[Federal Register Volume 62, Number 67 (Tuesday, April 8, 1997)]
[Corrections]
[Pages 17024-17036]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-9034]



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_______________________________________________________________________

Part IV





Department of Housing and Urban Development





_______________________________________________________________________



Fiscal Year 1997; Funding Availability for Continuum of Care Homeless 
Assistance; Supportive Housing Program (SHP); Shelter Plus Care (S+C); 
Sec. 8 Moderate Rehabilitation Single Room Occupancy Program for 
Homeless Individuals (SRO); Notice

  Federal Register / Vol. 62, No. 67, Tuesday, April 8, 1997 / 
Notices  

[[Page 17024]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4182-N-01]


Fiscal Year 1997 Notice of Funding Availability for Continuum of 
Care Homeless Assistance; Supportive Housing Program (SHP); Shelter 
Plus Care (S+C); Sec 8 Moderate Rehabilitation Single Room Occupancy 
Program for Homeless Individuals (SRO)

AGENCY: Office of the Assistant Secretary for Community Planning and 
Development, HUD.

ACTION: Notice of funding availability (NOFA).

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

SUMMARY: This Notice announces the 1997 homeless assistance competition 
designed to help communities develop Continuum of Care systems to 
assist homeless persons.
    The process of developing a Continuum of Care system is part of the 
community's larger effort of developing a Consolidated Plan. For a 
community to successfully address its often complex and interrelated 
problems, including homelessness, the community must marshall its 
varied resources--community and economic development resources, social 
service resources, housing and homeless assistance resources--and use 
them in a coordinated and effective manner. The Consolidated Plan 
serves as the vehicle for a community to comprehensively identify each 
of its needs and to coordinate a plan of action for addressing them.
    The funds available under this NOFA can be used under any of three 
programs that can assist in creating community systems for combating 
homelessness. The three programs are: (1) Supportive Housing; (2) 
Shelter Plus Care; and (3) Section 8 Moderate Rehabilitation for Single 
Room Occupancy Dwellings for Homeless Individuals. This notice of 
funding availability (NOFA) contains information concerning the 
Continuum of Care approach, eligible applicants, eligible activities, 
application requirements, and application processing.

DEADLINE DATE: Applications Delivered. Applications are due before 
midnight on July 8, 1997.
    Before and on the deadline date, and during normal business hours 
(up to 6:00 pm) completed applications will be accepted at the Office 
of Special Needs Assistance Programs (Room 7270) in Washington at the 
address below.
    On the deadline date and after normal business hours (after 6:00 
pm), hand-carried applications will be received at the South Lobby of 
the Department of Housing and Urban Development at the address below. 
HUD will treat as ineligible for consideration delivered applications 
that are received after that deadline.
    Applications Mailed. Applications will be considered timely filed 
if postmarked before midnight on July 8, 1997, and received by HUD 
Headquarters within ten (10) days after that date.
    Applications Sent by Overnight Delivery. Overnight delivery items 
will be considered timely filed if received before or on July 8, 1997, 
or upon submission of documentary evidence that they were placed in 
transit with the overnight delivery service by no later than July 8, 
1997.
    No facsimile (FAX). Applications may not be sent by FAX.
    Copies of Applications to Field Offices. Two copies of the 
application must also be sent to the HUD Field Office serving the State 
in which the applicant's projects are located. Field office copies must 
be received by the application deadline as well, but a determination 
that an application was received on time will be made solely on receipt 
of the application at HUD Headquarters in Washington. All three copies 
may be used in reviewing the application.

ADDRESSES: For a copy of the application package and supplemental 
information please call the Community Connections information center at 
1-800-998-9999 (voice) or 1-800-483-2209 (TTY), or contact by internet 
at http://www.comcon.org/ccprog.html.
    The address of the Special Needs Assistance Programs Office in HUD 
Headquarters is: Special Needs Assistance Programs, Room 7270, Office 
of Community Planning and Development, Department of Housing and Urban 
Development, 451 Seventh Street, S.W., Washington, DC 20410, Attention: 
Continuum of Care Funding. Addresses of HUD Field Offices are contained 
in Appendix B.

ELECTRONIC SUBMISSION: This year, for the first time, you may use a 
special supplement to HUD's new Community Planning Software to prepare 
your application. The special supplement has been programmed to produce 
the charts and narratives that will meet both the requirements of the 
homelessness sections of the Consolidated Plan (Con Plan) and the 
identical requirements of the Continuum of Care application. The 
supplement will also produce the necessary project-specific 
information. If you choose to use the supplement to prepare your 
Continuum of Care application, you will simply submit the required 
information on 3\1/2\'' computer diskettes, together with signed 
application cover sheets (SF-424), all required certifications and 
other required documentation, by the deadline identified above. Please 
submit three copies, as described in the DEADLINE DATE section above. 
The supplement may be obtained at no charge by contacting the Community 
Connections information center by phone or internet as described in the 
ADDRESSES section above.

