[Federal Register Volume 61, Number 76 (Thursday, April 18, 1996)]
[Notices]
[Pages 17218-17225]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-9543]




[[Page 17217]]


_______________________________________________________________________

Part VIII





Department of Housing and Urban Development





_______________________________________________________________________



Comprehensive Improvement Assistance Program; Funding Availability for 
Fiscal Year 1996; Notice

  Federal Register / Vol. 61, No. 76 / Thursday, April 18, 1996 / 
Notices  

[[Page 17218]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of the Assistant Secretary for Public and Indian Housing
[Docket No. FR-4037-N-01]


Notice of Funding Availability (NOFA) for Comprehensive 
Improvement Assistance Program (CIAP)

AGENCY: Office of the Assistant Secretary for Public and Indian 
Housing, HUD.

ACTION: Notice of Funding Availability for Fiscal Year (FY) 1996.

-----------------------------------------------------------------------

SUMMARY: This Notice informs Public Housing Agencies and Indian Housing 
Authorities (herein referred to as HAs) that own or operate fewer than 
250 public housing units and, therefore, are eligible to apply and 
compete for CIAP funds, of the requirements and application deadline 
date for FY 1996 CIAP funding and the expected availability of up to 
$257 million of CIAP funds. HAs with 250 or more public housing units 
are entitled to receive a formula grant under the Comprehensive Grant 
Program (CGP) and are not eligible to apply for CIAP funds.

DATES: The CIAP Application is due on or before 3:00 p.m. local time on 
June 17, 1996 at the HUD Field Office with jurisdiction over the HA, 
Attention: Director, Office of Public Housing (OPH), or Administrator, 
Office of Native American Programs (ONAP).

FOR FURTHER INFORMATION CONTACT: William J. Flood, Director, Office of 
Capital Improvements, Department of Housing and Urban Development, 451 
Seventh Street, SW., Room 4134, Washington, DC 20410. Telephone (202) 
708-1640. (This is not a toll free number.)
    IHAs may contact Deborah M. LaLancette, Director, Housing 
Management Division, Office of Native American Programs (ONAP), 
Department of Housing and Urban Development, 451 Seventh Street, SW., 
B-133, Washington, DC 20410. Telephone (202) 755-0088. (This is not a 
toll free number.)
    Hearing or speech impaired individuals may call HUD's TTY number 
(202) 708-4595. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION:

I. Allocation Amounts

    (a) The Congress has not yet enacted the FY 1996 appropriations for 
HUD. However, HUD is publishing this notice in order to give potential 
applicants adequate time to prepare applications. The amount of funds 
announced in this NOFA is an estimate of the amount that may be enacted 
in 1996. HUD is not bound by the estimate set forth in this notice. The 
estimated amount may be adjusted downward based on the enacted 1996 
appropriation.
    (1) Modernization funds are allocated between CIAP and CGP agencies 
based on the relative shares of backlog needs (weighted at 50%) and 
accrual needs (weighted at 50%), as determined by the field inspections 
conducted for the HUD-funded ABT study of modernization needs. This 
allocation results in CIAP agencies receiving approximately 10.49% and 
CGP agencies receiving approximately 89.51% of the total funds 
available.
    (i) Backlog needs are needed repairs and replacements of existing 
physical systems, items that must be added to meet the HUD 
modernization and energy conservation standards and State or local/
tribal codes, and items that are necessary for the long-term viability 
of a specific housing development.
    (ii) Accrual needs are needs that arise over time and include 
needed repairs and replacements of existing physical systems and items 
that must be added to meet the HUD modernization and energy 
conservation standards and State or local/tribal codes.
    (2) The modernization funds available to CIAP agencies are 
allocated between Public Housing at approximately 91.8505% and Indian 
Housing at approximately 8.1495%. This allocation also is based on the 
relative shares of backlog needs (weighted at 50%) and accrual needs 
(weighted at 50%).
    (b) Sub-assignment of Funds to Field Offices of Public Housing 
(OPH). Headquarters has determined the distribution of Public Housing 
CIAP funds for each Field OPH, based on the relative shares of backlog 
and accrual needs for CIAP PHAs, adjusted as necessary.
    (1) The Field OPH Director shall have authority to make Joint 
Review selections and CIAP funding decisions.
    (2) If additional funds for Public Housing CIAP become available, 
Headquarters will allocate the funds to one or more Field OPHs based on 
their relative shares of modernization need, approvable applications, 
and PHA capability to carry out the modernization.
    (3) If a Field OPH does not receive sufficient fundable 
applications to use its allocation, Headquarters will reallocate the 
remaining funds to one or more Field OPHs based on approvable 
applications and PHA capability to carry out the modernization.
    Of the amount available for Public Housing, 1% will be set aside to 
carry out goals related to pending civil rights litigation (e.g., Young 
v. Cisneros), which is subject to judicial oversight. The following 
table shows the percentage distribution of CIAP funds for PHAs, 
excluding IHAs, assigned by Headquarters to each Field OPH:

