[Federal Register Volume 73, Number 240 (Friday, December 12, 2008)]
[Notices]
[Pages 75733-75738]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-29426]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5251-N-01]


Reconsideration of Waivers Granted to and Alternative 
Requirements for the State of Mississippi's CDBG Disaster Recovery 
Grant Under the Department of Defense Emergency Supplemental 
Appropriations To Address Hurricanes in the Gulf of Mexico, and 
Pandemic Influenza Act, 2006

AGENCY: Office of the Secretary, HUD.

ACTION: Notice of reconsidered waivers, alternative requirements, and 
statutory program requirements.

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SUMMARY: This notice describes HUD's reconsideration of some of the 
additional waivers and alternative requirements applicable to the 
Community Development Block Grant (CDBG) disaster recovery grant 
provided to the State of Mississippi for the purpose of assisting in 
the recovery in the most impacted and distressed areas related to the 
consequences of Hurricane Katrina in 2005. HUD previously published an 
allocation and application notice on February 13, 2006, applicable to 
this grant and four others under the same appropriation, and 
reconsidered the waivers in that notice on August 8, 2008. The original 
June 14, 2006, notice has now been reconsidered and all waivers are 
being retained, with the exception of some of the overall benefit 
waivers.

DATES: Effective Date: December 17, 2008.

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 20410-7000, 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. Facsimile 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:

Authority To Grant Waivers

    The Department of Defense, Emergency Supplemental Appropriations To 
Address Hurricanes in the Gulf of Mexico, and Pandemic Influenza Act, 
2006 (Pub. L. 109-148, approved December 30, 2005) (the 2006 Act) 
appropriated $11.5 billion in CDBG funds for necessary expenses related 
to disaster relief, long-term recovery, and restoration of 
infrastructure directly related to the consequences of the covered 
disasters. The State of Mississippi received an allocation of 
$5,058,185,000 from this appropriation. The 2006 Act authorized the 
Secretary to waive, or specify alternative requirements for, any 
provision of any statute or regulation that the Secretary administers 
in connection with the obligation by the Secretary or use by the 
recipient of these funds and guarantees, except for requirements 
related to fair housing, nondiscrimination, labor standards, and the 
environment, upon a request by the State and a finding by the Secretary 
that such a waiver would not be inconsistent with the overall purpose 
of the statute. The law further provided that the Secretary may waive 
the requirement that activities benefit persons of low and moderate 
income, except that at least 50 percent of the funds granted must 
benefit primarily persons of low and moderate income, unless the 
Secretary otherwise makes a finding of compelling need. Additionally, 
regulatory waiver authority is provided by 24 CFR 5.110. The following 
waivers and alternative requirements came in response to written 
requests from the State of Mississippi and are being retained, with the 
exception of some of the overall benefit waivers, after 
reconsideration.
    The Secretary has found that the following waivers and alternative 
requirements, as described below, are not inconsistent with the overall 
purpose of 42 U.S.C. 5301 et seq., Title I of the Housing and Community 
Development Act of 1974, as amended (the 1974 Act); or of 42 U.S.C. 
12704 et seq., the Cranston-Gonzalez National Affordable Housing Act, 
as amended.
    Under the requirements of the Department of Housing and Urban 
Development Act, as amended (42 U.S.C. 3535(q)), regulatory waivers 
must

[[Page 75734]]

be published in the Federal Register. The Department is also using this 
notice to provide information about other ways in which the 
requirements for this grant vary from regular CDBG program rules. 
Therefore, HUD is using this notice to make public alternative 
requirements and to note the applicability of disaster recovery-related 
statutory provisions. Compiling this information in a single notice 
creates a helpful resource for Mississippi grant administrators and HUD 
field staff. Waivers and alternative requirements regarding the common 
application and reporting process for all grantees under the 2006 Act 
were published in a prior notice published February 13, 2006 (71 FR 
7666) and retained in a notice published on August 8, 2008 (73 FR 
46312).
    Except as described in notices regarding this grant, the statutory 
and regulatory provisions governing the CDBG program for states, 
including those at 24 CFR part 570, shall apply to the use of these 
funds.

