[Federal Register Volume 74, Number 217 (Thursday, November 12, 2009)]
[Notices]
[Pages 58306-58307]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-27093]


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

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5355-N-01]


Notice of Program Requirements for Community Development Block 
Grant Program Funding Under the American Recovery and Reinvestment Act 
of 2009: Reallocations

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

ACTION: Notice.

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

SUMMARY: On May 5, 2009, HUD posted on its Web site its ``Notice of 
Program Requirements for Community Development Block Grant Program 
Funding Under the American Recovery and Reinvestment Act of 2009.'' The 
Notice advised the public of statutory and regulatory waivers granted 
to grantees under the American Recovery and Reinvestment Act of 2009 
(Recovery Act), which made $1 billion in Community Development Block 
Grant (CDBG) funds available to states and local governments to carry 
out, on an expedited basis, eligible activities under the CDBG program. 
The May 5, 2009, Notice also indicated that HUD would establish and 
publish in the Federal Register criteria for reallocating and awarding 
CDBG-R funds that are not awarded to any eligible jurisdiction. Only 
one jurisdiction did not apply to receive its Recovery Act allocation. 
Today's Notice announces the process HUD will use to reallocate this 
assistance.

FOR FURTHER INFORMATION CONTACT: Stanley Gimont, Director, Office of 
Block Grant Assistance, Office of Community Planning and Development, 
Department of Housing and Urban Development, 451 7th Street, SW., Room 
7286, Washington, DC 20410; telephone number 202-708-3587 (this is not 
a toll-free number). Persons with hearing or speech impairments may 
access this number through TTY by calling the toll-free Federal 
Information Relay Service at 800-877-8339. Interested parties may also 
visit the CDBG-R Web page on HUD's Recovery Act Web site, http://www.hud.gov/recovery/, for updated information and resources.

SUPPLEMENTARY INFORMATION:

Authority To Provide Alternative Requirements and Grant Regulatory 
Waivers

    Title XII of Division A of the American Recovery and Reinvestment 
Act of 2009 (Pub. L. 111-005, approved February 17, 2009) appropriates 
$1 billion to carry out the CDBG program under Title I of the Housing 
and Community Development Act of 1974 (42 U.S.C. 5301, et seq.) on an 
expedited basis. These funds will be distributed to grantees that 
received CDBG funding in Fiscal Year (FY) 2008, in accordance with the 
provisions of 42 U.S.C. 5306. The grant program under Title XII is 
commonly referred to as the CDBG-R program. When referring to a 
provision of the appropriations statute itself, this notice will refer 
to the Recovery Act; when referring to the grants, grantees, assisted 
activities, and implementation rules, this notice will use the term 
CDBG-R.
    Under the authority of the Recovery Act, the Secretary may waive or 
specify alternative requirements for any provision of any statute or 
regulation in connection with the obligation by the Secretary or the 
use by the recipient of these funds, except for requirements related to 
fair housing, nondiscrimination, labor standards, and the environment, 
upon a finding that such waiver is necessary to expedite or facilitate 
the timely use of such funds

[[Page 58307]]

and would not be inconsistent with the overall purpose of the statute. 
The Secretary finds that the additional alternative requirement 
outlined below is necessary to expedite the use of these funds for 
their required purposes.

