of the Problem
Factor 3: Soundness of Approach
Factor 4: Leveraging Resources
Factor 5: Comprehensiveness and Coordination
(D) Negotiation
After all applications have been rated and ranked and a selection
has been made HUD may require that all winners participate in
negotiations to determine the specific terms of the grant agreement and
budget. In cases where HUD cannot successfully conclude negotiations or
a selected applicant fails to provide HUD with requested information,
awards will not be made. In such instances, HUD may offer an award to
the next highest ranking applicant, and proceed with negotiations with
the next highest ranking applicant.
(E) Adjustments to Funding
HUD reserves the right to fund less than the full amount requested
in any application to ensure the fair distribution of the funds and to
ensure the purposes of the programs contained in this SuperNOFA are
met. HUD may choose not to fund portions of the applications that are
ineligible for funding under applicable program statutory or regulatory
requirements, or which do not meet the requirements of this General
Section of this SuperNOFA or the requirements in the Programs Section
for the specific program, and fund eligible portions of the
applications.
If funds remain after funding the highest ranking applications, HUD
may fund part of the next highest ranking application in a given
program area. If the applicant turns down the award offer, HUD will
make the same determination for the next highest ranking application.
If funds remain after all selections have been made, remaining funds
may be available for other competitions for each program area where
there is a balance of funds.
Additionally, in the event of a HUD procedural error that, when
corrected,

[[Page 23884]]

would result in selection of an otherwise eligible applicant during the
funding round of this SuperNOFA, HUD may select that applicant when
sufficient funds become available.
(F) Performance and Compliance Actions of Grantees
Performance and compliance actions of grantees will be measured and
addressed in accordance with applicable standards and sanctions of
their respective programs.

IV. Application Submission Requirements

As discussed earlier in the introductory section of this SuperNOFA,
part of the simplification of this funding process, is to reduce the
duplication of effort involved in completing and submitting similar
applications for HUD funded programs. This SuperNOFA provides for
consolidated applications for several of the programs for which funding
is available under this SuperNOFA.

V. Corrections to Deficient Applications

After the application due date, HUD may not, consistent with 24 CFR
part 4, subpart B, consider unsolicited information from an applicant.
HUD may contact an applicant, however, to clarify an item in the
application or to correct technical deficiencies. Applicants should
note, however, that HUD may not seek clarification of items or
responses that improve the substantive quality of the applicant's
response to any eligibility or selection criterion. Examples of curable
technical deficiencies include failure to submit the proper
certifications or failure to submit an application containing an
original signature by an authorized official. In each case, HUD will
notify the applicant in writing by describing the clarification or
technical deficiency. HUD will notify applicants by facsimile or by
return receipt requested. Applicants must submit clarifications or
corrections of technical deficiencies in accordance with the
information provided by HUD within 14 calendar days of the date of
receipt of the HUD notification. If the deficiency is not corrected
within this time period, HUD will reject the application as incomplete.

VI. Promoting Comprehensive Approaches to Housing and Community
Development

(A) General
HUD believes the best approach for addressing community problems is
through a community-based process that provides a comprehensive
response to identified needs. By making HUD's Economic Development and
Empowerment funding available in one NOFA, applicants may be able to
relate the activities proposed for funding under this SuperNOFA to the
recent and upcoming NOFAs and the community's Consolidated Plan and
Analysis of Impediments to Fair Housing Choice. A complete schedule of
NOFAs to be published during the fiscal year and those already
published appears under the HUD Homepage on the Internet, which can be
accessed at http://www.hud.gov/nofas.html.
(B) Linking Program Activities With AmeriCorps
Applicants are encouraged to link their proposed activities with
AmeriCorps, a national service program engaging thousands of Americans
on a full or part-time basis to help communities address their toughest
challenges, while earning support for college, graduate school, or job
training. For information about AmeriCorps, call the Corporation for
National Service at (202) 606-5000.
(C) Encouraging Visitability in New Construction and Substantial
Rehabilitation Activities
In addition to applicable accessible design and construction
requirements, applicants are encouraged to incorporate visitability
standards where feasible in new construction and substantial
rehabilitation projects involving housing. Visitability standards allow
a person with mobility impairments access into the home, but does not
require that all features be made accessible. Visitability means at
least one entrance at grade (no steps), approached by an accessible
route such as a sidewalk; the entrance door and all interior passage
doors are at least 2 feet 10 inches wide, allowing 32 inches of clear
passage space. Allowing use of 2'10'' doors is consistent with the Fair
Housing Act (at least for the interior doors), and may be more
acceptable than requiring the 3 foot doors that are required in fully
accessible areas under the Uniform Federal Accessibility Standards for
a small percentage of units. A visitable home also serves persons
without disabilities, such as a mother pushing a stroller, or a person
delivering a large appliance. Copies of the UFAS are available from the
Office of Fair Housing and Equal Opportunity, U.S. Department of
Housing and Urban Development, Room 5230, 451 Seventh Street, SW,
Washington, DC 20410, telephone (202) 755-5404 or the TTY telephone
number, 1-800-877-8399 (Federal Information Relay Service).
(D) Developing Healthy Homes
HUD's Healthy Homes Initiative is one of the initiatives developed
by the White House Task Force on Environmental Health Risks and Safety
Risks to Children that was established under Executive Order 13045
(``Protection of Children from Environmental Health Risks and Safety
Risks''). HUD encourages the funding of activities (to the extent
eligible under specific programs) that promote healthy homes, or that
promote education on what is a healthy home. These activities may
include, but are not limited to the following: educating homeowners or
renters about the need to protect children in their home from dangers
that can arise from items such as curtain cords, electrical outlets,
hot water, poisons, fire, and sharp table edges, among others;
incorporating child safety measures in the construction, rehabilitation
or maintenance of housing, which include but are not limited to: child
safety latches on cabinets, hot water protection devices, properly
ventilated windows to protect from mold, window guards to protect
children from falling, proper pest management to prevent cockroaches
which can cause asthma, and activities directed to control of lead-
based paint hazards. The National Lead Information Hotline is 1-800-
424-5323.

VII. Findings and Certifications

(A) Environmental Impact
A Finding of No Significant Impact with respect to the environment
has been made in accordance with HUD regulations at 24 CFR part 50 that
implement section 102(2)(C) of the National Environmental Policy Act of
1969 (42 U.S.C. 4332). The Finding of No Significant Impact is
available for public inspection during regular business hours in the
Office of the General Counsel, Regulations Division, Room 10276, U.S.
Department of Housing and Urban Development, 451 Seventh Street, SW,
Washington, DC 20410-0500.
(B) Federalism, Executive Order 12612
The General Counsel, as the Designated Official under section 6(a)
of Executive Order 12612, Federalism, has determined that the policies
contained in this SuperNOFA will not have substantial direct effects on
States or their political subdivisions, or on the relationship between
the Federal Government and the States, or on the distribution of power
and responsibilities among the various levels of government.
Specifically, the SuperNOFA solicits applicants to

[[Page 23885]]