Descriptions of Changes

    This section of the notice briefly describes the basis for each 
waiver and provides an explanation of related alternative requirements, 
if additional explanation is necessary.
    Except as provided in the October 30, 2006, and August 8, 2008, 
notices, the waivers, alternative requirements, and statutory changes 
apply only to the CDBG supplemental disaster recovery funds 
appropriated in the 2006 Act and allocated to the State of Mississippi. 
These actions provide additional flexibility in program design and 
implementation and note statutory requirements unique to this 
appropriation.

Eligibility

    Eligibility--housing related. The waiver of section 105(a) that 
allows new housing construction and of section 105(a)(24) to allow 
homeownership assistance for families whose income is up to 120 percent 
of median income and payment of up to 100 percent of a housing 
downpayment is necessary following major disasters in which large 
numbers of affordable housing units have been damaged or destroyed, as 
is the case in the disaster eligible under this notice. The state 
requested that HUD broaden the section 105(a)(24) waiver to allow it to 
serve families with income up to 120 percent of median income to 
implement its Long Term Workforce Housing program in accordance with 
its accepted Action Plan for Disaster Recovery.
    General planning activities use entitlement presumption. The annual 
state CDBG program requires that local government grant recipients of 
planning-only grants must document that the use of funds meets a 
national objective. In the state CDBG program, these planning grants 
are typically used for individual project plans. By contrast, planning 
activities carried out by entitlement communities are more likely to 
include non-project specific plans such as functional land use plans, 
historic preservation plans, comprehensive plans, development of 
housing codes, and neighborhood plans related to guiding long-term 
community development efforts comprising multiple activities funded by 
multiple sources. In the annual entitlement program, these more general 
stand-alone planning activities are presumed to meet a national 
objective under the requirements at 24 CFR 570.208(d)(4). The 
Department noted that almost all effective CDBG disaster recoveries in 
the past have relied on some form of area-wide or comprehensive 
planning activity to guide overall redevelopment independent of the 
ultimate source of implementation funds. Therefore, the Department has 
removed the eligibility requirement that CDBG disaster recovery 
assisted planning-only grants or state directly administered planning 
activities that will guide recovery in accordance with the 
appropriations act, must comply with the state CDBG program rules at 24 
CFR 570.483(b)(5) or (c)(3).
    Compensation for disaster-related losses. The state is providing 
compensation to homeowners who lived outside the floodplain and whose 
homes were damaged by flooding during the covered disasters, if the 
homeowners agreed to meet the stipulations of the published program 
design. The state is also providing compensation to homeowners affected 
by the disaster in other circumstances, under Phase II and other 
aspects of the state's homeowner compensation program. The Department 
has waived the 1974 Act and associated regulations to make this use of 
grant funds eligible.
    Anti-pirating. The limited waiver of the anti-pirating requirements 
allowed the flexibility to provide assistance to a business located in 
another state or market area within the same state if the business was 
displaced from a declared area within the state by the disaster and the 
business wishes to return. This waiver is necessary to allow a grantee 
affected by a major disaster to rebuild its employment base.

Program Income

    A combination of CDBG provisions limited the flexibility available 
to the state for the use of program income. Prior to 2002, program 
income earned on disaster recovery grants was usually program income in 
accordance with the rules of the regular CDBG program of the applicable 
state and lost its disaster recovery grant identity, thus losing use of 
the waivers and streamlined alternative requirements. Also, the state 
CDBG program rule and law are designed for a program in which the state 
distributes all funds rather than carrying out activities directly. The 
1974 Act specifically provides for a local government receiving CDBG 
grants from a state to retain program income if it uses the funds for 
additional eligible activities under the annual CDBG program. The 1974 
Act allows the state to require return of the program income to the 
state under certain circumstances. The notice waived the existing 
statute and regulations to give the state, in all circumstances, the 
choice of whether or not a local government receiving a distribution of 
CDBG disaster recovery funds and using program income for activities in 
the Action Plan could retain this income and use it for additional 
disaster recovery activities. In addition, the notice allowed program 
income to the disaster recovery grant generated by activities 
undertaken directly by the state or its agent(s) to retain the original 
disaster recovery grant's alternative requirements and waivers and to 
remain under the state's discretion until grant closeout, at which 
point any program income on hand or received subsequently would become 
program income to the state's annual CDBG program. The alternative 
requirements provide all the necessary conforming changes to the 
program income regulations.

