HomeMy WebLinkAbout2014-37 CC Reso - Approving CDBG Program Income Reuse Plan I
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RESOLUTION NO. 2014-37 �
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH APPROVING THE
COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) PROGRAM INCOME REUSE PLAN.
WHEREAS, the City of Ukiah has received Community Development Block Grant funding;
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WHEREAS, the Community Development Block Grant Program Income Reuse Plan is a
requirement of said funding; and
WHEREAS,the notice for a public hearing was duly published on September 20, 2014 in the
Ukiah Daily Journal; and
WHEREAS, a Public Hearing was held pursuant to federal Citizen Participation requirements
before the City Council on October 1, 2014, to receive public comment and consider the City of
Ukiah's Community Development Block Grant Program Income Reuse Plan;
NOW, THEREFORE, BE IT RESOLVED as follows: �
1. The City of Ukiah has reviewed and herby approves the Community
Development Block Grant Program Income Reuse Plan attached hereto as Exhibit A.
2. The City Manager or designee is hereby authorized and directed to act on the City's
behalf in all matters pertaining to the CDBG Program Income Reuse Plan. I
3. The Assistant City Manager is hereby authorized to sign all necessary reports as required
by this plan to be submitted to the State of California, Department of Housing and Community
Development.
THE FOREGOING RESOLUTION WAS ADOPTED at a regular meeting of the Ukiah City �
Council held on the 1�` day of October 2014, by the following roll call vote.
AYES: Councilmembers Scalmanini, Crane, Thomas, and Mayor Baldwin I
NOES: �one ,
ABSENT: Vice Mayor Landis
ABSTAIN:None
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Philip E aldwin, Mayor
ATTEST:
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Kristine Lawler. City Clerk
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EXHIBIT A
The Citv of Ukiah's Communitv Development Block Grant
Proqrem Income Reuse Plan
[Attached behind this page]
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COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM
(CDBG) I
PROGRAM INCOME (PI) REUSE AGREEMENT
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I Execution of the this P/ Reuse Agreement by both the Jurisdiction and the California,
State Department of Housing and Community Development (Department) provides
officia/ notification of the Department's approval for the Jurisdiction to expend PI funds
under the State's administration of the federa/ Community Development Block Grant i
Program (CDBG) for (1) state non-entitlement jurisdictions; and (2) former state non- I
entitlement jurisdictions that are now entit/ement jurisdictions;, pursuant to the
provisions of 42 U.S. Code (U.S.C.) 5301 et seq., 24 Code of Federal Regulations
(CFR) Part 57Q Subpart l, and 25 California Code of Regulations (CCR), Sections 7050
et seq. CDBG funding is listed in the Catalog of Federal Domestic Assistance as
14.228 - CDBG Community Development B/ock Grant Program. The Agreement also
includes asset repayments from activities administered under DRI contracts.
By completing this P/ Reuse Agreement and signing the end of this document, the
Authorized Representative certifies the Jurisdiction has read, understands and will
adhere to the Program Income (PI) Reuse Overview and Process discussed in the first
section of this document, the Jurisdictional Certifications in the second section of this
document, and Department of Housing and Community Development (hereinafter
Department) terms and conditions in the third section of this document.
SECTION ONE: OVERVIEW AND PROCESS
JURISDICTION: Clt)/ Of Uklah
GOVERNING BODY ADOPTED ON: �cTOSEx / 1 /2014
This PI Reuse Agreement establishes policies and procedures for the administration i
and utilization of PI received as a direct result of eligible activities funded under CDBG
and DRI contracts with the Department. For payments generated under DR/ contracts,
while the funding was loaned under DRI, when a payment is received, per DRI
regu/ation, the payment becomes CDBG program income. I
Applicabilitv of this Aareement: �,
This PI Reuse Agreement between the Jurisdiction and Department is required by
CDBG federal regulation. This Agreement allows Jurisdictions receiving repayments
from CDBG and DRI assets to spend those PI funds in the absence of an active
Department CDBG grant contract. This Agreement applies to all current Department-
eligible Non-Entitlement Jurisdictions and HUD Entitlement Jurisdictions that are still
receiving Non-Entitlement PI revenue from previous State grants (CDBG and/or DRI).
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RECEIPT OF PROGRAM INCOME
Pursuant to the definition of program income found at 24 CFR 570.489(e)(2),
repayments of assets generated from use of CDBG funds received by the Jurisdiction
from the Department are PI. These repayments of loans, lease payments, and
proceeds of asset sales will be deposited into one of three separate local PI accounts
depending on what activity generated the PI. It is possible that the Jurisdiction may
have up to three separate accounts with which to manage PI.
, 1. If the Jurisdiction has a Department approved Revolving Loan Fund (RLF) for
Housing and/or ED, any PI from Housing or ED activities must be deposited into
the RLF associated with the activity that generated the PI.
This means:
a. Housing PI must be deposited into the Housing RLF.
b. ED PI must be deposited into the ED RLF.
Note: The accounts for each RLF must be separate accounts, however they both
must be interest bearing.
2. If RLF(s) are not approved for use, the Jurisdiction must deposit all CDBG
repayments into a single regular PI account which must be separate from either
of the RLF accounts, but it must also be interest bearing.
3. If repayment comes from a loan or asset that was originally paid with CDBG and
non-CDBG funds, the PI accounting and reporting must reflect the correct
amounts and proportions of CDBG PI and non-CDBG funds invested in the
asset. Only the CDBG portion of the repayment is deposited into one of the
three PI accounts.
OVERVIEW OF WAYS TO USE PROGRAM INCOME
There are five (5J ways to manage PI under the Agreement.
They are:
1. Expend PI and RLF monies first on active grant contract activities;
2. Expend PI General Administration (PI GA) for GA Activities (up to allowab/e limits)
3. Expend through an approved PI Revolving Loan Fund (RLF)
4. Expend PI on an approved waiver activity when no active contract is in force;
5. Return PI annually to the Department.
The undersigned Jurisdiction certifies that PI will be expended first when there is an
active grant contract with the Department. PI being received when there is no active
grant contract will be deposited into separate accounts for approved activities under this
Agreement (via GA, PI Waiver or RLF) and only be distributed and expended, as
follows:
1. Exoend PI and RLF Monies First on Active Grant Contract Activities•
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If the undersigned Jurisdiction has an active grant contract with the Department,
all PI on hand must be expended on open grant activities, prior to requesting i
grant funds from the Department.
If the undersigned Jurisdiction has a Department approved PI Revolving Loan
Fund (RLF) per this Agreement, and has an active grant contract which includes
the same eligible CDBG activity as the RLF, the RLF monies must be expended
, first before requesting any contract funds from the Department. PI must always
be expended first on active contract activities, prior to requesting grant contract
funds. I
See the Chapter on Proqram Income and Revolvinq Loan Funds in the
DepartmenYs CDBG Grant Management Manual for additional information
regarding use of PI to pay costs for activities under an active grant contract in the
Department.
2. FrnPnd PI General Administration (PI GA1 for GA Activities ��o �o allowable
lin�its!
The undersigned Jurisdiction must track a calculation of up to seventeen percent
(17%) of PI received annually for eligible GA costs. However, the seventeen
percent (17%) PI GA only applies to PI received that is not generated by a RLF
activity.
Since all PI must be expended first, GA funds cannot be held and used only as
PI GA costs are incurred. All PI must be spent on the next funds request
submitted. Thus, the Jurisdiction can choose to keep an accounting of the total ,
amount of PI GA available for use based on all regular PI received. '
PI GA funds cannot be used for planning studies or technical assistance
activities, these activities can only be funded under awarded grant contracts. See
the Program Income Chapter for further details on eligible PI GA activities under I
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3. Exnend PI throuah an a�oroved PI Revolvina Loan Fund IRLF):
To establish one or both of the RLFs discussed below, the undersigned
Jurisdiction must submit formal written request for Department approval using
the required process included with this Agreement.
The undersigned Jurisdiction agrees to all the DepartmenYs RLF requirements as
stated in this Agreement and detailed in the GMM Chapter.
I The two RLFs and their corresponding definitions, as permitted by this
agreement, are:
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1) Housina Revolvina Loan Fund IRLFI
' Eligible housing activities under this RLF include: I
I. Housinq Rehabilitation - Sinqle Unit Residence program for owner
and/or tenant occupied properties. Matrix code 14A.
II. Housinp Rehabilitation - 2-4 Units program for tenant occupied
properties. Matrix code 146.
III. Housinq Acquisition - Sinqle Familv program for homebuyer
assistance. Matrix code 13.
2) Economic Develonment (EDl Revolvinp Loan Funds IRLFI
Eligible ED activities under this RLF include:
i. Business Assistance program (direct financial assistance to a
for-profit business). Matrix code18A; and
ii. Microenterprise Financial Assistance (loans). Matrix code 18C.
The undersigned Jurisdiction will provide program guidelines for all eligible RLF
activities as part of the approval process when obtaining Department approval of
a RLF. Department written approval must be received before incurring any
activity or activity delivery costs associated with implementing any activities
under the approved RLF. All approved RLF projects, will be required to be
reported to the Department via the applicable CDBG Set-up/Completion reports.
