HUD Issues Notice on Hurricane Harvey CDBG-DR Funding

On December 27, HUD issued a notice announcing allocations, common application, waivers, and alternative requirements for Community Development Block Grant-Disaster Recovery (CDBG-DR) to the state of Texas. The notice allocates $57,800,000 of CDBG-DR funds to the State of Texas in response to Hurricane Harvey. Funds must be used only for specific disaster recovery related purposes. The notice is applicable starting January 2, 2018.

Grantees receiving an allocation of funds are subject to the requirements of the November 21, 2016 notice, as amended by this notice, which require grantees to submit a CDBG-DR Action Plan to HUD for approval prior to the obligation of CDBG-DR funds. The Action Plan must detail the proposed use of funds, including criteria for eligibility, and how the use of these funds will address long-term recovery and restoration of infrastructure and housing and economic revitalization in the most impacted and distressed areas.

The Action Plan for 2017 disasters must describe uses for all authorized activities and respond to the disaster-related impact to infrastructure, housing, and economic revitalization in the most impacted and distressed areas. The grantee must conduct an updated assessment of community impacts and unmet needs to guide the development and prioritization of planned recovery activities.

Before signing a grant agreement, HUD must verify that the grantee has proficient financial controls and procurement processes in place and has established adequate procedures to prevent any duplication of benefits, ensure timely expenditure of funds, maintain comprehensive websites regarding all disaster recovery activities assisted with these funds, and detect and prevent waste, fraud, and abuse of funds. To provide a basis for these certifications, grantees are required to submit documentation to the Department demonstrating compliance with the stated requirements and corresponding notice. However, HUD will not require grantees to resubmit previous documentation to support the Secretary’s required certification before signing the grant agreement for funds for 2017 disasters. Instead, grantees receiving an allocation of funds for 2017 disasters may submit a new certification to HUD indicating that its submissions in response to the certification requirements of the November 21, 2016 notice for its CDBG-DR grant for 2016 disasters remain unchanged, and the policies and procedures on which HUD based its certification for 2016 disasters are adopted and will apply to the grantee’s CDBG-DR grant allocation for 2017 disasters.

Pursuant to the November 21, 2016 notice, as amended, a grantee receiving an allocation of funds for 2017 disasters in a subsequent notice is also required to expend 100 percent of its allocation of CDBG-DR funds on eligible activities within 6 years of HUD’s execution of the grant agreement.

To receive funds allocated by this notice, Texas may adopt and incorporate applicable sections and any other relevant information from its approved Action Plan for 2016 disasters, and include any additional information, as appropriate, to address recovery from Hurricane Harvey.

The funds allocated under this notice are subject to the waivers and alternative requirements provided in the November 21, 2016, January 18, 2017, and August 7, 2017 notices governing the award of CDBG-DR funds to 2016 grantees.

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