------------------------------------------------------------------------
                                                                Percent 
                                                               of public
                Office of Public Housing (OPH)                  housing 
                                                                 funds  
------------------------------------------------------------------------
New England:                                                            
  Massachusetts State Office.................................     2.6187
  Connecticut State Office...................................      .9266
  New Hampshire State Office.................................     1.5066
  Rhode Island State Office..................................      .7365
New York/New Jersey:                                                    
  Buffalo Area Office........................................     2.1551
  New Jersey State Office....................................     2.7271
  New York State Office......................................     1.1576
Mid-Atlantic:                                                           
  Maryland State Office......................................      .4142
  West Virginia State Office.................................     1.4359
  Pennsylvania State Office..................................     1.1444
  Pittsburgh Area Office.....................................     1.2048
  Virginia State Office......................................      .5756
  District of Columbia Office................................      .1686
Southeast:                                                              
  Georgia State Office.......................................     5.3561
  Alabama State Office.......................................     4.7698
  South Carolina State Office................................      .9216
  North Carolina State Office................................     3.0244
  Mississippi State Office...................................     1.7112
  Jacksonville Area Office...................................     2.9639
  Knoxville Area Office......................................      .9171
  Kentucky State Office......................................     4.7691
  Tennessee State Office.....................................     1.8640
Midwest:                                                                
  Illinois State Office......................................     3.5943
  Cincinnati Area Office.....................................      .4374
  Cleveland Area Office......................................      .5098
  Ohio State Office..........................................     1.1247
  Michigan State Office......................................     2.0393
  Grand Rapids Area Office...................................     3.0354
  Indiana State Office.......................................     1.2262
  Wisconsin State Office.....................................     2.8249
  Minnesota State Office.....................................     2.9713
Southwest:                                                              
  New Mexico State Office....................................     1.3454
  Texas State Office.........................................     5.4523
  Houston Area Office........................................     1.1773
  Arkansas State Office......................................     3.0053
  Louisiana State Office.....................................     3.9795
  Oklahoma State Office......................................     1.9327
  San Antonio Area Office....................................     2.6835
Great Plains:                                                           
  Iowa State Office..........................................     1.4211
  Kansas/Missouri State Office...............................     3.8535
  Nebraska State Office......................................     1.2155
  St. Louis Area Office......................................     2.2640
Rocky Mountain:                                                         
  Colorado State Office......................................     3.5448
Pacific/Hawaii:                                                         
  Los Angeles Area Office....................................     1.2057
  Arizona State Office.......................................     1.2634
  Sacramento Area Office.....................................      .2747
  California State Office....................................     1.5927
Northwest/Alaska:                                                       
  Oregon State Office........................................     1.2688
  Washington State Office....................................     1.6876
                                                              ----------

[[Page 17219]]

                                                                        
      Total..................................................   100.0000
------------------------------------------------------------------------



    (c) Sub-assignment of Funds to Offices of Native American Programs 
(ONAP). Headquarters has determined the distribution of Indian Housing 
CIAP funds for each ONAP, based on the relative shares of backlog and 
accrual needs for CIAP IHAs, adjusted as necessary. The fund assignment 
will cover Indian Housing and any Public Housing owned and operated by 
IHAs.
    (1) The ONAP Administrator shall have authority to make Joint 
Review selections and CIAP funding decisions.
    (2) If additional funds for Indian Housing CIAP become available, 
Headquarters will allocate the funds to one or more ONAPs based on 
their relative shares of modernization need, approvable applications, 
and IHA capability to carry out the modernization.
    (3) If an ONAP does not receive sufficient fundable applications to 
use its allocation, Headquarters will reallocate the remaining funds to 
one or more ONAPs based on approvable applications and IHA capability 
to carry out the modernization.
    The following table shows the percentage distribution of CIAP funds 
for IHAs, assigned by Headquarters to each ONAP:

------------------------------------------------------------------------
                                                                Percent 
                                                               of Indian
          Office of Native American Programs (ONAP)             housing 
                                                                 funds  
------------------------------------------------------------------------
Eastern/Woodlands............................................    14.8444
Southern Plains..............................................    12.3324
Northern Plains..............................................    13.3174
Southwest....................................................    29.9263
Northwest....................................................    24.4868
Alaska.......................................................     5.0927
                                                              ----------
      Total..................................................   100.0000
------------------------------------------------------------------------

II. Purpose and Substantive Description

    (a) Authority. Sec. 14, United States Housing Act of 1937 (42 
U.S.C. 14371); Sec. 7(d) Department of Housing and Urban Development 
Act (42 U.S.C. 3535(d)). A final rule further streamlining the CIAP 
regulation, 24 CFR Part 968, Subparts A and B, for PHAs and 24 CFR Part 
950, Subpart I, for IHAs, was published on March 5, 1996.
    (b) Program Highlights.
    (1) Departmental Priority. Improving Public and Indian Housing is 
one of the Department's major priorities. Accordingly, a review has 
been made of the entire Public and Indian Housing Program. 
Specifically, the Department is very concerned about several aspects of 
the Modernization Program, as follows:
    (i) Design. When identifying physical improvement needs to meet the 
modernization standards, HAs are encouraged to consider design which 
supports the integration of public housing into the broader community. 
Although high priority needs, such as those related to health and 
safety, vacant, substandard units, structural or system integrity, and 
compliance with statutory, regulatory or court-ordered deadlines, will 
receive funding priority, HAs should plan their modernization in a way 
which promotes good design, but maintains the modest nature of public 
housing. The HA should pay particular attention to design, which is 
sensitive to traditional cultural values, and be receptive to creative, 
but cost-effective approaches suggested by architects, residents, HA 
staff, and other local entities. Such approaches may complement the 
planning for basic rehabilitation needs. It should be noted that there 
will be no increase in operating subsidy due to improved design 
promoting the blend of public housing into the surrounding neighborhood 
or to additional amenities improving the quality of life.
    (ii) Expediting the Program. HAs are reminded that they are 
expected to obligate all funds within two years and to expend all funds 
within three years of program approval (Annual Contributions Contract 
(ACC) Amendment execution) unless a longer implementation schedule 
(Part III of the CIAP Budget) is approved by the Field Office due to 
the size or complexity of the program. Failure to obligate funds in a 
timely manner may result in the termination of the program and 
recapture of the funds.
    (iii) Resident Involvement and Economic Uplift. HAs are required to 
explore and implement through all feasible means the involvement of 
residents, including duly-elected resident councils, in every aspect of 
the CIAP, from planning through implementation. HAs shall use Section 3 
provisions to the maximum feasible extent. HAs are encouraged to seek 
ways to employ Section 3 residents in all aspects of the CIAP's 
operation and to develop means to promote contracting opportunities for 
businesses in Section 3 areas. Refer to 24 CFR 85.36(e) regarding the 
provision of such opportunities.
    (iv) Elimination of Vacant Units. HAs are encouraged to apply for 
CIAP funds to address vacant units where the work does not involve 
routine maintenance, but will result in re-occupancy.
    (2) Relationship to Technical Review Factors. The Departmental goal 
of improving Public and Indian Housing is reflected in the technical 
review factors, set forth in section IV(c)(5), on which the Field 
Office scores each HA's CIAP Application. Based on the HA's total 
score, the Field Office then ranks each HA to determine selection for 
Joint Review. The technical review factors emphasize the following 
Departmental initiatives to improve Public and Indian Housing:
    (i) Restoration of vacant units to occupancy;
    (ii) Resident capacity-building and resident involvement in HA 
operations, including opportunities for resident management and 
homeownership;
    (iii) Job training and employment opportunities for residents and 
contracting opportunities for Section 3 businesses;
    (iv) Drug elimination initiatives;
    (v) Partnership with local government; and
    (vi) Provision of appropriate replacement housing, as described in 
paragraph (c) below.
    (c) Expansion of Eligible Activities.
    (1) FY 1995 and Prior FY Modernization Funds. The FY 1995 
Rescissions Act expanded the eligible activities that may be funded 
with CIAP or CGP assistance provided from FY 1995 and prior FY funds. 
These activities include: new construction or acquisition of additional 
public housing units, including replacement units; modernization 
activities related to the public housing portion of housing 
developments held in partnership or cooperation with non-public housing 
entities; and other activities related to public housing, including 
activities eligible under the Urban Revitalization Demonstration (HOPE 
VI), such as community services.
    (2) FY 1996 Modernization Funds. The Continuing Resolution provides 
for the continuation of the Department's programs and activities. 
Funding provided under the Continuing Resolution is subject to the 
authority and conditions of the 1995 appropriation, including the FY 
1995 Rescissions Act. Therefore, FY 1996 funds provided under the 
Continuing Resolution may be used for the eligible activities set forth 
in subparagraph (1) of this paragraph with prior HUD approval.