expand their role in addressing community development needs in their
localities, and does not impinge upon the relationships between the
Federal government and State and local governments. As a result, the
SuperNOFA is not subject to review under the Order.
(C) Prohibition Against Lobbying Activities
Applicants for funding under this SuperNOFA are subject to the
provisions of section 319 of the Department of Interior and Related
Agencies Appropriation Act for Fiscal Year 1991, 31 U.S.C. 1352 (the
Byrd Amendment), which prohibits recipients of Federal contracts,
grants, or loans from using appropriated funds for lobbying the
executive or legislative branches of the Federal Government in
connection with a specific contract, grant, or loan. Applicants are
required to certify, using the certification found at Appendix A to 24
CFR part 87, that they will not, and have not, used appropriated funds
for any prohibited lobbying activities. In addition, applicants must
disclose, using Standard Form LLL, ``Disclosure of Lobbying
Activities,'' any funds, other than Federally appropriated funds, that
will be or have been used to influence Federal employees, members of
Congress, and congressional staff regarding specific grants or
contracts. Tribes and tribally designated housing entities (THDEs)
established by an Indian tribe as a result of the exercise of the
tribe's sovereign power are excluded from coverage of the Byrd
Amendment, but tribes and TDHEs established under State law are not
excluded from the statute's coverage.
(D) Section 102 of the HUD Reform Act; Documentation and Public Access
Requirements
Section 102 of the Department of Housing and Urban Development
Reform Act of 1989 (42 U.S.C. 3545) (HUD Reform Act) and the
regulations codified in 24 CFR part 4, subpart A, contain a number of
provisions that are designed to ensure greater accountability and
integrity in the provision of certain types of assistance administered
by HUD. On January 14, 1992 (57 FR 1942), HUD published a notice that
also provides information on the implementation of section 102. The
documentation, public access, and disclosure requirements of section
102 apply to assistance awarded under this SuperNOFA as follows:
(1) Documentation and public access requirements. HUD will ensure
that documentation and other information regarding each application
submitted pursuant to this SuperNOFA are sufficient to indicate the
basis upon which assistance was provided or denied. This material,
including any letters of support, will be made available for public
inspection for a 5-year period beginning not less than 30 days after
the award of the assistance. Material will be made available in
accordance with the Freedom of Information Act (5 U.S.C. 552) and HUD's
implementing regulations in 24 CFR part 15.
(2) Disclosures. HUD will make available to the public for 5 years
all applicant disclosure reports (HUD Form 2880) submitted in
connection with this SuperNOFA. Update reports (also Form 2880) will be
made available along with the applicant disclosure reports, but in no
case for a period less than 3 years. All reports--both applicant
disclosures and updates--will be made available in accordance with the
Freedom of Information Act (5 U.S.C. 552) and HUD's implementing
regulations at 24 CFR part 15.
(3) Publication of Recipients of HUD Funding. HUD's regulations at
24 CFR 4.7 provide that HUD will publish a notice in the Federal
Register on at least a quarterly basis to notify the public of all
decisions made by the Department to provide:
(i) Assistance subject to section 102(a) of the HUD Reform Act; or
(ii) Assistance that is provided through grants or cooperative
agreements on a discretionary (non-formula, non-demand) basis, but that
is not provided on the basis of a competition.
(E) Section 103 HUD Reform Act
HUD's regulations implementing section 103 of the Department of
Housing and Urban Development Reform Act of 1989 (42 U.S.C. 3537a),
codified in 24 CFR part 4, apply to this funding competition. The
regulations continue to apply until the announcement of the selection
of successful applicants. HUD employees involved in the review of
applications and in the making of funding decisions are limited by the
regulations from providing advance information to any person (other
than an authorized employee of HUD) concerning funding decisions, or
from otherwise giving any applicant an unfair competitive advantage.
Persons who apply for assistance in this competition should confine
their inquiries to the subject areas permitted under 24 CFR part 4.
Applicants or employees who have ethics related questions should
contact the HUD Ethics Law Division at (202) 708-3815. (This is not a
toll-free number.) For HUD employees who have specific program
questions, the employee should contact the appropriate field office
counsel, or Headquarters counsel for the program to which the question
pertains.

VIII. The FY 1998 SuperNOFA Process and Future HUD Funding Processes

In FY 1997, Secretary Cuomo took the first step at changing HUD's
funding process to better promote comprehensive, coordinated approaches
to housing and community development. In FY 1997, the Department
published related NOFAs on the same day or within a few days of each
other. In the individual NOFAs published in FY 1997, HUD advised that
additional steps on NOFA coordination may be considered for FY 1998.
The three SuperNOFAs to be published for FY 1998 represent the
additional step taken by HUD to improve HUD's funding process and
assist communities to make better use of available resources through a
coordinated approach. This new SuperNOFA process was developed based on
comments received from HUD clients and the Department believes it
represents a significant improvement over HUD's approach to the funding
process in prior years. For FY 1999, HUD may take even further steps to
enhance this process. HUD welcomes comments from applicants and other
members of the public on this process, and how it may be improved in
future years.
The description of program funding available under this second
SuperNOFA for Economic Development and Empowerment Programs follows.

Dated: April 23, 1998.
Saul N. Ramirez, Jr.,
Acting Deputy Secretary.

BILLING CODE 4210-32-P

Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 /
Notices

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[GRAPHIC] [TIFF OMITTED] TN30AP98.007

BILLING CODE 4210-22-C

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Notices

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Funding Availability for the Brownfields Economic Development
Initiative (BEDI)

Program Description: Approximately $25 million is available for
Brownfields Economic Development Initiative (BEDI) grants under Section
108(q) of the Housing and Community Development Act of 1974, as
amended. BEDI funds are used to enhance the security of the Section 108
guaranteed loan for the same project or to improve the viability of a
project financed with a Section 108-guaranteed loan. A BEDI grant is
required to be used in conjunction with a new Section 108 guaranteed
loan commitment.
Application Due Date: Completed applications (one original and two
copies) must be submitted no later than 12:00 midnight, Eastern time,
on August 10, 1998 to the addresses shown below. See the General
Section of this SuperNOFA for specific procedures governing the form of
application submission (e.g., mailed applications, express mail,
overnight delivery, or hand carried).

Addresses for Submitting Applications

To HUD Headquarters. The completed application (an original and one
copy) must be submitted to: Processing and Control Unit, Room 7255,
Office of Community Planning and Development, Department of Housing and
Urban Development, 451 Seventh Street, SW, Washington, D.C. 20410,
Attention: BEDI Grant, by mail or hand delivery.
To the Appropriate CPD Field Office. An additional copy should be
submitted to the Community Planning and Development Division of the
appropriate HUD Field Office for the applicant's jurisdiction.
When submitting your application, please refer to BEDI, and include
your name, mailing address (including zip code) and telephone number
(include area code).

For Application Kits, Further Information, and Technical Assistance

For Application Kits. For an application kit and any supplemental
information, please call HUD's SuperNOFA Information line toll free at
1-800-HUD-8929. Persons with hearing or speech impairments may call the
Center's TTY number at 1-800-HUD-2209 to obtain an application kit. The
application kit will also be available on the Internet through the HUD
web site at http://www.hud.gov. When requesting an application kit,
please refer to BEDI. Please be sure to provide your name, address
(including zip code), and telephone number (including area code).
For Further Information and Technical Assistance. Contact either
Stan Gimont or Paul Webster, Financial Management Division, Office of
Block Grant Assistance, Department of Housing and Urban Development,
451 Seventh Street, SW, Room 7178, Washington, DC 20410, telephone
(202) 708-1871 (this is not a toll-free number). Persons with speech or
hearing impairments may access this number via TTY by calling the toll-
free Federal Information Relay Service at 1-800-877-8339.
See the General Section of this SuperNOFA for guidance on technical
assistance. With respect to the Section 108 Loan Guarantee program,
which is not a competitive program and thus not subject to those
provisions of the HUD Reform Act pertaining to competitions, HUD staff
will be available to provide advice and assistance to develop Section
108 loan applications.

Additional Information

I. Authority; Definitions; Purpose; Amount Allocated; and
Eligibility

(A) Authority

Section 108(q), Title I, Housing and Community Development Act of
1974, as amended, (42 U.S.C. 5301-5320) (the Act); 24 CFR part 570.

(B) Definitions

Unless otherwise defined herein, terms defined in 24 CFR part 570
and used in this program section of this SuperNOFA shall have the
respective meanings given thereto in that part.
Brownfield means abandoned, idled, or under-used real property
(including industrial and commercial facilities) where expansion or
redevelopment is complicated by real or suspected contamination.
Brownfields Economic Development Initiative (BEDI) means the
competitive award of up to $25 million, as appropriated in the FY 1998
HUD Appropriations Act, for economic development grant assistance under
section 108(q) of the Act for the purpose of assisting public entities
in the redevelopment of brownfields.
CDBG funds means those funds as defined at 24 CFR 570.3, including
grant funds received pursuant to section 108(q) and this program
section of this SuperNOFA.
Economic Development Initiative (EDI) means the provision of
economic development grant assistance under section 108(q) of the Act,
as authorized by Section 232 of the Multifamily Housing Property
Disposition Reform Act of 1994 (Pub. L. 103-233, approved April 11,
1994).
Economic development project means an activity or activities
(including mixed use projects with housing components) that are
eligible under the Act and under 24 CFR 570.703, and that increase
economic opportunity for persons of low- and moderate-income or that
stimulate or retain businesses or jobs or that otherwise lead to
economic revitalization in connection with brownfields.
Empowerment Zone or Enterprise Community means an urban area so
designated by the Secretary of HUD pursuant to 24 CFR part 597, or a
rural area so designated by the Secretary of Agriculture pursuant to 7
CFR part 25, subpart B.
EPA means the U.S. Environmental Protection Agency.
Showcase Community means an applicant chosen by the Federal
Government's Brownfields National Partnership for inclusion in Federal
Government's Brownfields Showcase Communities program.
Strategic Plan means a strategy developed and agreed to by the
nominating local government(s) and State(s) and submitted in partial
fulfillment of the application requirements for an Empowerment Zone or
Enterprise Community designated pursuant to 24 CFR part 597.