FOR FURTHER INFORMATION AND TECHNICAL ASSISTANCE: A video presentation 
providing general background that can be useful in preparing your 
application can be obtained for a nominal fee from the Community 
Connections information center. This fee may be waived in the event of 
financial hardship.
    For answers to your questions, you have several options. You may 
call the HUD Field Office serving your area, at the telephone number 
shown in Appendix B to this NOFA. Or, you may contact the Community 
Connections information center at 1-800-998-9999 (voice) or 1-800-483-
2209 (TTY) or by internet at: http://www.comcon.org/ccprog.html.
    Prior to the application deadline, staff will be available to 
provide general guidance, but not guidance in actually preparing the 
application. HUD field office staff will also be available to help 
identify organizations in your community that are involved in 
developing the Continuum of Care system. Following conditional 
selection, HUD staff will be available to assist in clarifying or 
confirming information that is a prerequisite to the offer of a grant 
agreement or Annual Contributions Contract by HUD. However, between the 
application deadline and the announcement of conditional selections, 
HUD will accept no information that would improve the substantive 
quality of the application pertinent to the funding decision.

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act Statement

    The information collection requirements contained in this notice 
have been submitted to the Office of Management and Budget (OMB) under 
the Paperwork Reduction Act of 1995 (42 U.S.C. 3501-3520), and OMB 
approval is pending. 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.

[[Page 17025]]

Promoting Comprehensive Approaches to Housing and Community 
Development

    HUD is interested in promoting comprehensive, coordinated 
approaches to housing and community development. Economic development, 
community development, public housing revitalization, homeownership, 
assisted housing for special needs populations, supportive services, 
and welfare-to-work initiatives can work better if linked at the local 
level. Toward this end, the Department in recent years has developed 
the Consolidated Planning process designed to help communities 
undertake such approaches.
    In this spirit, it may be helpful for applicants under this NOFA to 
be aware of other related HUD NOFAs that have recently been published 
or are expected to be published in the near future. By reviewing these 
NOFAs with respect to their program purposes and the eligibility of 
applicants and activities, applicants may be able to relate the 
activities proposed for funding under this NOFA to the recent and 
upcoming NOFAs and to the community's Consolidated Plan.
    The related NOFAs the Department expects to publish in the Federal 
Register within the next few weeks include: the Family Unification 
NOFA, the Housing Opportunities for Persons with AIDS (HOPWA) NOFA, the 
Supportive Housing for the Elderly NOFA, the Designated Housing NOFA, 
and the NOFA for Mainstream Housing Opportunities.
    To foster comprehensive, coordinated approaches by communities, the 
Department intends for the remainder of FY 1997 to continue to alert 
applicants to upcoming and recent NOFAs as each NOFA is published. In 
addition, 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. Additional steps on NOFA coordination may be considered for 
FY 1998.
    To help in obtaining a copy of your community's Consolidated Plan, 
please contact the community development office of your municipal 
government.

I. Substantive Description

(a) Authority
    The Supportive Housing Program is authorized by title IV, subtitle 
C, of the Stewart B. McKinney Homeless Assistance Act (McKinney Act), 
as amended, 42 U.S.C. 11381. Funds made available under this NOFA for 
the Supportive Housing program are subject to the program regulations 
at 24 CFR part 583, as amended by the final rule published in the 
Federal Register on September 30, 1996 (61 FR 51174).
    The Shelter Plus Care program is authorized by title IV, subtitle 
F, of the McKinney Act, as amended, 42 U.S.C. 11403. Funds made 
available under this NOFA for the Shelter Plus Care program are subject 
to the program regulations at 24 CFR part 582, as amended by the final 
rule published in the Federal Register on September 30, 1996 (61 FR 
51168).
    The Section 8 Moderate Rehabilitation Program for Single Room 
Occupancy Dwellings for Homeless Individuals (SRO) is authorized by 
section 441 of the McKinney Act, as amended, 42 U.S.C. 11401. Funds 
made available under this NOFA for the SRO program are subject to the 
program regulations at 24 CFR part 882, subpart H, as amended by the 
final rule published in the Federal Register on September 11, 1996 (61 
FR 48052).
(b) Program Summaries
    The chart in Appendix A summarizes key aspects of the Supportive 
Housing Program, the Shelter Plus Care Program, and the Section 8 
Moderate Rehabilitation Program for Single Room Occupancy Dwellings for 
Homeless Individuals. Program descriptions are contained in the 
applicable regulations cited in the chart.
(c) Funding Availability
    Approximately $625 million is available for this competition. Any 
unobligated funds from previous competitions or additional funds that 
may become available as a result of deobligations or recaptures from 
previous awards may be used in addition to 1997 appropriations to fund 
applications submitted in response to this NOFA.
    Amounts for each of the three programs will not be specified this 
year. Instead, the distribution of funds among the three programs will 
depend on locally determined priorities and overall demand. 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 these homeless programs are met.
(d) Purpose: Develop Continuum of Care Systems
    The purpose of this NOFA is to fund projects that will fill gaps in 
locally developed Continuum of Care systems to assist homeless persons 
move to self-sufficiency and permanent housing. A Continuum of Care 
system consists of four basic components:
    (1) A system of outreach and assessment for determining the needs 
and conditions of an individual or family who is homeless;
    (2) Emergency shelters with appropriate supportive services to help 
ensure that homeless individuals and families receive adequate 
emergency shelter and referral to necessary service providers or 
housing finders;
    (3) Transitional housing with appropriate supportive services to 
help those homeless individuals and families who are not prepared to 
make the transition to permanent housing and independent living; and
    (4) Permanent housing, or permanent supportive housing, to help 
meet the long-term needs of homeless individuals and families.
    A Continuum of Care system is developed through a community-wide or 
region-wide process involving nonprofit organizations (including those 
representing persons with disabilities), government agencies, other 
homeless providers, housing developers and service providers, private 
foundations, neighborhood groups, and homeless or formerly homeless 
persons. It should address the specific needs of each homeless 
subpopulation: the jobless, veterans, homeless persons with serious 
mental illnesses, persons with substance abuse issues, persons with 
HIV/AIDS, persons with multiple diagnoses, victims of domestic 
violence, runaway youth, and any others.
    The community process used in developing a Continuum of Care system 
must include interested veteran service organizations, particularly 
veteran service organizations with specific experience in serving 
homeless veterans, in order to ensure that the Continuum of Care system 
addresses the needs of homeless veterans.
    High scores under the Continuum of Care scoring criteria will be 
assigned to applications that demonstrate the achievement of two basic 
goals:
     Have maximum participation by non-profit providers of 
housing and services; homeless and formerly homeless persons; state and 
local governments and agencies; veteran service organizations; 
organizations representing persons with disabilities; the private 
sector; housing developers; foundations and other community 
organizations.
     Create, maintain and build upon a community-wide inventory 
of housing and services for homeless families and individuals; identify 
the full spectrum of needs of homeless families and individuals; and 
coordinate efforts to