4. Exnend PI on an Aooroved PI Waiver Activitv when no active contra i in
, force•
The undersigned Jurisdiction may only utilize the DepartmenYs PI Waiver
, process when it has no active grant contracts with the Department. Once there
are no active contracts with the Department, the undersigned Jurisdiction can
have up to two active eligible CDBG activities approved by the Department, for
which PI may be expended. Waivers will consist of a single program, service or
single project activity. If it is a single program activity, it cannot be the same
program activity as funded under an approved RLF.
The undersigned Jurisdiction will follow all PI Waiver procedural requirements as
stated in the Program Income Chapter of the Grant Management Manual (GMM).
Written Department approval is required before expending any PI funds on a
Waiver activity. Each Waiver activity must clear the activity General and any
Special Conditions which include federal overlays as posted on DepartmenYs
webpage.
A PI Waiver project can only be approved if the total project / program cost for
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the proposed activity is on hand in the Jurisdiction's PI account. Future PI may
not be committed for PI Waivers.
The undersigned Jurisdiction understands that PI Waiver activities are limited to �
two active projects, services and/or programs, and will remain active until close
out has been completed and approved by the Department. Each approved '
Waiver activity will be set up with the Department using current Set-Up Report.
The undersigned Jurisdiction understands if they receive a subsequent award of
CDBG funds, upon execution of the new grant contract all waiver activities are to
be completed first, after which, PI must be expended first on the active grant
contract activities. PI Waivers will not be included in the grant, because
Supplemental activities will be included in contracts.
5. Return PI to the Deoartment
The undersigned Jurisdiction has the option to return PI back to the DepaRment.
However, semi-annual and annual reports are still required to confirm PI being
returned.
Intentionally left blank,
please continue to the next page.
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SECTION TWO: CERTIFICATION FOR PROCESS AND USE OF
PROGRAMINCOME
Since CDBG is a federal funding source, Citizen Participation is required when utilizing
any of the five (5) ways to use PI listed above. Those requirements are incorporated
below.
The City of Ukiah certifies that:
1. Resolution:
The PI Reuse Agreement was formally adopted via resolution on
xxixxi2o�a by the Jurisdiction's Governing Body, executed by
the Authorized Representative and submitted to Department with certified copy of
the approving resolution attached for full execution.
2. Citizen Particioation:
Each of the processes discussed in this Agreement will be carried out in
compliance with the CDBG Citizen Participation process as specified in federal
I regulations at 24 CFR 570.486, and Jurisdiction's public hearing requirements.
3. Governina Compliance:
The undersigned Jurisdiction certifies the administration of all CDBG eligible
activities conducted under the above described Ways to Spend PI, will be
conducted in compliance with all current State and federal regulations and
policies, including all applicable Grant Management Manual (GMM) chapters and
Department Management Memos.
' 4. Ineliaible Activities and Costs:
The undersigned Jurisdiction acknowledges that if ineligible activities or costs are
paid for with CDBG PI, those funds must be returned to the Jurisdiction's PI or
' RLF account (whichever account expended ineligible funds) using local
Jurisdiction funds.
The undersigned Jurisdiction acknowledges that ineligible activities or costs paid
for with PI under an active grant contract must be repaid to the Department using
local non-federal funds.
5. �risdictions Leavina the State Non-Entitlement Proaram and
Jurisdictions Enterina the State Non-Entitlement Proaram•
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The undersigned Jurisdiction certifies that it will follow these procedures when
leaving or entering the State CDBG Program:
A. 24 CFR 570.489(e)(3)(iii) Transfer of proqram income to Entitlement
proqram.
Jurisdictions that are entitlement communities or part of an urban
agreement, or grantees that at a later date become an entitlement
community orjoin a urban agreement, have the following options for PI
and RLFs:
PI not associated with a RLF, the iurisdiction must:
1) Complete the process to certify they will be reporting the State PI into
the Entitlement Programs process, including receipting the CDBG i
proceeds into IDIS, or,
2) Return all State CDBG Program Income to the Department, the
amounts on hand once the HUD agreement is signed and as it is
received until all PI generated by State CDBG funding has been
returned.
PI in an approved RLF:
Entitlement jurisdictions and those who are part of an urban agreement
may keep their RLF(s) and monies within an RLF as long as the following
is met:
1) They have a State Reuse Plan (Agreement) signed by the Department
and the City/County Authorized Representative.
2) Agree to operate the RLF under the DepartmenYs RLF rules going
forv✓ard
3) Report all expenditure, and accounting of RLF(s) as required by the
Department.
4) The Jurisdiction shall be required to have loan servicing policies and
asset management policies and procedures, pursuant to the
DepartmenYs Grant Management Manual Chapter on Asset and Real
Property Management
B. 24 CFR 570 489(e)(3) (iv) Transfer of proqram income of qrantees losinq
Entit/ement status.
Upon entry into the State CDBG program, a unit of general local
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government that has lost or relinquished its Entitlement status must submit
a letter to the department, signed by the Authorized Representative stating
' which of the following options the jurisdiction will be implementing. Keep
in mind, that retaining Entitlement PI while participating in the State CDBG
program will require PI reporting for both sets of funding. Entitlement PI
and any PI generated by State CDBG fund cannot be comingled.
Within 90 days of leaving the Entitlement Program to join the State CDBG
program, the jurisdiction must certify that it will either:
1) Retain program income generated under Entitlement grants and
continue to comply with Entitlement program requirements for program
income, including reporting it into IDIS or the urban county; or
2) Retain the program income and transfer it to the State CDBG program,
in which case the jurisdiction must comply with the State's rules for PI
and RLF address within this Memo, the Reuse Plan and Chapter 14 of
the Grant Management Memo.
6. Reauirements of Proaram Income
I This PI Reuse Agreement is intended to satisfy the requirements specified in
federal statute and regulation at Section 104Q) of the Housing and Community
Development Act ("the AcY'), as amended in 1992 and 24 CFR 570.489(e) and
(f). These statutory and regulatory sections permit a unit of local government to
retain PI for CDBG-eligible activities, with Department approval. Under federal
' guidelines adopted by the State of California's CDBG Program, local
governments are permitted to retain PI as long as the local government has
received advance approval from the State of a local Agreement that will govern
the expenditure of the PI. This Agreement has been developed to meet that
I requirement when an active contract between the Department and the
undersigned Jurisdiction is not in force.
The undersigned Jurisdiction certifies their PI will be used to fund eligible
CDBG activities that meet a National Objective and any public benefit
requirements. Eligible activities, National Objective and public benefit
requirements are specified in Federal Statute at Sections 104(b), 105(a) of The
Housing and Community Development Act of 1974, and in Federal Regulations
at 24 CFR 570.482 and 24 CFR 570.483. The Jurisdiction understands, if it is
� determined that an activity/project funded with PI that does not meet a National
Objective and/or meet the public benefit requirement, the Jurisdiction will be
' required to use its own local funds to repay the PI Account.
7. Definition of Proaram Income
"Program Income" means gross income earned by the Jurisdiction from grant-
funded activities and is subject to CDBG regulatory requirements pursuant to
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24 CFR, Part 570.489(e) - Program Administrative Requirements as amended
in the CDBG Final Rule, 24 CFR, Part 570.504 - Program Income, 24 CFR Part '
85 — Administrative Requirements for Grants and Cooperative Agreements to
' State, Local and Federally Recognized Indian Tribal Governments, and OMB
Circulars A-87 and A-122 as applicable. These regulations include the
requirement that the Jurisdiction record the receipt and expenditure of PI as
part of the financial transactions of the grant activity(ies).
For activities generating PI that are only partially funded with CDBG funds,
such income is prorated to reflect the actual percentage of CDBG participation.
Examqles of PI include but are not limited to: payments of principal and
interest on housing rehabilitation or business loans made using CDBG funds;
interest earned on PI pending its disposition; interest earned on funds that have
been placed in a revolving loan account; net proceeds from the disposition by
sale or long-term lease of real property purchased or improved with CDBG
funds; and, income (net of costs that are incidental to the generation of the
income) from the use or rental of real property that has been acquired,
constructed or improved with CDBG funds and that is owned (in whole or in
part) by the participating Jurisdiction or Sub-recipient.
8. Fiscal Reaortina of Proqram Income Recei�ts Deuosits and
Disbursements
The undersigned Jurisdiction certifies that CDBG PI will be accounted for using
the Department's fiscal year timeframe (July 1 to June 30). All receipts of PI or
RLF revenue (and the depositing of those funds into separate account(s)) and
expenditures of PI in accordance with this PI Reuse Agreement will be
monitored and reported per the DepartmenYs fiscal year cycle. The
undersigned Jurisdiction certifies that they will report using the Department's
reports/forms and will submit them in a timely manner.
9. Duration of This Proaram Income Reuse Aareement I
The undersigned Jurisdiction certifies that it and its Governing Body I
understand that this document is effective for five (5) years from the execution
date by the authorized CDBG Representative listed in this Agreement. At that
time unless here are no further CDBG PI assets generating repayments, or the i
Jurisdiction has become a HUD entitlement Jurisdiction and uses these funds
for entitlement activities, a new PI Reuse Agreement will be submitted to the
Department. The Department has the Authority to void the Agreement with
notice for cause.
