P.L. 113-2 Grants:

Certifications, Funds Management & 2-Year Expenditure Deadline

U.S. Department of Housing and Urban Development

I. Certification of Proficient Controls, Processes & Procedures

II. Overview of Financial Management & Reporting Requirements

III. PL 113-2 Funding Process & Expenditure Deadline

IV. Process for Requesting Deadline Extensions

V. Updating Projections

VI. Q & A

I. Certifications

Public Law 113-2

The Disaster Relief Appropriations Act, 2013

The Appropriations Act required the Secretary to certify, in advance of signing a grant agreement, that the grantee had met certain requirements.

March 5, 2013 Federal Register Notice

• Certification of Proficient Controls, Processes and Procedures:

– Section III. Timely Expenditure of Funds and Prevention of Waste Fraud, Abuse and Duplication of Benefits (Page 14330)

– Section VI. Paragraph A.1.i (Page 14436)

Certifications

• Proficient financial controls and procurement processes

• Prevent duplication of benefits • Ensure timely expenditure of funds • Maintain a comprehensive website • Procedures to detect and prevent waste,

fraud, and abuse of funds

Certification Checklist

https://www.hudexchange.info/resource/2925/certification-checklist-cdbg-dr-disaster-relief-appropriations-act-2013/

Nov. 18, 2013 Federal Register Notice

*Action Plan Amendment* Grantees are required to provide updates to HUD

on changes to its processes or procedures that would impact its certifications (Page 69109).

Monitoring Subject to ongoing monitoring by HUD and the

Office of Inspector General.

Resources

• HUD Representative

• CDBG-DR Regulations, Law and Requirements https://www.hudexchange.info/cdbg-dr/cdbg-dr-

laws-regulations-and-federal-register-notices/

II. Overview of Financial Management & Reporting Requirements

Overview of P.L. 113-2 Grants Financial Management

• Additional Reporting Requirements (FFATA/FSRS) • Appropriation Specific Deadlines/Timelines • Partial Obligations • Achieving 2 yr Expenditures timelines through:

• Drawdowns • Budget Adjustments • Extensions

FFATA / FSRS Reporting

• Federal Funding Accountability and Transparency Act (PL 109-282) – Applies to federally funded grants/contracts awarded

on or after Oct. 1, 2010 for $25,000 or more

– Two-tier Reporting (reported through USASpending.gov) • Prime Award Data – reported by Federal Agency

(HUD) • Sub-Award Data - reported by Grantee

– Applies to sub-grants/contracts ≥ $25,000 – Reporting due by the end of the month following the month in

which sub-award or contract was executed – www.FSRS.gov (additional information)

III. P.L. 113-2 Funding Process & Expenditure Deadline

P.L. 113-2 Funding Challenges LOTS OF MONEY - • Appropriation Amount: approx. $15.2 billion

LIMITED TIME - • Obligation Deadline: Sept. 30, 2017 • Expenditure Deadline: 2 yr from date of HUD obligation

What to do…What to do???? Partial Obligations!

Partial Obligation Process

• Documents Developed – – Grantee coordinates with HUD CPD Rep – HUD-7082 Grant Agreement/Grant Conditions

• Grant Agreement Executed –

– Signed by Grantee and HUD HUD signature = Obligation Date (beginning of 2 yr Exp. Period)

• HUD 7082 Processed by HUD Accounting – Grantee Line of Credit/LOCCS Authorized Amt in DRGR

• DRSI Staff reduces Restricted Balance in DRGR

Establishing CDBG Funding Rounds in DRGR

Grantee establishes Projects/Activities in DRGR

– Projects must be a reflection of budget table within grant agreement (Amount & Category)

– Project/Activity Names or Numbers must indicate Round (R#)

– HUD/DRSI Staff will assign Project/Activity Block Dates (2 yr after obligation date)

Managing 2 yr Expenditure Deadline

• Draw the Funds – within 2 yr deadline

• Adjust the Funds – Budget Revision – NOTE: Budget Revisions may trigger Substantial

Amendment if certain criteria are met.