(C) Purpose

(1) Background. HUD has multiple programs which are intended to
stimulate and promote economic and community development and can be
effectively employed to address and remedy brownfield conditions.
Primary among HUD's resources are the Community Development Block Grant
(CDBG) program and the Section 108 loan guarantee program.
The CDBG program provides grant funds ($4.195 billion in FY 1998)
to local governments (either directly or through States) to carry out
community and economic development activities. The Section 108 loan
guarantee program provides local governments with a source of financing
for economic development, housing rehabilitation, and other eligible
large scale physical development projects. HUD is authorized pursuant
to Section 108 to guarantee notes issued by CDBG entitlement
communities and non-entitlement units of general local government
eligible to receive funds under the State CDBG program. Regulations
governing the Section 108 program are found at 24 CFR part 570, subpart
M. It must be noted that the Section 108 program is subject to the

[[Page 23890]]

regulations of 24 CFR part 570 applicable to the CDBG program with the
exception of changes embodied in 24 CFR part 570, subpart M.
For FY 1998, the Section 108 program is authorized at $1.261
billion in loan guarantee authority. The full faith and credit of the
United States is pledged to the payment of all guarantees made under
Section 108. Under this program, communities (and States, if
applicable) pledge their future years' CDBG allocations as security for
loans guaranteed by HUD. The Section 108 program, however, does not
require CDBG funds to be escrowed for loan repayment (unless such an
arrangement is specifically negotiated as loan security). This means
that a community can continue to spend its existing allocation for
other CDBG purposes, unless needed for loan repayment.
(2) EDI Program. The EDI program was enacted in 1994 and is
intended to complement and enhance the Section 108 Loan Guarantee
program. The purpose of EDI (and BEDI) grant funds is to further
minimize the potential loss of future CDBG allocations:
(a) By strengthening the economic feasibility of the projects
financed with Section 108 funds (and thereby increasing the probability
that the project will generate enough cash to repay the guaranteed
loan);
(b) By directly enhancing the security of the guaranteed loan; or
(c) Through a combination of these or other risk mitigation
techniques.
(3) BEDI Program. For FY 1998, the Congress made a specific
appropriation of approximately $25 million for the EDI program to
assist in financing ``brownfields'' redevelopment. HUD intends the $25
million in Brownfields EDI (BEDI) funds available pursuant to this
program section of this SuperNOFA to be used with a particular emphasis
upon the redevelopment of brownfield sites consistent with the
statutory purpose of the FY 1998 HUD Appropriations Act. Accordingly,
BEDI funds shall be used as the stimulus for local governments and
private sector parties to commence redevelopment or continue phased
redevelopment efforts on brownfield sites where contamination is known
or suspected and redevelopment plans exist. HUD desires to see BEDI and
Section 108 funds used to finance projects and activities that will
provide near-term results and demonstrable economic benefits, such as
job creation and increases in the local tax base. HUD does not
encourage applications whose scope is limited only to site acquisition
and/or remediation (i.e., land banking).
(4) Redevelopment Focus. The redevelopment focus for BEDI-assisted
projects is also prompted by the need to provide additional security
for the Section 108 loan guarantee pursuant to 24 CFR 570.705(b)(3).
While public entities are required by the Act to pledge their current
and future CDBG funds as a source of security for the Section 108 loan
guarantee, the public entity will usually be required to furnish
additional collateral which, ideally, will be the assets financed with
the Section 108 loan funds. Clearly, a redevelopment focus for the BEDI
funds will help achieve this goal by enhancing the value and improving
the viability of projects assisted with Section 108 financing.
(5) Integration of Other Government Brownfield Programs. HUD
expects and encourages local governments which are designated through
the Federal Government's Brownfields Showcase Community program or
other brownfields programs (i.e., EPA's Assessment Pilot or Revolving
Loan Fund programs) or a State-supported brownfields program or related
economic development program to integrate efforts arising from those
programs in developing projects for assistance under HUD's BEDI and
Section 108 programs. Such applicants should elaborate upon these ties
in their response to the rating factors, where appropriate (e.g.
``Capacity of the Applicant,'' ``Soundness of Approach,'' or
``Leveraging Resources,''--Rating Factors 1, 3, and 4 respectively.)
(6) Typical Project Structures. Provided that proposals are
consistent with other CDBG requirements, including national objectives,
HUD envisions that the following project structures could be typical:
(a) Land Writedowns. Local governments may use a combination of
Section 108 and BEDI funds to acquire a brownfield site for purposes of
reconveying the site to a private developer at a discount from its
purchase price. This approach would provide the developer with an asset
of enhanced value which could be used as collateral for other sources
of funding. Such other sources of financing could be used to finance
environmental remediation or other development costs. In theory, the
level of BEDI assistance would approximate the difference between the
original cost of the site and its remediation in comparison to the
market value of the remediated property.
(b) Site Remediation Costs. Local governments may use BEDI funds in
any of several ways to address site remediation costs. If the local
government used Section 108 funds to acquire real property, BEDI funds
could be used to address assessment and site remediation costs as part
of demolition, clearance, or site preparation activities. If the local
government used Section 108 funds to make a loan to a developer, BEDI
funds could be granted to the developer for the purpose of addressing
remediation costs as part of an economic development activity.
(c) Funding Reserves. The cash flow generated by an economic
development project may be expected to be relatively ``thin'' in the
early stages of the project, i.e. potentially insufficient cash flows
to meet operating expenses and debt service obligations. The BEDI grant
can make it possible for reserves to be established in a way that
enhances the economic feasibility of the project.
(d) Over-Collateralizing the Section 108 Loan.
(i) The use of BEDI grant funds may be structured in appropriate
cases so as to improve the likelihood that project-generated cash flow
will be sufficient to cover debt service on the Section 108 loan and
directly to enhance the guaranteed loan. One technique for
accomplishing this approach is over-collateralization of the Section
108 loan.
(ii) An example is the creation of a loan pool made up of Section
108 and BEDI grant funds. The community would make loans to various
businesses from the combined pool at an interest rate equal to or
greater than the rate on the Section 108 loan. The total loan portfolio
would be pledged to the repayment of the Section 108 loan.
(e) Direct Enhancement of the Security of the Section 108 Loan. The
BEDI grant can be used to cover the cost of providing enhanced
security. An example of how the BEDI grant can be used for this purpose
is by using the grant funds to cover the cost of a standby letter of
credit, issued in favor of HUD. This letter of credit will be available
to fund amounts due on the Section 108 loan if other sources fail to
materialize and will, thus, serve to protect the public entity's future
CDBG funds.
(f) Provision of Financing to For-Profit Businesses at a Below
Market Interest Rate.
(i) While the rates on loans guaranteed under Section 108 are only
slightly above the rates on comparable U.S. Treasury obligations, they
may nonetheless be higher than can be afforded by businesses in
severely economically distressed neighborhoods. The BEDI grant can be
used to make Section 108 financing affordable.
(ii) BEDI grant funds could serve to ``buy down'' the interest rate
up front,

[[Page 23891]]

or make full or partial interest payments, allowing the businesses to
be financially viable in the early start-up period not otherwise
possible with Section 108 alone. This strategy would be particularly
useful where a community was undertaking a large commercial/retail
project in a distressed neighborhood to act as a catalyst for other
development in the area.
(g) Combination of Techniques. An applicant could employ a
combination of these or other techniques in order to implement a
strategy that carries out an economic development project.

(D) Amount Allocated

HUD has available a maximum of $25 million for the BEDI program, as
appropriated in the FY 1998 HUD Appropriations Act for the purpose of
assisting public entities in the redevelopment of brownfields.

(E) Eligibility to Apply for Grant Assistance

Any public entity eligible to apply for Section 108 loan guarantee
assistance in accordance with 24 CFR 570.702 may apply for BEDI grant
assistance under section 108(q). Eligible applicants are CDBG
entitlement units of general local government and non-entitlement units
of general local government eligible to receive loan guarantees under
24 CFR part 570, subpart M. Note that effective January 25, 1995, non-
entitlement public entities in the states of New York and Hawaii were
authorized to apply to HUD for Section 108 loans (see 59 FR 47510,
December 27, 1994). Thus non-entitlement public entities in all 50
states and Puerto Rico are eligible to participate in the Section 108
and BEDI programs.