10. Program Income General Administration (PI GA)
� A. After the PI Reuse Agreement is executed, the Jurisdiction reserves the right
to calculate and track up to seventeen percent (17%) of PI received pursuant �
to Section 1 , item 2 above, for payment of eligible PI GA costs. PI GA will not
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be calculated for any RLF deposits. PI GA funds will not be used until
General Conditions for PI GA are cleared and Departmental written approval
is received. As noted above, these funds cannot be set aside since all PI
must be expended first on whatever CDBG cost must be paid next, however
tracking the amount of PI GA generated by the Jurisdiction's PI revenue
permits the Jurisdiction to use that amount on eligible CDBG costs that don't
have to meet a national objective, and ensures the Department is not
exceeding the administrative funding cap of twenty percent (20%), as set by
federal statute.
B. If more funds are expended than what is available under PI GA calculation,
the Jurisdiction will be required to return the over-expended PI GA amount
� back into their PI Account.
C. Ineligible PI GA costs will be required to be returned to their PI Account.
D. PI GA funds, once approved for use, may be used to pay for costs associated
with receiving Department approval of PI activities funded under this
agreement. Before submitting any proposed PI activities (Waivers or RLF) for
Department approval, the Jurisdiction must hold at least one formal public
hearing to discuss eligible activities and proposed PI activities. Department
recommends that this public hearing be conducted to review current fiscal
year PI activities and proposed and possible activities for future Department
applications.
11. Revolving Loan Funds (RLFs)
A. Pursuant to the criteria noted below, the undersigned Jurisdiction may be
eligible to apply for the Housing RLF and/or the ED RLF.
B. RLFs listed under the Agreement will only be utilized after the Jurisdiction
submits written certification as well as the required guideline documents, and
receives written Departmental approval certifying that the proposed RLF
i meets the DepartmenYs definition as follows:
1) There are existing loans and assets from past RLF eligible activities that
can be reasonable expected to generate repayments.
2) The existing loans and assets have generated at least one loan
repayment in the current fiscal year.
' C. The two RLFs and their respective CDBG eligible activities listed in this
Agreement will be administered under the guidance and requirements
provided in this Agreement and in the DepartmenYs current GMM Chapter on
Program Income, and any subsequent policy, regulation, or statutory
guidance, from the Department.
D. Pursuant to Management Memorandum 14-05, the undersigned Jurisdiction
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' certifies acknowledgement that the Department reserves the right to cancel ,
the grantee's RLF and require the funds to be returned to the Department
as a corrective action for significant, ongoing non-compliance with RLF
rules.
E. The two (2) RLFs listed below each have a multiple eligible CDBG program
activities. All CDBG rules pertaining to eligible RLF program activities will
be followed.
1) Housina Revolvinq Loan Fund
There are three (3) housing programs that must be made available
under this RLF. The Jurisdiction will get written Department approval
for all three programs as part of Housing RLF approval. I
Eligible housing activities under this RLF include:
i. Housinq Rehabilitation - Sinqle Unit Residence program for owner
and/or tenant occupied properties. Matrix code 14A. �
ii. Housinq Rehabilitation - 2-4 Units program for owner and/or tenant
occupied properties. Matrix code 14B.
iii. Housinq Acquisition - Sinqle Family program for homebuyer
assistance. Matrix code 13.
2) F�onomic Develooment IEDI Revolvina Loan Funds (RLFI
Eligible ED activities under this RLF include:
i. Business Assistance program (direct financial assistance to a for-
profit business). Matrix codel8A; and
ii. Microenterprise Financial Assistance. Matrix code 18C.
F. Each approved RLF will offer all eligible activities under the RLF definition.
G. Separate and formally adopted program guidelines for each eligible activity
will be provided to the Department as part of General Conditions for all
eligible RLF activities when obtaining Department approval of a RLF.
H. The undersigned Jurisdiction acknowledges that although all eligible
activities under each approved RLF must be available, the Jurisdiction has
the discretion to fund RLF loans for the activity or activities they deem to I
address the greatest need in their community.
I. RLF receipts on deposit may be used for one or both single family housing
program activities. Although both activities are required to be approved by
the Department for use under the RLF, the Jurisdiction may choose to only
� operate one program at time or both simultaneously.
J. In addition, each approved RLF will meet the following criteria: i
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1) RLFs will operate on a fiscal year of July 1 to June 30 for accounting
and performance reporting.
2) Jurisdictions will set up RLFs as separate accounts (Housing and ED
RLF accounts must be separate) with separate fund and transaction
numbers. All other CDBG funds received as PI must be accounted for
in a separate account. ,
3) All accounts set up pursuant to 2.G.2 will be interest bearing.
4) RLF monies will be expended first when the same RLF activity is
funded under an awarded active grant contract.
5) RLF projects may be funded with both RLF monies and an active grant
contract.
6) RLFs will be expended primarily on loans since RLFs must revolve.
Thus, activities under an active contract that are funded using only
grants rather than loans, will use contract funds not RLF monies to pay
for the activity. Microenterprise grants, home repair grants and closing
cost grants, that do not have loans associated with them, will not
become RLF assets and therefore will not require RLF funds to be
spent first on the active grant activities.
7) The RLFs will primarily provide financing instruments that will revolve,
(i.e. loans), RLFs cannot fund projects primarily or solely with grants or
forgivable loans.
, 8) RLF receipts from loans or assets generated from the same program
activity, (i.e. single family housing rehabilitation loan repayments will
only be deposited into a Housing RLF). Thus, repayments from the
same program activities that go into an RLF must be used for
originating loans for the same program activities.
9) RLF PI balances will not be moved to another approved RLF account or
, to the Jurisdiction's regular PI account. The Department may use a
, state or federal disaster declaration to formally allow for re-purposing of
, PI funds by the Jurisdiction. Funds approved by the Department for re-
purposing to meet an urgent need are considered PI and must be
expended first under active grant contracts or under approved waivers if
there is no active contract.
10) RLFs that become depleted of funds and do not have additional asset
repayments to sustain revolving activities, such that no longer meeting
I the Departments RLF definition, will be canceled by the Department.
11) RLF PI received and deposited is not allowable for PI GA expenses
thus, seventeen percent (17%) cannot be set aside as with Jurisdictions
with separate PI accounts.
12) RLFs with no annual revolving activities, (i.e. approved loans), are not
able to be used by the Jurisdiction for reimbursement of non-revolving
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I costs therefore, activity delivery (AD) costs are not eligible. AD costs I
are onlv eliaible if one or more proiects are funded and
accomalishment data li.e. beneficiariesl. for those activitvfiesl. on
an annual basis. are renorted. I
' 13) RLF projects must be documented as meeting a national objective. If a
project does not meet a national objective, then all expenses associated
with the project (activity and activity delivery funds) must be repaid to
the RLF with non-federal funds.
14) Given that RLF revenue cannot be "banked", to remain eligible, a RLF ,
must revolve. To meet the definition of revolving, the undersigned ',
Jurisdiction will not have more than $100,000 on deposit in an RLF within
a fiscal year without making at least one loan. Nor will the undersigned I
Jurisdiction have more than $500,000 on hand even if making loans,
� each fiscal year.
15) The undersigned Jurisdiction certifies they are aware that the
Department will address excess funds and revolving compliance by
issuing finding letters to the grantee which could result in the
Department cancelling the grantee's RLF, which immediately converts
the funds to PI; and, therefore, must be used prior to drawing down
grant funds.
16) RLF activity delivery funds (AD) may be used to pay for loan servicing
costs.
17) Citizens of the Jurisdiction must be the primary beneficiaries of all RLF
program activities.
18) Financial and performance reporting, on RLF projects will be done I
using current eligible activity set up, performance and completion ,
, reports for National Objective data and beneficiary demographics as '
HUD required accomplishment information.
19) Additional financial reports for RLF PI deposits and expenditures will be
� done twice a year using the DepartmenYs current PI fiscal reporting
forms.
20) The Jurisdiction will be required to repay the RLF account for ineligible
costs or activities with local non-federal funds.
21) RLF programs will meet the CDBG National Objective of benefit to
Low/Moderate-income (Low/Mod) households. per 24 CFR Part 5, and
in accordance with the DepartmenYs Income Manual.
22) Loan servicing costs under the RLFs are not eligible as PI GA costs but
are eligible AD costs. As such, loan servicing costs are only eligible if
one or more loans are made fiscally. j
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K. Activity Specific Requirements:
1) Housing RLF:
a. All Housing Rehabilitation and Homeownership Assistance i
programs will only fund projects that meet a National Objective and �
comply with other State and federal requirements, including
Department Management Memorandums and GMM Chapters on
Housing Rehabilitation, Multi-Family Rehabilitation (2-4 units), and
Homeownership Assistance.
b. No more than nineteen percent (19%) of funds expended for �
Housing Rehabilitation in the RLF will be used for AD costs on an
annual fiscal basis.
c. No more than eight percent (8%) of funds expended in a fiscal year
for Homeownership Assistance will be used to reimburse eligible
' AD costs.
d. AD costs are not eligible until one loan is approved, closed and
project beneficiary information is submitted.
e. Projects cannot be solely funded as a grant.