III. Application Preparation and Submission by HA

    (a) Planning. In preparing its CIAP Application, the HA is 
encouraged to assess all its physical and management improvement needs. 
Physical

[[Page 17220]]

improvement needs should be reviewed against the modernization 
standards, as set forth in HUD Handbook 7485.2, as revised, and any 
cost-effective energy conservation measures, identified in updated 
energy audits. The modernization standards include development specific 
work to ensure the long-term viability of the developments, such as 
amenities and design changes to promote the integration of low-income 
housing into the broader community. See section II(b)(1)(i). In 
addition, the HA is strongly encouraged to contact the Field Office to 
discuss its modernization needs and obtain information. The term 
``Field Office'' includes the ONAP.
    (b) Resident Involvement and Local/Tribal Official Consultation 
Requirements.
    (1) Residents/Homebuyers. The CIAP regulations at Secs. 968.215 or 
950.624 require the HA to establish a Partnership Process to ensure 
full resident participation in the planning, implementation and 
monitoring of the modernization program, as follows:
    (i) Before submission of the CIAP Application, consultation with 
the residents, resident organization, and resident management 
corporation (herein referred to as residents) of the development(s) 
being proposed for modernization regarding its intent to submit an 
application and to solicit resident comments;
    (ii) Reasonable opportunity for residents to present their views on 
the proposed modernization and alternatives to it, and full and serious 
consideration of resident recommendations;
    (iii) Written response to residents indicating acceptance or 
rejection of resident recommendations, consistent with HUD requirements 
and the HA's own determination of efficiency, economy and need, with a 
copy to the Field Office at Joint Review. If the Joint Review is 
conducted off-site, a copy is mailed to the Field Office;
    (iv) After HUD funding decisions, notification to residents of the 
approval or disapproval and, where requested, provision to residents of 
a copy of the HUD-approved CIAP Budget; and
    (v) During implementation, periodic notification to residents of 
work status and progress and maximum feasible employment of residents 
in the modernization effort.
    (2) Local/Tribal Officials. Before submission of the CIAP 
Application, consultation with appropriate local/tribal officials 
regarding how the proposed modernization may be coordinated with any 
local plans for neighborhood revitalization, economic development, drug 
elimination and expenditure of local funds, such as Community 
Development Block Grant funds.
    (c) Contents of CIAP Application. Within the established deadline 
date, the HA shall submit the CIAP Application to the Field Office, 
with a copy to appropriate local/tribal officials. The HA may obtain 
the necessary forms from the Field Office. The CIAP Application is 
comprised of the following documents:
    (1) Form HUD-52822, CIAP Application, in an original and two 
copies, which includes:
    (i) A general description of HA development(s), in priority order, 
(including the current physical condition, for each development for 
which the HA is requesting funds, or for all developments in the HA's 
inventory) and physical and management improvement needs to meet the 
Secretary's standards in Sec. 968.115 or Sec. 950.603; description of 
work items required to correct identified deficiencies; and the 
estimated cost. Where the HA has not included some of its developments 
in the CIAP Application, the Field Office may not consider funding any 
nonemergency work at excluded developments or subsequently approve use 
of leftover funds at excluded developments. Therefore, to provide 
maximum flexibility, the HA may wish to include all of its developments 
in the CIAP Application, even though there are no known current needs. 
Following is an example of the general description:
    Development 1-1: 50 units of low-rent; 25 years old; physical needs 
are: new roofs; storm windows and doors; and electrical upgrading at 
estimated cost of $150,000.
    Development 1-2: 40 units of low-rent; 20 years old; physical needs 
are: physical accessibility in 2 units; kitchen floors; shower/bathtub 
surrounds; fencing; and exterior lighting at estimated cost of $90,000.
    Development 1-3: 35 units of Turnkey III; 15 years old; physical 
needs are: physical accessibility in 3 units; and roof insulation at 
estimated cost of $50,000.
    Development 1-4: 20 units of low-rent; 5 years old; no physical 
needs; no funding requested.
    (ii) Where funding is being requested for management improvements, 
an identification of the deficiency, a description of the work required 
for correction, and estimated cost. Examples of management improvements 
include, but are not limited to the following areas:
    (A) the management, financial, and accounting control systems of 
the HA;
    (B) the adequacy and qualifications of personnel employed by the HA 
in the management and operation of its developments by category of 
employment; and
    (C) the adequacy and efficacy of resident programs and services, 
resident and development security, resident selection and eviction, 
occupancy and vacant unit turnaround, rent collection, routine and 
preventive maintenance, equal opportunity, and other HA policies and 
procedures.
    (iii) a certification that the HA has met the requirements for 
consultation with local/tribal officials and residents/homebuyers and 
that all developments included in the application have long-term 
physical and social viability, including prospects for full occupancy. 
If the HA cannot make this certification with respect to long-term 
viability, the HA shall attach a narrative, explaining its viability 
concerns.
    (2) A narrative statement, in an original and two copies, 
addressing each of the technical review factors in section IV(c)(5) 
and, where applicable for Public Housing, the bonus points in section 
IV(c)(6).
    (3) Form HUD-50071, Certification for Contracts, Grants, Loans and 
Cooperative Agreements, in an original only, required of HAs 
established under State law, applying for grants exceeding $100,000.
    (4) SF-LLL, Disclosure of Lobbying Activities, in an original only, 
required of HAs established under State law, only where any funds, 
other than federally appropriated funds, will be or have been used to 
influence Federal workers, Members of Congress and their staff 
regarding specific grants or contracts. The HA determines if the 
submission of the SF-LLL is applicable.
    (5) Form HUD-2880, Applicant/Recipient Update/Disclosure Report, in 
an original only, required of HAs established under State law.
    (6) At the option of the HA, photographs or video cassettes showing 
the physical condition of the developments.