(F) Related Section 108 Loan Guarantee Application

(1) Each BEDI application must be accompanied by a request for new
Section 108 loan guarantee assistance. Both the BEDI and Section 108
funds must be used in conjunction with the same economic development
project. This request may take any of several forms as defined below.
(a) A formal application for new Section 108 loan guarantee(s),
including the documents listed at 24 CFR 570.704(b);
(b) A brief description (not to exceed three pages) of a new
Section 108 loan guarantee application(s). Such 108 application(s) will
be submitted within 60 days, with HUD reserving the right to extend
such period for good cause on a case-by-case basis, of a notice of BEDI
selection. BEDI awards will be conditioned on approval of actual
Section 108 loan commitments. This description must be sufficient to
support the basic eligibility of the proposed project or activities for
Section 108 assistance. (See Section I(G) of this program section of
this SuperNOFA.);
(c) If applicable, a copy of a Section 108 loan guarantee approval
document with grant number and date of approval (which was approved
after the date of this SuperNOFA, except in conjunction with a previous
EDI award); or
(d) A request for a Section 108 loan guarantee amendment (analogous
to Section I(F)(1) (a) or (b) of this BEDI section of the SuperNOFA)
that proposes to increase the amount of a previously approved
application. However, any amount of Section 108 loan guarantee
authority approved before the date of this SuperNOFA is not eligible to
be used in conjunction with a BEDI grant under this SuperNOFA.
(2) Further, a Section 108 loan guarantee amount that is required
to be used in conjunction with a prior EDI grant award, whether or not
the Section 108 loan guarantee has been approved as of the date of this
SuperNOFA, is not eligible for a BEDI award under this SuperNOFA. For
example, if a public entity has a previously approved Section 108 loan
guarantee commitment of $12 million, even if none of the funds have
been utilized, or if the public entity had previously been awarded an
EDI grant of $1 million and had certified that it will submit a Section
108 loan application for $10 million in support of that EDI grant, the
public entity's application under this program section of this
SuperNOFA must propose to increase the amount of its total Section 108
loan guarantee commitments beyond those amounts (the $12 million or $10
million in this example) to which it has previously agreed.

(G) Eligible Activities and National Objectives

BEDI grant funds may be used for activities listed at 24 CFR
570.703, provided such activities are carried out as part of an
economic development project as defined in Section I(B) of this BEDI
section of this SuperNOFA. Each activity assisted with Section 108 loan
guarantee or BEDI funds must meet a national objective of the CDBG
program as described in 24 CFR 570.208. In the aggregate, a grantee's
use of CDBG funds, including any Section 108 loan guarantee proceeds
and section 108(q) (EDI) funds provided pursuant to this program
section of this SuperNOFA, must comply with the CDBG primary objectives
requirements as described in section 101(c) of the Housing and
Community Development Act of 1974, as amended, and 24 CFR 570.200(c)(3)
or 570.484 in the case of State grantees. The foregoing eligible
activities may also include:
(1) Payment of costs of private financial guaranty insurance
policies, letters of credit, or other credit enhancements for the notes
or other obligations guaranteed by HUD pursuant to Section 108,
provided that the proceeds of such notes or obligations are used to
finance an economic development project. Such enhancements shall be
specified in the contract required by 24 CFR 570.705(b)(1), and shall
be satisfactory in form and substance to HUD for security purposes; and
(2) The payment of interest due (and other costs such servicing,
underwriting, or other costs as may be authorized by HUD) on the notes
or other obligations guaranteed by HUD pursuant to the Section 108 loan
guarantee program.

(H) Limitations on Use of BEDI and Section 108 Funds

Certain restrictions shall apply to the use of BEDI and Section 108
funds:
(1) BEDI grants shall not be used as a resource to immediately
repay the principal of a loan guaranteed under Section 108. Repayment
of principal is only permissible with BEDI grant funds as a matter of
security if other sources projected for repayment of principal prove to
be unavailable.
(2) BEDI grant funds shall not be used in any manner by grantees to
provide public or private sector entities with funding to remediate
conditions caused by their actions, where the public entity (or other
known prospective beneficiary of the proposed BEDI grant) has been
determined responsible for causation and remediation by order of a
court or a Federal, State, or local regulatory agency, or is
responsible for the remediation as part of a settlement approved by
such a court or agency.
(3) Applicants may not propose projects on sites which are listed
or proposed to be listed on EPA's National Priority List (NPL).
Further, applicants are cautioned against proposing projects on sites
where the nature and degree of environmental contamination is not well
quantified or which are the subject of on-going litigation or
environmental enforcement action.
(4) Applicants are cautioned against using Section 108 funds to
finance activities which also include financing generated through the
issuance of federally tax exempt obligations. Pursuant to Office of
Management and Budget (OMB) Circular A-129 (Policies

[[Page 23892]]

for Federal Credit Programs and Non-Tax Receivables), Section 108
guaranteed loan funds may not directly or indirectly support federally
tax-exempt obligations.

(I) Limitations on Grant Amounts

(1) HUD expects to approve BEDI grant amounts for approvable
applications at a range of ratios of BEDI grant funds awarded to new
Section 108 loan guarantee commitments but the minimum ratio will be $1
of Section 108 loan guarantee commitments for every $1 of BEDI grant
funds. However, applicants that propose a leverage ratio of 1:1 will
not receive any points under the Rating Subfactor 4(1): ``Leverage of
Section 108 Funds.''
For example, an applicant requesting a BEDI grant of $1 million
will be required to leverage a minimum of at least $1 million in new
Section 108 loan guarantee commitments. This will be a special
condition of the BEDI grant award. Of course, even though there is a
minimum ratio of 1:1, applications with higher ratios will receive more
points under Rating Factor 4, ``Leveraging Resources/Financial Need''
and, all other things being equal, will be more competitive. Applicants
are encouraged to propose projects with a greater leverage ratio of new
Section 108 to BEDI grant funds (assuming such projects are financially
viable). For example $1 million of BEDI could leverage $12 million of
new Section 108 loan commitments. HUD intends that the BEDI funds will
be used for projects which leverage the greatest possible amount of
Section 108 loan guarantee commitments.
(2) HUD expects that the average grant size will be approximately
$1 million.
(3) In the event the applicant is awarded a BEDI grant that has
been reduced below the original request (e.g. the application contained
some activities that were ineligible or there were insufficient funds
to fund the last competitive application at the full amount requested),
the applicant will be required to modify its project plans and
application to conform to the terms of HUD approval before execution of
a grant agreement. HUD reserves the right to reduce or de-obligate the
BEDI award if approvable Section 108 loan guarantee applications are
not submitted by the grantee in the required amounts on a timely basis.
Any requested modifications must be within the scope of the original
BEDI application.
(4) In the case of requested amendments to a previously approved
Section 108 loan guarantee commitment (as further discussed in section
I(F)(1)(d) above), the BEDI assistance approved will be based on the
increased amount of Section 108 loan guarantee assistance.

(J) Timing of Grant Awards

(1) To the extent a full Section 108 application is submitted with
the BEDI grant application, the Section 108 application will be
evaluated concurrently with the request for BEDI grant funds. Note that
BEDI grant assistance cannot be used to support a Section 108 loan
guarantee approved prior to the date of the publication of this
SuperNOFA. However, the BEDI grant may be awarded prior to HUD approval
of the Section 108 commitment if HUD determines that such award will
further the purposes of the Act.
(2) HUD notification to the grantee of the amount and conditions
(if any) of BEDI funds awarded based upon review of the BEDI
application shall constitute an obligation of grant funds, subject to
compliance with the conditions of award and execution of a grant
agreement. BEDI funds shall not be disbursed to the public entity
before the issuance of the related Section 108 guaranteed obligations.

II. Program Requirements

In addition to the program requirements listed in the General
Section of this SuperNOFA, applicants are subject to the following
requirements.

(A) CDBG Program Regulations

The requirements of 24 CFR part 570, including subpart K (Other
Program Requirements).

(B) Environmental Review

After the completion of this competition and after HUD's award of
BEDI grant funds, pursuant to 24 CFR 570.604, each project or activity
assisted under this program is subject to the provisions of 24 CFR part
58, including limitations on the EDI grant and Section 108 public
entity's commitment of HUD and non-HUD funds prior to the completion of
environmental review, notification and release of funds. No such
assistance will be released by HUD until a request for release of funds
is submitted and the requirements of 24 CFR part 58 have been met. All
public entities, including nonentitlement public entities, shall submit
the request for release of funds and related certification, pursuant to
24 CFR part 58, to the appropriate HUD field office for each project to
be assisted.

