U.S. Department of Housing and Urban Development. NSP Webinar. NSP Closeouts. December 6, :00 P.M. EST. Community Planning and Development

Transcription

1 U.S. Department of Housing and Urban Development NSP Webinar NSP Closeouts December 6, :00 P.M. EST Community Planning and Development

2 Presenters Mary Paumen, TDA HUD NSP Staff Jesse Handforth Kome John Laswick David Noguera Hunter Kurtz Moderators Webinar Host Kent Buhl, Enterprise Community Partners Surabhi Dabir, Enterprise Community Partners 2

3 Access to Materials Instructions to Download Materials Go to the NSP Resource Exchange at Click Learning Center then Webinars Locate today s webinar and click Presentation Slides. 3

4 Technical Assistance on NSP Closeouts Three Webinars - December 6, NSP Closeout Process - Early Questions on NSP Closeout Process - Early NSP Closeout Guide Publication of NSP Closeout Guide in early 2013 The expenditure deadlines are the highest priority for those below 100% in NSP1&2 and under 50% in NSP3. Closeouts come later, AFTER completion of all activities and achievement of a national objective for each one. 4

5 Webinar Objectives Describe the requirements for closing an NSP grant after all activities have been completed and met a national objective. Discuss the process for closing a grant. Cover the technical corrections contained in the NSP Closeout Notice 5

6 What is NSP Closeout? NSP grant will be closed out when HUD determines, in consultation with the Grantee, that the following criteria have been met: 1. All costs to be paid have been incurred. (except for final audit costs and contingent liabilities) 2. All activities have been completed. 6

7 What is NSP Closeout (con t.) 3. 25% set aside has been expended (to house persons at 50% or below Average Median Income) including 25% of all Program Income 4. All other grant responsibilities and regulations have been carried out. This includes the requirement that every activity has met a national objective, typically area benefit for demolition (LMMA) or occupied units of housing (LMMH). 7

8 When are you ready for NSP Closeout? Not complete, Not occupied, Does not meet national objective: Not ready for closeout All activities complete, All occupied, All meet national objective: Ready for Closeout 8

9 Timeline for NSP Closeouts HUD has not set a specific deadline for program closeouts. Timeline will be driven by Grantees for the foreseeable future. Current emphasis is on NSP spending deadlines. 12/3/2012 NSP1 NSP2 NSP3 NSP3 Under 50% % 50-59% % 60-69% % 70-79% % 80-89% % 90-99% % 100% % + TOTAL

10 NSP at Work in New Orleans 10

11 Closeout Actions What steps do you need to take to closeout out an NSP program? What is the process? 1. Final Quarterly Progress Report in DRGR to be submitted within 90 calendar days after determination that closeout criteria have been met. 11

12 Closeout Actions 2. HUD/Grantee closeout agreement is signed. 3. Cancellation of any unused portion of the NSP grant award (in line of credit). HUD will coordinate timing to minimize loss. 4. Any costs not audited before closeout must be audited in next single audit. Disallowed costs still subject to repayment. 12

13 NSP at Work in Miami 13

14 Closeout Agreement To be prepared by the HUD Field Office, in consultation with the Grantee, and will include provisions to address the following six issues: 1. Any lingering costs to be paid after closeout agreement signed. 2. Any unused grant funds to be cancelled. 14

15 Closeout Agreement 3. All program assets, including: program income held, list of real property subject to continuing affordability requirements, real property in NSPassisted land banks 4. Any land-banked property (disposition plan) 5. NSP continuing affordability plan and responsible organizations. 15

16 Closeout Agreement 6. Grantee s responsibilities after closeout: A. Compliance with all NSP program requirements in using program income on deposit, and in using any other remaining NSP funds available for closeout costs and contingent liabilities B. Use of real property assisted with NSP funds in accordance with CDBG Change of Use rules 16

17 Closeout Agreement C. Land banks must ensure that each property will meet a specific eligible use. D. Program Income use in accordance with CDBG requirements E. Flood insurance coverage requirement for any affected property owners during mandatory period. 17

18 Land Banks: Must Obligate for a Specific Use This example from Cuyahoga County describes the strategic planning that grantees should be undertaking to dispose of properties. 18