IV. Application Processing by Field Office

    (a) Completeness Review (Corrections to Deficient Applications). To 
be eligible for processing, the CIAP Application must be physically 
received by the Field Office by the time and date specified in this 
NOFA. Immediately after the application deadline, the Field Office 
shall perform a completeness review to determine whether an application 
is complete, responsive to the NOFA, and acceptable for technical 
processing.

[[Page 17221]]

    (1) If either Form HUD-52822, CIAP Application, or the narrative 
statement on the technical review factors is missing, the HA's 
application will be considered substantially incomplete and, therefore, 
ineligible for further processing. The Field Office shall immediately 
notify the HA in writing.
    (2) If Form HUD-50071, Certification for Contracts, Grants, Loans, 
and Cooperative Agreements, or SF-LLL, Disclosure of Lobbying 
Activities, are required, but missing, or Form HUD-2880, Applicant/
Recipient Update/Disclosure Form, is missing, or there is a technical 
mistake, such as no signature on a submitted form or the HA failed to 
address all of the technical review factors, the Field Office shall 
immediately notify the HA in writing to submit or correct the 
deficiency within 14 calendar days from the date of HUD's written 
notification. This is not additional time to substantially revise the 
application. Deficiencies which may be corrected at this time are 
inadvertently omitted documents, as specified in this subparagraph, or 
clarifications of previously submitted material and other changes which 
are not of such a nature as to improve the competitive position of the 
application.
    (3) If the HA fails to submit or correct the items within the 
required time period, the HA's application will be ineligible for 
further processing. The Field Office shall immediately notify the HA in 
writing after this occurs.
    (4) The HA may submit a CIAP Application for Emergency 
Modernization whenever needed. See section IV(j).
    (b) Eligibility Review. After the HA's CIAP Application is 
determined to be complete and accepted for review, the Field Office 
eligibility review shall determine if the application is eligible for 
full processing or processing on a reduced scope.
    (1) Eligibility for Full Processing. To be eligible for full 
processing:
    (i) Each eligible development for which work is proposed has 
reached the Date of Full Availability (DOFA) and is under ACC at the 
time of CIAP Application submission; and
    (ii) Where funded under Major Reconstruction of Obsolete Projects 
(MROP) after FY 1988, the development/building has reached DOFA or, 
where funded during FYs 1986-1988, all MROP funds for the development/
building have been expended.
    (2) Eligibility for Processing on Reduced Scope. When the following 
conditions exist, the HA's application will be reviewed on a reduced 
scope:
    (i) Section 504 Compliance. Where the HA has not completed all 
required structural changes to meet the need for accessible units, as 
identified in the HA's Section 504 needs assessment, the HA is eligible 
for processing only for Emergency Modernization or physical work needed 
to meet Section 504 requirements.
    (ii) Lead-Based Paint (LBP) Testing Compliance. Where the HA has 
not complied with the statutory requirement to complete LBP testing on 
all pre-1978 family units, the HA is eligible for processing only for 
Emergency Modernization or work needed to complete the testing.
    (iii) Fair Housing and Equal Opportunity (FHEO) Compliance. Where 
the HA has not complied with FHEO requirements as evidenced by an 
enforcement action, finding or determination, the HA is eligible for 
processing only for Emergency Modernization or work needed to remedy 
civil rights deficiencies--unless the HA is implementing a voluntary 
compliance agreement or settlement agreement designed to correct the 
area(s) of noncompliance. The enforcement actions, findings or 
determinations that trigger limited eligibility are described in 
paragraphs (A) through (E) below:
    (A) A pending proceeding against the HA based upon a Charge of 
Discrimination issued under the Fair Housing Act. A Charge of 
Discrimination is a charge under Section 810(g)(2) of the Fair Housing 
Act, issued by the Department's Assistant Secretary for FHEO or legally 
authorized designee;
    (B) A pending civil rights suit against the HA, referred by the 
Department's Assistant Secretary for FHEO and instituted by the 
Department of Justice;
    (C) Outstanding HUD findings of HA noncompliance with civil rights 
statutes and executive orders under 24 CFR Part 5 and 24 CFR 968.110 or 
24 CFR 950.115, or implementing regulations, as a result of formal 
administrative proceedings;
    (D) A deferral of the processing of applications from the HA 
imposed by HUD under Title VI of the Civil Rights Act of 1964 and HUD 
implementing regulations (24 CFR 1.8), the Attorney General's 
Guidelines (28 CFR 50.3), and procedures (HUD Handbook 8040.1), or 
under Section 504 of the Rehabilitation Act of 1973 and HUD 
implementing regulations (24 CFR 8.57); or
    (E) An adjudication of a violation under any of the authorities 
specified in 24 CFR Part 5 and 24 CFR 968.110 or 24 CFR 950.115 in a 
civil action filed against the HA by a private individual.
    (c) Selection Criteria and Ranking Factors. After all CIAP 
Applications are reviewed for eligibility, the Field Office shall 
categorize the eligible HAs and their developments into two processing 
groups, as defined in subparagraph (1) of this paragraph: Group 1 for 
Emergency Modernization; and Group 2 for Other Modernization. HA 
developments may be included in both groups and the same development 
may be in each group. However, the HA is only required to submit one 
CIAP Application.
    (1) Grouping Modernization Types.
    (i) Group 1, Emergency Modernization. This is a type of 
modernization program for a development that is limited to physical 
work items of an emergency nature to correct conditions that pose an 
immediate threat to the health or safety of residents or are related to 
fire safety, and that must be corrected within one year of CIAP funding 
approval. Funding may not be used for management improvements. 
Emergency Modernization includes all LBP testing and abatement of units 
housing children under six years old with elevated blood lead levels 
(EBLs) and all LBP testing and abatement of HA-owned day care 
facilities used by children under six years old with EBLs. Group 1 
developments are not subject to the technical review rating and ranking 
in subparagraphs (5), (6) and (7) of this paragraph and the long-term 
viability and reasonable cost determinations in section V(a).
    (ii) Group 2, Other Modernization. This is a type of modernization 
program for a development that includes one or more physical work 
items, where the Field Office determines that the physical improvements 
are necessary and sufficient to extend substantially the useful life of 
the development, and/or one or more development specific or HA-wide 
management work items (including planning costs), and/or LBP testing, 
professional risk assessment, interim containment, and abatement. 
Therefore, eligibility of work under Other Modernization ranges from a 
single work item to the complete rehabilitation of a development. Refer 
to section II(b)(1)(i) regarding modest amenities and improved design. 
Group 2 developments are subject to the technical review rating and 
ranking in subparagraphs (5), (6) and (7) of this paragraph and the 
long-term viability and reasonable cost determinations in section V(a).
    (2) Assessment of HA's Management Capability. As part of its 
technical review of the CIAP Application, the Field Office shall 
evaluate the HA's