Relocation Requirements

    HUD provided and is continuing a limited waiver of the relocation 
requirements. HUD waived the one-for-one replacement of low- and 
moderate-income housing units demolished or converted using CDBG funds 
requirement for housing units damaged by one or more disasters. HUD has 
waived this requirement because it did not take into account the large, 
sudden changes a major disaster may cause to the local housing stock, 
population, or local economy.
    Further, the requirement did not take into account the threats to 
public health and safety and to economic revitalization that may be 
caused by the presence of disaster-damaged structures that are 
unsuitable for rehabilitation. Left unchanged, the requirement could 
have impeded disaster recovery and discouraged grantees from acquiring,

[[Page 75735]]

converting, or demolishing disaster-damaged housing because of 
excessive costs that would have resulted from replacing all such units 
within the specified time frame.
    HUD also waived the relocation benefits requirements contained in 
Section 104(d) of the 1974 Act to the extent they differ from those of 
the Uniform Relocation Assistance and Real Properties Acquisition Act 
of 1970 (42 U.S.C. 4601 et seq.). This change simplifies implementation 
while preserving statutory protections for persons displaced by 
projects assisted with CDBG disaster recovery grant funds.

Overall Benefit

    The waivers related to overall benefit in Mississippi were 
published in several previous notices. Because the waivers are 
inextricably interrelated and have common alternative requirements, HUD 
is reconsidering all of them at this point, as the reconsideration of 
the first of them is now required. The State complied fully with the 
alternative data collection requirements included with the original 
waivers and collected income information for all of its direct benefit 
activities, regardless of overall benefit waivers. This data, and the 
State's completion of the initial budgeting of all of its disaster 
recovery grant funds, provided HUD with enough information to determine 
whether the State still has the statutorily mandated ``compelling 
need'' for each of those previously granted waivers.
    A CDBG grantee uses its grant funds for eligible activities, such 
as rehabilitation of a single house, construction of a water and sewer 
line, providing childcare through a particular program, or making a 
loan to a small business. Each activity must demonstrate benefit by 
meeting one of the three national objectives of the CDBG program. These 
national objectives are:
    (1) Provide benefit to low- and moderate-income persons (low/mod 
activities);
    (2) prevent or eliminate slums or blight (slum/blight activities); 
or
    (3) address urgent community needs for which no other funding 
exists (urgent need activities).
    For purposes of reporting to HUD, the funds and performance of some 
types of activities, such as single family housing, may be aggregated. 
For example, Mississippi has been reporting quarterly on its single-
family homeowner compensation program under two categories, one that 
aggregates activity performance and costs for payments to low- and 
moderate-income households and one that aggregates payments made under 
the urgent need national objective.
    The regular CDBG program also subtotals the funds used for each 
national objective and compares the subtotals to the overall grant 
amount (minus general administration and planning costs) in a test 
called overall benefit. To meet the overall benefit test, the 
percentage of funds a grantee has expended for the subtotal of 
individual activities that meet the national objective of benefit to 
low- and moderate-income persons must be at least 70 percent of the 
total funds used for all activities (excluding general administration 
and planning costs).
    For the CDBG supplemental grants for recovery from the consequences 
of Hurricanes Katrina, Rita, and Wilma, HUD granted two kinds of 
overall benefit waivers. The first kind is common to all five state 
grantees. Published February 13, 2006, this waiver lowered the overall 
benefit threshold from 70 percent to 50 percent for each of the 
recovery grants under Public Law 109-148. The same waiver was made 
October 30, 2006, for the recovery grants under Public Law 109-234. 
These waivers were reconsidered and republished August 8, 2008. 
Therefore, absent an additional waiver, 50 percent of each Gulf Coast 
recovery grant governed by those notices must support activities that 
meet the low- and moderate-income national objective.
    The second kind of waiver granted for Gulf Coast recovery grants 
was only requested by the State of Mississippi and only then for the 
first recovery grant made under Public Law 109-148, not for the second 
grant. Between October 2006 and July 2008, Mississippi requested 
multiple additional waivers of the overall benefit requirement for its 
first grant and HUD provided some limited approvals for specific 
activities.
    The standard that Congress provided for granting an overall benefit 
