1. FY2015 States & Small Cities CDBG Update for COSCDA
March 17, 2015
Pamela Glekas Spring, Director
States & Small Cities Division
Office of Block Grant Assistance

2. State CDBG Update Key topics that were covered included:
OMB Super Circular
Moving from FIFO to Grant-Based Accounting
Section 108 Fee-based Summary
Using the American Community Survey data for CDBG projects
Demo on the Low Moderate Income Summary data mapping tool and
Guidance on how to design an effective state program and overcome capacity issues

3. State CDBG– Key Topics National Disaster Resilience Competition
FY2015 Program Budget
Section 108 Fee-Based Summary
LMISD Notice and Data
OMB Super Circular Implementation
Moving from FIFO to Grant-Based Accounting
NSP Closeout Update
Recent Policy Issuances

4. National Disaster Resilience Competition
Announced by the President June 14, 2014
Qualifying disaster in 2011, 2012, or 2013
67 potential applicants – states, local governments, District of Columbia, and Puerto Rico
Includes local governments that received HUD CDBG-DR funding under PL 113-2
Applicants must tie proposal to qualifying disaster
Competitive program with a focus on resilience and recovery

5. National Disaster Resilience Competition (continued)
Notice of Funding Availability (NOFA)
Launch – NOFA release, webinars, etc
Total of $1 billion available - $181 million reserved to Sandy-region
Geographic diversity considered in the selection
Minimum grant size $1M – Maximum $500M
Deadline for applications extended to March 27, 2015 & review of the applications will begin late soon thereafter
For more info, go to HUDexchange.info or

6. FY 2015 CDBG Program Budget President’s CDBG Request - $2.8 billion
Final Budget figure - $3 billion for States & Entitlement areas (~ 1.5% less than 2013)
$900 million for States & Small Cities
Timing the Submission of Your Plan

7. Section 108 Fee-Based Summary
Background
2014 HUD Appropriations Act authorizes HUD to collect fees from borrowers
Proposed rule would amend Section108 regulations to permit HUD to collect fees from borrowers to offset the costs of Section 108 loan guarantees
Fee is intended solely to offset credit subsidy cost, and determined accordingly
 Current Status
A Rule/Notice published in Federal Register Thursday 2/5/15 as a proposed rule w/30-day public comment period (shortened public comment period to ensure HUD will not exhaust credit subsidy prior to Rule being in place);
Comment period expires Monday 3/9/15

8. Low/Moderate Income Summary Data
Historically, Low/Moderate Income (LMI) data was derived from decennial long-form census
In 2010 – Census’s long form was replaced by American Community Survey (ACS).
American Community Survey (ACS) is a mandatory, ongoing statistical survey that samples a small percentage of the population every year -- giving communities the information they need to plan investments and services.
This was a problem for Entitlement grantees since CDBG regulation requirements are based on block groups as geographic building blocks.
So far a while grantees were told to keep using 2000 Census-derived data.
A VICTORY! HUD appealed to Census & (for the most part) won, so HUD received ACS data at the block group, but not for split block groups.
Ultimately, as a result of ACS replacing the Census long form, IDIS had to be revised to accommodate more frequent/multiple years’ worth of data
In June 2014, HUD issued CPD Notices and 14-11, implementing new LMISD for States and Entitlements (respectively).

9. Low/Moderate Income Summary Data (continued)
Census Bureau releases new data each year — you can get the latest on American FactFinder website, or get advice on choosing the right tool or data table for your needs. Learn more about the annual Census data releases or browse the supporting documentation. Go to
The new ACS data must be used to qualify all LMI area benefit activities for which funds are first obligated after July 1, 2014 (meaning under contract for a specific activity and a specific dollar amount)…
…unless it meets the 4-part test to determine whether the old data can still be used:
Funds were obligated before July 1
For a specific activity identified in the Action Plan
For a specific dollar amount
With a clearly defined service area.

10. Low/Moderate Income Summary Data (continued)
For the future
Presently, HUD intends to issue new LMISD every 5 years. Census has advised us that it is not a good thing to use data sets that have overlapping years, that we should run data based on mutually-exclusive 5 year datasets.
HUD has observed that the ACS data jumps around a lot. We will continue to monitor the ACS data over time to determine if it still makes sense to issue new LMISD every 5 years.