[[Page 17026]]

obtain resources, particularly resources sought through this NOFA, to 
fill gaps between the current inventory and existing needs.
    In deciding the geographic area to be covered by a Continuum of 
Care strategy, applicants should be aware that the single most 
important factor in receiving funding under this competition will be 
the strength of the Continuum of Care strategy when measured against 
the Continuum of Care criteria described in this NOFA. In determining 
what jurisdictions to include in a Continuum of Care strategy area, the 
applicant should include those jurisdictions that are involved in the 
development and implementation of the Continuum of Care strategy.
    Applicants should also be aware that the larger the area included 
in a Continuum of Care strategy area, the larger the pro rata need 
share that will be allocated to the strategy area (as described in 
section III(a)(4) of this NOFA). However, it would be a mistake to 
include jurisdictions that are not fully involved in the development 
and implementation of the Continuum of Care strategy since this would 
adversely affect the Continuum of Care score. Because most rural 
counties have extremely small pro rata need shares, they are strongly 
encouraged to consider working with larger groups of contiguous 
counties to develop a region-wide or multi-county Continuum of Care 
strategy covering the combined service areas of these counties. This 
will be taken into account during the HUD review.
    Since the basic concept of a Continuum of Care strategy is the 
creation of a single, coordinated, inclusive homeless assistance system 
for an area, the areas covered by Continuum of Care strategies should 
not overlap. If there are cases where the Continuum of Care strategies 
geographically overlap to the extent that they are essentially 
competing with each other, projects in the application/Continuum of 
Care that receives the highest score out of the possible 60 points for 
Continuum of Care will be eligible for up to 40 points under Need. 
Projects in the competing applications with the less effective 
Continuum of Care strategies will be eligible for only 10 points under 
Need. In no case will the same geography be used more than one time in 
assigning Need points. The local HUD field office can help applicants 
determine if any of the area covered by one Continuum of Care strategy 
is also likely to be claimed under another Continuum of Care in this 
competition.
(e) Prioritizing
    Priority decisions are best made through a locally-driven process 
and are key to the ultimate goal of reducing homelessness. As was done 
in 1996, this year's application (1997) instructs that all projects 
proposed for funding under this NOFA be listed in priority order from 
the highest priority to the lowest. This priority order will mean, for 
example, that if funds are only available to finance 8 of 10 proposed 
projects, then funding will be awarded to the first eight projects 
listed. HUD expects nonprofit organizations to be given a fair role in 
establishing these priorities.
    This priority list will be used in awarding up to 40 points per 
project under the ``Need'' scoring criteria. Higher priority projects 
will receive more points under Need than lower priority projects. If 
projects are not prioritized in the application, each project will 
receive the lowest score for Need.
    Project renewals. In the past, HUD has taken a portion of the funds 
available under the current appropriation to fund the renewal of 
expiring Supportive Housing grants, Supportive Housing Demonstration 
Program grants, and SAFAH grants. However, this policy results in less 
funds available for the competition and places the decision on what is 
needed in a community in the hands of HUD officials rather than 
communities. Consistent with the Continuum of Care approach, the need 
for the continuation of previously funded projects should be considered 
in the local needs analysis and a decision should be made locally on 
the priority to assign to the continuation of a project. Therefore, HUD 
funds needed to continue expiring Supportive Housing grants, Supportive 
Housing Demonstration Program grants, SAFAH grants, and Shelter Plus 
Care grants, as described below, will only be available through the 
competitive process described in this NOFA.
    For this 1997 competition, communities need to pay particular 
attention to the funding needs of current McKinney homeless assistance 
projects which will have insufficient funds to continue operating 
throughout 1998 if additional funds are not awarded to them in this 
competition. To the extent a locality desires to have such projects 
renewed, it should give them the top priorities on the priority 
projects listing in the application. (Communities should not request 
additional funding in this competition for those projects that have 
sufficient remaining funds to continue operating into 1999.) For the 
renewal of a Supportive Housing project, you may request for each of 
three (3) years up to 50 percent of the amount of leasing and operating 
costs in the final year of the expiring grant's term and up to 50 
percent of the amount of HUD grant funds for supportive services in the 
final year of the expiring grant's term. For the renewal of a 
Supportive Housing Demonstration Program project or SAFAH project which 
is at the 50 percent amount in its final year, you may request up to 
the same amount as in the final year for each of three (3) years. For 
the renewal of a Shelter Plus Care project, you may request up to the 
amount determined by multiplying the number of units under lease at the 
time of application for renewal funding under this NOFA by the 
applicable current Fair Market Rent(s) by 60 months. This NOFA is not 
applicable to the renewal of funding under the SRO program.