waiver for a disaster recovery grant is ``compelling need'' for the 
waiver. HUD denied several blanket waiver requests for the overall 
benefit test primarily because the State had not yet budgeted enough of 
its grant to allow HUD to weigh the necessity for a blanket waiver.
    The additional waivers HUD granted provided that specified 
activities undertaken by Mississippi would not be considered in 
calculating the overall benefit test if such consideration would cause 
the State to fail to meet the requirement. Each of these waivers is 
only needed if the State needs the activity to continue its recovery 
and the State would be in noncompliance with the overall benefit 
provision without the waiver. To determine if the State is in 
compliance with the overall benefit requirement, HUD calculates the 
overall benefit test as usual by excluding all planning and general 
administration activities, and then removing the funds applied to 
waivered slum/blight or urgent need activities one at a time until the 
State passes the test. To facilitate this process, HUD required the 
State to keep beneficiary data for each activity despite the waivers. 
(Note that, although the Disaster Recovery Grant Reporting (DRGR) 
system is used to collect the benefit information, it only calculates 
the overall benefit test as usual, not as waived. The effects of the 
waiver on compliance must be manually determined. Therefore, the 
automatically calculated percentages in the published reports are 
technically inaccurate.) In the notices, HUD linked all of the 
Mississippi-only overall benefit waivers to specific, named and dated 
action plans. This means that when the State substantially amends an 
activity under the waiver, that waiver no longer applies to the funds 
removed from the original activity. This occurred frequently as the 
budget for Phase I of the homeowner compensation program decreased in 
size from over $3 billion to about $1.5 billion and as the State 
completed other reprogramming from undersubscribed activities.
    At this time, using budgets and data provided by the State, HUD has 
calculated that the State is likely to achieve approximately 40 percent 
overall benefit for the whole grant (before applying the waivers). 
Next, based on the information available prior to publication of this 
notice, HUD has performed the overall benefit test by removing an 
activity at a time, in the date order in which the waivers were 
granted. If, at any point in the calculation the State would clearly be 
in compliance with the overall benefit requirement without further 
waivers, then there can be no compelling need for subsequent waivers.
    HUD calculates that, if the original waivers for three activities 
launched early in the recovery that now have been completed or nearly 
completed in reliance on those waivers (homeowner compensation Phase 1, 
assistance to private utilities, and windpool payments) remain without 
change, then the State will pass the overall benefit test with the 
remaining grant funds as they are currently budgeted. This conclusion 
removes the compelling need for the waivers granted for other 
activities and they are hereby rescinded, as shown in the table below.

[[Page 75736]]



----------------------------------------------------------------------------------------------------------------
        Activity or program              Original waiver date                 Reconsideration status
----------------------------------------------------------------------------------------------------------------
Regional Infrastructure Program....  August 24, 2007 (72 FR       Waiver rescinded.
                                      48808).
Economic Development and Community   March 6, 2007 (72 FR 10020)  Waiver rescinded.
 Revitalization.
Regional Infrastructure Program--    October 24, 2006 (71 FR      Waiver rescinded.
 Master Plan and Emergency            62372).
 Infrastructure.
Ratepayer and Windpool Mitigation..  October 24, 2006 (71 FR      Waiver retained as originally granted.
                                      62372).
Compensation for housing loss......  June 14, 2006 (71 FR 34457)  Waiver retained for Phase 1 Urgent Need
                                                                   activities.
----------------------------------------------------------------------------------------------------------------

    HUD notes that the change in the status of these waivers will 
require no changes in the State's currently budgeted and operating 
programs beyond the stipulated attention on the part of the State to 
addressing the recovery needs of low- and moderate-income persons in 
the required proportions for the remainder of its activities.
    The original waiver notices include greater detail about the 
State's requests and the waivers and alternative requirements. The 
specific notices to reference are:
     71 FR 34457, published June 14, 2006;
     71 FR 62372, published October 24, 2006;
     72 FR 10020, published March 6, 2007; and
     72 FR 48808, published August 24, 2007.