11. New Government Wide Financial Management Requirements aka “OmniCircular”
The “Omni Circular” or Super Circular replaces multiple existing regulations and OMB circulars: A- 87, A-110, A-122, A-133, Parts 84 & 85
Also included in this circular are updated requirements that apply consistently to grantees, subrecipients, nonprofit organizations, across all grant programs
State CDBG remains partially exempt because they were never subject to Part 85 – but are subject to the provisions that replace A-87, A-133, etc.
Federal Agencies were directed to have implementing regulations in place by 12/26/14.

12. New Government Wide Financial Management Requirements aka “OmniCircular” (continued)
This means HUD will be issuing regulations that replace Parts 84 & 85 and incorporate the other Circulars.
These changes will also require conforming regulation changes to other regulations that cross- reference the various financial management requirements…like recordkeeping requirements.
OMB & various other sources already have webinars, training materials, FAQs, etc.
HUD anticipates the need for cross-programmatic training for grantees once these are out.

13. Eliminating First-In First Out (FIFO) & Moving to Grant Based Accounting
HUD’s OIG and OMB have determined that the First In First Out (FIFO) drawdown process does not comply with federal financial standards. The FIFO drawdown process predates IDIS – it’s been used since the beginning of the CDBG program in 1975.
A memorandum detailing this change was sent on May 9, 2014 to all CDBG grantees from Acting Assistant Secretary Cliff Taffet
This will affect all formula CPD programs beginning with FY15 funding. FY14 and earlier funding will stay on a FIFO drawdown process. This means the drawdown process will become a bit more complicated

14. Eliminating First-In First Out (FIFO) & Moving to Grant Based Accounting (continued)
For FY15 funding and thereafter, you will draw down money for a specific activity (as you do currently, but rather than drawing on all available money from your line of credit, you will designate a specific year allocation in funding an activity.
As an example, if you are drawing down $100,000 for an FY15 Action Plan activity, the money will come out of your FY15 allocation amount.
For the States grantees, you an breathe a small sigh of relief – this means somewhat less of an imposition for you because states have always operated more on a discrete grant year by grant year basis than on a cumulative approach. .

15. Neighborhood Stabilization Program (NSP) Closeout Update
Notice & Guide
Website materials
Readiness checks
Progress to date
No deadline to close your grant
Special note for NSP-2 grantees

16. Recent Policy Issuances
Some relevance for States as a reference: CPD Notice issued August 2013: Clarifies the distinction between Activity Delivery Costs and Program Administrative Costs.
A State may decide to adopt or follow the notice in allowing their UGLG’s to have “activity delivery costs” State may also use this guidance as an “interpretive
reference” for their program admin costs
Closeout Notice issued February 2014: Closeout instructions for NSP, for CDBG-R, for State CDBG and for Entitlement CDBG. All but 19 CDBG-R grants closed out as of 9/30/14.
Code Enforcement: CPD Notice , issued October Clarifies use of national objectives, delineating ‘deteriorated/deteriorating areas’ that code enforcement must be targeted to, issues of eligible/allowable costs & documentation.
HUD plans to issue a companion set of FAQs related to the Code Enforcement Notice.

17. HUD’s Future Directions
HUD’s New Secretary -Julian Castro
Secretary Castro well versed w/CDBG funding as a former Mayor of San Antonio & has publically stated his support for the program
The FY2016 budget will be the first policy imprint Secretary Castro has on longer term directions for HUD’s programs

18. 40th Anniversary of CDBG Program
HUD’s Housing & Community Development Act enacted into law Aug 22,1974 as one of the first acts of former President Gerald Ford
HUD launched a 40th Anniversary Page in 2014 featuring your best practices! HUD Launched 5 new video and multimedia products that showcase the CDBG program and its flexibility
Collaborating with TA Provider to bring 20 more learning products in !!!!
Coming Soon – New Web portal on the HUD Exchange to submit project profiles. HUD encourages grantees to showcase how your community has been helped by CDBG by either ing or tweet it with the hashtag #CDBGturns40
THANK YOU – for sharing your inspirational stories that remind people what a great program CDBG is.

19. Pamela Glekas Spring Director State and Small Cities Division
Wrap-Up
Pamela Glekas Spring Director State and Small Cities Division