[Federal Register Volume 72, Number 237 (Tuesday, December 11, 2007)]
[Notices]
[Pages 70472-70474]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-24002]



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Part V





Department of Housing and Urban Development





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Allocations and Requirements for the Supplemental Grant to the State of 
Louisiana Under Division B of the Department of Defense Appropriations 
Act, 2008; Notice

  Federal Register / Vol. 72, No. 237 / Tuesday, December 11, 2007 / 
Notices  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5183-N-01]


Allocations and Requirements for the Supplemental Grant to the 
State of Louisiana Under Division B of the Department of Defense 
Appropriations Act, 2008

AGENCY: Office of the Secretary, HUD.

ACTION: Notice of allocation and requirements.

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SUMMARY: This Notice advises the public of the allocation of a $3 
billion Community Development Block Grant (CDBG) disaster recovery 
grant to the State of Louisiana solely for the purpose of covering 
costs associated with otherwise uncompensated but eligible claims that 
were filed on or before July 31, 2007, under the Road Home homeowner 
compensation program administered by the State in accordance with plans 
approved by the Secretary. As described in the Supplementary 
Information section of this notice, HUD has determined that the State 
shall follow the requirements applicable to the other CDBG disaster 
recovery grants funding the Road Home homeowner compensation program, 
unless those requirements conflict with the requirements of section 159 
of Public Law 110-116, in which case the requirements of that law 
apply.

DATES: Effective Date: December 11, 2007.

FOR FURTHER INFORMATION CONTACT: Jessie Handforth Kome, Director, 
Disaster Recovery and Special Issues Division, Office of Block Grant 
Assistance, Department of Housing and Urban Development, 451 Seventh 
Street, SW., Room 7286, Washington, DC 20410, telephone number (202) 
708-3587. Persons with hearing or speech impairments may access this 
number via TTY by calling the Federal Information Relay Service at 
(800) 877-8339. Fax inquiries may be sent to Ms. Kome at (202) 401-
2044. (Except for the ``800'' number, these telephone numbers are not 
toll-free.)

SUPPLEMENTARY INFORMATION:

Program Requirements

    Except as described in Public Law 110-116 and in this and other 
notices applicable to this grant, statutory and regulatory provisions 
governing the Community Development Block Grant program for states, 
including those at 24 CFR part 570, shall apply to the use of these 
funds.
    The stated purpose of the supplemental appropriation is:
* * * solely for the purpose of covering costs associated with 
otherwise uncompensated but eligible claims that were filed on or 
before July 31, 2007, under the Road Home program administered by 
the State in accordance with plans approved by the Secretary.

    The conference report clarifies that these funds are for costs 
associated with the Road Home homeowner compensation program and not 
for any other Road Home program. Public Law 110-116 further stipulates 
that the funds must ``serve only to supplement and not supplant any 
other State or Federal resources committed to the Road Home program.''
    On review of Public Law 110-116, HUD has determined these funds 
must be used in accordance with the same CDBG disaster recovery program 
requirements that apply to the Road Home homeowner compensation program 
under law, regulation, and Notice unless those requirements conflict 
with the requirements of Public Law 110-116, in which case the 
stipulations of that supplemental law shall apply. This means, for 
example, that:
     The State must only use the funds for costs eligible under 
the Road Home homeowner compensation program under the Action Plans for 
Disaster Recovery (Action Plans) for the grants made under Public Laws 
109-148 and 109-234, as those plans have been amended and accepted by 
HUD and in accordance with Public Law 110-116;
     The State may assume the responsibility for environmental 
review related to this grant in accordance with 24 CFR part 58;
     Because this grant is additional funding for activities 
included in approved Action Plans, this Notice requires that the amount 
of CDBG disaster recovery and State funds must remain at or above the 
allocations for the homeowner compensation program as of the date the 
law is effective until funds for the costs associated with the last 
eligible homeowner compensation claim are assigned by the State;
     On a quarterly basis, the State must report to HUD on the 
grant in the disaster recovery grant reporting system;
     The same CDBG disaster recovery financial standards and 
requirements apply to this grant as applied to the two preceding CDBG 
disaster recovery grants to the State;
     The same CDBG property disposition requirements apply to 
properties assisted or acquired with this grant; and
     HUD will apply the same actions to prevent fraud, waste, 
and abuse of funds related to this grant as it is applying to the 
previous CDBG disaster recovery grants.
    As noted, in general, CDBG waivers already granted to the State and 
alternative requirements already specified for CDBG disaster recovery 
grant funds provided under Public Law 109-148 and under Public Law 109-
234 also apply to grant funds provided under Public Law 110-116. This 
eliminates unnecessary inconsistencies in administration of the three 
grants and, thus, reduces the opportunities for technical errors. The 
notices in which these prior waivers and alternative requirements 
appear are 71 FR 7666, published February 13, 2006 (all five states); 
71 FR 34451 (for Louisiana), published June 14, 2006; 71 FR 63337, 
published October 30, 2006 (all five states); 72 FR 10014, published 
March 6, 2007 (for Louisiana); and 72 FR 48804, published August 24, 
2007 (all five states). In addition to the requirements imposed by HUD, 
all other requirements of the Road Home homeowner compensation program 
shall apply to the use of these funds. Specifically, it is HUD's 
understanding that the State set a deadline of December 1, 2007, for 
those homeowners who applied by July 31, 2007, to schedule an 
appointment with the Road Home program to complete the application and 
begin the verification process. HUD expects the State to adhere to this 
deadline. The State may not extend this deadline without prior HUD 
approval.
    The Road Home homeowner compensation program includes an elevation 
component, which is eligible under CDBG, but was intended by the 
program designers to be funded primarily through a Federal Emergency 
Management Agency (FEMA) program. Therefore, HUD expects the State of 
Louisiana to continue to work constructively with FEMA to access the 
available Hazard Mitigation Grant Program funding for elevation 
activities.
    The provisions of this notice do not apply to funds provided to the 
states under the regular CDBG program.