(C) Environmental Justice

(1) Executive Order 12898 (Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations directs
Federal agencies to develop strategies to address environmental
justice. Environmental justice seeks to rectify the disproportionately
high burden of environmental pollution that is often borne by low-
income, minority, and other disadvantaged communities, and to ensure
community involvement in policies and programs addressing this issue.
(2) Brownfields are often located in distressed neighborhoods,
contribute to neighborhood blight, and lower the quality of social,
economic, and environmental health of communities. The BEDI program is
intended to promote the clean up and redevelopment of brownfield sites
and, to this end, HUD expects that projects presented for BEDI funding
will integrate environmental justice concerns and provide demonstrable
benefits for affected communities and their residents.

(D) Compliance With Applicable Laws

Applicants are advised that an award of BEDI funding does not in
any way relieve the applicant or third parties users of BEDI funds from
compliance with all applicable Federal, State and local laws,
particularly those addressing the environment. Applicants are further
advised that HUD may require evidence that any project involving
remediation has been or will be carried out in accordance with State
law, including voluntary clean up programs.

III. The Application Selection Process

(A) Rating and Ranking

(1) Each rating factor and the maximum number of points is provided
below. The maximum number of points to be awarded is 102. This includes
two EZ/EC bonus points as described in the General Section of the
SuperNOFA, or two bonus points for having received a federal
designation as a Brownfields Showcase Community.
(2) Once scores are assigned, all applications will be ranked in
order of points assigned, with the applications receiving more points
ranking above those receiving fewer points. Applications will be funded
in rank order.
(3) If HUD determines that an application rated, ranked and
fundable could be funded at a lesser BEDI grant amount than requested
consistent with feasibility of the funded project or activities and the
purposes of the Act,

[[Page 23893]]

HUD reserves the right to reduce the amount of the BEDI award and/or
increase the Section 108 loan guarantee commitment, if necessary, in
accordance with such determination. An application in excess of $1
million may be reduced below the amount requested by the applicant if
HUD determines that such a reduction is appropriate.
(4) HUD may decide not to award the full amount of BEDI grant funds
available under this program section of this SuperNOFA and may make any
remaining amounts available under a future SuperNOFA.

(B) Narrative Statement

Each applicant shall provide a narrative statement describing the
activities that will be carried out with the BEDI grant funds and
explaining the nature and extent of the Brownfield's problems(s)
affecting the project. The narrative statement shall not exceed three
(3) 8.5'' by 11'' pages for the description of the activities to be
carried out with the BEDI grant funds. The description of activities
should include a statement of how the proposed uses of BEDI funds will
meet the national objectives for the CDBG program under 24 CFR 570.208
and qualify as eligible activities under 24 CFR 570.703. Citations to
the specific regulatory subsections supporting eligibility are
recommended, but a narrative description will be accepted. See Section
I(G) of this program section of this SuperNOFA. The applicant shall
also provide a narrative response to the rating factors below. Each of
the listed rating factors (or, where applicable, each subfactor) below
also has a separate page limitation specified. Narrative statements
must be printed in 12 point type/font, and have sequentially numbered
pages.

(C) Factors for Award Used to Evaluate and Rate Applications

All applications will be considered for selection based on the
following factors that demonstrate the quality of the proposed project
or activities, and the applicant's creativity, capacity and commitment
to obtain maximum benefit from the BEDI funds, in accordance with the
purposes of the Act.
Rating Factor 1: Capacity of the Applicant and Relevant Organizational
Experience (15 Points)
[Your response to this factor is limited to three (3) pages.]
This factor addresses the extent to which the applicant has the
organizational resources necessary to successfully implement the
proposed activities in a timely manner. The rating of the ``applicant''
or the ``applicant's organization and staff'' for technical merit or
threshold compliance, unless otherwise specified, will include any
faculty, subcontractors, consultants, subrecipients, and members of
consortia which are firmly committed (i.e. has a written agreement or a
signed letter of understanding with the applicant agreeing in principle
to its participation and role in the project). In rating this factor,
HUD will consider the following:
(1) With regard to the BEDI/Section 108 project proposed by the
applicant, the applicant should demonstrate that it has the capacity to
implement the specific steps required to successfully carry out the
proposed BEDI/Section 108 project. This includes factors such as the
applicant's:
(a) Performance in the administration of its CDBG, HOME or other
programs;
(b) Previous experience, if any, in administering a Section 108
loan guarantee;
(c) Performance and capacity in carrying out economic development
projects;
(d) Performance and capacity to carry out Brownfields redevelopment
projects;
(e) Ability to conduct prudent underwriting;
(f) Capacity to manage and service loans made with the guaranteed
loan funds or previous EDI grant funds;
(g) Capacity to carry out its projects and programs in a timely
manner; and,
(h) If applicable, the applicant's capacity to manage projects
under this program section of this SuperNOFA along with any federal
funds awarded as a result of a federal urban Empowerment Zone/
Enterprise Community designation.
(2) If an applicant has previously received an EDI grant award(s),
the applicant must describe the status of the implementation of that
EDI-assisted project(s), any delays that have been encountered and the
actions the applicant is taking to overcome any such delays in order to
carry out the project in a timely manner. For such previously funded
EDI grant projects, HUD will consider the extent to which the awarded
EDI grant funds and the associated Section 108-guaranteed loan funds
have been utilized.
(3) The capacity of subrecipients, nonprofit organizations and
other entities that have a role in implementing the proposed program
will be included in this review. HUD may also rely on information from
performance reports, financial status information, monitoring reports,
audit reports and other information available to HUD in making its
determination under this factor.
Rating Factor 2: Distress/Extent of the Problem (15 Points)
[Your response to this factor is limited to three (3) pages.]
This factor addresses the extent to which there is need for funding
the proposed activities based on levels of distress, and an indication
of the urgency of meeting the need/distress in the target area.
(1) In applying this factor, HUD will consider current levels of
distress in the immediate community to be served by the project and the
jurisdiction applying for assistance. Applicants who are able to
indicate a level of distress in the immediate project area that is
greater than the level of distress in the applicant's jurisdiction as a
whole will receive a higher score under this factor than those who do
not. HUD requires that applicants use sound and reliable data that is
verifiable to support the level of distress claimed in the application.
The applicant shall provide a source for the information it uses.
(2) In previous EDI competitions, the poverty rate was often
considered the best indicator of distress; however, the applicant may
demonstrate the level of distress with other factors such as income
levels and unemployment rates.
(3) HUD will consider a project to have maximum distress if the
project(s) is located within the boundaries of a federally-designated
Empowerment Zone or Enterprise Community (Applicants will be
responsible for demonstrating that the project site is within the
boundaries of the applicant's EZ/EC area).
(4) To the extent that the applicant's Consolidated Plan and its
Analysis of Impediments to Fair Housing choice (AI) identifies the
level of distress in the community and the neighborhood in which the
project is being carried out, the applicant should include references
to such documents in preparing its response to this factor.
Rating Factor 3: Soundness of Approach (25 Points)
[Your response to this factor is limited to three (3) pages.]
This factor addresses the quality and cost-effectiveness of the
applicant's proposed plan. There must be a clear relationship between
the proposed activities, community needs and purposes of the program
funding for an applicant to receive points for this factor. In rating
this factor, HUD will consider the following:
(1) HUD will consider the quality of the applicant's plan/proposal
for the use

[[Page 23894]]

