[Code of Federal Regulations]
[Title 24, Volume 3]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR570.420]

[Page 91-92]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER V--OFFICE OF ASSISTANT SECRETARY FOR COMMUNITY PLANNING AND 
        DEVELOPMENT, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
 
PART 570_COMMUNITY DEVELOPMENT BLOCK GRANTS--Table of Contents
 
                     Subpart F_Small Cities Program
 
Sec. 570.420  General.

    Source: 62 FR 62914, Nov. 25, 1997, unless otherwise noted.


    (a) HUD administration of nonentitlement CDBG funds. Title I of the 
Housing and Community Development Act of 1974 permits each State to 
elect to administer all aspects of the Community Development Block Grant 
(CDBG) Program annual fund allocation for the nonentitlement areas 
within its jurisdiction. This subpart sets forth policies and procedures 
applicable to grants for nonentitlement areas in States that have not 
elected, in a manner and time prescribed by the Secretary, to administer 
the CDBG Program. States that elected to administer the program after 
the close of fiscal year 1984 cannot return administration of the 
program to HUD. A decision by a State to discontinue administration of 
the program would result in the loss of CDBG funds for nonentitlement 
areas in that State and the reallocation of those funds to all States in 
the succeeding fiscal year.
    (b) Scope and applicability. (1) This subpart describes the policies 
and procedures of the Small Cities Program which apply to nonentitlement 
areas in States where HUD administers the CDBG Program. HUD currently 
administers the Small Cities Program in only two States--New York and 
Hawaii. This subpart principally addresses the requirements for New 
York, and Sec. Sec. 570.429 and 570.430 identify special procedures 
applicable to Hawaii.
    (2) The allocation of formula CDBG funds for use in nonentitlement 
areas of Hawaii and New York is as provided in subpart A of this part. 
The policies and procedures set forth in the following identified 
subparts of this part 570 apply to the HUD-administered Small Cities 
Program, except as modified or limited under the provisions thereof or 
this subpart:
    (i) Subpart A--General Provisions;
    (ii) Subpart C--Eligible Activities;
    (iii) Subpart J--Grant Administration;
    (iv) Subpart K--Other Program Requirements; and
    (v) Subpart O--Performance Reviews.
    (c) Public notification requirements. (1) Section 102 of the 
Department of Housing and Urban Development Reform Act of 1989 (42 
U.S.C. 3545) contains a number of provisions that are designed to ensure 
greater accountability and integrity in the provision of certain types 
of assistance administered by HUD. All competitive grants in the

[[Page 92]]

HUD-administered Small Cities Program in New York are affected by this 
legislation, and the requirements identified at 24 CFR part 4 apply to 
them. Imminent threat grants under Sec. 570.424 and section 108 
repayment grants under Sec. 570.432 are not affected by section 102 as 
they are not competitive grants.
    (2) The Hawaii HUD-administered Small Cities Program is not subject 
to section 102, since the funds are not distributed in a competitive 
manner.
    (d) Abbreviated consolidated plan. Applications for the HUD-
administered Small Cities Program which contain housing activities must 
include a certification that the proposed housing activities are 
consistent with the applicant's consolidated plan as described at 24 CFR 
part 91.
    (e) National and primary objectives. (1) Each activity funded 
through the Small Cities Program must meet one of the following national 
objectives as defined under the criteria in Sec. 570.208. Each activity 
must:
    (i) Benefit low- and moderate-income families;
    (ii) Aid in the prevention or elimination of slums or blight; or
    (iii) Be an activity which the grantee certifies is designed to meet 
other community development needs having a particular urgency because 
existing conditions pose a serious and immediate threat to the health or 
welfare of the community where other financial resources are not 
available to meet such needs.
    (2) In addition to the objectives described in paragraph (e)(1) of 
this section, with respect to grants made through the Small Cities 
Program, not less than 70 percent of the total of grant funds from each 
grant and Section 108 loan guarantee funds received under subpart M of 
this part within a fiscal year must be expended for activities which 
benefit low- and moderate-income persons under the criteria of 
Sec. Sec. 570.208(a), or 570.208(d) (5) or (6). In the case of 
multiyear plans in New York State approved in response to NOFAs 
published prior to calendar year 1997, not less than 70 percent of the 
total funding for grants approved pursuant to a multiyear plan for a 
time period of up to 3 years must be expended for activities which 
benefit low- and moderate-income persons. Thus, 70 percent of the grant 
for year 1 of a multiyear plan approved in response to NOFAs published 
prior to calendar year 1997 must meet the 70 percent requirement, 70 
percent of the combined grants from years 1 and 2 must meet the 
requirement, and 70 percent of the combined grants from years 1, 2, and 
3 must meet the requirement. In determining the percentage of funds 
expended for such activity, the provisions of Sec. 570.200(a)(3) (i), 
(iii), (iv), and (v) shall apply.

(Approved by the Office of Management and Budget under control number 
2506-0060)