II. Application Requirements

    The application requires a description of the Continuum of Care 
system and proposed project(s). It also contains certifications that 
the applicant will comply with fair housing and civil rights 
requirements, program regulations, and other Federal requirements, and 
(where applicable) that the proposed activities are consistent with the 
HUD-approved Consolidated Plan of the applicable State or unit of 
general local government, including the Analysis of Impediments to Fair 
Housing and the Action Plan to address these impediments. Projects 
funded under this NOFA shall operate in a fashion that does not deprive 
any individual of any right protected by the Fair Housing Act (42 
U.S.C. 3601-19), Section 504 of the Rehabilitation Act of 1973 (29 
U.S.C. 794) or the Americans with Disabilities Act of 1990 (42 U.S.C. 
12101 et. seq.)
    There are three options for submitting an application under this 
NOFA.
    One: A ``Consolidated Application'' is submitted when a 
jurisdiction (or a consortium of jurisdictions) submits a single 
application encompassing a Continuum of Care strategy and containing 
all the projects within that strategy for which funding is being 
requested. Individual projects are contained within the one 
consolidated application. Grant funding may go to one entity which then 
administers all funded projects submitted in the application, or under 
this option, grant funding may go to all or any of the projects 
individually. Your application will specify the grantee for each 
project.
    Two: ``Associated Applications'' are submitted when applicants plan 
and organize a single Continuum of Care

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strategy which is adopted by project sponsors or operators who choose 
to submit separate applications for projects while including the 
identical Continuum of Care strategy. In this case, project funding 
would go to each successful applicant individually and each would be 
responsible to HUD for administering its separate grant.
    Three: A ``Solo Application'' is submitted when an applicant 
applies for a project exclusive of participation in any community-wide 
or region-wide Continuum of Care development process.
    Options one and two are not substantively different and will be 
considered equally competitive. Applicants are advised that projects 
that are not a part of a Continuum of Care strategy will receive few, 
if any, points under the Continuum of Care rating criteria.