of BEDI funds and Section 108 loan funds, including the extent to which
the applicant's proposed plan for the effective use of BEDI grant/
Section 108 loan guarantee will address the needs described in Rating
Factor 2 above regarding the distress and extent of the problem in the
applicant's immediate community and/or its jurisdiction.
(2) HUD will consider the extent to which the plan is logically,
feasibly, and substantially likely to achieve its stated purpose. HUD's
desire is to fund projects and activities which will quickly produce
demonstrable results and advance the public interest including the
number of jobs to be created by the project. An applicant should
demonstrate that it has a clear understanding of the steps required to
implement its project, the actions that it and others responsible for
implementing the project must complete and shall include a reasonable
time schedule for carrying out the project.
(3) The applicant's response to this factor should take into
account certain site selection, planning, and environmental issues.
Further, applicants are cautioned against proposing projects on sites
where the nature and degree of environmental contamination is not well
quantified or which are the subject of on-going litigation or
environmental enforcement. To reiterate, HUD's desire is to fund
projects and activities which will quickly produce demonstrable results
and advance the public interest. Sites with unknown or exceptionally
expensive contamination problems may be beyond the scope of the BEDI
program's financial resources and sites subject to pending and current
litigation may not be available for remediation and development in a
timeframe consistent with HUD's desire for rapid progress in the use of
BEDI and Section 108 funds.
(4) The BEDI program is intended to promote the clean up and
redevelopment of brownfield sites and, to this end, HUD expects that
projects presented for BEDI funding will integrate environmental
justice concerns and provide demonstrable benefits for affected
communities and their residents.
(5) HUD will evaluate the extent to which the applicant's project
incorporates one or more elements that facilitate a successful
transition of welfare recipients from welfare to work. Such an element
could include, for example, linking the proposed project or loan fund
to social and/or other services needed to enable welfare recipients to
successfully secure and carry out full-time jobs in the private sector;
provision of job training to welfare recipients who might be hired by
businesses financed through the proposal; and/or incentives for
businesses financed with BEDI/section 108 funds to hire and train
welfare recipients.
(6) Up to two (2) additional points will be awarded to any
application submitted by the City of Dallas, Texas, to the extent this
subfactor is addressed. Due to an order of the U.S. District Court for
the Northern District of Texas, Dallas Division, with respect to any
application submitted by the City of Dallas, Texas, HUD's consideration
of the applicant's response to this factor, ``Soundness of Approach''
will include the extent to which the applicant's plan for the use of
BEDI funds and Section 108 loans will be used to eradicate the vestiges
of racial segregation in the Dallas Housing Authority's programs
consistent with the Court's order.
Rating Factor 4: Leveraging Resources/Financial Need (35 Points)
[Page limits for the response to this factor are listed separately for
each subfactor under this factor.]
In evaluating this factor, HUD will consider the extent to which
the applicant's response demonstrates the financial need and
feasibility of the project and the leverage ratio of Section 108 loan
proceeds to BEDI grant funds. This factor has three subfactors, each
with its own maximum point total:
(1) Leverage of Section 108 funds (20 points). [Your response to
this subfactor is limited to one (1) page.] The minimum ratio of
Section 108 funds to BEDI funds in any project may not be less than
1:1. The extent to which the proposed project leverages an amount of
Section 108 funds beyond the 1:1 ratio will be considered a positive
factor. Applicants that have a ratio of 1:1 will not receive any points
under this subfactor. Applicants that use their BEDI grant to leverage
more Section 108 commitments will receive more points under this
subfactor.
(2) Financial feasibility (10 points). [Your response to this
subfactor is limited to three (5) pages.] HUD will consider the extent
to which the applicant demonstrates that the project is financially
feasible. This may include factors such as:
(a) Project costs and financial requirements. Applicants should
provide a funding sources and uses statement (not included in 5 page
narrative limit) as well as justifications for project costs.
(b) The amount of any debt service or operating reserve accounts to
be established in connection with the economic development project.
(c) The reasonableness of the costs of any credit enhancement paid
with BEDI grant funds.
(d) The amount of program income (if any) to be received each year
during the repayment period for the guaranteed loan.
(e) Interest rates on those loans to third parties (other than
subrecipients) (either as an absolute rate or as a plus/minus spread to
the Section 108 rate).
(f) Underwriting criteria that will be used in determining project
feasibility.
(3) Leverage of other financial resources (5 points). [Your
response to this subfactor is limited to one (1) page plus supporting
documentation evidencing third party commitment (written and signed) of
funds.] HUD will evaluate the extent to which the applicant leverages
other funds (public or private) with BEDI grant funds and section 108
guaranteed loan funds and the extent to which such other funds are
firmly pledged to the project. This could include the use of CDBG
funds, other Federal or state grants or loans, a grantee's general
funds, project equity or commercial financing provided by private
sources or funds from non-profits or other sources. Funds will be
considered pledged to the project if there is evidence of the third
party's written commitment to make the funds available for the BEDI/108
project, subject to approval of the BEDI and Section 108 assistance and
completion of any environmental clearance required under 24 CFR part 58
for the project. Note that with respect to CDBG funds, the applicant's
pledge of its CDBG funds will be considered sufficient commitment.
Rating Factor 5: Comprehensiveness and Coordination (10 Points)
[Your response to this factor is limited to two (2) pages.]
This factor addresses the extent to which the applicant coordinated
its activities with other known organizations, participates or promotes
participation in the applicant's or a State's Consolidated Planning
process, and is working towards addressing a need in a comprehensive
manner through linkages with other activities in the community.
In evaluating this factor, HUD will consider the extent to which
the applicant demonstrates it has:
(1) Coordinated its proposed activities with those of other groups
or organizations prior to submission in order to best complement,
support and coordinate all known activities and if funded, the specific
steps it will take to share information on solutions and outcomes with
others. Any written

[[Page 23895]]

agreements, memoranda of understanding in place, or that will be in
place after award should be described.
(2) Developed linkages, or the specific steps it will take to
develop linkages with other activities, programs or projects through
meetings, information networks, planning processes or other mechanisms
to coordinate its activities so solutions are holistic and
comprehensive, including linkages with other HUD-funded projects/
activities outside the scope of those covered by the Consolidated Plan.
(3) Coordinated its efforts with other Federal, State or locally
supported activities, including EPA's various Brownfields initiatives,
and those proposed or on-going in the community.

IV. Application Submission Requirements

(A) Public entities seeking BEDI assistance must make a specific
request for that assistance, in accordance with the requirements of
this program section of this SuperNOFA.
(B) The application should include an original and one copy of the
items listed below submitted to HUD Headquarters (see the section
``Addresses For Submitting Applications in this program section of this
SuperNOFA), with one additional copy submitted directly to the
Community Planning and Development Division of the cognizant HUD Field
Office for the applicant's jurisdiction.
(C) A BEDI application shall consist of the following items:
(1) Transmittal letter from applicant;
(2) Table of contents;
(3) Application check list (supplied in application kit);
(4) A request for loan guarantee assistance under Section 108, as
further described in Section I(F) of this program section of this
SuperNOFA. Application guidelines for the Section 108 program are found
at 24 CFR 570.704;
(5) As described in Section III(B) of this program section of this
SuperNOFA, a narrative statement (3 page limit) describing the
activities that will be carried out with the BEDI grant funds;
(6) Responses to each of the rating factors (within the page limits
provided for each factor or subfactor as applicable);
(7) Completion of a funding sources and uses statement and a BEDI
and Section 108 eligibility statement (see the application kit);
(8) Written agreements or signed letters of understanding in
support of Rating Factor 1: ``Capacity of the Applicant and Relevant
Organizational Experience'';
(9) Signed third party commitment letters pledging funds in support
of subfactor 4(2): ``Leverage of other financial resources'';
(10) Required certifications; and
(11) Acknowledgement of Application Receipt form.

V. Corrections to Deficient Applications

The General Section of the SuperNOFA provides the procedures for
corrections to deficient applications.

BILLING CODE 4210-32-P

Federal Register / Vol. 63, No. 83 / Thursday, April 30, 1998 /
Notices

[[Page 23897]]

[GRAPHIC] [TIFF OMITTED] TN30AP98.008

BILLING CODE 4210-32-C

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Notices

[[Page 23899]]

Funding Availability for the Economic Development Initiative (EDI)

Program Description: Approximately $38 million is available for
Economic Development Initiative (EDI) grants under Section 108(q) of
the Housing and Community Development Act of 1974, as amended. (Please
see Section I(D) of this EDI section of the SuperNOFA for possible set-
aside.) EDI funds are used to enhance the security of the Section 108
guaranteed loan for the same project or to improve the viability of a
project financed with a Section 108-guaranteed loan. An EDI grant is
required to be used in conjunction with a new Section 108 guaranteed
loan commitment.
Application Due Date: Completed applications (one original and two
copies) must be submitted no later than 12:00 midnight, Eastern time,
on July 30, 1998 to the addresses shown below. See the General Section
of this SuperNOFA for specific procedures governing the form of
application submission (e.g., mailed applications, express mail,
overnight delivery, or hand carried).

Address for Submitting Applications

To HUD Headquarters. The completed application (an original and one
copy) must be submitted to: Processing and Control Unit, Room 7255,
Office of Community Planning and Development, Department of Housing and
Urban Development, 451 Seventh Street, SW, Washington, DC 20410,
Attention: EDI Grant, by mail or hand delivery.
To the Appropriate CPD Field Office. An additional copy should be
submitted to the Community Planning and Development Division of the
appropriate HUD Field Office for the applicant's jurisdiction.
When submitting your application, please refer to EDI, and include
your name, mailing address (including zip code) and telephone number
(including area code).