2) ED RLF:
' a. Both ED programs will only fund projects that meet a National
Objective and comply with other State and federal requirements,
including Department Management Memorandums and GMM
Chapters on Microenterprise and BA program.
b. Income eligibility must be met per 24 CFR Part 5 and in accordance
with the DepartmenYs Income Manual.
c. No more than 15 percent (15%) of the total funds expended for BA
or Microenterprise financial assistance activities shall be used to
reimburse Jurisdiction for eligible activity delivery (AD) costs on an
annual fiscal basis.
d. Annual AD costs are not eligible until one loan is approved, closed
and project beneficiary information is submitted.
e. For Business Assistance (BA), local review and underv✓riting of
, business assistance projects requesting a CDBG loan under this
RLF shall be conducted under the Business Assistance Program
Guidelines that have been adopted by the Governing Body of the
' undersigned Jurisdiction and approved in writing by the I
Department, as part of RLF approval.
f. For Microenterprise Assistance (ME) The CDBG eligible activity I
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of direct financial assistant to eligible Microenterprise businesses
will be conducted under this RLF. Local review and approval of
microenterprise business assistance projects requesting a CDBG
loan under this RLF shall be conducted under the Microenterprise
Financial Assistance Program Guidelines that have been adopted '
by the Governing Body of the undersigned Jurisdiction and
approved in writing by the Department as part of the General
Conditions clearance. Note: this subsection applies to ME loans
only, not ME grants. Financial Assisfance that is so/ely a grant
cannot be made through an RLF. j
12. Loan Portfolio and Asset Management Policies and Costs I
A. The undersigned Jurisdiction certifies that it has asset management policies
and loan portfolio servicing policies that are in compliance with HUD
standards per 24 CFR Part 570, OMB Circulars A-87, A-122 A-133, and 24
CFR Part 85.
B. The use of CDBG funds creates public financial assets. The public financial
assets created can be in the form of loans or other repayment instruments
which result in PI. Financial assets may also be in the form of real property
or chattel (equipment and fixtures). All assets created from the use of
CDBG funds must be administered in compliance with OMB Circulars A-87,
A-122 A-133, 24 CFR Part 85. These policies will be used for managing all
CDBG assets, including those which generate PI and RLF PI.
C. General Administration PI funds may be used to reimburse the Jurisdiction
for loan servicing and asset management costs. If the Jurisdiction has no PI
GA available, GA funds from active grant contracts may be used to pay for
eligible loan servicing costs.
13. Program Income Waivers
A. The PI Waiver Submission Process will only be conducted when the
undersigned Jurisdiction has no active grant contract(s) with the Department.
B. The process below will be followed if a PI Waiver is to be requested:
1) All PI Waiver requests will be submitted on approved Departmental forms
for the DepartmenYs written approval.
2) After the DepartmenYs review of the activity for eligibility and national
objective compliance, the PI Waiver will be formally adopted via public
hearing and resolution of the Jurisdiction's Governing Body, as part of
the PI Waiver General (and Special Conditions if applicable) Clearance
process.
3) Expenditure of PI Waiver funds will not commence until clearance of all
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required General and Special Conditions have been met, and written
Departmental approval has been issued to the Jurisdiction.
4) Possible Waiver activities will be discussed at a properly noticed public
hearing, held in front of the Jurisdiction's Governing Body, prior to
submission of a Certified Resolution as part of a PI Waiver Request to
the Department.
5) The PI Waiver request must be submitted in accordance with current
' Department policy, and any subsequent policy, regulation, or statutory
guidance.
6) PI Waiver activity reporting will be submitted per current Departmental
policies and includes financial accounting of all PI received and
expended, including PI Waivers and PI Waiver activity performance.
7) PI Waiver activities must be fully funded with program income already on
hand.
8) Only two (2) PI Waivers may be open and active at any one time.
9) RLF funds will not be used for PI Waivers, since RLF monies must be
expended on the activity that generated the payments.
10) PI Waivers will not be approved for the same program activities for
approved RLFs.
C. PI GA and PI Waiver financial and perFormance reporting will be done using
current eligible activity set up and completion reports which will collect
national objective data and beneficiary demographics for HUD required
accomplishment information.
D. Additional financial reports for PI GA, PI Waivers, PI deposits and
expenditures will be done semi-annually using the DepartmenYs current PI
fiscal reporting forms.
E. Ineligible costs will be required to be repaid to the PI Account. In some
cases with ongoing significant compliance issues, the Department reserves
the right to require the jurisdiction return all PI to the Department until it is
satisfied that the jurisdiction has resolved all compliance issues.
14.Progrem Income Not Associated with an RLF
A. Provided the undersigned Jurisdiction has made the Department aware at the
beginning of the fiscal year they intend to exercise the $35,000 rule, PI which is
received annually that has a cumulative amount up to $35,000 (RLF receipts
are not included in the $35,000 calculation) may be "re-categorized" as non-
CDBG funds. In electing to exercise the $35,000 rule, the Jurisdiction agrees
not to expend CDBG revenue until either the fiscal year ends or the amount
received goes above $35,000, at which point the jurisdiction must consider the
revenue as CDBG PI and must use it, first prior to drawing CDBG contract
funds.
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B. The undersigned Jurisdiction certifies that it acknowledges if it has PI on hand
and has not applied for or been awarded CDBG funds with the past three
NOFAs, the Jurisdiction will be required to submit a PI Expenditure Plan for
its PI on hand. The plan must be submitted via the CDBG PI Waiver process. '
If the Jurisdiction does not initiate the request, the Department will send the
Jurisdiction a letter requiring submission of the plan within a set time frame. If
the Jurisdiction does not respond to the Department's letter, the Jurisdiction
will be required to return all PI on hand to the Department, regardless of the
amount of PI.
Intentionally left blank,
please continue to the next page.
II
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SECTION THREE: DEPARTMENT TERMS, CONDITIONS AND
AUTHORIZATION
TERMS AND CONDITIONS: The undersigned Jurisdiction certifies that all terms and
conditions listed below have been read and understood, and will be implemented and
followed:
1. Authoritv 8 Puroose
' This Agreement provides official notification of the Jurisdiction's PI Reuse
AgreemenYs approval under the State's administration of the Federal CDBG for
Non-entitlement Jurisdictions pursuant to the provisions of 42 U.S. Code (U.S.C.)
5301 et seq., 24 Code of Federal Regulations (CFR) Part 570, Subpart I, and 25
California Code of Regulations (CCR), Sections 7050 et seq. The Program is
listed in the Catalog of Federal Domestic Assistance as 14.228 - CDBG
Community Development Block Grant Program.
In accepting the PI Reuse Agreement approval, the Jurisdiction agrees to comply
with the terms and conditions of this Agreement, all exhibits hereto and the
representations contained in the Jurisdiction's PI Reuse Agreement. Any
changes made to the PI Reuse Agreement after this Agreement is accepted must
receive prior written approval from the Department.
2. Distribution for Reuse of PI
I A. The Jurisdiction shall perform PI funded activities as described in the
Distribution for Reuse in the PI Reuse Agreement. All written materials or
alterations submitted as addenda to the original PI Reuse Agreement and
which are approved in writing by the Department are hereby incorporated
as part of the PI Reuse Agreement.
The Department reserves the right to require the Jurisdiction to modify any
or all parts of the PI Reuse Agreement in order to comply with CDBG
requirements. The Department reserves the right to review and approve
' all work to be performed by the Jurisdiction in relation to this Agreement.
Any proposed revision to the work must be submitted in writing for review
and approval by the Department and may require an amendment to this
Agreement. Approval shall not be presumed unless such approval is
, made in writing by the Department.
B. The PI funded activities shall principally benefit Low/Mod-income persons
or households residing in the Jurisdiction. HUD defines Low/Mod as
having an annual income that is no more than 80 percent (80%) of the
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county median area income, adjusted for household size.
3. Sufficiencv of Funds and Termination
The Department may terminate this Agreement at any time for cause. . The
Jurisdiction will have at least 14 days upon receipt of the Departments written i
notice. Termination shall consist of violations of any terms and/or conditions of
this Agreement, upon the request of HUD, or withdrawal of the DepartmenYs '
expenditure authority.
The Department reserves the right, for any significant on-going non-compliance
with RLF or Program Income rules, to cancel any RLF and require, all RLF and
PI funds, to be returned to the Department.
4. Meetina National Obiectives
All activities performed under this Agreement must meet one of the National
Objectives determined by the HUD regulations as included in the Application
authorized under Title I of the Housing and Community Development Act of
1974, as amended.
A. Benefit to HUD defined Low/Mod-income person or household (LMI). The
term Low/Mod-income is defined under CDBG as no more than 80 percent
(80%) of the median area income, as determined by HUD, per Federal I
Regulation 24 CFR, Part 570.483(b); and/or,
B. Prevention or elimination of slums or blight. In order for an activity to meet
the National Objective of elimination of slums and blight, the activity must
take place in an area that meets the definition of a blighted area and the
project must be shown to eliminate blight or prevent further blight per
Federal Regulation 24 CFR, Part 570.483(c). I
C. For Microenterprise Assistance activities, the Jurisdiction must only meet I
the benefit to Low/Mod-income person or household (LMI) National I
Objective.
5, InsnPr.tinns Of Activities I
A. The Department reserves the right to inspect any activity(ies) performed
hereunder to verify that the activity(ies) is in accordance with the
applicable federal, State and/or local requirements and this Agreement. ,
B. The Jurisdiction shall inspect any activity performed by contractors and
subrecipients hereunder to ensure that the activity(ies) is in accordance
with the applicable federal, State and/or local requirements and this
Agreement.
_ _ - �
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The Jurisdiction agrees to require that all activity(ies) found by such
inspections not to conform to the applicable requirements be corrected,
and to withhold payment to its contractor or subcontractor, respectively, I
until it is so corrected.
