1. CDBG Changes in IDIS U.S. Department of Housing and Urban Development 1

2. Welcome Purpose: Provide background/status of IDIS changes in Release 11.4 Listen to feedback Answer questions 2

3. Purpose of System Changes Enhance the role of IDIS as a tool to strengthen the oversight of CDBG activities. 3

4. IDIS Release 11.4 4 How we got here…

5. Results of OIG Audit October 31, 2011 Finding: HUD did not adequately use its system to provide oversight of its Block Grant program $67million disbursed by over 1,300 activities that grantees cancelled with draws Nearly $3 billion associated with more than 20,000 activities that grantees failed to complete for up to 11 years 5

6. HUD did not……. Have policies and procedures requiring it to routinely use IDIS data to provide oversight of long-standing open activities and activities that were cancelled with draws Did not evaluate the adequacy of actions grantees took regarding these activities 6

7. Conclusion Significant amounts of CDBG funding disbursed nationwide did not… Benefit low- and moderate-income persons, Aid in preventing or eliminating slums or blight, or Meet community development needs having a particular urgency 7

8. Result Puts in jeopardy: All the good work you do CDBG program funding levels CDBG program 8

9. CDBG Response to Audit CDBG actions in response to the audit have included:  Resolving the nearly 23,000 long-standing open activities and activities cancelled with draws  Issuing activity resolution and reporting guidance  Incorporating review of IDIS data into monitoring procedures in the monitoring handbook  Creating “IDIS Resources for the CDBG Program” page on hud.gov  Implementing IDIS system changes to prevent longstanding open activities, reduce the number of activities that are cancelled with draws, and track revised draws 9

10. Overview of System Changes The new functionality includes:  Flagging and requiring remediation plans for the following activities: Activities without draws for 12 months Activities with no accomplishments reported after three years Activities that are 80% drawn down no accomplishments reported  Requiring approval for activities that grantees want to cancel with draws  Requiring justifications for draws revised from one activity to another 10

11. Planned Modifications Scheduled for IDIS Release 11.5, May 30, 2013  One Remediation Plan per At-Risk Activity, no matter how many “at-risk” conditions it meets  Exempt public facilities and certain economic development activities from the 80 percent drawn and no accomplishments factor  Due dates For Remediation Plans will appear on Review Activities list 11

12. These Changes are about… OVERSIGHT not COMPLIANCE 12

13. Compared to Recent HOME Changes  Similar: – Flagged activities show up on a banner and require entry of narrative fields and dates  But different: – CDBG changes do not block grantee access to activities – No automatic impact on activities 13

14. Working with these Changes  Initially, a large backlog of activities, requiring both grantee and field office action, has been flagged  Deadlines for action by grantees and field offices  Extending deadlines for initial backlog—three months for grantee action and three months for FO action instead of two weeks  Work with your field office  Grantees may need to go into IDIS more frequently 14

15. Remediation Plans HUD is more likely to approve plans: – That have specific timelines – That have everything in place, including developers and legally committed financing – When agreements ensure that CDBG funds are repaid in case of failure – When comprehensive underwriting practices were exercised – When relevant details are provided 15

16. Remediation Plans Samples of Adequate Justifications 16 Activity DescriptionReasons for DelayAction Plan Construction of a new senior center This project is on schedule. From beginning to end, the timeline for completing the project has always been 3.5 years. Construction will be completed by June 2013. Accomplishment data will be gathered and entered into the system by December 2013 Loan to businessThe business could not provide a reason for the delay in creating jobs even though its expansion occurred two years ago. The State Grant Recipient has asked the business for a timeframe during which the jobs would be created and discussed loan repayment in accordance with the terms of its agreement with the borrower. If job creation does not occur by June 2013, the borrower will repay the loan in full, according to the terms of its agreement with the State Grant Recipient.

17. Remediation Plans 17 Activity DescriptionReasons for DelayRemediation Plan Economic Development Activity: Assistance to Private Business (extension to facility & purchase of equipment) Warehouse construction was delayed, which in turn delayed the purchase of the new equipment funded by CDBG. The new warehouse building is on schedule to be completed within 5 months, by August 2013. Once completed and new equipment is installed, the business will begin the hiring process for newly created positions. The job reporting period will be ongoing through December 2013 with the activity to be completed in IDIS by January 2014. 48-56 Treelined AvenueCDBG used for acquisition and HOME funds are being used for rehabilitation of these units. Rehabilitation just completed. Properties have all been sold to eligible home owners HOME-funded rehabilitation work will be completed in December 2012. The units have already been sold to income-eligible households, who will occupy the units by February 2013. Accomplishments will be reported in March 2013 and the activity will be completed. At that time.

18. An Inadequate Remediation Plan 18 Activity DescriptionReason for DelayRemediation Plan What’s Wrong? EconomicActivity has not yetJobs will be reported inThere is no clear Development Activity:created any jobs.IDIS when the activityexplanation about Assistance to Private Business (extension to facility & purchase of equipment) creates jobs. why the project is stalled, no timeline for getting the project back on track, and no description of the underwriting requirements used to award this grant.

19. Status of At-Risk Activities All CDBG Grantees 19 Total Flagged Activities39,542 Number of Activities Flagged as of January 18, 2013 29,551 Number of Activities Completed, Canceled or having Remediation Plans 9,991

20. Status of At-Risk Activities Entitlement Communities 20 Total Flagged Activities26,329 Number of Activities Flagged as of January 18, 2013 19,056 Number of Activities Completed, Canceled or having Remediation Plans 7,273

21. 21 Great Job!

22. Need Help? Contact your field office to have HUD complete certain activities for you Webinar 22 Converted/older activities that were never funded IDIS malfunctions/new data requirements Pre-2000 Other

23. Need Help? Contact your field office to have HUD complete certain activities for you Webinar 23 Converted/older activities that were never funded IDIS malfunctions/new data requirements Pre-2000 Other

24. Resources Grantee Instructions Webinar FAQs On OneCPD website and www.hud.gov/offices/cpd/systems/idis/cdbg 24