1. NCDA Annual Meeting Palm Springs, CA June 21, 2012 CPD Policy Update

2. CPD Today Assistant Secretary Marquez departed May 18, 2012 Mark Johnston, DAS for Special Needs, has been appointed as Acting Assistant Secretary for remainder of term Cliff Taffet remains as General Deputy Assistant Secretary Yolanda Chavez remains as DAS for Grant Programs Ann Oliva now Acting DAS for Special Needs 2

3. FY 2012 Operations FY 2012 formula allocations announced in January 2012 consistent with 60 day provision of law Field offices should be fully caught up on reviews of con plans and actions plans, making grants in timely manner Maintaining monitoring schedule at field office level despite tight budgetary constraints Funding constraints having impact on ability of field offices to hire staff

4. CDBG FY 12 formula funding level - $2.948 billion Represents 26% reduction in comparison to FY 10 $300 million from CDF account for disaster recovery purposes (additional $100 million outside budget cap) $400 million in CDBG DR allocated in January 2012 to 17 grantees (8 states and 9 local governments)

5. CDBG in FY 13 House and Senate Appropriations Committees have both reported THUD bill House - $3.34 billion for formula Senate - $3.1 billion for formula Expect consideration by full House next week Senate timing unknown Outside possibility that THUD bill could be approved before November elections

6. Congressional Interest in CDBG FY 12 appropriation called for two reviews: GAO to review best practices in formula programs HUD to report to committees on data systems improvements House Appropriations Surveys and Investigations on administrative/planning costs House Appropriations staff questions on activity delivery costs, grandfathered communities, public service cap, American Community Survey

7. CDBG Policy Considerations Guidance issued on CDBG-R and NSP 1 closeouts, addressing open activities cites by OIG audit, voluntary grant reductions, Hoping to issue guidance on mixed use economic development, activities jointly funded by entitlements and states, use of ACS data for low-mod area benefit Evaluating changes to IDIS performance measurement structure Other IDIS upgrades

8. CDBG Issues – IG Audit Formally issued October 31, 2011 “HUD did not adequately use its System (IDIS) to provide oversight of activities under the Block Grant program.” Unaware of how grantees used $67 million to fund more than 1,300 cancelled activities Lacked oversight of almost $3 billion funding more than 20,000 long-standing open activities 8

9. CDBG Issues – IG Audit Some seriously bad actors 46 grantees accounted for 11,647 open activities 64 grantees accounted for $2 billion in open activities Have reduced open activities to 3,409 or 16.4% of original 20,000, representing 22% of funds Have reduced canceled/drawn activities to 360, representing 29% of funds Guidance to field offices to help on tough issues 9

10. CDBG Issues – ACS Data FY 2012 allocations used American Community Survey (ACS) data for 2005-2009 in place of 2000 Census data (plus 2010 population count) Census long form discontinued Significant funding changes for many grantees due to new data and reduced appropriation HUD correctly applied available data consistent with statutory directives Path of appeal is to Census Bureau

11. Section 108 $240 million in guarantee authority in FY 2012 FY 2013 Administration request was $500 million in guarantee authority along with fee-based approach Senate adopted Administration proposal while House used traditional credit subsidy approach ($6 million for approximately $250 million) HUD’s Policy Development and Research Office to issue report on Section 108 program shortly Need grantees to make use of Section 108 in order to preserve it 11

12. NSP Status – June 18, 2012 NSP 1 = $3.92 billion 91.45% expended (109.4% obligated) Grant amount must be expended by March 2013 NSP2 = $1.93 billion 66.98% expended 54 of 56 Grantees met 50% expenditure mark Must expend 100% of grant amount by February 11, 2013 12

13. NSP Status NSP3 = $970 million 13% expended 50% of grant amount to be expended by March 2013, 100% by March 2014 Working on policies for transition after NSP Still have technical assistance available, especially for NSP3

14. Project Rebuild President Obama included $15 billion for Project Rebuild as part of American Jobs Act Request repeated as part of FY 2013 budget submission Introduced in both House and Senate Would improve upon and expand NSP $10 billion formula allocation to states and local governments $5 billion competition to include governmental partners but also non-profits and for-profits 14