6. lnsurance �
The Jurisdiction shall have and maintain in full force and effect during the term of
this Agreement such forms of insurance, at such levels as may be determined by
the Jurisdiction and the Department to be necessary for specific components of
the activity(ies) described in this Reuse Agreement.
7. Contractors and Subrecinients
A. The Jurisdiction shall not enter into any agreement, written or oral, with
any contractor or subrecipient without the prior determination that the
contractor or subrecipient is eligible to receive CDBG funds and is not
listed on the Federal Consolidated List of Debarred, Suspended, and
Ineligible Contractors.
1) Contractors are defined as program operators or construction
contractors who are procured competitively.
2) Subrecipients are defined as public or private non-profit agencies or
organizations and certain (limited) private for-profit entities who
receive CDBG funds from an awarded Jurisdiction to undertake
eligible activities.
B. An agreement between the Jurisdiction and any contractor or subrecipient
shall require:
I1) Compliance with the applicable State and federal requirements of
this Agreement, which pertain to, among other things, labor
standards, non-discrimination, Americans with Disabilities Act,
Equal Employment Opportunity, and Drug-Free Workplace; and,
Compliance with the applicable provisions relating to Labor
Standards/Prevailing Wages. In addition to these requirements, all
contractors and subcontractors shall comply with the applicable
provisions of the California Labor Code.
2) Maintenance of, at minimum, the State-required Workers'
' Compensation Insurance for those employees who will perform the
activity(ies) or any part of it.
3) Maintenance of, if so required by law, unemployment insurance,
disability insurance and liability insurance, which is reasonable to
compensate any person, firm, or corporation, who may be injured
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I or damaged by the contractor, or any subcontractor in performing
the activity(ies) or any part of it.
4) Compliance with the applicable Equal Opportunity Requirements
described in this Agreement.
C. Contractors shall:
' 1) Perform the activity(ies) in accordance with federal, State and local
housing and building codes, as are applicable.
2) Provide security to assure completion of the project by furnishing
the borrower and construction lenders with Performance and
Payment Bonds, or other security approved in advance in writing by
the Department.
D. Subrecipients shall:
1) Retain all books, records, accounts, documentation, and all other
materials relevant to this Agreement for a period of five (5) years
from date of termination of this Agreement, or five (5) years from
the conclusion or resolution of any and all audits or litigation
relevant to this Agreement, and any amendments, whichever is
later.
2) Permit the State, federal government, the Bureau of State Audits,
the Department and/or their representatives, upon reasonable I
notice, unrestricted access to any or all books, records, accounts,
documentation, and all other materials relevant to the agreement
for the purpose of monitoring, auditing, or otherwise examining said
materials.
8. Obliaations of the Jurisdiction with Respect to Certain Third Partv
Relationships
The Jurisdiction shall remain fully obligated under the provisions of this
Agreement notwithstanding its designation of any third party or parties for the
undertaking of all or any part of the Activities funded under this agreement with
respect to which assistance is being provided under this Agreement to the
Jurisdiction.
The Jurisdiction shall comply with all lawful requirements of the Department
necessary to ensure that the Program, with respect to which assistance is being
provided under this Agreement to the Jurisdiction, is carried out in accordance
with the DepartmenYs Assurance and Certifications, including those with respect
I
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to the assumption of environmental responsibilities of the Department under
' Section 104(g) of the Housing and Community Development Act of 1974.
I
9. Periodic Renortina Reauirements
During the term of this Agreement, the Jurisdiction must submit the following
reports by the dates identified, respectively, or as othenvise required at the
discretion of the Department. The Jurisdiction's performance under this
Agreement will be based, in part, on whether it has submitted the reports on a
timely basis.
A. Semi-Annual PI Expenditure/Performance Report: Submit by January 31
i and July 31 of each year regardless of whether or not the Jurisdiction has
any unexpended PI. PI Waivers or open Grants with no accomplishment
are not excluded to the reporting requirement.
B. Annual Federal Overlav Reportinq: Submit by July 31 starting from the
I contract effective date to subsequent June 30, and for each State Fiscal
Year. Annual Reporting includes but is not limited to: Section 3, and
Minority Owned BusinessNVomen Owned Business (MBENVBE).
C. Waqe Comoliance Reoorts: Semi-annual Wage Compliance Reports are
to be submitted by October 7 and April 7 during the entire construction
period. The final Wage Compliance Report is to be submitted thirty (30)
days after construction is completed.
D. Any other reports that may be required as a Special Condition of this
, Agreement.
10. Monitorina Reauirements
The Department shall perform a program and/or fiscal monitoring of the
activity(ies). The Jurisdiction shall be required to resolve any monitoring findings
to the DepartmenYs satisfaction by the deadlines set by the Department. If
findings are not adequately resolved in a timely manner, the Department may
deduct points from the Jurisdiction's performance score on future applications.
' Additionally, the Department reserve the right to suspend a Jurisdiction's
, authority to expend PI (Waiver, RLF and/or PI attached to an open grant) based
on significant compliance issues, reporting concerns or serious lack of
� cooperation in clearing PI monitoring findings.
11. i n
� If the Jurisdiction places signs stating that the Department is providing financing,
it shall indicate in a typeface and size commensurate with the DepartmenYs
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,
funding portion of the project that the Department is a source of financing through I
the CDBG Program.
12. AudiURetention and Insoection of Records
A. The Jurisdiction must have intact, auditable fiscal records at all times. If
the Jurisdiction is found to have missing audit reports from the SCO during
the term of this Agreement, the Jurisdiction will be required to submit a
Agreement to the State, with task deadlines, for submitting the audit to the
SCO. If the deadlines are not met, the Jurisdiction will be subject to
termination of this Agreement and disencumbrance of the funds awarded.
The Jurisdiction's audit completion Agreement is subject to prior review
and approval by the Department.
B. The Jurisdiction agrees that the Department or its designee will have the
right to review, obtain, and copy all records pertaining to performance of
this Agreement. The Jurisdiction agrees to provide the Department or its
designee with any relevant information requested and shall permit the
Department or its designee access to its premises, upon reasonable
notice, during normal business hours for the purpose of interviewing
employees and inspecting and copying such books, records, accounts,
and other material that may be relevant to a matter under investigation for
the purpose of determining compliance with California Public Contract
Code (PCC) Section 10115 et seq., Government Code (GC)
Section 8546.7 and 2 CCR 1896.60 et seq. The Jurisdiction further
agrees to maintain such records for a period of five (5) years after final
payment under this Agreement. The Jurisdiction shall comply with the
caveats and be aware of the penalties for violations of fraud and for
obstruction of investigation as set forth in PCC 10115.10.
C. An expenditure which is not authorized by this Agreement or which cannot
be adequately documented shall be disallowed and must be reimbursed to
the Department or its designee by the Jurisdiction.
D. Absent fraud or mistake on the part of the Department, the determination
by the Department of allowable expenditures shall be final.
E. For the purposes of annual audits under OMB Circular A-133 (The United
States Office of Management and Budget Circular for Audits of States and
Local Governments), Jurisdiction shall use the Federal Catalog
Number 14.228 for the State CDBG Program. i
F. Notwithstanding the foregoing, the Department will not reimburse the
Jurisdiction for any audit cost incurred after the expenditure deadline of
this Agreement.
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G. The Jurisdiction understands that the expenditure of PI is covered under
the OMB A-133 Single Audit Requirements and will meet all these
requirements and report said PI Expenditure along with grant funds each I
fiscal year. I
13. Conflict of Interest of Members Officers or Emolovees of Contractor
Members of Local Governinq Bodv. or other Public Officials
Pursuant to 24 CFR 570.611 , no member, officer, or employee of the
Jurisdiction, or its designees or agents, no member of the Governing Body of the
locality in which the program is situated, and no other public official of such
locality or localities who exercise or have exercised any functions or
responsibilities with respect to CDBG activities assisted under this part, or who
are in a position to participate in a decision-making process or gain inside
information with regard to such activities, may obtain a financial interest or
benefit from a CDBG-assisted activity, or have a financial interest in any contract,
subcontract or agreement with respect to a CDBG-assisted activity or its
proceeds, either for themselves or those with whom they have business or
immediate family ties, during their tenure or for one (1) year thereafter. The
Jurisdiction shall incorporate, or cause to be incorporated, in all such contracts or
subcontracts a provision prohibiting such interest pursuant to the purposes of this
Section.
14. iv r
No waiver of any breach of this Agreement shall be held to be a waiver of any �
prior or subsequent breach. The failure of the Department to enforce at any time
the provisions of this Agreement or to require at any time performance by the
' Jurisdiction of these provisions shall in no way be construed to be a waiver of
such provisions nor to affect the validity of this Agreement or the right of the
Department to enforce these provisions.
15. Litipation I
A. ff any provision of this Agreement, or an underlying obligation, is held I
invalid by a court of competent Jurisdiction, such invalidity, at the sole
discretion of the Department, shall not affect any other provisions of this
Agreement and the remainder of this Agreement shall remain in full force
and effect. Therefore, the provisions of this Agreement are, and shall be,
deemed severable. I
B. The Jurisdiction shall notify the Department immediately of any claim or
action undertaken by or against it which affects or may affect this �i
� Agreement or the Department, and shall take such action with respect to
the claim or action as is consistent with the terms of this Agreement and
the interests of the Department.