III. Application Selection Process

(a) Review, Rating and Conditional Selection
    The Department will use the same review, rating, and conditional 
selection process for all three programs (S+C, SRO, and SHP). To review 
and rate applications, the Department 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. 
Two types of reviews will be conducted. Paragraphs (1) and (2) below 
describe threshold reviews and paragraphs (3) and (4) describe 
criteria--Continuum of Care and Need--that will be used to assign 
points. Up to 100 points will be assigned using these criteria.
    (1) Applicant and sponsor eligibility and capacity. Applicant and 
project sponsor capacity will be reviewed to ensure the following 
eligibility and capacity standards are met. If HUD determines these 
standards are not met, the project will be rejected from the 
competition.
     The applicant must be eligible to apply for the specific 
program;
     The applicant must demonstrate that there is sufficient 
knowledge and experience to carry out the project(s). With respect to 
each proposed project, this means that in addition to knowledge of and 
experience with homelessness in general, the organization carrying out 
the project, its employees, or its partners, must have the necessary 
experience and knowledge to carry out the specific activities proposed, 
such as housing development, housing management, and service delivery;
     If the applicant or project sponsor is a current or past 
recipient of assistance under a HUD McKinney Act program or the HUD 
Single Family Property Disposition Homeless Program, there must be no 
project or construction delay, HUD finding, or outstanding audit that 
HUD deems serious regarding the administration of HUD McKinney Act 
programs or the HUD Single Family Property Disposition Homeless 
Program; and
     The applicant and project sponsors must be in compliance 
with applicable civil rights laws and Executive Orders.
    The Department will use the following standards to assess 
compliance with civil rights laws at the threshold review. In making 
this assessment, the Department shall review appropriate records 
maintained by the Office of Fair Housing and Equal Opportunity, e.g., 
records of monitoring, audit, or compliance review findings, complaint 
determinations, compliance agreements, etc. If the review reveals the 
existence of any of the following, the application will be rejected.
    (1) There is pending civil rights suit against the sponsor 
instituted by the Department of Justice.
    (2) There is an outstanding finding of noncompliance with civil 
rights statutes, Executive Orders or regulations as result of formal 
administrative proceedings, unless the applicant is operating under a 
HUD-approved compliance agreement designed to correct the area of 
noncompliance, or is currently negotiating such an agreement with the 
Department.
    (3) There is an unresolved Secretarial charge of discrimination 
issued under Section 810(g) of the Fair Housing Act, as implemented by 
24 CFR 103.400.
    (4) There has been adjudication of a civil rights violation in a 
civil action brought against it by a private individual, unless the 
applicant is operating in compliance with a court order designed to 
correct the area of noncompliance or the applicant has discharged any 
responsibility arising from such litigation.
    (5) There has been a deferral of the processing of applications 
from the sponsor imposed by HUD under Title VI of the Civil Rights Act 
of 1964, the Attorney General's Guidelines (28 CFR 50.3) or the HUD 
Title VI regulations (24 CFR 1.8) and procedures, or under Section 504 
of the Rehabilitation Act of 1973 and the HUD Section 504 regulations 
(24 CFR 8.57).
    (2) Project eligibility and quality. Each project will be reviewed 
to determine if it meets the following eligibility and threshold 
quality standards. If HUD determines the following standards are not 
met by a specific project or activity, the project or activity will be 
rejected from the competition.
     The population to be served must meet the eligibility 
requirements of the specific program, as described in the application 
instructions;
     The activity(ies) for which assistance is requested must 
be eligible under the specific program, as described in the program 
regulations;
     The housing and services proposed must be appropriate to 
the needs of the persons to be served. HUD may find a project to be 
inappropriate if:

--The type and scale of the housing or services clearly does not fit 
the needs of the proposed participants (e.g., housing homeless families 
with children in the same space as homeless individuals, or separating 
members of the same family, without an acceptable rationale provided);
--Participant safety is not addressed;
--Participants will have little or no involvement in decision-making 
and project operations
--The housing or services are clearly designed to principally meet 
emergency needs rather than helping participants achieve self-
sufficiency;
--Transportation and community amenities are not available and 
accessible; or
--Housing accessibility in accordance with applicable laws for persons 
with disabilities is not addressed;

     The project must be cost-effective in HUD's opinion, 
including costs associated with construction, operations, and 
administration, with such costs not deviating substantially from the 
norm in that locale for the type of structure or kind of activity.
     Supportive services only projects, and all others, must 
show how participants will be helped to access permanent housing and 
achieve self-sufficiency.
     For the Section 8 SRO program, at least 25 percent of the 
units to be assisted at any one site must be vacant at the time of 
application;
     For those projects proposed under the SHP innovative 
category: Whether or not a project is considered innovative will be 
determined on the basis that the particular approach proposed is new to 
the area, is a sensible model for others, and can be replicated; and
     HUD will also find one or more of these standards not to 
have been met if there is insufficient information provided in the 
application on which to make a determination.
    (3) Continuum of Care. Up to 60 points will be awarded as follows:
    (i) Process and Strategy. Up to 30 points will be awarded based on 
the

[[Page 17028]]