For Application Kits, Further Information, and Technical Assistance

For Application Kits. For an application kit and any supplemental
information, please call HUD's SuperNOFA Information line toll free at
1-800-HUD-8929. Persons with hearing or speech impairments may call the
Center's TTY number at 1-800-HUD-2209 to obtain an application kit. The
application kit will also be available on the Internet through the HUD
web site at http://www.hud.gov. When requesting the application kit,
please refer to EDI. Please make sure to provide your name, address
(including zip code), and telephone number (including area code).
For Further Information and Technical Assistance. Contact either
Stan Gimont or Paul Webster, Financial Management Division, Office of
Block Grant Assistance, Department of Housing and Urban Development,
451 Seventh Street, SW, Room 7178, Washington, DC 20410; telephone
(202) 708-1871 (this is not a toll-free number). Persons with speech or
hearing impairments may access this number via TTY by calling the toll-
free Federal Information Relay Service at 1-800-877-8339.
See the General Section of this SuperNOFA for guidance on technical
assistance. With respect to the Section 108 Loan Guarantee program,
which is not a competitive program and thus not subject to those
provisions of the HUD Reform Act pertaining to competitions, HUD staff
will be available to provide advice and assistance to develop Section
108 loan applications.

Additional Information

I. Authority; Definitions; Purpose; Amount Allocated; and
Eligibility

(A) Authority

Section 108(q), Title I, Housing and Community Development Act of
1974, as amended (42 U.S.C. 5301-5320) (the Act); 24 CFR part 570.

(B) Definitions

Unless otherwise defined herein, terms defined in 24 CFR part 570
and used in this program section of this SuperNOFA shall have the
respective meanings given thereto in that part.
CDBG funds means those funds as defined at 24 CFR 570.3, including
grant funds received pursuant to section 108(q) of the Act and this
program section of this SuperNOFA.
Economic Development Initiative (EDI) means the provision of
economic development grant assistance under section 108(q) of the Act,
as authorized by Section 232 of the Multifamily Housing Property
Disposition Reform Act of 1994 (Pub.L. 103-233, approved April 11,
1994).
Economic development project means an activity or activities
(including mixed use projects with housing components) that are
eligible under the Act and under 24 CFR 570.703, and that increase
economic opportunity for persons of low- and moderate-income or that
stimulate or retain businesses or jobs or that otherwise lead to
economic revitalization.
Empowerment Zone or Enterprise Community means an urban area so
designated by the Secretary of HUD pursuant to 24 CFR part 597, or a
rural area so designated by the Secretary of Agriculture pursuant to 7
CFR part 25, subpart B.
Strategic Plan means a strategy developed and agreed to by the
nominating local government(s) and State(s) and submitted in partial
fulfillment of the application requirements for an Empowerment Zone or
Enterprise Community designated pursuant to 24 CFR part 597.

(C) Purpose

(1) Background. HUD has multiple programs which are intended to
stimulate and promote economic and community development. Primary among
HUD's resources are the Community Development Block Grant (CDBG)
program and the Section 108 loan guarantee program.
The CDBG program provides grant funds ($4.195 billion in FY 1998)
to local governments (either directly or through States) to carry out
community and economic development activities. The Section 108 loan
guarantee program provides local governments with a source of financing
for economic development, housing rehabilitation and other eligible
large scale physical development projects. HUD is authorized pursuant
to Section 108 to guarantee notes issued by CDBG entitlement
communities and non-entitlement units of general local government
eligible to receive funds under the State CDBG program. Regulations
governing the Section 108 program are found at 24 CFR part 570, subpart
M. It must be noted that the Section 108 program is subject to the
regulations of 24 CFR part 570 applicable to the CDBG program with the
exception of changes embodied in 24 CFR part 570, subpart M.
For FY 1998, the Section 108 program is authorized at $1.261
billion in loan guarantee authority. The full faith and credit of the
United States is pledged to the payment of all guarantees made under
Section 108. Under this program, communities (and States, if
applicable) pledge their future years' CDBG allocations as security for
loans guaranteed by HUD. The Section 108 program, however, does not
require CDBG funds to be escrowed for loan repayment (unless such an
arrangement is specifically negotiated as loan security). This means
that a community can continue to spend its existing allocation for
other CDBG purposes, unless needed for loan repayment.
(2) EDI Program. The EDI program was enacted in 1994 and is
intended to complement and enhance the Section 108 Loan Guarantee
program. The

[[Page 23900]]

purpose of EDI grant funds is to further minimize the potential loss of
future CDBG allocations:
(a) By strengthening the economic feasibility of the projects
financed with Section 108 funds (and thereby increasing the probability
that the project will generate enough cash to repay the guaranteed
loan);
(b) By directly enhancing the security of the guaranteed loan; or
(c) Through a combination of these or other risk mitigation
techniques.
(3) Purpose of EDI Funding. HUD intends the approximately $38
million in EDI funds to stimulate economic development by local
governments and private sector parties. HUD desires to see EDI and
Section 108 funds used to finance projects and activities that will
provide near-term results and demonstrable economic benefits, such as
job creation and increases in the local tax base.
(4) Additional Security for Section 108 Loan Guarantee. Public
entities should be mindful of the need to provide additional security
for the Section 108 loan guarantee pursuant to 24 CFR 570.705(b)(3).
Although a public entity is required by the Act to pledge its current
and future CDBG funds as security for the Section 108 loan guarantee,
the public entity will usually be required to furnish additional
collateral. In most cases, the additional collateral consists (in whole
or in part) of the asset financed with the Section 108 loan funds
(e.g., a loan made to a business as part of an economic development
project). Applications proposing uses for EDI funding that enhance the
viability of projects will help ensure that the project-based asset(s)
will satisfy the additional collateral requirements.
(5) Typical Project Structures. Provided that proposals are
consistent with other CDBG requirements, including national objectives,
HUD envisions that the following project structures could be typical:
(a) Funding Reserves. The cash flow generated by an economic
development project may be expected to be relatively ``thin'' in the
early stages of the project, i.e. potentially insufficient cash flows
to meet operating expenses and debt service obligations. The EDI grant
can make it possible for reserves to be established in a way that
enhances the economic feasibility of the project.
(b) Over-Collateralizing the Section 108 Loan.
(i) The use of EDI grant funds may be structured in appropriate
cases so as to improve the likelihood that project-generated cash flow
will be sufficient to cover debt service on the Section 108 loan and
directly to enhance the guaranteed loan. One technique for
accomplishing this approach is over-collateralization of the Section
108 loan.
(ii) An example is the creation of a loan pool funded with Section
108 and EDI grant funds. The community would make loans to various
businesses from the combined pool at an interest rate equal to or
greater than the rate on the Section 108 loan. The total loan portfolio
would be pledged to the repayment of the Section 108 loan.
(c) Direct Enhancement of the Security of the Section 108 Loan. The
EDI grant can be used to cover the cost of providing credit
enhancements. An example of how the EDI grant can be used for this
purpose is by using the grant funds to cover the cost of a standby
letter of credit, issued in favor of HUD. This letter of credit will be
available to fund amounts due on the Section 108 loan if other sources
fail to materialize and will, thus, serve to protect the public
entity's future CDBG funds.
(d) Provision of Financing to For-Profit Businesses at a Below
Market Interest Rate.
(i) While the rates on loans guaranteed under Section 108 are only
slightly above the rates on comparable U.S. Treasury obligations, they
may nonetheless be higher than can be afforded by businesses in
severely economically distressed neighborhoods. The EDI grant can be
used to make Section 108 financing affordable.
(ii) EDI grant funds could serve to ``buy down'' the interest rate
up front, or make full or partial interest payments, allowing the
businesses to be financially viable in the early start-up period not
otherwise possible with Section 108 alone. This strategy would be
particularly useful where a community was undertaking a large
commercial/retail project in a distressed neighborhood to act as a
catalyst for other development in the area.
(e) Combination of Techniques. An applicant could employ a
combination of these or other techniques in order to implement a
strategy that carries out an economic development project.

(D) Amount Allocated

HUD has available a maximum of approximately $38 million for the
EDI program, as appropriated in the FY 1998 HUD Appropriations Act. If
any additional EDI grant monies for this SuperNOFA become available,
HUD may either fund additional applicants in accordance with this
SuperNOFA during Fiscal Year 1998 or may add any funds that become
available to funds available for any future EDI competitions.
As part of EDI, HUD is developing a program enhancement designed to
reduce the risk that CDBG funds will have to be used to repay Section
108 loans that finance economic development projects. This mechanism
will allow public entities to pool economic development loans and
related reserves. The diversification created by the pooling of loans
and reserves will reduce the risk that a public entity will incur a
catastrophic loss to its CDBG program if a business defaults on an
economic development loan made with Section 108 funds. The CDBG Risk
Reduction Pool will also assist public entities in satisfying the
collateral requirements for Section 108 loans. The pool's reserves and
incremental cash flows will provide an additional credit enhancement
for the Section 108 loan and thereby satisfy Section 108 additional
collateral requirements. The HUD budget for FY 1999 has requested $400
million for an enhanced EDI program that includes features of this
mechanism.
HUD is developing this pooling mechanism in consultation with other
Federal agencies and outside experts. HUD is considering a $10 million
demonstration in FY 1998. If the demonstration occurs, then $28 million
will be available for the EDI competition announced in this SuperNOFA.
In this event, HUD will publish a supplementary notice to the EDI
program section of this SuperNOFA announcing the availability of the
$10 million for an FY 1998 demonstration of this mechanism. Should
there be no demonstration in FY 1998, then HUD reserves the right to
utilize the $10 million for the EDI competition announced in this
SuperNOFA, making the total amount available $38 million.