Timely Distribution of Funds

    The state CDBG program regulation regarding timely distribution of 
funds is at 24 CFR 570.494. This provision is designed to work in the 
context of an annual program in which almost all grant funds are 
distributed to units of general local government. Because the State may 
have used its disaster recovery grant funds to carry out activities 
directly, and because Congress expressly allowed this grant to be 
available until expended, HUD waived this requirement. However, HUD 
still expects the State of Mississippi to expeditiously obligate and 
expend all funds, including any recaptured funds or program income, in 
carrying out activities in a timely manner.

Waivers and Alternative Requirements

    1. Program income waivers and alternative requirement. 42 U.S.C. 
5304(j) and 24 CFR 570.489(e) are waived to the extent that they 
conflict with the rules stated in the program income alternative 
requirement below. The following alternative requirement applies 
instead.
    (a) Program income. (1) For the purposes of this subpart, ``program 
income'' is defined as gross income received by a state, a unit of 
general local government, a tribe, or a subrecipient of a unit of 
general local government or a tribe that was generated from the use of 
CDBG funds, except as provided in paragraph (a)(2) of this section. 
When income is generated by an activity that is only partially assisted 
with CDBG funds, the income shall be prorated to reflect the percentage 
of CDBG funds used (e.g., a single loan supported by CDBG funds and 
other funds; a single parcel of land purchased with CDBG funds and 
other funds). Program income includes, but is not limited to, the 
following:
    (i) Proceeds from the disposition by sale or long-term lease of 
real property purchased or improved with CDBG funds;
    (ii) Proceeds from the disposition of equipment purchased with CDBG 
funds;
    (iii) Gross income from the use or rental of real or personal 
property acquired by the unit of general local government or tribe or 
subrecipient of a state, a tribe, or a unit of general local government 
with CDBG funds, less the costs incidental to the generation of the 
income;
    (iv) Gross income from the use or rental of real property owned by 
a state, tribe, or the unit of general local government or a 
subrecipient of a state, tribe, or unit of general local government, 
that was constructed or improved with CDBG funds, less the costs 
incidental to the generation of the income;
    (v) Payments of principal and interest on loans made using CDBG 
funds;
    (vi) Proceeds from the sale of loans made with CDBG funds;
    (vii) Proceeds from the sale of obligations secured by loans made 
with CDBG funds;
    (viii) Interest earned on program income pending disposition of the 
income, but excluding interest earned on funds held in a revolving fund 
account;
    (ix) Funds collected through special assessments made against 
properties owned and occupied by households not of low and moderate 
income, where the special assessments are used to recover all or part 
of the CDBG portion of a public improvement; and
    (x) Gross income paid to a state, tribe, or a unit of general local 
government or subrecipient from the ownership interest in a for-profit 
entity acquired in return for the provision of CDBG assistance.
    (2) ``Program income'' does not include the following:
    (i) The total amount of funds which is less than $25,000 received 
in a single year that is retained by a unit of general local 
government, tribe, or subrecipient;
    (ii) Amounts generated by activities eligible under section 
105(a)(15) of the 1974 Act and carried out by an entity under the 
authority of section 105(a)(15) of the Act.
    (3) The state may permit the unit of general local government or 
tribe that receives or will receive program income to retain the 
program income, subject to the requirements of paragraph (a)(3)(ii) of 
this section, or the state may require the unit of general local 
government or tribe to pay the program income to the state.
    (i) Program income paid to the state. Program income that is paid 
to the state or received by the state is treated as additional disaster 
recovery CDBG funds subject to the requirements of this notice and must 
be used by the state or distributed to units of general local 
government in accordance with the state's Action Plan for Disaster 
Recovery. To the maximum extent feasible, program income shall be used 
or distributed before the state makes additional withdrawals from the 
United States Treasury, except as provided in paragraph (b) of this 
section.
    (ii) Program income retained by a unit of general local government 
or tribe.
    (A) Program income that is received and retained by the unit of 
general local government or tribe before closeout of the grant that 
generated the program income is treated as additional disaster recovery 
CDBG funds and is subject to the requirements of this notice.
    (B) Program income that is received and retained by the unit of 
general local government or tribe after closeout of the grant that 
generated the program