extent to which the application demonstrates:
     The existence of a quality and inclusive community 
process, including organizational structure(s), for developing and 
implementing a Continuum of Care strategy which includes nonprofit 
organizations (such as veterans service organizations, other 
organizations representing persons with disabilities, and other groups 
serving homeless persons), State and local governmental agencies, other 
homeless providers, housing developers and service providers, private 
foundations, local businesses and the banking community, neighborhood 
groups, and homeless or formerly homeless persons, as articulated in 
section I(d) of this NOFA; and
     That a quality and comprehensive strategy has been 
developed which addresses the components of a Continuum of Care system 
(i.e., outreach, intake, and assessment; emergency shelter; 
transitional housing; permanent and permanent supportive housing) and 
that strategy has been designed to serve all homeless subpopulations in 
the community (e.g., seriously mentally ill, persons with multiple 
diagnoses, veterans), including those persons living in emergency 
shelters, supportive housing for homeless persons, or in places not 
designed for, or ordinarily used as, a regular sleeping accommodation 
for human beings. For S+C, the strategy receives more points based on 
the extent to which S+C activities will serve homeless persons who are 
seriously mentally ill, have chronic alcohol and/or substance abuse 
issues, or have AIDS and related diseases.
    (ii) Gaps and Priorities. Up to 20 points will be awarded based on 
the extent to which the application:
     Establishes the relative priority of homeless needs 
identified in the Continuum of Care strategy; and
     Proposes projects that are consistent with the priority 
analysis described in the Continuum of Care strategy.
    (iii) Supplemental Resources. Up to 10 points will be awarded based 
on the extent to which the application demonstrates leveraging of funds 
requested under this NOFA with other resources, including private, 
other public, and mainstream services and housing programs.
    (iv) 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 Continuum of Care 
strategy for the Dallas area 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 Continuum of Care score 
based on this consideration.
    (4) Need. Up to 40 points will be awarded for need. There is a 
three-step approach to determining the need scores to be awarded to 
projects:
    (i) Determining relative need: To determine the homeless assistance 
need of a particular jurisdiction, HUD will use nationally available 
data, including the following factors as used in the Emergency Shelter 
Grants program: data on poverty, housing overcrowding, population, age 
of housing, and growth lag. Applying those criteria to a particular 
jurisdiction provides an estimate of the relative need index for that 
jurisdiction compared to other jurisdictions applying for assistance 
under this NOFA.
    (ii) Applying relative need: That relative need index is then 
applied to the total amount of funding estimated to be available under 
this NOFA to determine a jurisdiction's pro rata need. HUD reserves the 
right to adjust pro rata need if necessary to address the issue of 
project renewals.
    (iii) Awarding need points to projects: Once the pro rata need is 
established, it is applied against the priority project list in the 
application. Starting from the highest priority project, HUD proceeds 
down the list to include those projects whose total funding equals that 
jurisdiction's pro rata need. Those priority projects which fall within 
that pro rata need each receive the full 40 points for need. 
Thereafter, HUD proceeds further down the priority project list until 
two (2) times the pro rata need is reached and each of those projects 
receive 20 points. Remaining projects each receive 10 points.
    If an application does not prioritize projects, each project will 
receive 10 points for Need.
    In the case of competing applications from a single jurisdiction or 
service area, projects in the application that received the highest 
score out of the possible 60 points for Continuum of Care are eligible 
for up to 40 points under Need. Projects in the competing applications 
with less effective Continuum of Care strategies are eligible for only 
10 points under Need.
    (5) Ranking. The score for Continuum of Care will be added to the 
Need score in order to obtain a total score for each project. The 
projects will then be ranked from highest to lowest according to the 
total combined score. A bonus of 3 points will be added in determining 
the final score of any project that will be located within the 
boundaries of a federal Empowerment Zone (EZ) or Enterprise Community 
(EC) if priority placement will be given by the project to homeless 
persons living on the streets or in shelters within the EZ or EC, or 
whose last known address was within the EZ or EC. A bonus of 2 points 
will be added in determining the final score of any project that will 
make use of surplus military buildings or properties located on a 
military base that is covered by the provisions of the Base Closure 
Community Redevelopment and Homeless Assistance Act of 1994.
    (6) Conditional selection. Whether a project is conditionally 
selected, as described in section IV below, will depend on its overall 
ranking compared to others, except that HUD reserves the right to 
select lower rated projects if necessary to achieve geographic 
diversity.
    HUD also reserves the right to break ties among projects by 
determining which project will best achieve the purposes described in 
the preceding sentence, or to fund a project at less than the full 
amount requested.
    In the event of an error that, when corrected, would result in 
selection of an otherwise eligible project during the funding round 
under this NOFA, one remedy may be that HUD selects that project to the 
extent funds are available.
    (7) Additional selection considerations. HUD will also apply the 
limitations on funding described below in making conditional 
selections.
    In accordance with section 429 of the McKinney Act, as amended, HUD 
will award Supportive Housing funds as follows: not less than 25 
percent for projects that primarily serve homeless families with 
children; not less than 25 percent for projects that primarily serve 
homeless persons with disabilities; and not less than 10 percent for 
supportive services not provided in conjunction with supportive 
housing. After projects are rated and ranked, based on the criteria 
described above, HUD will determine if the conditionally selected 
projects achieve these minimum percentages. If not, HUD will skip 
higher-ranked projects in a category for which the minimum percent has 
been achieved in order to achieve the minimum percent for another 
category. If there are an insufficient number of conditionally selected 
projects in a

[[Page 17029]]