(E) Eligibility to Apply for Grant Assistance

Any public entity eligible to apply for Section 108 loan guarantee
assistance pursuant to 24 CFR 570.702 may apply for EDI grant
assistance under Section 108(q). Eligible applicants are CDBG
entitlement units of general local government and non-entitlement units
of general local government eligible to receive loan guarantees under
24 CFR part 570, subpart M. Note that effective January 25, 1995, non-
entitlement public entities in the states of New York and Hawaii were
authorized to apply to HUD for Section 108 loans (see 59 FR 47510,
December 27, 1994). Thus, non-entitlement public entities in all 50
states and Puerto Rico are eligible to

[[Page 23901]]

participate in the Section 108 and EDI programs.

(F) Related Section 108 Loan Guarantee Application

(1) Each EDI application must be accompanied by a request for new
Section 108 loan guarantee assistance. Both the EDI and Section 108
funds must be used in conjunction with the same economic development
project. This request may take any of several forms as defined below.
(a) A formal application for new Section 108 loan guarantee(s),
including the documents listed at 24 CFR 570.704(b);
(b) A brief description (not to exceed three pages) of a new
Section 108 loan guarantee application(s). Such 108 application(s) will
be submitted within 60 days, with HUD reserving the right to extend
such period for good cause on a case-by-case basis, of a notice of EDI
selection. EDI awards will be conditioned on approval of actual Section
108 loan commitments. This description must be sufficient to support
the basic eligibility of the proposed project or activities for Section
108 assistance. (See Section I(G) of this program section of this
SuperNOFA.);
(c) If applicable, a copy of a Section 108 loan guarantee approval
document with grant number and date of approval (which was approved
after the date of this SuperNOFA, except in conjunction with a previous
EDI award); or
(d) A request for a Section 108 loan guarantee amendment (analogous
to Section I(G)(1)(a) or (b) above) that proposes to increase the
amount of a previously approved application. However, any amount of
Section 108 loan guarantee authority approved before the date of this
SuperNOFA is not eligible to be used in conjunction with a EDI grant
under this SuperNOFA.
(2) Further, a Section 108 loan guarantee amount that is required
to be used in conjunction with a prior EDI grant award, whether or not
the Section 108 loan guarantee has been approved as of the date of this
SuperNOFA, is not eligible for an EDI award under this SuperNOFA. For
example, if a public entity has a previously approved Section 108 loan
guarantee commitment of $12 million, even if none of the funds have
been utilized, or if the public entity had previously been awarded an
EDI grant of $1 million and had certified that it will submit a Section
108 loan application for $10 million in support of that EDI grant, the
public entity's EDI application under this SuperNOFA must propose to
increase the amount of its total Section 108 loan guarantee commitments
beyond those amounts (the $12 million or $10 million in this example)
to which it has previously agreed.

(G) Eligible Activities and National Objectives

EDI grant funds may be used for activities listed at 24 CFR
570.703, provided such activities are carried out as part of an
economic development project as defined in Section I(B) of this EDI
section of this SuperNOFA. Each activity assisted with Section 108 loan
guarantee or EDI funds must meet a national objective of the CDBG
program (see 24 CFR 570.208). In the aggregate, a grantee's use of CDBG
funds, including any Section 108 loan guarantee proceeds and section
108(q) (EDI) funds provided pursuant to this program section of this
SuperNOFA, must comply with the CDBG primary objectives requirement as
described in section 101(c) of the Housing and Community Development
Act of 1974, as amended, and 24 CFR 570.200(c)(3) or 24 CFR 570.484 in
the case of State grantees. The foregoing eligible activities may also
include:
(1) Payment of costs of private financial guaranty insurance
policies, letters of credit, or other credit enhancements for the notes
or other obligations guaranteed by HUD pursuant to Section 108,
provided that the proceeds of such notes or obligations are used to
finance an economic development project. Such enhancements shall be
specified in the contract required by 24 CFR 570.705(b)(1), and shall
be satisfactory in form and substance to HUD for security purposes; and
(2) The payment of interest due (and other costs such as servicing,
underwriting, or other costs as may be authorized by HUD) on the notes
or other obligations guaranteed by HUD pursuant to the Section 108 loan
guarantee program.

(H) Limitations on Use of EDI and Section 108 Funds

Certain restrictions shall apply to the use of EDI and Section 108
funds:
(1) EDI grants shall not be used as a resource to immediately repay
the principal of a loan guaranteed under Section 108. Repayment of
principal is only permissible with EDI grant funds as a matter of
security if other sources projected for repayment of principal prove to
be unavailable.
(2) Applicants are cautioned against using Section 108 funds to
finance activities which also include financing generated through the
issuance of federally tax exempt obligations. Pursuant to Office of
Management and Budget (OMB) Circular A-129 (Policies for Federal Credit
Programs and Non-Tax Receivables), Section 108 guaranteed loan funds
may not directly or indirectly support federally tax-exempt
obligations.

(I) Limitations on Grant Amounts

(1) HUD expects to approve EDI grant amounts for approvable
applications at a range of ratios of EDI grant funds awarded to new
Section 108 loan guarantee commitments, but the minimum ratio will be
$1 of Section 108 loan guarantee commitments for every $1 of EDI grant
funds. However, applicants that propose a leverage ratio of 1:1 will
not receive any points under Ration Subfactor 4(1): ``Leverage of
Section 108 Funds.'' For example, an applicant requesting a EDI grant
of $1 million will be required to leverage a minimum of at least $1
million in new Section 108 loan guarantee commitments. This will be a
special condition of the EDI grant award. Of course, even though there
is a minimum ratio of 1:1, applications with higher ratios will receive
more points under Rating Factor 4, ``Leveraging Resources/Financial
Need'' and, all other things being equal, will be more competitive.
Applicants are encouraged to propose projects with a greater leverage
ratio of new Section 108 to EDI grant funds (assuming such projects are
financially viable). For example, $1 million of EDI could leverage $12
million of new Section 108 loan commitments. HUD intends that the EDI
funds will be used for projects which leverage the greatest possible
amount of Section 108 loan guarantee commitments.
(2) HUD expects that the average grant size will be approximately
$1 million.
(3) If additional EDI grant funds become available to HUD as the
result of recaptures prior to the date of this NOFA, HUD reserves the
right to award grants under this SuperNOFA whose aggregate total may
exceed the $38 million announced in this SuperNOFA, up to the maximum
amount authorized by law.
(4) In the event the applicant is awarded an EDI grant that has
been reduced below the original request (e.g. the application contained
some activities that were ineligible or there were insufficient funds
to fund the last competitive application at the full amount requested),
the applicant will be required to modify its project plans and
application to conform to the terms of HUD's approval before execution
of a grant agreement. HUD reserves the right to reduce or de-obligate
the EDI award if approvable Section 108 loan guarantee applications are
not

[[Page 23902]]

submitted by the grantee in the required amounts on a timely basis. Any
requested modifications must be within the scope of the original EDI
application.
(5) In the case of requested amendments to a previously approved
Section 108 loan guarantee commitment (as further discussed in Section
I(F)(1)(d), above), the EDI assistance approved will be based on the
increased amount of Section 108 loan guarantee assistance.

(J) Timing of Grant Awards

(1) To the extent a full Section 108 application is submitted with
the EDI grant application, the Section 108 application will be
evaluated concurrently with the request for EDI grant funds. Note that
EDI grant assistance cannot be used to support a Section 108 loan
guarantee approved prior to the date of the publication of this
SuperNOFA. However, the EDI grant may be awarded prior to HUD approval
of the Section 108 commitment if HUD determines that such award will
further the purposes of the Act.
(2) HUD notification to the grantee of the amount and conditions
(if any) of EDI funds awarded based upon review of the EDI application
shall constitute an oblig

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A98-11392. Public record. Not legal advice.