• Extend the Funds – – Request HUD to extend the Exp. deadline/DRGR

Block Date

Adjusting the Funds - Budget Revisions by type/level

Adjusting the Funds - Budget Revisions by type/level

• Activity Level (not impacting Project Budget) – - Does not require any formal action - Changes will be noted/reviewed by CPD Rep during

quarterly Action Plan/QPR review process

• Project Level (Grant Agreement Budget Revision) –

- Changes will impact Project Level funding - Changes stay within amounts allocated to

programs/projects in approved Action Plan - Requires issuance of revised Grant Conditions

• Grant Level (Substantial Amendment) – - Changes do not stay within approved Action Plan allocation amounts

Project Level Budget Revisions

If certain activities progress more quickly than others, funds can be reallocated

• Among Projects within the same round • Across rounds of funding

Provided: • Total amount of Grant Agreement/Round does

not change, and • Proposed changes are in line with approved hard

copy Action Plan.

Reallocating Funds Among Rounds Approved Published Plans / DRGR Action Plans

Amendment to Reallocate Among Rounds

Infrastructure is moving faster than Econ Dev.

Reallocating Funds Among Rounds Approved Published Plans / DRGR Action Plans

Amendment to Reallocate Among Rounds

Econ Dev is not progressing quickly enough

Reallocating Funds Among Rounds Approved Published Plans / DRGR Action Plans

Amendment to Reallocate Among Rounds

Grantee wants to add MF Housing

Project Level Budget Revisions

Project Level Budget Revisions = Changes to Grant Agreement

• Must be Approved by HUD

• Must be documented with new Grant Conditions

Project Level Budget Revision Process

Informal Process: • Grantee coordinates with CPD Rep

– Via email/letter – Defines scope of budget revisions

• HUD CPD Rep reviews Request – Determines changes are acceptable

• HUD CPD Documents Budget Revision – Send approval letter and revised grant

conditions (new budget table)

IV. Process for Requesting Deadline Extensions

Extension Requests

“The grantee has demonstrated that it has evaluated all reasonable alternatives prior to determining that an extension is the only remaining viable alternative.” (80 FR 26942)

Extension Requests

• OMB authorized HUD to provide expenditure deadline extensions

• HUD has authority up to approx. $7 billion (50% of Appropriations)

• FR Notice published on May 11, 2015 outlines process for these requests

• Must be submitted at least 120 days before deadline (60 for funds expiring in 2015)

Extension Requests

• Activities that are inherently long-term

• Limited to certain types of eligible activity categories: – Public facilities & improvements – Housing – Economic revitalization – Grant administration

• Different requirements process for RBD & NDRC

Extension Requests

• Extension request must be program/project- specific

• Expenditure Deadline Extension Request Template

• Criteria for approval

• HUD approves through letter; FR Notice later published for public record

V. Updating Projections

Updating Projections

• Projections of expenditures and outcomes

• Based on each quarter’s expected performance

• Beginning first quarter that funds available and until all funds expended

• Action Plans must be amended to reflect subsequent changes, updates, revisions of projections

• Non-substantial amendment

• Template and guidance are posted on HUD Exchange

Updating Projections (Expenditures)

• Expenditure projections for three major activity categories– – Housing – Non-Housing – Planning & Administration

• “Total Expenditures” table rolls these up to arrive at the projection for the entire grant

Updating Projections (Accomplishments)

• Accomplishment projections for each of the grantee’s activity types (as selected using DRGR).

Questions? Contact Information: Ebony Madyun – Ebony.M.Madyun@hud.gov & 202-402-2188

Phyllis Foulds – Phyllis.J.Foulds@hud.gov & 202-402-3217

Bennett Hilley – .Bennett . R. Hilley@heweud.gov & 202-402-4202