Community Development Block Grants-Section 108 Loan Guarantees (14.248)

Program

14.248 Community Development Block Grants-Section 108 Loan Guarantees

Federal Agency

Agency: Department of Housing and Urban Development
Office: Office Of Community Planning And Development

Authorization

Housing and Community Development Act of 1974, as amended, Title 24, Part 570, Section Subpart M.

Program Number

14.248

Last Known Status

Active

Objectives

To provide communities with a source of financing for economic development, housing rehabilitation, public facilities, and large scale physical development projects.

Types of Assistance

GUARANTEED/INSURED LOANS

Uses and Use Restrictions

For purposes of determining eligibility, the Community Development Block Grant (CDBG) rules and requirements apply. As with the CDBG program, all projects and activities must either principally benefit low- and moderate-income persons, aid in the elimination or prevention of slums and blight, or meet urgent needs of the community. The President's FY 2009 budget proposes to combine several categorical programs, including the Section 108 program, into the CDBG program.

Eligibility Requirements

Applicant Eligibility

Eligible Applicants include: metropolitan cities and urban counties, i.e., CDBG entitlement recipients; nonentitlement communities that are assisted in their submission of applications by States that administer the CDBG program; nonentitlement communities eligible to receive CDBG funds under the HUD-Administered Small Cities CDBG program; and Insular Areas (American Samoa, Guam, Northern Mariana Islands, and the Virgin Islands). The public entity may be the borrower or it may designate a public agency to be the borrower. Furthermore, HUD's FY 2008 appropriations act authorizes HUD to provide loan guarantees to States borrowing on behalf of local governments in nonentitlement areas.

Beneficiary Eligibility

The principal beneficiaries are low and moderate income persons.

Credentials/Documentation

Costs will be determined in accordance with OMB Circular No. A-87 for State and local governments. OMB Circular No. A-87 applies to this program.

Application and Award Process

Preapplication Coordination

Preapplication coordination is required. Environmental impact information is not required for this program. This program is excluded from coverage under E.O. 12372.

Application Procedure

OMB Circular No. A-102 applies to this program. OMB Circular No. A-110 applies to this program. Application requirements are found in 24 CFR Section 570.704.

Award Procedure

Upon approval of an application, HUD will issue to the applicant an offer of commitment to guarantee notes or other obligations issued by the applicant or its public agency designee. The commitment will be subject to compliance with applicable requirements and such conditions as HUD may specify in the commitment document. Furthermore, borrowers are required to pledge current and future CDBG funds as security for the loan guarantee. HUD also requires that the loan guarantee be secured with other collateral.

Deadlines

Not Applicable.

Range of Approval/Disapproval Time

From 60 to 90 days. Approximately 75 days from submission of complete application to appropriate HUD Field Office.

Appeals

Not Applicable.

Renewals

N/A.

Assistance Considerations

Formula and Matching Requirements

This program has no statutory formula.

This program has no matching requirements.

MOE requirements are not applicable to this program.

Length and Time Phasing of Assistance

The maximum repayment period for a Section 108 loan is twenty years. Repayment schedules and forms are negotiable. See the following for information on how assistance is awarded/released: Loans funds are advanced under promissory notes or other obligations guaranteed by HUD.

Post Assistance Requirements

Reports

Consolidated Annual Performance Evaluation Report. No cash reports are required. No progress reports are required. Consolidated Performance Annual Performance Evaluation Report. Grantee must report performance outcomes.

Audits

In accordance with the provisions of OMB Circular No. A-133 (Revised, June 27, 2003), "Audits of States, Local Governments, and Non-Profit Organizations," nonfederal entities that expend financial assistance of $500,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Nonfederal entities that expend less than $500,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in Circular No. A-133. In accordance with the provisions of OMB Circular No. A-133, "Audits of State and Local governments and Nonprofit Organizations," nonfederal entities that expend financial assistance of $500,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Nonfederal entities that expend less than $500,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in Circular No. A-133.

Records

The record keeping requirements of Subpart J of 24 CFR Part 570 apply to entitlement public entities receiving grants under Subpart F of 24 CFR Part 570. The record keeping requirements of Subpart I of 24 CFR Part 570 apply to State-assisted public entities.

Program Accomplishments

Fiscal Year 2008: 6,491 jobs. Fiscal Year 2009: 6,000 jobs. Fiscal Year 2010: 6,000 jobs.

Financial Information

Account Identification

86-0198-0-1-451.

Obligations

(Guaranteed/Insured Loans) FY 08 $200,000,000; FY 09 est $275,000,000; FY 10 est $275,000,000

Range and Average of Financial Assistance

In FY 2008, commitments were issued in amounts ranging from $500,000 to $25,000,000.

Regulations, Guidelines and Literature

24 CFR 570 Subpart M.

Related Programs

14.218 Community Development Block Grants/Entitlement Grants; 14.228 Community Development Block Grants/State's program and Non-Entitlement Grants in Hawaii

Information Contacts

Regional or Local Office

See Regional Agency Offices. Contact appropriate HUD Field Office listed in Appendix IV of the Catalog.

Headquarters Office

Paul D. Webster, 451 7th Street, SW Room 7180
, Washington, District of Columbia 20410 Email: paul.webster@hud.gov Phone: (202) 708-1871 Fax: (202) 708-1798

Web Site Address

http://www.hud.gov/offices/cpd/communitydevelopment/programs/.

Examples of Funded Projects

Not Applicable.

Criteria for Selecting Proposals

Applications are reviewed against criteria set forth at 24 CFR S 570.704.