[[Page 17222]]

management capability. Particular attention shall be given to the 
adequacy of the HA's maintenance in determining the HA's management 
capability. This assessment shall be based on the compliance aspects of 
on-site monitoring, such as audits, reviews or surveys which are 
currently available within the Field Office, and on the performance 
review under the Public Housing Management Assessment Program (PHMAP) 
for PHAs or the Administrative Capability Assessment for IHAs, and 
other information sources, as follows:
    (i) Public Housing. A PHA has management capability if it is (A) 
not designated as Troubled under Part 901, PHMAP, or (B) designated as 
Troubled, but has a reasonable prospect of acquiring management 
capability through CIAP-funded management improvements and 
administrative support. A Troubled PHA is eligible for Emergency 
Modernization only, unless it is making reasonable progress toward 
meeting the performance targets established in its memorandum of 
agreement or equivalent under 24 CFR 901.140 or has obtained 
alternative oversight of its management functions.
    (ii) Indian Housing. An IHA has management capability if it is (A) 
not designated as High Risk under 24 CFR 950.135 or (B) designated as 
High Risk, but has a reasonable prospect of acquiring management 
capability through CIAP-funded management improvements and 
administrative support. A High Risk IHA is eligible for Emergency 
Modernization only, unless it is making reasonable progress toward 
meeting the performance targets established in its management 
improvement plan under 24 CFR 950.135.
    (3) Assessment of HA's Modernization Capability. As part of its 
technical review of the CIAP Application, the Field Office shall 
evaluate the HA's modernization capability, including the progress of 
previously approved modernization and the status of any outstanding 
findings from CIAP monitoring visits, as follows:
    (i) Public Housing. A PHA has modernization capability if it is (A) 
not designated as Modernization Troubled under Part 901, PHMAP, or (B) 
designated as Modernization Troubled, but has a reasonable prospect of 
acquiring modernization capability through CIAP-funded management 
improvements and administrative support, such as hiring staff or 
contracting for assistance. A Modernization Troubled PHA is eligible 
for Emergency Modernization only, unless it is making reasonable 
progress toward meeting the performance targets established in its 
memorandum of agreement or equivalent under 24 CFR 901.140 or has 
obtained alternative oversight of its modernization functions. Where a 
PHA does not have a funded modernization program in progress, the Field 
Office shall determine whether the PHA has a reasonable prospect of 
acquiring modernization capability through hiring staff or contracting 
for assistance.
    (ii) Indian Housing. An IHA has modernization capability if it is 
(A) not designated as High Risk under 24 CFR 950.135, or (B) designated 
as High Risk, but has a reasonable prospect of acquiring modernization 
capability through CIAP-funded management improvements and 
administrative support, such as hiring staff or contracting for 
assistance. An IHA that has been classified High Risk with regard to 
modernization is eligible for Emergency Modernization only, unless it 
is making reasonable progress toward meeting the performance targets 
established in its management improvement plan under 24 CFR 
950.135(f)(2) or has obtained alternative oversight of its 
modernization functions. Where an IHA does not have a funded 
modernization program in progress, the ONAP shall determine whether the 
IHA has a reasonable prospect of acquiring modernization capability 
through hiring staff or contracting for assistance.
    (4) Technical Processing. After categorizing the eligible HAs and 
their developments into Group 1 and Group 2, the Field Office shall 
review and rate each Group 2 HA on each of the technical review factors 
in subparagraph (5) of this paragraph. With the exception of the 
technical review factor of ``extent and urgency of need,'' a Group 2 HA 
is rated on its overall HA application and not on each development. For 
the technical review factor of ``extent and urgency of need,'' each 
development for which funding is requested in the CIAP Application by a 
Group 2 HA is scored; the development with the highest priority needs 
is scored the highest number of points, which are then used for the 
overall HA score on that factor.
    (5) Technical Review Factors. The technical review factors for 
assistance are:

------------------------------------------------------------------------
                                                                Maximum 
                   Technical review factors                      points 
------------------------------------------------------------------------
Extent and urgency of need, including need to comply with               
 statutory, regulatory or court-ordered deadlines, to                   
 complete previously funded modernization work, or to provide           
 appropriate replacement housing for HUD- approved demolition/          
 disposition.................................................         40
HA's modernization capability................................         15
HA's management capability...................................         15
Extent of vacancies, where the vacancies are not due to                 
 insufficient demand.........................................         10
Degree of resident involvement in HA operations..............          5
Degree of HA activity in resident initiatives, including                
 resident management, economic development, and drug                    
 elimination efforts.........................................          5
Degree of resident employment through direct hiring or                  
 contracting or job training initiatives.....................          5
Local government support for proposed modernization..........          5
                                                              ----------
      Total maximum score....................................        100
------------------------------------------------------------------------

    (6) Bonus points.
    (i) For Public Housing only, the Field Office shall provide up to 5 
bonus points for any PHA that can demonstrate that it has obtained 
funds, within the last 12 months, from a non-HUD source to support the 
modernization activities or improve the general operation of the PHA. 
Non-HUD sources of funding may include: local government, over and 
above what is required under the Cooperation Agreement for municipal 
services such as police and fire protection and refuse collection; 
private non-profit organizations; or other public and private entities. 
To qualify for the bonus points, the PHA shall identify the entity, the 
amount of funds, the date on which the funds were or will be provided, 
and the purpose of the funding.
    (ii) For Public Housing only, the Field Office shall provide up to 
2 bonus points for any PHA that can demonstrate that it has awarded 
contracts, including subcontracts, to minority business enterprises 
(MBEs) or women's business enterprises (WBEs) within the last 12 
months. PHAs are

[[Page 17223]]

required by 24 CFR 968.110(b) to take every affirmative action to meet 
Departmental goals for awarding contracts to MBEs and WBEs. To qualify 
for the bonus points, the PHA shall identify the contractor or 
subcontractor, the dollar value of the contract or subcontract, and the 
date of award.
    (7) Rating and Ranking. After rating all Group 2 HAs/developments 
on each of the technical review factors and providing any bonus points 
as set forth in subparagraph (6) of this paragraph, the Field Office 
shall then rank each Group 2 HA based on its total score, list Group 2 
HAs in descending order, subject to confirmation of need and cost at 
Joint Review, and identify for Joint Review selection the highest 
ranking applications in Group 2 and other Group 2 HAs with lower 
ranking applications, but with high priority needs. High priority needs 
are non-emergency needs, but related to: health or safety; vacant, 
substandard units; structural or system integrity; or compliance with 
statutory, regulatory or court-ordered deadlines. All Group 1 
applications are automatically selected for Joint Review. The Field 
Office shall consult with Headquarters regarding any identified FHEO 
noncompliance.
    (d) Joint Review. The purpose of the Joint Review is for the Field 
Office to discuss with the HA the proposed modernization program, as 
set forth in the CIAP Application, review long-term viability and cost 
reasonableness determinations, and determine the size of the grant, if 
any, to be awarded.
    (1) The Field Office shall select HAs, including all Group 1 HAs, 
for Joint Review so that the total dollar value of all proposed 
modernization recommended for funding exceeds the Field Office's 
estimated funding amount by at least 15 percent. This preserves the 
Field Office's ability to adjust cost estimates and work items as a 
result of Joint Review.
    (2) The Field Office shall notify each HA whose application has 
been selected for further processing as to whether Joint Review will be 
conducted on-site or off-site (e.g., by telephone or in-office 
meeting).
    (3) The HA shall prepare for Joint Review by preparing a draft CIAP 
Budget and reviewing the other items to be covered during Joint Review, 
as prescribed by the Field Office, such as the need for professional 
services, method of accomplishment of physical work (contract or force 
account labor), HA compliance with various Federal statutes and 
regulations, etc. If conducted on-site, Joint Review may include an 
inspection of the proposed physical work.
    (4) The Field Office shall advise in writing each HA not selected 
for Joint Review of the reasons for non-selection.
    (e) Funding Decisions. After all Joint Reviews are completed, the 
Field Office shall adjust the HAs, developments, and work items to be 
funded and the amounts to be awarded, on the basis of information 
obtained from Joint Reviews, FHEO review, and environmental reviews 
(refer to paragraph (h) of this section) and make the funding 
decisions. Such adjustments are necessary where Joint Review determines 
that actual Group 1 emergencies and Group 2 high priority needs, HA 
priorities, or cost estimates vary from the HA's application. Such 
adjustments may preclude the Field Office from funding all of the 
higher ranked HA applications in order to accommodate the funding of 
high priority needs. However, where the information obtained from Joint 
Reviews, FHEO review, and environmental reviews does not substantially 
alter the information used to establish the rankings before Joint 
Review, the Field Office shall make funding decisions in accordance 
with its rankings. An HA will not be selected for Joint Review if there 
is a duplication of funding (refer to section V(c)). After 
Congressional notifications, the Field Office shall notify the HAs of 
their funding approval, subject to submission of the CIAP Budget, 
including an implementation schedule, and other required documents.
    (f) HA Submission of Additional Documents. After Field Office 
funding decisions, the HA shall submit the following documents within 
the time frame prescribed by the Field Office:
    (1) Form HUD-52825, CIAP Budget/Progress Report, which includes the 
implementation schedule(s), in an original and two copies.
    (2) Form HUD-50070, Certification for a Drug-Free Workplace, in an 
original only.
    (3) Form HUD-52820, HA Board Resolution Approving CIAP Budget, in 
an original only.
    (g) ACC Amendment. After HUD approval of the CIAP Budget, the Field 
Office and the HA shall enter into an ACC amendment in order for the HA 
to draw down modernization funds. The ACC amendment shall require low-
income use of the housing for not less than 20 years from the date of 
the ACC amendment (subject to sale of homeownership units in accordance 
with the terms of the ACC). The HA Executive Director, where authorized 
by the Board of Commissioners and permitted by State/tribal law, may 
sign the ACC amendment on behalf of the HA. HUD has the authority to 
condition an ACC amendment (e.g., to require an HA to hire a 
modernization coordinator or contract administrator to administer its 
modernization program).
    (h) Environmental review.
    (1) Public Housing. The Field Office shall review the environmental 
impact of all modernization activities, proposed by PHAs, under 24 CFR 
Part 50, in accordance with the provisions of Part 968. The Field 
Office may obtain the information required to conduct the environmental 
review during Joint Review. The PHA shall provide any documentation to 
the Field Office that it needs to carry out its review under the 
National Environmental Policy Act (NEPA). After all Joint Reviews are 
conducted, the Field Office shall complete the environmental reviews 
before funding decisions are made and announced and before PHAs are 
invited to submit CIAP Budgets. Therefore, in requesting CIAP Budgets, 
the Field Office shall specify any PHA modification or elimination of 
activities or expenditures that the Field Office has determined, after 
review under NEPA or related laws, to have an unacceptable 
environmental impact. Upon approval of the CIAP Budget, the Field 
Office shall send an approval letter to the PHA which includes 
notification that HUD has complied with its responsibilities under 
Sec. 968.110 (c) and (d) before entering into an ACC amendment with the 
PHA.
    (2) Indian Housing. For IHAs, the environmental impact of 
modernization activities is reviewed by a responsible entity under 24 
CFR Part 58 in accordance with Sec. 950.120(a). The responsible entity 
may be an Indian tribe or, in the case of IHAs in Alaska, an Alaska 
native village, a state, or unit of local government. Under this 
procedure, the environmental impact of each IHA project will be 
considered before an IHA obligates or expends funds for physical 
improvements.
    (i) Declaration of Trust. Where the Field Office determines that a 
Declaration of Trust is not in place or is not current, the HA shall 
execute and file for record a Declaration of Trust, as provided under 
the ACC, to protect the rights and interests of HUD throughout the 20-
year period during which the HA is obligated to operate its 
developments in accordance with the ACC, the Act, and HUD regulations 
and requirements. HUD has determined that its interest in Mutual Help 
units is sufficiently protected without the further requirement of a 
Declaration of Trust; therefore, a Declaration of Trust is not required 
for Mutual Help units.

