[Federal Register Volume 75, Number 204 (Friday, October 22, 2010)]
[Notices]
[Pages 65368-65370]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-26777]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5441-N-01]


Additional Waivers Granted to and Alternative Requirements for 
the State of Illinois' CDBG Disaster Recovery Grant Under Public Law 
110-329

AGENCY: Office of the Secretary, HUD.

ACTION: Notice of additional waivers and alternative requirements.

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SUMMARY: This notice describes additional waivers and alternative 
requirements applicable to the Community Development Block Grant (CDBG) 
disaster recovery grant provided to the State of Illinois for the 
purpose of assisting in the recovery related to the consequences of the 
State's 2008 disasters. HUD previously published allocation and 
application notices applicable to this grant on February 13, 2009 (74 
FR 7244), and August 14, 2009 (74 FR 41146).

DATES: Effective Date: October 27, 2010.

FOR FURTHER INFORMATION CONTACT: Scott Davis, Director, Disaster 
Recovery and Special Issues Division, Office of Block Grant Assistance, 
Department of Housing and Urban Development, 451 7th 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 telephone number 800-877-8339. 
Facsimile inquiries may be sent to Mr. Davis at facsimile number 202-
401-2044. (Except for the ``800'' number, these telephone numbers are 
not toll free.)

SUPPLEMENTARY INFORMATION:

Authority To Grant Waivers

    The Consolidated Security, Disaster Assistance, and Continuing 
Appropriations Act, 2009 (Pub. L. 110-329, approved September 30, 2008) 
(hereinafter, ``Second 2008 Act'' to differentiate it from the earlier 
2008 Supplemental Appropriations Act, Public Law 110-252, approved June 
30, 2008) appropriated $6.5 billion, to remain available until 
expended, in CDBG funds for necessary expenses related to disaster 
relief, long-term recovery, and restoration of infrastructure, housing 
and economic revitalization in areas affected by hurricanes, flooding, 
and other natural disasters occurring during 2008 for which the 
President declared a major disaster under title IV of the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 
et seq.).
    The Second 2008 Act authorizes 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 (including 
requirements concerning lead based paint), upon a request by a state 
grantee explaining why such waiver is required to facilitate the use of 
such funds or guarantees and a finding by the Secretary that such a 
waiver would not be inconsistent with the overall purpose of Title I of 
the Housing and Community Development Act of 1974 (HCD Act). 
Additionally, regulatory waiver authority is provided by 24 CFR 5.110, 
91.600, and 570.5. The following application and reporting waivers and 
alternative requirements are in response to a request received from the 
State of Illinois regarding its use of funds under the Second 2008 Act.
    The Secretary finds that the following waivers and alternative 
requirements, as described below, are necessary to facilitate use of 
the funds for the statutory purposes and are not inconsistent with the 
overall purpose of Title I of the HCD Act or the Cranston-Gonzalez 
National Affordable Housing Act, as amended.
    Under the requirements of the Second 2008 Act and the Department of 
Housing and Urban Development Reform Act of 1989 (the HUD Reform Act), 
regulatory waivers must be justified and published in the Federal 
Register. Except as described in this Notice, 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. In accordance with 
the Second 2008 Act, HUD will reconsider every waiver in this Notice on 
the two-year anniversary of the day this Notice is published.

Waiver Justification

    Except as described below, the waivers, alternative requirements, 
and statutory changes published in notices on February 13, 2009 (74 FR 
7244) and August 14, 2009 (74 FR 41146) will continue to apply to the 
State's CDBG disaster recovery funds appropriated under the Second 2008 
Act (Pub. L. 110-329). The actions below provide additional flexibility 
in program design and implementation and implement statutory 
requirements unique to this appropriation. The provisions of this 
Notice do not apply to funds provided under the annual CDBG program.
    National Objective Documentation for Economic Development 
Activities. For the national objective documentation for business 
assistance activities, Illinois has asked to apply individual salaries 
or wages per job and the income limits for a household of one, rather 
than the usual CDBG standard of total household income and the limits-
by-total household size. Illinois has asserted that this proposed 
documentation would be simpler and quicker for participating lenders to 
administer, easier to verify, and would not misrepresent the amount of 
low- and moderate-income benefit provided. Upon consideration, HUD is 
granting this waiver, which has also been granted to a number of other 
state grantees under the Second 2008 Act. It will play a key role in 
streamlining the State's documentation process because it allows 
collection of wage data for

[[Page 65369]]