category to achieve its minimum percent, the unused balance will be 
used for the next highest-ranked approvable Supportive Housing project.
    In accordance with section 463(a) of the McKinney Act, as amended 
by the 1992 Act, at least 10 percent of Shelter Plus Care funds will be 
awarded for each of the four components of the program: Tenant-based 
Rental Assistance; Sponsor-based Rental Assistance; Project-based 
Rental Assistance; and Section 8 Moderate Rehabilitation of Single Room 
Occupancy Dwellings for Homeless Individuals (provided there are 
sufficient numbers of approvable projects to achieve these 
percentages). After projects are rated and ranked, based on the 
criteria described below, HUD will determine if the conditionally 
selected projects achieve these minimum percentages. If necessary, HUD 
will skip higher-ranked projects for a component for which the minimum 
percent has been achieved in order to achieve the minimum percent for 
another component. If there are an insufficient number of approvable 
projects in a component to achieve its minimum percent, the unused 
balance will be used for the next highest-ranked approvable Shelter 
Plus Care project.
    In accordance with section 455(b) of the McKinney Act, no more than 
10 percent of the assistance made available for Shelter Plus Care in 
any fiscal year may be used for programs located within any one unit of 
general local government.
    In accordance with section 441(c) of the McKinney Act, no city or 
urban county may have Section 8 SRO projects receiving a total of more 
than 10 percent of the assistance made available under this program.
    This year's NOFA does not make available specific amounts for the 
three programs covered by the NOFA. Instead, distribution is demand-
driven. However, potential applicants need to be able to plan for their 
project proposals. Therefore, HUD is defining the 10 percent 
availability this fiscal year as $10 million for Shelter Plus Care and 
$10 million for Section 8 SRO. The $10 million number is based on past 
experience of the distribution of the total funds made available for 
HUD homeless assistance programs. However, if the amount awarded under 
either of these two programs exceeds $100 million, then the amount 
awarded to any one unit of general local government (for purposes of 
the Shelter Plus Care program) or city or urban county (for the 
purposes of the SRO program) could be up to 10 percent of the actual 
total amount awarded for that program.
    Lastly, HUD reserves the right to reduce the amount of a grant if 
necessary to ensure that no more than 10 percent of assistance made 
available under this NOFA will be awarded for projects located within 
any one unit of general local government or within the geographic area 
covered by any one Continuum of Care. If HUD exercises a right it has 
reserved under this NOFA, that right will be exercised uniformly across 
all applications received in response to this NOFA.
(b) Clarification of Application Information
    In accordance with the provisions of 24 CFR part 4, subpart B, HUD 
may contact an applicant to seek clarification of an item in the 
application, or to request additional or missing information, but the 
clarification or the request for additional or missing information 
shall not relate to items that would improve the substantive quality of 
the application pertinent to the funding decision.

IV. Funding Award Process

    HUD will notify conditionally selected applicants in writing. As 
necessary, HUD will subsequently request them to submit additional 
project information, which may include documentation to show the 
project is financially feasible; documentation of firm commitments for 
cash match; documentation showing site control; information necessary 
for HUD to perform an environmental review, where applicable; and such 
other documentation as specified by HUD in writing to the applicant, 
that confirms or clarifies information provided in the application. SRO 
and S+C/SRO applicants will be notified of the date of the two month 
deadline for submission of such information; other S+C applicants and 
all SHP applicants will be notified of the date of the one month 
deadline for submission of such information. If an applicant is unable 
to meet any conditions for fund award within the specified timeframe, 
HUD reserves the right not to award funds to the applicant, but instead 
to either: use them to select the next highest ranked application(s) 
from the original competition for which there are sufficient funds 
available; or add them to funds available for the next competition for 
the applicable program.

V. Program Limitations

    (a) SRO program. Applicants need to be aware of the following 
limitations that apply to the Section 8 SRO program:
     Under section 8(e)(2) of the United States Housing Act of 
1937, no single project may contain more than 100 units;
     Under 24 CFR 882.802, applicants that are private 
nonprofit organizations must subcontract with a Public Housing 
Authority to administer the SRO assistance;
     Under section 8(e)(2) of the United States Housing Act of 
1937 and 24 CFR 882.802, rehabilitation must involve a minimum 
expenditure of $3,000 for a unit, including its prorated share of work 
to be accomplished on common areas or systems, to upgrade conditions to 
comply with the Housing Quality Standards.
     Under section 441(e) of the McKinney Act and 24 CFR 
882.805(g)(1), HUD publishes the SRO per unit rehabilitation cost limit 
each year to take into account changes in construction costs. This cost 
limitation applies to rehabilitation that is compensated for in a 
Housing Assistance Payments Contract. For purposes of Fiscal Year 1997 
funding, the cost limitation is raised from $16,500 to $16,900 per unit 
to take into account increases in construction costs during the past 
12-month period.
    (b) Shelter Plus Care/Section 8 SRO Component. With regard to the 
SRO component of the Shelter Plus Care program, applicant States, units 
of general local government and Indian tribes must subcontract with a 
Public Housing Authority to administer the Shelter Plus Care 
assistance. Also with regard to this component, no single project may 
contain more than 100 units.

VI. Timeliness Standards

    Applicants are expected to initiate their approved projects 
promptly. If implementation difficulties occur, applicants need to be 
aware of the following timeliness standards:
    (a) Supportive Housing Program.
     HUD will deobligate SHP funds if site control has not been 
demonstrated within one (1) year after initial notification of the 
grant award, as provided in 24 CFR 583.320(a), subject to the 
exceptions noted in that regulation.
     Except where HUD finds that delay was due to factors 
beyond the control of the grantee, HUD will deobligate SHP funds if the 
grantee does not meet the following additional timeliness standards:

--Construction activities must begin within eighteen (18) months after 
initial notification of the grant award

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and be completed within thirty-six (36) months after that notification.
--For activities that cannot begin until construction activities are 
completed, such as supportive service or operating activities that will 
be conducted within the building being rehabilitated or newly 
constructed, these activities must begin within three (3) months after 
the construction is completed.
--For all activities that may proceed independent of construction 
activities, these activities must begin within twelve (12) months after 
initial notification of the grant award.