[[Page 75737]]

income, but that is used to continue the disaster recovery activity 
that generated the program income, is subject to the waivers and 
alternative requirements of this notice.
    (C) All other program income is subject to the requirements of 42 
U.S.C. 5304(j) and subpart I of 24 CFR part 570.
    (D) The state shall require units of general local government or 
tribes, to the maximum extent feasible, to disburse program income that 
is subject to the requirements of this notice before requesting 
additional funds from the state for activities, except as provided in 
paragraph (b) of this section.
    (b) Revolving funds.
    (1) The state may establish or permit units of general local 
government or tribes to establish revolving funds to carry out 
specific, identified activities. A revolving fund, for this purpose, is 
a separate fund (with a set of accounts that are independent of other 
program accounts) established to carry out specific activities that, in 
turn, generate payments to the fund for use in carrying out such 
activities. These payments to the revolving fund are program income and 
must be substantially disbursed from the revolving fund before 
additional grant funds are drawn from the United States Treasury for 
revolving fund activities. Such program income is not required to be 
disbursed for nonrevolving fund activities.
    (2) The state may also establish a revolving fund to distribute 
funds to units of general local government or tribes to carry out 
specific, identified activities. A revolving fund, for this purpose, is 
a separate fund (with a set of accounts that are independent of other 
program accounts) established to fund grants to units of general local 
government to carry out specific activities which, in turn, generate 
payments to the fund for additional grants to units of general local 
government to carry out such activities. Program income in the 
revolving fund must be disbursed from the fund before additional grant 
funds are drawn from the Treasury for payments to units of general 
local government that could be funded from the revolving fund.
    (3) A revolving fund established by either the state or unit of 
general local government shall not be directly funded or capitalized 
with grant funds.
    (c) Transfer of program income. Notwithstanding other provisions of 
this notice, the state may transfer program income before closeout of 
the grant that generated the program income to its own annual CDBG 
program or to any annual CDBG-funded activities administered by a unit 
of general local government or Indian tribe within the state.
    (d) Program income on hand at the state or its subrecipients at the 
time of grant closeout by HUD and program income received by the state 
after such grant closeout shall be program income to the most recent 
annual CDBG program grant of the state.
    2. Housing-related eligibility waivers. 42 U.S.C. 5305(a) is waived 
to the extent necessary to allow homeownership assistance for 
households with up to 120 percent of area median income and downpayment 
assistance for up to 100 percent of the downpayment (42 U.S.C. 
5305(a)(24)(D)) and to allow new housing construction.
    3. Compensation for loss of housing. 42 U.S.C. 5305(a) is waived to 
the extent necessary to allow compensation for unreimbursed loss of 
housing caused by the disaster. The grantee must undertake any 
compensation activity in accordance with the state's approved action 
plan and published program design.
    4. Planning requirements. For CDBG disaster-recovery-assisted 
general planning activities that will guide recovery in accordance with 
the 2006 Act, the state CDBG program rules at 24 CFR 570.483(b)(5) and 
(c)(3) are waived and the presumption at 24 CFR 570.208(d)(4) applies.
    5. Waiver and modification of the anti-pirating clause to permit 
assistance to help a business return. 42 U.S.C. 5305(h) and 24 CFR 
570.482(h) are hereby waived only to allow the grantee to provide 
assistance under this grant to any business that was operating in the 
covered disaster area before the incident date of Hurricane Katrina and 
has since moved, in whole or in part, from the affected area to another 
state or to a labor market area within the same state to continue 
business.
    6. Waiver of one-for-one replacement of units damaged by disaster. 