[[Page 17224]]

    (j) ``Fast Tracking'' Applications. Emergency applications do not 
have to be processed within the normal processing time allowed for 
other applications. Where an immediate hazard must be addressed, HA 
applications may be submitted and processed at any time during the year 
when funds are available. The Field Office shall ``fast track'' the 
processing of these emergency applications so that fund reservation may 
occur as soon as possible.

V. Other Program Items

    (a) Long-Term Viability and Reasonable Cost. On Form HUD-52822, 
CIAP Application, the HA certifies whether the developments proposed 
for modernization have long-term physical and social viability, 
including prospects for full occupancy. During Joint Review, the Field 
Office will review with the HA the determination of reasonable cost for 
the proposed modernization to ensure that unfunded hard costs do not 
exceed 90 percent of the computed total development cost (TDC) for a 
new development with the same structure type and number and size of 
units in the market area. The Field Office shall make a final viability 
determination. Where the estimated per unit unfunded hard cost is equal 
to or less than the per unit TDC for the smallest bedroom size at the 
development, no further computation of the TDC limit is required.
    (1) If the Field Office determines that completion of the 
improvements and replacements will not reasonably ensure the long-term 
physical and social viability of the development at a reasonable cost, 
the Field Office shall only approve Emergency Modernization or non-
emergency funding for essential non-routine maintenance needed to keep 
the property habitable until the demolition or disposition application 
is approved and residents are relocated.
    (2) Where the Field Office wishes to fund a development with hard 
costs exceeding 90 percent of computed TDC, the Field Office shall 
submit written justification to Headquarters for final decision. Such 
justification shall include:
    (i) Any special or unusual conditions have been adequately 
explained, all work has been justified as necessary to meet the 
modernization and energy conservation standards, including development 
specific work necessary to blend the development in with the design and 
architecture of the neighborhood; and
    (ii) Reasonable cost estimates have been provided, and every effort 
has been made to reduce costs; and
    (iii) Rehabilitation of the existing development is more cost-
effective in the long-term than construction or acquisition of 
replacement housing; or
    (iv) There are no practical alternatives for replacement housing.
    (b) Use of Dwelling Units for Economic Self-Sufficiency Services 
and/or Drug Elimination Activities. CIAP funds may be used to convert 
dwelling units for purposes related to economic self-sufficiency 
services and/or drug elimination activities. Regarding the eligibility 
for funding under the Performance Funding System of dwelling units used 
for these purposes, refer to 24 CFR 990.108(b)(2) or 24 CFR 
950.720(b)(2).
    (c) Duplication of Funding. The HA shall not receive duplicate 
funding for the same work item or activity under any circumstance and 
shall establish controls to assure that an activity, program, or 
project that is funded under any other HUD program shall not be funded 
by CIAP.

VI. Application Deadline Date and Summary of FY 1996 CIAP Processing 
Steps

    The deadline date for submission of the FY 1996 CIAP Application is 
June 17, 1996. Dates for other processing steps will be established by 
each Field Office to reflect local workload issues.