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16. Lead-Based PaintHazards
Activity(ies) performed with assistance provided under this Agreement are ,
subject to lead-based paint hazard regulations contained in Title 8 (Industrial
Relations) and Title 17 (Public Health) of the CCR and 24 CFR, Part 35 (Lead �
Disclosure). Any grants or loans made by the Jurisdiction with assistance
provided under this Agreement shall be made subject to the provisions for the
elimination or mitigation of lead-based paint hazards under these Regulations.
The Jurisdiction shall be responsible for the notifications, inspections, and
clearance certifications required under these Regulations.
17. Prevailinq Waaes
A. Where funds provided through this Agreement are used for construction '
work, or in support of construction work, the Jurisdiction shall ensure that
the requirements of California Labor Code (LC), Chapter 1, commencing
with Section 1720, Part 7 (pertaining to the payment of prevailing wages
and administered by the California Department of Industrial Relations) are
met.
B. For the purposes of this requirement "construction work" includes, but is
not limited to rehabilitation, alteration, demolition, installation or repair
done under contract and paid for, in whole or in part, through this
Agreement. All construction work shall be done through the use of a
written contract with a properly licensed building contractor incorporating
these requirements (the "construction contracY'). Where the construction
contract will be between the Jurisdiction and a licensed building
contractor, the Jurisdiction shall serve as the "awarding body° as that term
is defined in the LC. Where the Jurisdiction will provide funds to a third
party that will enter into the construction contract with a licensed building
contractor, the third party shall serve as the "awarding body." Prior to any
disbursement of funds, including but not limited to release of any final
retention payment, the Department may require a certification from the
awarding body that prevailing wages have been or will be paid.
18. Comoliance with State and Federal Laws and Reaulations
A. The Jurisdiction agrees to comply with all State laws and regulations that
pertain to construction, health and safety, labor, fair employment I
practices, equal opportunity, and all other matters applicable to the
Jurisdiction, its subcontractors, contractors or subcontractors, and the
Reuse activity(ies), and any other State provisions as set forth in this
Agreement.
I B. The Jurisdiction agrees to comply with all federal laws and regulations
applicable to the CDBG Program and to the activity(ies), and with any
I other federal provisions as set forth in this Agreement.
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19. Anti-Lobbvina Certification
The Jurisdiction shall require that the language of this certification be included in �
all contracts or subcontracts entered into in connection with this activity(ies) and
that all subrecipients shall certify and disclose accordingly. �
This ceRification is a material representation of fact upon which reliance was
placed when this transaction was made or entered into. Submission of this
certification is a prerequisite for making or entering into this transaction imposed
by 31 U.S.C. 1352. Any person who fails to file the required certification shall be
subject to a civil penalty of not less than $10,000 and no more than $100,000 for
such failure.
"The undersigned certifies, to the best of his or her knowledge or belief, that: I
� A. No federal appropriated funds have been paid or will be paid, by or on
behalf of it, to any person for influencing or attempting to influence an
officer or employee of any agency, a Member of Congress, an officer or
employee of Congress, or an employee of a Member of Congress in
connection with the awarding of any federal contract, the making of any
federal grant, the making of any federal loan, the entering into of any
cooperative agreement, and the extension, continuation, renewal,
amendment, or modification of any federal contract, grant, loan, or
cooperative agreement; and,
B. If any funds other than federal appropriated funds have been paid or will
be paid to any person for influencing or attempting to influence an officer
or employee of any agency, a Member of Congress, an officer or
employee of Congress, or an employee of a Member of Congress in
connection with this federal contract, grant, loan, or cooperative
agreement, it will complete and submit Standard Form-LLL, "Disclosure �
Form to Report Lobbying," in accordance with its instructions." I
� 20. Bonus or Commission. Prohibition Aaainst Pavments of
The assistance provided under this Agreement shall not be used in the payment I
of any bonus or commission for the purpose of:
, A. Obtaining the DepartmenYs approval of the Application for such I
assistance; or,
B. The DepartmenYs approval of the Applications for additional assistance;
or, ,
I
C. Any other approval or concurrence of the Department required under this
Agreement, Title I of the Housing and Community Development Act of
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i
1974, or the State regulations with respect thereto; provided, however,
that reasonable fees for bona fide technical, consultant, managerial or
other such services, other than actual solicitation, are not hereby I
prohibited if otherwise eligible as program costs.
21. Citizen Participation
The Jurisdiction is subject to the requirements concerning citizen participation
contained in Federal Regulations at 24 CFR, Part 570.486, Local Government
Requirements. Part 91.105 and 91.115.
22. Clean Air and Water Acts
This Agreement is subject to the requirements of the Clean Air Act, as amended,
42 USC 1857 et seq., the Federal Water Pollution Control Act, as amended, 33
USC 1251et seq., and the regulations of the Environmental Protection Agency
with respect thereto, at 40 CFR, Part 15, as amended from time to time.
23. Conflict of Interest of Certain Federal Officials
No member of or delegate to the Congress of the United States, and no resident
commissioner, shall be admitted to any share or part of this Agreement or to any
benefit to arise from the same. The Jurisdiction shall report all perceived or '
actual conflicts of interest cases to the State for review before financial benefits
are given.
24. Environmental Reauirements
The Jurisdiction shall comply with the provisions of the National Environmental
Policy Act (NEPA) by following the procedures contained in 24 CFR, Part 58.
The Jurisdiction shall not undertake any activity that would have an adverse
environmental impact or limit the choice of reasonable alternatives under 24
CFR, Part 58.22 until HUD or the Department has issued an environmental
clearance.
25. EaualOpaortunitv
A. The Civil Riqhts Housinq and CommunitV Development and Aqe
Discrimination Acts Assurances
During the performance of this agreement, the Jurisdiction assures that no �
otherwise qualified person shall be excluded from participation or
employment, denied program benefits, or be subjected to discrimination
I based on race, color, national origin, sex, age, handicap, religion, familial
status, or religious preference, under any activity funded by this
Agreement, as required by Title VI of the Civil Rights Act of 1964, Title I of
the Housing and Community Development Act of 1974, as amended, the
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Age Discrimination Act of 1975, the Fair Housing Amendment Act of 1988,
and all implementing regulations.
B. Rehabilitation Act of 1973 and the "504 Coordinator" �I
The Jurisdiction further agrees to implement the Rehabilitation Act of ��
1973, as amended, and its regulations, 24 CFR, Part 8, including, but not '
limited to, for Jurisdiction's with fifteen (15) or more permanent full or part
time employees, the local designation of a specific person charged with
I local enforcement of this Act, as the "504 Coordinator."
C. The Traininq Emplovment and Contractinq Oqqortunities for Business
and Lower-Income Persons Assurance of Compliance
1) The activity(ies) to be performed under this Agreement are subject
to the requirements of Section 3 of the HUD Act of 1968, as
amended, 12 U.S.C. 1701 u. Recipients, contractors and
subcontractors shall direct their efforts to provide, to the greatest
extent feasible, training and employment opportunities generated
from the expenditure of Section 3 covered assistance to Section 3
residents in the order of priority provided in 24 CFR,
Part 135.34(a)(2).
2) The parties to this Agreement will comply with the provisions of said
Section 3 and the regulations issued pursuant thereto by the
Secretary of HUD set forth in 24 CFR, Part 135, and all applicable
rules and orders of the Department issued thereunder prior to the
execution of this Agreement. The parties to this Agreement certify
and agree that they are under no contractual or other disability
which would prevent them from complying with these requirements.
3) The Jurisdiction will include these Section 3 clauses in every
contract and subcontract for Work in connection with the
activity(ies) and will, at the direction of the Department, take
appropriate action pursuant to the contract or subcontract upon a
finding that the Jurisdiction or any contractor or subcontractor is in
violation of regulations issued by the Secretary of HUD, 24 CFR,
' Part 135 and, will not let any contract unless the Jurisdiction or
contractor or subcontractor has first provided it with a preliminary
statement of ability to comply with the requirements of these
regulations.
4) Compliance with the provisions of Section 3, the regulations set
' forth in 24 CFR, Part 135, and all applicable rules and orders of the
Department issued thereunder prior to the execution of this
Agreement shall be a condition of the federal financial assistance
provided to the activity(ies), binding upon the Jurisdiction, its
successors, and assigns. Failure to fulfill these requirements shall
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subject the Jurisdiction, its contractors and subcontractors and its
successors, to such sanctions as are specified by 24 CFR, Part 135
and those sanctions specified by this Agreement.
D. Assurance of Comqliance with Requirements Placed on Construction
Contracts of $10,000 or More
The Jurisdiction hereby agrees to place in every contract and subcontract
for construction exceeding $10,000 the Notice of Requirement for
Affirmative Action to ensure Equal Employment Opportunity (Executive
Order 11246), the Standard Equal Employment Opportunity, and the
Construction Contract Specifications. The Jurisdiction furthermore agrees
to insert the appropriate Goals and Timetables issued by the U.S.
Department of Labor in such contracts and subcontracts. I
26. Flood Disaster Protection
A. This Agreement is subject to the requirements of the Flood Disaster
Protection Act (FDPA) of 1973 (Public Law 93-234). No portion of the
assistance provided under this Agreement is approved for acquisition or
construction purposes as defined under FDPA, Section 3 (a) of said Act,
for use in an area identified by the Secretary of HUD as having special
flood hazards which is located in a community not then in compliance with
the requirements for participation in the national flood insurance program
pursuant to FDPA, Section 102(d) of said Act.