19 Questions on NSP Closeout Type questions in Q&A. Address questions to "All Panelists" 19

20 NSP at Work in Denver 20

21 Technical Corrections Demolition Land Banks Economic Development LH25 Program Income Long Term Affordability Recapture Provisions 21

22 Demolition Eligible Use D includes acquisition and disposition. This means that property acquired for demolition can meet a national objective through the demolition. Subsequent disposition (an eligible activity) is allowed as long as the use meets a national objective. If the activity is not eligible in NSP, it must be undertaken with other funds. 22

23 Demolition Demolition only Demo with subsequent use 23

24 Land Banks The closeout agreement date will establish the beginning of the ten year period to obligate property in a land bank for a specific, eligible redevelopment. The changes to Use D should simplify this process. Any property may be disposed of if its subsequent use meets a NSP national objective. If the use is not an eligible NSP activity, any source of funds may be used to meet this standard. 24

25 Land Banks: Obligate for Specific Eligible Use. Cuyahoga County maintains a detailed database of properties and planned uses. 25

26 Land Banks Land banks can acquire new property after closeout, but must dispose of it within the 10 year period starting at closeout. Other subsequent uses include: Public improvements like parks, drainage Land trust designation for affordable housing Any other CDBG program use Affordable housing under active development Designation in redevelopment plan If not, reverts to CDBG program for immediate use. 26

27 Economic Development Special economic development activities (24 CFR ) are added: as an eligible activity under Eligible Use B (Rehabilitation) and under Eligible Use E for NSP 1 (Redevelop Demolished or Vacant Properties). 27

28 Economic Development LMMA - Area Benefit LMMJ - Create/Retain Jobs 28

29 Program Income Prior to closeout, Grantees must deplete line of credit or the funds will be canceled. HUD will work with Grantees to reduce amounts subject to cancellation. ALL program income prior to closeout must set aside 25% for low-income housing. After closeout, Grantees will continue to use program income in compliance with NSP rules. 29

30 Program Income, cont d. PI under $25,000/year total must be used for administration or added to CDBG PI. New construction and land banks (not eligible in CDBG) will still be eligible. NSP national objectives as amended. Beneficiaries will include up to 120% AMI. Program income over $250,000/year must comply with 25% Low-income Set-Aside 30

31 NSP at Work in Phoenix 31

32 Program Income, cont d. Rules for non-profit consortium members and nonentitlement NSP3 Grantees will be slightly different. Non-profits must are restricted miscellaneous revenues (meet NSP eligibility and national objectives) for five years; then the funds are unrestricted miscellaneous revenues. This applies to members and lead members of non-profit NSP2 consortia. State/Entitlement members of NSP2 consortia will be treated under Entitlement rules. 32

33 Program Income cont d. NSP3 Non-entitlement Grantees will follow the nonprofit guidance unless the NSP3 grantee has an open CDBG grant from the state at the time of closeout. If the NSP3 grantee is a State CDBG grant recipient at the time of closeout, NSP requirements apply and the grantee must use program income to continue the NSP activity that generated it. 33

34 NSP at Work in Detroit 34

35 Long Term Affordability HUD will develop a reporting mechanism to ensure that Grantees report through the affordability period on all homes. Plans will describe roles and responsibilities for 5 to 20 year periods. This will occur annually and eventually become part of IDIS. Non-profits and non-entitlements will likely continue to use DRGR. 35

36 Recapture Provisions HUD recaptured funds from states that did not meet NSP1 obligation deadlines, in accordance with the Oct NSP Notice Rather than reallocating these funds to NSP, HUD will place this money in the Disaster Fund. HUD initially believed that the amount of recaptured funds would be much larger, but has determined that reallocating approximately 0.5% of the original funding ($20 million) would not be cost-effective. 36

37 Tracking and Reporting Grantees need to develop a strategy for land banks and the use of land assembled with NSP funding Track assets (land) and continued affordability in DRGR until the information is migrated to IDIS Grantees should monitor and report annually on continued affordability Closeout Agreement will specify who does what to assure continued affordability 37

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39 NSP Eligibility Provisions 11/27/12 New Language in Yellow: Property Eligibility in Green 39

40 NSP Help / Resources HUD NSP Resource Exchange: Learning Center: 40