    (b) Shelter Plus Care Program Components Except SRO Component. 
Except where HUD finds that delay was due to factors beyond the control 
of the grantee, HUD will deobligate S+C funds if the grantee does not 
meet the following timeliness standards:
     For Tenant-based Rental Assistance, for Sponsor-based 
Rental Assistance, and for Project-based Rental Assistance without 
rehabilitation, the rental assistance must begin within twelve (12) 
months of the initial announcement of the grant award.
     For Project-based Rental Assistance with rehabilitation, 
the rehabilitation must be completed within twelve (12) months of 
initial notification of the grant award.
    (c) SRO Program and SRO Component of the Shelter Plus Care Program.
    For projects carried out under the SRO program and the SRO 
component of the S+C program, the rehabilitation work must be completed 
and the Housing Assistance Payments contract executed within twelve 
(12) months of execution of the Annual Contributions Contract. HUD may 
reduce the number of units or the amount of the annual contribution 
commitment if, in the determination of HUD, the Public Housing 
Authority fails to demonstrate a good faith effort to adhere to this 
schedule.

VII. Linking Supportive Housing Programs and AmeriCorps

    Applicants for the Supportive Housing Program are encouraged to 
link their proposed projects 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 SHP partnerships, call the Corporation for National 
Service at (202) 606-5000 extension 486.

VIII. Other Matters

    Performance Measures. The grant agreement or Annual Contributions 
Contract to be executed by HUD and the award recipient will contain 
performance measures.
    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 the Interior and 
Related Agencies Appropriations Act for Fiscal Year 1990 (31 U.S.C. 
1352) (the ``Byrd Amendment'') and the 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 
sub-recipients 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.
    Applicants for funding under this NOFA are subject to the 
provisions of Section 319 of the Department of the Interior and Related 
Agencies Appropriation Act for Fiscal Year 1991, 31 U.S.C. 1352 (the 
Byrd Amendment), which prohibits applicants 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.
    Environmental Impact. This NOFA provides funding under, and does 
not alter the environmental requirements of, regulations in 24 CFR 
parts 582, 583 and 882, subpart H. Accordingly, under 24 CFR 
50.19(c)(5), this NOFA is categorically excluded from environmental 
review under the National Environmental Policy Act of 1969 (42 U.S.C. 
4321). Conditional selection of projects under this NOFA is subject to 
the environmental review requirements under 24 CFR 582.230, 583.230 and 
882.804(c), as applicable.
    Executive Order 12606, The Family. The General Counsel, as the 
Designated Official under Executive Order 12606, The Family, has 
determined that the policies announced in this Notice would have a 
significant impact on the formation, maintenance, and general well-
being of families, but since this impact would be beneficial, no 
further analysis under the Order is necessary.
    Executive Order 12612, Federalism. The General Counsel has 
determined, as the Designated Official for HUD under section 6(a) of 
Executive Order 12612, Federalism, that the policies contained in this 
Notice will not have federalism implications and, thus, are not subject 
to review under the Order. The promotion of activities and policies to 
end homelessness is a recognized goal of general benefit without direct 
implications on the relationship between the national government and 
the states or on the distribution of power and responsibilities among 
various levels of government.
    Drug-Free Workplace Certification. The Drug-Free Workplace Act of 
1988 requires grantees of Federal agencies to certify that they will 
provide drug-free workplaces. Thus, each applicant must certify that it 
will comply with drug-free workplace requirements in accordance with 24 
CFR part 24, subpart F.
    Accountability in the Provision of HUD Assistance. Section 102 of 
the Department of Housing and Urban Development Reform Act of 1989 (HUD 
Reform Act) and the final rule codified at 24 CFR part 4, subpart A, 
published on April 1, 1996 (61 FR 1448), 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, HUD published, at 57 FR 1942, a notice that also 
provides information on the implementation of section 102. The 
documentation, public access, and disclosure requirements of section 
102 are applicable to assistance awarded under this NOFA as follows:
    Documentation and public access requirements. HUD 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 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

[[Page 17031]]

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.
    Disclosures. HUD will make available to the public for five years 
all applicant disclosure reports (HUD Form 2880) submitted in 
connection with this NOFA. Update reports (also Form 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.
    Section 103 HUD Reform Act. Section 103 of the Department of 
Housing and Urban Development Reform Act of 1989, and HUD's 
implementing regulation codified at subpart B of 24 CFR part 4, applies 
to the funding competition announced today. These requirements 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 section 103 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 section 103 and subpart B of 24 CFR part 
4.
    Applicants or employees who have HUD Reform Act or other ethics 
related questions should contact the HUD's Ethics Law Division (202) 
708-3815. (This is not a toll-free number.)

    Authority: 42 U.S.C. 11403 note; 42 U.S.C. 11389; 42 U.S.C. 
1437a, 1437c, and 1437f; 42 U.S.C. 3535(d); 24 CFR parts 582, 583, 
and 882.

    Dated: April 3, 1997.
Jacquie Lawing,
General Deputy Assistant Secretary for Community Planning and 
Development.

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[FR Doc. 97-9034 Filed 4-7-97; 8:45 am]
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