Formula: Reallocation

    Section I.B of the May 5, 2009, Notice stated that if a unit of 
general local government, State, or Insular Area receiving an 
allocation of CDBG-R funds under that notice fails to submit a 
substantial amendment to its program year 2008 action plan for its 
grant allocation by the deadlines specified in Section II.A.4. of the 
Notice, or submits an application for less than the total allocation 
amount, or if HUD is unable to approve any entity's submission, HUD may 
notify the jurisdiction of the cancellation of all or part of its 
allocation amount. The Notice further states that once HUD determines 
the amount of funds (if any) that are not awarded to any jurisdictions, 
the Secretary will establish criteria by which to award such funds to 
other entities, and the criteria will be published in the Federal 
Register. The Notice indicated that these criteria will be established 
only if funds become available for reallocation.
    Fairbanks, Alaska is the only grantee that declined to apply for 
its CDBG-R funding. Every other grantee submitted a substantial 
amendment to its action plan for its full allocation amount, and each 
is likely to be awarded its funds. Fairbanks was a grantee under the 
regular annual CDBG Entitlement program through Federal Fiscal Year 
(FFY) 2008, but starting in FY 2009, Fairbanks relinquished its status 
as an entitlement community in order to participate in the State of 
Alaska CDBG program. The City declined to apply for its CDBG-R funds in 
part because of the small amount of funds involved and in part because 
it is discontinuing its participation in the CDBG Entitlement program.
    Fairbanks' formula allocation of CDBG-R funds was one of the 50 
smallest allocations in the program (out of nearly 1,200). Its 
allocation amount was $67,436. The amount of CDBG-R funds that are 
available for reallocation is a tiny fraction of the CDBG-R funds 
distributed to states and local governments (less than .007 percent of 
the appropriation).
    The Department has determined that it is necessary to employ an 
alternative reallocation process in order to expedite the timely use of 
these reallocated funds. Under 42 U.S.C. 5306(c), any unawarded CDBG 
Entitlement funds are to be reallocated in the next fiscal year to 
other metropolitan cities or counties in the same metropolitan area 
that would be adversely affected by the loss of the funds. If there is 
no such other city or county in that metropolitan area, as is the case 
with Fairbanks, the funds are to be reallocated in the next fiscal year 
among all Entitlement grantees nationwide. Under the existing 
provisions of 42 U.S.C. 5306(c), this money would be reallocated as 
part of the process for allocating the next fiscal year's appropriation 
of regular CDBG funding, sometime in FFY 2010.
    Reallocating the small amount of funds involved to almost 1,200 
Entitlement grantees according to the regular CDBG reallocation method 
would impose a substantial administrative burden on both HUD and 
grantees. Delaying the reallocation of these funds until the next FFY 
would also cut into the time the eventual recipient has to expend funds 
before the September 30, 2012, expenditure deadline. The Department has 
further determined that it would not be time- or cost-effective to 
develop a formal process and set of selection criteria for awarding 
these funds to other grantees on a competitive basis. Most CDBG-R 
grantees have just begun to implement their programs, and no meaningful 
data are yet available on which to judge the relative performance of 
grantees. HUD believes it would be inconsistent with the purposes and 
requirements of the Recovery Act to wait for performance data to become 
available before establishing a reallocation process. Such a delay 
would be counter to the Recovery Act's intent to produce an immediate 
economic stimulus.
    Weighing the fact that the reallocated funds were designated for 
Fairbanks, Alaska, which has now ceased its participation in the 
Entitlement CDBG program to instead participate in the State program, 
the need for economic stimulus in Alaska, and the governmental interest 
in putting these funds to expeditious use, the Secretary finds good 
cause to waive the existing requirements in order to reallocate $67,436 
in unawarded CDBG-R funds to the State of Alaska. This additional 
increment of funding equals less than 10 percent of the State of 
Alaska's initial allocation of CDBG-R funds.

Paperwork Reduction Act

    The information collection requirements in this Notice have been 
approved by the Office of Management and Budget (OMB) under the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned OMB 
Control Number 2506-0184. In accordance with the Paperwork Reduction 
Act, HUD may not conduct or sponsor, and a person is not required to 
respond to, a collection of information unless the collection displays 
a currently valid OMB control number.

Environmental Impact

    A Finding of No Significant Impact (FONSI) with respect to the 
environment has been made for this issuance 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 
FONSI is available for public inspection between the hours of 8 a.m. 
and 5 p.m. weekdays in the Regulations Division, Office of General 
Counsel, Room 10276, Department of Housing and Urban Development, 451 
Seventh Street, SW., Washington, DC 20410. Due to security measures at 
the HUD Headquarters building, please schedule an appointment to review 
the FONSI by calling the Regulations Division at 202-708-3055 (this is 
not a toll-free number). Individuals with speech or hearing impairments 
may access this number via TTY by calling the toll-free Federal 
Information Relay Service at 800-877-8339.

    Dated: October 13, 2009.
Mercedes M[aacute]rquez,
Assistant Secretary for Community Planning and Development.
[FR Doc. E9-27093 Filed 11-10-09; 8:45 am]
BILLING CODE 4210-67-P