B. The use of any assistance provided under this Agreement for such
acquisition or construction in such identified areas in communities then
participating in the national flood insurance program shall be subject to the
mandatory purchase of flood insurance requirements of FDPA, Section
102(a) of said Act.
C. Any contract or agreement for the sale, lease, or other transfer of land �
acquired, cleared or improved with assistance provided under this
Agreement shall contain certain provisions. These provisions will apply if
such land is located in an area identified by the Secretary of HUD as
having special flood hazards and in which the sale of flood insurance has
been made available under the National Flood Insurance Act of 1968, as
amended, 42 U.S.C. 4001 et seq.
D. These provisions shall obligate the transferee and its successors or
' assigns to obtain and maintain, during the ownership of such land, such
� flood insurance as required with respect to financial assistance for �
acquisition or construction purposes under FDPA, Section 102(s) of the
Flood Disaster Protection Act of 1973. Such provisions shall be required
notwithstanding the fact that the construction on such land is not itself
funded with assistance provided under this Agreement.
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27. Federal Labor Standards Provisions
The Jurisdiction shall cause or require to be inserted in full, in all such contracts
subject to such regulations, provisions meeting the requirements of:
, A. Davis-Bacon Act (40 U.S.C. 3141-3148) requires that workers receive no
less than the prevailing wages being paid for similar work in their locality.
Prevailing wages are computed by the Federal Department of Labor and
are issued in the form of federal wage decisions for each classification of
work. The law applies to most construction, alteration, or repair contracts
over $2,000.
B. "Anti-Kickback Act of 1986" (41 U.S.0 51-58) prohibits any person from
(1) providing, attempting to provide, or offering to provide any kickback; (2)
soliciting, accepting, or attempting to accept any kickback; or (3) including
directly or indirectly, the amount of any kickback prohibited by clause (1)
or (2) in the contract price charged by a subcontractor to a prime
contractor or a higher tier subcontractor or in the contract price charged by
a prime contractor to the United States.
C. Contract Work Hours and Safetv Standards Act - CWHSSA (40 U S C
37021 requires that workers receive "overtime" compensation at a rate of
one to one-half (1-1/2) times their regular hourly wage after they have
worked forty (40) hours in one week.
D. Title 29, Code of Federal Requlations CFR Subtitle A Parts I 3 and 5)
are the regulations and procedures issued by the Secretary of Labor for
the administration and enforcement of the Davis-Bacon Act, as amended.
The Jurisdiction shall maintain documentation that demonstrates compliance with
hour and wage requirements of this part. Such documentation shall be made
available to the Department for review upon request.
28. Procurement
The Jurisdiction shall comply with the procurement provisions in 24 CFR, Part
85.36: Administrative Requirements for Grants and Cooperative Agreements to
' State, Locai and Federally Recognized Indian Tribal Governments.
29. Non-Performance
The Department shall review the actual National Objective and/or Public Benefit
achievements of the Jurisdiction. In the event that the National Objective and/or
Public Benefit requirements are not met, the Department will require the
recapture of the entire PI expended on that projecUactivity. Additional remedies
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may include suspending the Jurisdiction's authority to use PI funds until the
Jurisdiction has developed capacity to ensure future PI funds will be used for
eligible activities that will meet a National Objective.
30. Relocation. Disnlacement. and Acauisition
The provisions of the Uniform Relocation Act, as amended, 49 CFR, Part 24, and
Section 104(d) of the Housing and Community Development Act of 1974 shall be
followed where any acquisition of real propeRy is carried out by the Jurisdiction
and assisted in whole or in part by funds allocated by CDBG.
31. Uniform Administrative Reauirements
The Jurisdiction shall comply with applicable Uniform Administrative
Requirements as described in 24 CFR, Section 570.502, including cited Sections �
of 24 CFR, Part 85.
32. Section 3 j
I
The Jurisdiction will comply with Section 3 of the Housing and Urban '
Development Act of 1968 (12 U.S.C. 1701u), and implementing Regulations at I
24 CFR, Part 135.
33. Affirmativelv Furtherinq Fair Housina
The Jurisdiction will affirmatively further fair housing, which means that it will
conduct an analysis to identify impediments to fair housing choice within the
Jurisdiction, take appropriate actions to overcome the effects of any impediments
identified through that analysis, and maintain records reflecting the analysis and
actions in this regard.
34. General Contract Conditions
The following conditions apply to all activities, including set aside activities. The
Jurisdiction must meet the conditions within ninety (90) days of this Agreement's
execution. Failure to meet the following Special Conditions may result in
termination of this Agreement.
A. Environmental Compliance '
The Jurisdiction shall have satisfied all National Environmental Policy Act
(NEPA) requirements and California Environmental Quality Act (CEQA)
requirements. CEQA shall be approved by the Jurisdiction. The level of
compliance varies by activity. NEPA review must be completed by the
Jurisdiction for each activity and approved in writing by Department staff
prior to incurring costs on the activity(ies).
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B. Acquisition/Relocation Compliance I
The Jurisdiction must document its compliance with the Uniform
Relocation Act, Section 104(d) before release of funds by the Department.
The Jurisdiction must submit a specific relocation assistance Agreement
for each activity which mav result in temporary or permanent
displacement. For projects where there will be temporary or permanent
displacement, the Jurisdiction must submit signed General Information
Notices (GINs) from each tenant who was residing in the project at the
time of Application submittal. If the Jurisdiction believes that there will be
no displacement as a result of their activities, they must submit a letter
explaining why no displacement or relocation will occur, which will be
subject to written approval by the Department.
C. Site Control
The Jurisdiction shall demonstrate site control of the proposed project
property by submitting evidence of one or more of the following to the
Department:
1) Fee title;
2) A leasehold interest on the project property with provisions that
enable the lessee to make improvements on and encumber the
property provided that the terms and conditions of any proposed
lease shall permit compliance with all Program requirements;
3) An option to purchase or lease;
4) A disposition and development agreement with a public agency;
5) A land sale contract, or other enforceable agreement for the
acquisition of the property; or,
6) All easements and right-of-ways (required for completion of the
CDBG project) must be obtained.
D. Fundinp Commitments and Proiect Cost Estimates
All funding required for project completion must be documented and
committed. If all funding is not committed, the Department shall terminate
this Agreement. If the Jurisdiction has applied for other funding prior to the
execution of this Agreement, the Jurisdiction must notify the Department '
as soon as that application is approved or denied. If the Jurisdiction must
apply for other funding after the execution date of this Agreement, the
Jurisdiction must apply at the earliest possible opportunity offered by the
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other funding source(s) and notify the Department as soon as that
application is approved or denied. '
A current third-party cost estimate must be provided by the engineer or
architect for the project.
E. Activitv Administration Documentation
There are four methods of administering and/or completing RLF activities:
1) Use of in-house staff only;
2) Subrecipient agreement(s) with qualified non-profit(s);
3) Consultants/contractors/others obtained through federal
procurement procedures; and,
4) Any combination of the above methods.
The Jurisdiction must provide the following documentation demonstrating
that one or more of these methods were used for the GA of the RLF and
for all activities carried out under this Agreement.
1) Use of in-house staff only: If not previously provided in the
Application, submit staff resumes and duty statements that clearly
identify that Jurisdiction staff has capacity and experience to
complete administration of the proposed activities in the
Application.
2) Subrecipient aqreement(s) with qualified non-qrofit(s): Sub-
recipients and their respective agreements with the Jurisdiction
must adhere to all Program requirements. Submit the subrecipient
agreement that was executed between the non-profit and the
Jurisdiction. (Submitting draft documents for review prior to
execution is recommended.) The scope of work in the subrecipient
agreement must match the description of activity in this Agreement.
Any parts of the activity description in this Agreement not covered
by the subrecipient agreement must have separate procurement
information. If the subrecipient is using CDBG funds to hire other
consultants or subrecipients to do part or all of the Work then the
procurement documentation or additional subrecipient agreements
must be provided to the Department for review and approval.
3) Consultants: Submit procurement documentation that all third-party
consultants are procured in accordance with Federal Procurement
Procedures and the Grant Management Manual, as follows:
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a. A copy of the document used to notify prospective
consultants, such as a Request for Proposal or similar
document.
b. A list of all bid respondents, showing respondents' contact
information and the dollar amount of each proposal.
c. A brief description of the process used to select the
consultanU contractor/other, including the rationale for the
selection.
d. Additional information may be found in the Grant
Management Manual, Program Operators.
F. Compliance With All Loans and/or Grant Aqreements
Pursuant to this Agreement, the Jurisdiction must comply with State and
Federal Laws and Regulations that pertain to matters applicable to the
Jurisdiction. Prior to disbursement of any funds under this Agreement, the
Jurisdiction shall be in compliance with all loan and/or grant agreements to
which it is a party, which are administered by the Department.
G. Easements and Riqhts-of-Wav
If required for the completion of a CDBG project, the Jurisdiction must
obtain all easements and rights-of-ways required for completion of the
CDBG project within twelve (12) months of execution of this Agreement.
Failure to obtain these may result in termination of this Agreement.