15. OneCPD TA OneCPD replaces previous CPD approach to technical assistance Borrows from and expands upon SNAPS and NSP TA efforts Almost $70 million available across FY10-12 appropriations Have already initiated several dozens of engagements from highly targeted to comprehensive CPD field offices are the access point 15

16. Homeless Emergency Assistance and Rapid Transition to Housing (HEARTH) Act Signed into law on May 20, 2009 Reauthorizes HUD’s McKinney-Vento Programs Six sets of Regulations developed: Definition of Homeless Continuum of Care Program Emergency Solutions Grants Program Conforming Amendments to the Consolidated Plan Homeless Management Information Systems Rural Housing Stability Program 16

17. Status of the Regulations Published Proposed Rules: Homeless Management Information Systems Published Interim Rules: Emergency Solutions Grants Program with conforming amendments to the Consolidated Plan Published Final Rules: Defining Homeless – amendments to the SHP and S+C regulations Rules Pending Publication CoC Program RHS Program 17

18. Emergency Solutions Grant (ESG) Program A combination of the current Emergency Shelter Grants (ESG) Program and the Homelessness Prevention and Rapid Re-Housing Program (HPRP) Allocations done by formula based on 20 percent of the available grant funds in the appropriation Focus on interventions such as rapid re-housing and homelessness prevention 18

20. Continuum of Care (CoC) Program The CoC program is a consolidation of the Supportive Housing Program and Shelter Plus Care program HEARTH Act codifies the CoC structure and planning process Provides planning dollars for the CoC and FMR increases for grants currently funded under SHP, and creates a 25 percent overall match. 20

21. Rural Housing Stability Assistance Program Designed to assist individuals and families who are homeless, in imminent danger of losing housing, or in the worst case housing situations Will allow for new activities such as rehab and repair to housing and mortgage assistance for homeowners Recipients of funding under this program may not simultaneously receive funding under the CoC program 21

22. Resources to Help Communities Up to date information regarding the HEARTH Act, including a copy of the McKinney-Act amended by the HEARTH Act, can be found at http://www.hudhre.info/hearth/ http://www.hudhre.info/hearth/ Notification of the availability of future information will be released via HUD’s Homeless Assistance listserv. To join HUD’s listserv, go to http://www.hud.gov/subscribe/mailinglist.cfm and click on “Homeless Assistance Program” http://www.hud.gov/subscribe/mailinglist.cfm 22

23. FY 2012 Appropriation - $1 Billion Same as FY 1993 funding level FY 2013 Request - $1 Billion House mark: $1.2 billion Senate mark: $1.0 billion $500,000 minimum qualification threshold to minimize new PJs qualifying at lower $335,000 threshold FY12 HOME Appropriation

24. Imposed 4 provisions on 2012 HOME projects Evaluation of Developer Capacity, Underwriting and Market Demand before committing funds; Homebuyer Units remaining unsold 6 months after construction must be converted to rental; Projects not completed 4 years after commitment must be terminated and funds repaid; PJ must certify that CHDO receiving ‘12 funds has staff with demonstrated development capacity;

25. FY12 HOME Appropriation CPD Notice 12-07, Operating Guidance for Implementing FY 2012 Appropriation Requirements explains what the law requires HUD is hosting 8 webinars to provide technical assistance on practical considerations related to PJ implementation of requirements Webinar schedule and archived webinars can be found at http:\hometa.info

26. IDIS System Improvements Went Live on May 4th System flags for Projects: In final draw for > 120 days With an initial disbursement but no subsequent disbursement for > 180 days Committed more than 4 years ago, but not completed 26

27. IDIS System Improvements Required Certifications at Project Set-up: CHDO Capacity Assessment of Underwriting, Developer Capacity and Neighborhood Market Conditions 27

28. HOME Rulemaking Proposed Rule Published: December 16, 2011 Public comments were due on February 14, 2012 – HUD received 320 comments Combined HOME and the Housing Trust Fund Final Rule will go into Departmental clearance this month. Expected publication this Fall 28