each position created or retained from the assisted businesses, rather 
than from each individual household.
    Eligibility--buildings for the general conduct of government. 
Illinois has requested a limited waiver of the prohibition on funding 
buildings for the general conduct of government as many of these 
buildings were damaged by the 2008 disasters. HUD has considered this 
request and agrees that it is consistent with the overall purposes of 
the 1974 Act. Therefore, Illinois may use funds provided under the 
Second 2008 Act to repair or reconstruct buildings used for the general 
conduct of government so long as (1) the buildings are selected in 
accordance with a method described in the State's Action Plan for 
Disaster Recovery, and (2) the State determines that the selected 
buildings have substantial value in promoting disaster recovery. 
However, as stipulated by the Second 2008 Act, funds may not be used 
for activities reimbursable by, or for which funds are made available 
by, the Federal Emergency Management Agency or the Army Corps of 
Engineers.
    Public benefit for certain economic development activities. 
Illinois has requested a waiver of the public benefit standards for 
certain economic development activities. The public benefit provisions 
set standards for individual economic development activities (such as a 
single loan to a business) and for economic development activities in 
the annual aggregate. Currently, public benefit standards limit the 
amount of CDBG assistance per job retained or created, or the amount of 
CDBG assistance per low and moderate-income person to which goods or 
services are provided by the activity. Essentially, the public benefit 
standards are a proxy for all the other possible public benefits 
provided by an assisted activity. These dollar thresholds were set more 
than a decade ago and under disaster recovery conditions (which often 
require a larger investment to achieve a given result), can be too low 
and thus impede recovery by limiting the amount of assistance the 
grantee may provide to a critical activity.
    After consideration, this Notice waives the public benefit 
standards for the cited activities, except that the State shall report 
and maintain documentation on the creation and retention of (a) Total 
jobs, (b) number of jobs within certain salary ranges, (c) the average 
amount of assistance per job and activity or program, and (d) the types 
of jobs. As a conforming change for the same activities or programs, 
HUD is also waiving paragraph (g) of 24 CFR 570.482 to the extent its 
provisions are related to public benefit. Illinois has made public in 
its Action Plan the disaster recovery needs each activity is 
addressing.
    Housing incentives to resettle in disaster-affected communities. 
The State believes that incentives are vital to encourage its citizens 
to move out of harms' way to safer areas outside the 100 year 
floodplain. Upon consideration, the Department is waiving 42 U.S.C 
5305(a) of the 1974 Act and associated regulations to permit the State 
to offer disaster recovery or mitigation housing incentives to promote 
housing development or resettlement in particular geographic areas.
    Limitation on emergency grant payments. HUD is waiving 42 U.S.C. 
5305(a) to allow the State to extend interim mortgage assistance to 
qualified individuals for up to 20 months. The State plans to create an 
Interim Mortgage Assistance Program to assist homeowners (likely to be 
applicants in the State's future buyout program) with mortgage payments 
and other eligible property carrying costs while they may be living in 
temporary housing. As it takes more than three months for buyout 
decisions to be made and implemented, this will provide key assistance 
to qualified homeowners during this interim period.

Applicable Rules, Statutes, Waivers, and Alternative Requirements

    1. Except as described in this Notice, statutory and regulatory 
provisions governing the Community Development Block Grant program for 
states, including those at 42 U.S.C. 5301 et seq. and 24 CFR part 570, 
and those described in Federal Register notices 74 FR 7244 and 74 FR 
41146, shall apply to the use of these funds. Also, please note that 
any program changes implemented as a result of the waivers published in 
today's Notice must be in accordance with the State's approved Action 
Plan for Disaster Recovery.
    2. National Objective Documentation for Economic Development 
Activities. 24 CFR 570.483(b)(4)(i) is waived to allow the State to 
establish low- and moderate-income jobs benefit by documenting for each 
person employed the name of the business, type of job, and the annual 
wages or salary of the job. HUD will consider the person income-
qualified if the annual wages or salary of the job is at or under the 
HUD-established income limit for a one-person family.
    3. Buildings for the general conduct of government. 42 U.S.C. 
5305(a) and associated regulations are waived to the extent necessary 
to allow Illinois to fund the rehabilitation or reconstruction of 
public buildings that are otherwise ineligible and that the State 
selects in accordance with its approved Action Plan for Disaster 
Recovery and that the State has determined have substantial value in 
promoting disaster recovery.
    4. Public benefit for certain economic development activities. For 
economic development activities designed to create or retain jobs or 
businesses (including but not limited to long-term, short-term, and 
infrastructure projects), the public benefit standards at 42 U.S.C. 
5305(e)(3) and 24 CFR 570.482(f)(1), (2), (3), (4)(i), (5), and (6) are 
waived, except that the State shall report and maintain documentation 
on the creation and retention of total jobs, the number of jobs within 
certain salary ranges, the average amount of assistance provided per 
job by activity or program, and the types of jobs. Paragraph (g) of 24 
CFR 570.482 is also waived to the extent its provisions are related to 
public benefit.
    5. Housing incentives to resettle in disaster-affected communities. 
42 U.S.C 5305(a) of the 1974 Act and associated regulations are waived 
to permit the State to offer disaster recovery or mitigation housing 
incentives to promote housing development or resettlement in particular 
geographic areas. The incentives must be in accordance with State's 
approved Action Plan and published program design(s), and the State 
must maintain documentation that the costs are necessary and 
reasonable.
    6. Limitation on emergency grant payments. 42 U.S.C. 5305(a) is 
waived so that Illinois can use funds under the Second 2008 Act to 
extend interim mortgage assistance to qualified individuals for up to 
20 months.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance numbers for the disaster 
recovery grant under this Notice are as follows: 14.218 and 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 Regulations Division, Office of General Counsel, Department of 
Housing and Urban Development, Room 10276, 451 7th Street, SW., 
Washington, DC 20410-0500. Due to security measures at the HUD 
Headquarters building, an advance appointment to

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review the docket file must be scheduled by calling the Regulations 
Division at 202-708-3055 (this is not a toll-free number). Hearing or 
speech-impaired individuals may access this number through TTY by 
calling the toll-free Federal Information Relay Service at 800-877-
8339.

    Dated: October 4, 2010.
Mercedes M. M[aacute]rquez,
Assistant Secretary for Community Planning and Development.
[FR Doc. 2010-26777 Filed 10-21-10; 8:45 am]
BILLING CODE 4210-67-P