H. Section 504 Accessibilitv Requirements
1) Section 504 Regulations apply when CDBG funds are used on a
new construction housing or public facility project or when an
existing public facility or housing project with fifteen (15) or more
units is being purchased and/or "substantially"
rehabilitated. Qualified CDBG assisted housing projects are
required to have a certain percentage of the units designed for and
accessible to persons with mobility and sensory impairments.
2) For a federally assisted new construction housing project, Section
504 requires five percent (5%) of the dwelling units, or at least one
unit, whichever is greater, to meet Uniform Federal Accessibility
Standards or a standard that is equivalent or stricter, for persons
with mobility disabilities. An additional two percent (2%) of the �
dwelling units, or at least one unit, whichever is greater, must be
accessible for persons with hearing or visual disabilities.
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3) Under Section 504, alterations are substantial (i.e. substantially
i rehabilitated ) if they are undertaken to a housing project that has
15 or more units and the cost of the alterations is seventy-five
percent (75%) or more of the replacement cost of the completed
Ifacility; and require that a minimum of five percent (5%) of the
dwelling units, or at least one unit, whichever is greater, shall be
made accessible to persons with mobility disabilities and an
additional two percent (2%) of the dwelling units, or at least one
unit, whichever is greater, shall be made accessible to persons with
hearing or visual disabilities.
I 4) The Jurisdiction shall provide documentation satisfactory to the
Department verifying that the required housing units or public
facility described in the project comply with the accessibility
standards. CDBG funds will not be released until the necessary �
documentation is provided. All CDBG funded programs must, to !
the greatest degree possible, be conducted in buildings which meet
I Section 504 accessibility standards.
I. Grantee's Data Universal Numberinq Svstem (DUNS)
The Jurisdiction shall provide the Department with a DUNS number for
, any contractor or subcontractor prior to release of any funds under this
Agreement. ,
35. Communitv Develooment Activitv Conditions
A. Homeownership Assistance
If the Work to be performed under this Agreement involves
Homeownership Assistance, the following additional special conditions
apply:
1) Proqram Guidelines: The Jurisdiction must submit a copy of its
Homeownership Assistance Program Guidelines and its PI Re-Use
Agreement to the Department for review and approval within ninety
(90) days of the execution date of this Agreement.
2) If the Jurisdiction proposed to assist homebuyers to purchase
newly constructed units in its CDBG application under the
Homeownership Assistance activity, the following requirements
must be met:
i a) The units must have been available for sale to the general
public;
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b) Development of the new subdivision must not be dependent I�
upon the funding of the homebuyer loan;
c) CDBG funds shall not be used for construction; and,
' d) Homeownership Assistance loans will not be approved prior
to the foundation of the housing being in place.
i B. Housinq Rehabilitation
If the Work to be performed under this Agreement involves Housin
9
Rehabilitation, the following additional special conditions apply:
1) Proqram Guidelines: The Jurisdiction must submit a copy of its
Housing Rehabilitation Program Guidelines and its PI Re-Use
Agreement to the Department for review and approval.
2) Affordable Rent: If the Jurisdiction's Housing Rehabilitation
Program provides for rehabilitating rental properties, the
Jurisdiction must submit to the Department its provisions for
assuring affordable rent for the LMI occupants. Jurisdiction may
include this information as part of the Housing Rehabilitation
Program Guidelines.
36. Fconomic Develooment Activitv-Soecific Conditions
I A. Restrictions on CDBG-Assisted Public Propertv
CDBG funds can be used by the Jurisdiction to purchase or rehabilitate
public property. The change of use of real property provisions contained
in 24 CFR 570.489(i) apply to real property within the unit of general local
governmenYs control (including activities undertaken by subrecipients),
which was acquired or improved in whole or in part using CDBG funds in
excess of the threshold for small purchase procurement (currently
$100,000). The restrictions shall apply from the date CDBG funds are first
expended for the property until five (5) years after completion of the
project. See the Federal Regulations for the full text of this regulation.
The Jurisdiction must provide documentation of proper restriction on
assisted property.
B. Business Assistance Activitv
1) Jurisdictions implementing Business Assistance (BA) Loans, shall
submit program guidelines that ensure compliance with CDBG
underwriting requirements as described in 24 CFR 570, Appendix
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A, "Guidelines and Objectives for Evaluating Project Costs and
Financial Requirements" and with public benefit requirements
contained in 24 CFR 570.482(f).
2) Jurisdictions implementing a BA loan shall provide a written
Employment Agreement required to be executed between the '
Jurisdiction and the business owner [requirements of the �
Employment Agreement are described in 24 CFR 570.506 (b), (5),
and (6)]. The written Employment Agreement must include a
commitment by the business that the jobs are to be created or
retained by the termination date of this Agreement and that at least
fifty-one percent (51%) of all jobs created or retained (on a FTE
basis) will be held by LMI persons. The Employment Agreement
shall specify that, prior to receiving assistance, the business shall
agree to:
a) Provide a listing, by job title, of the permanent jobs projected
to be created; '
b) Identify which jobs, if any, are part-time and the annual
hours of work for each position;
c) Identify which jobs are projected to be filled by LMI; and,
d) Provide periodic reporting (semi-annual) not limited to: listing
jobs, by job title, of all the permanent jobs actually filled, and
which of those jobs are held by members of the LMI.
C. Microenterqrise Assistance Activities
1) Jurisdictions implementing a Microenterprise Assistance activity for
technical assistance and/or microenterprise loans, shall submit
program guidelines that ensure compliance with CDBG
requirements. Specifically, guidelines must ensure that all
beneficiaries of the program are eligible micro enterprises, per HUD �
definitions. A microenterprise must: ;
a) Have all owners of the business documented as meeting
HUD family income eligibility standards; and,
b) Have documentation that the business's owners and
employees are five (5) or fewer in number. '
2) When implementing a Microenterprise Program, the program
guidelines shall include the proposed benefits, eligible activities and
ongoing evaluation of program services. The guidelines will indude '
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a Beneficiary Tracking Agreement, which defines the goals; Ili
identifies the roles and responsibilities of the service providers,
identifies the market and focuses the outreach; defines the
screening and referral process; and, tracks the beneficiaries
through the program's level of service. The Beneficiary Tracking
Agreement shall also describe the roles and responsibilities of the
Jurisdiction and/or program operator for meeting the reporting
requirements of the State CDBG Program.
3) When implementing a Microenterprise Program that is part of an
integrally-related component of a larger project where non-LMI
persons will be extended training and supportive services, shall
submit guidelines including the methodology describing how CDBG
funds will only be used towards the assistance of LMI to LMI
persons under the Jurisdiction's activity.
4) Jurisdictions implementing a Microenterprise activity for loans to
microenterprises made with Grant funds or PI funds, shall submit
guidelines that ensure compliance with CDBG underwriting
requirements as described in 24 CFR, Part 570, Appendix A,
"Guidelines and Objectives for Evaluating Project Costs and
Financial Requirements."
5) If under this Agreement, a Microenterprise Fa�ade Improvement
activity is being implemented, the Jurisdiction shall submit program
� guidelines that ensure compliance with CDBG National Objective
requirements, as described in 24 CFR 570, Appendix A,
"Guidelines and Objectives for Evaluating Project Costs and
Financial Requirements."
� D. Required Aqreements for Assisted Businesses
The Jurisdiction shall execute a written agreement between the
Jurisdiction and the business receiving CDBG funds (loans or grants)
under this Agreement to ensure compliance with CDBG State and federal
regulations. The written agreement shall contain language to ensure each
business complies with the terms of this Agreement, Exhibit A, as well as
each of the criteria as set forth in 24 CFR 570.506 (b)(4) and (c).
1) Each agreement between the Jurisdiction and the business(es)
shall be submitted to the Department for review and written
approval, prior to execution by the business and the Jurisdiction.
2) Each agreement shall require the business to report employee
� information periodically to the Jurisdiction, so that the Jurisdiction
can comply with its reporting requirements to the Department. The
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report shall list each job position by job title and number of annual
hours worked and LMI status. The report shall list all the
permanent jobs actually created or retained, and identify which of
those job positions are held by members of the LMI. Additionally, �
the report shall include the demographics of job holders
(ethnicity/race, disability, status, gender, and head of household
status).
3) Each agreement shall require the business(es) submit a Data
Universal Numbering System (DUNS) number and be verified as
not being on the current federal debarred list, prior to receiving any
CDBG financial assistance. The agreement shall require proof of
proper insurance for secured collateral and protecting the
' Jurisdiction. The agreement shall reference this Agreement
between the Department and the Jurisdiction. The agreement shall
contain all other special conditions as directed by the Department
or local loan committee.
I 37. Communitv and Economic Develooment Aareement Activities
Non Implementation Activities and Planninq activities are not allowed under this
aareement usinct PI.
A. Implementation Activitv
Implementation Activities are not permitted under this Agreement using PI
GA funds.
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8 Certified Approving Resolution Is Attached
I i certify that the foregoing is true and correct and the city ot ukian
will follow all requirements of this agreemenf. I understand thaf my certification
also acknowledges that serious compliance issue with fhe above requirements
could resulf in the State suspending the authority of the c�ty os ukiah
to expend PI or may require City of Ukiah to return unused P/ to
the State until the City of Ukiah clears the serious compliance issues.
� _ ' ��f!� _ / — � ,` � '
Signature of Authorized Representative Date Signed
Jane Chambers, City Manager
Name and Title of Authorized Representative
Signature of CDBG Section Chief Date Signed
� Name of CDBG Section Chief
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