42 U.S.C. 5304(d)(2)(A)(i)-(ii) and 42 U.S.C. 5304(d)(2)(A)(iii)-(iv) 
are waived to remove the one-for-one replacement requirements for 
occupied and vacant, occupiable lower-income dwelling units that may be 
demolished or converted to a use other than for housing; and to remove 
the relocation benefits requirements contained at 42 U.S.C. 5304(d) to 
the extent they differ from those of the Uniform Relocation Act. Also, 
24 CFR 42.375 is waived to remove the requirements implementing the 
above-mentioned statutory requirements regarding replacement of housing 
and 24 CFR 42.350, to the extent that these regulations differ from the 
regulations contained in 49 CFR part 24. These requirements are waived 
provided the grantee assures HUD it will use all resources at its 
disposal to ensure no displaced homeowner will be denied access to 
decent, safe, and sanitary suitable replacement housing because he or 
she has not received sufficient financial assistance.
    7. Overall benefit. 42 U.S.C. 5301(c) and 5304(b)(3), and 24 CFR 
570.484 and 24 CFR 91.325(b)(4)(ii), with respect to the overall 
benefit requirement, were waived June 14 and October 24, 2006; and 
March 6 and August 24, 2007, for the CDBG disaster recovery grant 
covered by this notice, to the extent necessary to permit Mississippi 
to carry out activities specified in each notice provided that the 
state must give reasonable priority for the balance of its funds to 
activities that will primarily benefit persons of low and moderate 
income.
    a. After the required reconsideration, HUD is retaining waivers 
granted under 71 FR 34460 paragraph 7, and 71 FR 62374 paragraph 4, to 
the extent necessary to allow the retention of the overall benefit 
waiver for the ratepayer mitigation and windpool activities.
    b. After the required reconsideration, the Department no longer 
finds compelling need for, and is therefore rescinding, the waivers 
granted under 71 FR 62374 paragraph 4, to the extent that the waiver 
originally was granted for the Regional Infrastructure Program--Master 
Plan and Emergency Infrastructure; 72 FR 10021 paragraph 5, to the 
extent that it covers the Economic Development and Community 
Revitalization program; and 72 FR 48811 paragraph 2, to the extent that 
it covers the Regional Infrastructure Program. HUD continues to expect 
the grantee to maintain low- and moderate-income benefit documentation 
for each activity providing such benefit.
    8. Waiver of requirement for timely distribution of funds. 24 CFR 
570.494 regarding timely distribution of funds is waived.
    9. Note on the eligibility of providing funds to Enterprise and 
Local Initiatives Support Corporation (LISC) for certain purposes. The 
appropriations statute provides that the states of Louisiana and 
Mississippi may each use up to $20,000,000 (with up to $400,000 each 
for technical assistance) from funds made available under this heading 
for LISC and the Enterprise Foundation for activities authorized by 
section 4 of the HUD Demonstration Act of 1993 (Pub. L. 103-120, 42 
U.S.C. 9816 note), as in effect immediately before June 12, 1997, and 
for activities authorized under section 11 of the Housing Opportunity 
Program Extension Act of 1996 (Pub. L. 104-120, 42 U.S.C. 12805 note),

[[Page 75738]]

including demolition, site clearance and remediation, and program 
administration.
    10. Non-Federal Cost Sharing of Army Corps of Engineers Projects. 
Public Law 105-276, Title II, Oct. 21, 1998, 112 Stat. 2478, provided 
in part that: ``For any fiscal year, of the amounts made available as 
emergency funds under the heading `Community Development Block Grants 
Fund' and notwithstanding any other provision of law, not more than 
$250,000 may be used for the non-Federal cost-share of any project 
funded by the Secretary of the Army through the Corps of Engineers.''

Finding of No Significant 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, 
which implement section 102(2)(C) of the National Environmental Policy 
Act of 1969 (42 U.S.C. 4332(2)(C)). The Finding of No Significant 
Impact is available for public inspection between 8 a.m. and 5 p.m. 
weekdays in the Regulations Division, 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: November 24, 2008.
Roy A. Bernardi,
Deputy Secretary.
[FR Doc. E8-29426 Filed 12-11-08; 8:45 am]
BILLING CODE 4210-67-P