Summary of Processing Steps

    1. HA submits CIAP Application.
    2. Field Office conducts completeness review and requests 
corrections to deficient applications or notifies HAs of ineligible 
applications.
    3. HA submits corrections to deficient applications within 14 
calendar days of notification from Field Office.
    4. Field Office conducts eligibility review and technical review 
(rating and ranking) and makes Joint Review selections.
    5. Field Office completes Joint Reviews, environmental reviews (for 
PHAs) and FHEO review.
    6. Field Office makes funding decisions and forwards Congressional 
notifications to Headquarters.
    7. Congressional notification is completed and Field Office 
notifies HA of funding decisions.
    8. HA submits additional documents as required in section IV(f).
    9. Field Office completes fund reservations and forwards ACC 
amendment to HA for signature and return.
    10. Field Office executes ACC amendment and HA begins 
implementation.

VII. Other Matters

    (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 implementing 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 and copying 
between 7:30 a.m. and 5:30 p.m. weekdays at the Office of the Rules 
Docket Clerk, 451 Seventh Street, S.W., Room 10276, Washington, DC 
20410.
    (b) Federalism Impact. The General Counsel, as the Designated 
Official under section 6(a) of Executive Order 12612, Federalism, has 
determined that the policies and procedures contained in this NOFA will 
not have substantial direct effects on States or their political 
subdivisions, or the relationship between the federal government and 
the States, or on the distribution of power and responsibilities among 
the various levels of government. As a result, the NOFA is not subject 
to review under the Order.
    (c) Impact on the Family. The General Counsel, as the Designated 
Official for Executive Order 12606, The Family, has determined that 
this NOFA will likely have a beneficial impact on family formation, 
maintenance and general well-being. Accordingly, since the impact on 
the family is beneficial, no further review is considered necessary.
    (d) Accountability in the Provision of HUD Assistance. The 
Department has promulgated a final rule to implement section 102 of the 
Department of Housing and Urban Development Reform Act of 1989 (HUD 
Reform Act). The final rule is codified at 24 CFR Part 12. Section 102 
contains a number of provisions that are designed to ensure greater 
accountability and integrity in the provision of certain types of 
assistance administered by the Department. On January 16, 1992, the 
Department published at 57 FR 1942, additional information that gave 
the public (including applicants for, and recipients of, HUD 
assistance) further information on the implementation, public access, 
and disclosure requirements of section 102. The documentation, public 
access, and disclosure requirements of section 102 are applicable to 
assistance awarded under this NOFA as follows:
    (1) Documentation and Public Access. The Department will ensure 
that documentation and other information regarding each application 
submitted pursuant to this NOFA are sufficient to indicate the basis 
upon which assistance was provided or denied. This

[[Page 17225]]

material, including any letters of support, will be made available for 
public inspection for a five-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 at 24 CFR Part 15. In addition, HUD will 
include the recipients of assistance pursuant to this NOFA in its 
Federal Register notice of all recipients of HUD assistance awarded on 
a competitive basis. (See 24 CFR 12.14(a) and 12.16(b), and the notice 
published in the Federal Register on January 16, 1992 (57 FR 1942), for 
further information on these requirements.)
    (2) HUD Responsibilities--Disclosures. The Department will make 
available to the public for five years all applicant disclosure reports 
(Form HUD-2880) submitted in connection with this NOFA. Update reports 
(also Form HUD-2880) will be made available along with the applicant 
disclosure reports, but in no case for a period less than three 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. (See 24 CFR 
Part 12, Subpart C, and the notice published in the Federal Register on 
January 16, 1992 (57 FR 1942), for further information on these 
disclosure requirements.)
    (e) Prohibition Against Advance Information on Funding Decisions. 
HUD's regulation implementing section 103 of the Department of Housing 
and Urban Development Reform Act of 1989, codified as 24 CFR part 4, 
applies to the funding competition announced today. The requirements of 
the rule 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 part 
4 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 Office of Ethics (202) 708-3815. (This is not a toll-
free number.) For HUD employees who have specific program questions, 
such as whether particular subject matter can be discussed with persons 
outside HUD, the employee should contact the appropriate Field Office 
Counsel, or Headquarters counsel for the program to which the question 
pertains.
    (f) Prohibition Against Lobbying Activities.
    The use of funds awarded under this NOFA is subject to the 
disclosure requirements and prohibitions of Section 319 of the 
Department of Interior and Related Agencies Appropriations Act for 
Fiscal Year 1990 (31 U.S.C. 1352) and the HUD implementing regulations 
at 24 CFR Part 87. These authorities prohibit 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. The prohibition 
also covers the awarding of contracts, grants, cooperative agreements 
or loans unless the recipient has made an acceptable certification 
regarding lobbying. Under 24 CFR Part 87, applicants, recipients and 
subrecipients of assistance exceeding $100,000 must certify that no 
federal funds have been or will be spent on lobbying activities in 
connection with the assistance.
    IHAs 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 IHAs established under State law are not excluded from 
the statute's coverage.
    If the amount applied for is greater than $100,000, the 
certification is required at the time application for funds is made 
that federally appropriated funds are not being or have not been used 
in violation of the Byrd Amendment. If the amount applied for is 
greater than $100,000 and the HA has made or has agreed to make any 
payment using non-appropriated funds for lobbying activity, as 
described in 24 CFR Part 87 (Byrd Amendment), the submission also must 
include the SF-LLL, Disclosure of Lobbying Activities. The HA 
determines if the submission of the SF-LLL is applicable.
    (g) Paperwork Reduction Act Statement. The information collection 
requirements contained in this NOFA have been approved by the Office of 
Management and Budget (OMB) under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501-3520) and have been assigned OMB control number 2577-
0044. 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.

VIII. Catalog of Federal Domestic Assistance Program

    The Catalog of Federal Domestic Assistance Program Number is 
14.852.

    Dated: April 3, 1996.
Michael B. Janis,
General Deputy Assistant Secretary for Public and Indian Housing.
[FR Doc. 96-9543 Filed 4-17-96; 8:45 am]
BILLING CODE 4210-33-P