Allocations

    Public Law 110-116 (effective November 13, 2007) provides $3 
billion of supplemental appropriation for the State of Louisiana CDBG 
program solely for:

the purpose of covering costs associated with otherwise 
uncompensated but eligible claims that were filed on or before July 
31, 2007, under the Road Home program administered by the State in 
accordance with plans approved by the Secretary.

    As further provided for in Public Law 110-116, the funds may only 
be used to supplement and not supplant any other

[[Page 70473]]

State or federal resources committed to the Road Home homeowner 
compensation program. No funds shall be drawn from the U.S. Treasury 
beyond those necessary to fulfill this exclusive purpose. To ensure 
compliance with this limitation, the Department will make the grant 
under this Notice, but will restrict the use of the grant funds in the 
State's line of credit until the State has certified to HUD that all 
CDBG funds approved for the same purposes in the Action Plans for 
Disaster Recovery under each preceding CDBG disaster recovery grant (as 
of November 13, 2007, amounts budgeted from the grant under Public Law 
109-148 equal $4,035,090,868 and those under the Public Law 109-234 
grant equal $2,955,361,750), along with the $372.5 million of 
additional state-appropriated funds pledged to the Road Home homeowner 
compensation program, have already been assigned by the State for 
eligible costs under that program. The State will demonstrate this 
assignment by documenting payment requests from its contractor for 
costs associated with Option 1 claims that have already closed or for 
costs associated with Option 2 or 3 claims that are scheduled for 
closing. The payment requests must document costs associated with 
homeowner compensation claims that are sufficient to exhaust funds 
budgeted for homeowner compensation in the Public Law 109-148 and 
Public Law 109-234 grants and the $372.5 million in cash budgeted by 
the State. On receiving the signed certification from the State, HUD 
will permit drawdowns under this grant to commence. This assignment and 
certification process will allow HUD and the State to comply with the 
law without slowing the flow of funds to homeowners and without undue 
burden to the State program administrators. HUD will monitor compliance 
with this direction and may be compelled to disallow expenditures if it 
finds uses of funds are not in compliance with this provision.

Prevention of Fraud, Abuse, and Duplication of Benefits

    The previous supplemental appropriations statutes (Public Laws 109-
148 and 109-234) also directed the Secretary to:

Establish procedures to prevent recipients from receiving any 
duplication of benefits and report quarterly to the Committees on 
Appropriations with regard to all steps taken to prevent fraud and 
abuse of funds made available under this heading including 
duplication of benefits.
    The grant under this Notice will be subject to the courses of 
action HUD is already undertaking for the two previous grants to the 
State. To meet this directive, HUD is pursuing five courses of action. 
First, this Notice makes applicable specific reporting, written 
procedures, monitoring, and internal audit requirements for grantees. 
Second, to the extent its resources allow, HUD will institute risk 
analysis and on-site monitoring of grantee management of the grants and 
of the specific uses of funds. Third, HUD will be extremely cautious in 
considering any waiver related to basic financial management 
requirements. HUD's standard, time-tested CDBG financial requirements 
will continue to apply. Fourth, HUD is collaborating with the HUD 
Office of Inspector General to plan and implement oversight of these 
funds. Fifth, HUD is applying $6 million for immediate enhancement of 
the capabilities of the Disaster Recovery Grant Reporting system by 
building additional electronic controls to increase accountability 
while further decreasing the risk of fraud, waste, or abuse of funds.

Application for Allocation

    The general requirements related to a state's application for its 
allocation are those delineated in a notice entitled, ``Allocations and 
Common Application and Reporting Waivers Granted to and Alternative 
Requirements for CDBG Disaster Recovery Grantees Under the Department 
of Defense Appropriations Act, 2006,'' published February 13, 2006, at 
71 FR 7666. HUD invites the State of Louisiana to submit an 
application, including a Standard Form 424 and the appropriate CDBG 
disaster recovery certifications as listed in that Notice. Public Law 
110-116 stipulates that this grant is governed by the State's Action 
Plans for the Road Home homeowner compensation program. Adding the 
additional program funding constitutes an amendment to the program 
covered by these plans, but because of the specificity of the law 
regarding the uses of funds, HUD has determined that the Action Plans 
taken together are drafted so that this funding increase, large as it 
is, does not meet the substantial amendment definition in the Notice 
cited above.

Applicable Rules, Statutes, Waivers, and Alternative Requirements

    1. General requirements.  Except as described in this Notice, the 
statutory, regulatory, and notice provisions that shall apply to the 
use of these funds are:
    a. Those governing the funds appropriated under the Appropriations 
Act and already published in the Federal Register, including those in 
notices 71 FR 7666, published February 13, 2006 (for all five states); 
71 FR 34451 (for Louisiana), published June 14, 2006; 71 FR 63337, 
published October 30, 2006 (all five states); 72 FR 10014, published 
March 6, 2007 (for Louisiana); and 72 FR 48804, published August 24, 
2007 (all five states); and
    b. Those governing the CDBG program for states, including those at 
42 U.S.C. 5301 et seq. and 24 CFR part 570.
    c. In addition to the requirements imposed by HUD, all other 
requirements of the Road Home homeowner compensation program shall 
apply to the use of these funds. Specifically, it is HUD's 
understanding that the State set a deadline of December 1, 2007, for 
those homeowners who applied by July 31, 2007, to schedule an 
appointment with the Road Home program to complete the application and 
begin the verification process. HUD expects the State to adhere to this 
deadline. The State may not extend this deadline without prior HUD 
approval.
    2. Use of grant funds.
    a. Public Law 110-116 requires that activities funded under this 
Notice be used solely for the purpose of covering costs associated with 
otherwise uncompensated but eligible claims that were filed on or 
before July 31, 2007 under the Road Home homeowner compensation program 
administered by the State in accordance with its CDBG Action Plans. To 
the extent that the requirements of Public Law 110-116 conflict with 
the requirements listed in paragraph 1 of this Notice, the requirements 
of Public Law 110-116 will apply.
    b. Further, grant funds must serve only to supplement and not 
supplant any other state or federal resources committed to the Road 
Home program. Before the Department will permit the State to draw down 
grant funds, the State must certify to HUD, in writing, that all CDBG 
funds approved for the same purposes in the Action Plans under the 
grants made under Public Laws 109-148 and 109-234 and the $372.5 
million in additional state funds pledged to the Road Home homeowner 
compensation program already have been assigned or expended by the 
State for costs associated with the homeowner compensation program. The 
State will demonstrate the assignment of funds by documenting payment 
requests from the contractor for costs associated with Option 1 claims 
that have already closed or for costs associated with Option 2 or 3 
claims that are scheduled for closing. The payment requests must 
document total costs associated with homeowner compensation claims that 
are sufficient to exhaust funds budgeted

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for homeowner compensation in the Public Law 109-148 and Public Law 
109-234 grants and the $372.5 million in cash budgeted by the State. On 
receiving the signed certification from the State, HUD will permit the 
State to begin making draw downs under this grant.
    c. The amount of CDBG disaster recovery funds budgeted for the 
homeowner compensation program must remain at or above the current 
Actions Plan allocations for the homeowner compensation program as of 
the date the law is effective until the costs associated with the last 
eligible homeowner compensation claim are assigned.
    3. De-obligation of unused grant funds.  If grant funds under 
Public Law 110-116 remain after all costs associated with Road Home 
homeowner compensation claims that were filed on or before July 31, 
2007, have been paid, those remaining funds shall be de-obligated by 
HUD.
    4. Information collection approval note.  HUD has approval for 
information collection requirements in accordance with the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501-3520) under Office of Management 
and Budget (OMB) control number 2506-0165 . In accordance with the 
Paperwork Reduction Act, HUD may not conduct or sponsor, nor is a 
person required to respond to, a collection of information unless the 
collection displays a valid control number.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance numbers for the disaster 
recovery grants under this Notice are as follows: 14.219; 14.228.

Finding of No Significant Impact

    A Finding of No Significant Impact (FONSI) with respect to the 
environment has been made in accordance with HUD regulations at 24 CFR 
part 50, which implement section 102(2)(C) of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4332). The FONSI is 
available for public inspection between 8 a.m. and 5 p.m. weekdays in 
the Office of the Rules Docket Clerk, Office of General Counsel, 
Department of Housing and Urban Development, 451 Seventh Street, SW., 
Room 10276, Washington, DC 20410-0500. Due to security measures at the 
HUD Headquarters building, please schedule an appointment to review the 
finding by calling the Regulations Division at (202) 708-3055 (this is 
not a toll-free number).

    Dated: December 5, 2007.
Roy A. Bernardi,
Deputy Secretary.
 [FR Doc. E7-24002 Filed 12-10-07; 8:45 am]
BILLING CODE 4210-67-P