[Code of Federal Regulations]

[Title 24, Volume 3]

[Revised as of April 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 24CFR570.201]



[Page 41-44]

 

                 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 C_Eligible Activities

 

Sec.  570.201  Basic eligible activities.



    CDBG funds may be used for the following activities:

    (a) Acquisition. Acquisition in whole or in part by the recipient, 

or other public or private nonprofit entity, by purchase, long-term 

lease, donation, or otherwise, of real property (including air rights, 

water rights, rights-of-way, easements, and other interests therein) for 

any public purpose, subject to the limitations of Sec.  570.207.

    (b) Disposition. Disposition, through sale, lease, donation, or 

otherwise, of any real property acquired with CDBG funds or its 

retention for public purposes, including reasonable costs of temporarily 

managing such property or property acquired under urban renewal, 

provided that the proceeds from any such disposition shall be program 

income subject to the requirements set forth in Sec.  570.504.

    (c) Public facilities and improvements. Acquisition, construction, 

reconstruction, rehabilitation or installation of public facilities and 

improvements, except as provided in Sec.  570.207(a), carried out by the 

recipient or other public or private nonprofit entities. (However, 

activities under this paragraph may be directed to the removal of 

material and architectural barriers that restrict the mobility and 

accessibility of elderly or severely disabled persons to public 

facilities and improvements, including those provided for in Sec.  

570.207(a)(1).) In undertaking such activities, design features and 

improvements which promote energy efficiency may be included. Such 

activities may also include the execution of architectural design 

features, and similar treatments intended to enhance the aesthetic 

quality of facilities and improvements receiving CDBG assistance, such 

as decorative pavements, railings, sculptures, pools of water and 

fountains, and other works of art. Facilities designed for use in 

providing shelter for persons having special needs are considered public 

facilities and not subject to the prohibition of new housing 

construction described in Sec.  570.207(b)(3). Such facilities include 

shelters for the homeless; convalescent homes; hospitals, nursing homes; 

battered spouse shelters; halfway houses for run-away children, drug 

offenders or parolees; group homes for



[[Page 42]]



mentally retarded persons and temporary housing for disaster victims. In 

certain cases, nonprofit entities and subrecipients including those 

specified in Sec.  570.204 may acquire title to public facilities. When 

such facilities are owned by nonprofit entities or subrecipients, they 

shall be operated so as to be open for use by the general public during 

all normal hours of operation. Public facilities and improvements 

eligible for assistance under this paragraph are subject to the policies 

in Sec.  570.200(b).

    (d) Clearance activities. Clearance, demolition, and removal of 

buildings and improvements, including movement of structures to other 

sites. Demolition of HUD-assisted or HUD-owned housing units may be 

undertaken only with the prior approval of HUD.

    (e) Public services. Provision of public services (including labor, 

supplies, and materials) including but not limited to those concerned 

with employment, crime prevention, child care, health, drug abuse, 

education, fair housing counseling, energy conservation, welfare (but 

excluding the provision of income payments identified under Sec.  

570.207(b)(4)), homebuyer downpayment assistance, or recreational needs. 

To be eligible for CDBG assistance, a public service must be either a 

new service or a quantifiable increase in the level of an existing 

service above that which has been provided by or on behalf of the unit 

of general local government (through funds raised by the unit or 

received by the unit from the State in which it is located) in the 12 

calendar months before the submission of the action plan. (An exception 

to this requirement may be made if HUD determines that any decrease in 

the level of a service was the result of events not within the control 

of the unit of general local government.) The amount of CDBG funds used 

for public services shall not exceed paragraphs (e) (1) or (2) of this 

section, as applicable:

    (1) The amount of CDBG funds used for public services shall not 

exceed 15 percent of each grant, except that for entitlement grants made 

under subpart D of this part, the amount shall not exceed 15 percent of 

the grant plus 15 percent of program income, as defined in Sec.  

570.500(a). For entitlement grants under subpart D of this part, 

compliance is based on limiting the amount of CDBG funds obligated for 

public service activities in each program year to an amount no greater 

than 15 percent of the entitlement grant made for that program year plus 

15 percent of the program income received during the grantee's 

immediately preceding program year.

    (2) A recipient which obligated more CDBG funds for public services 

than 15 percent of its grant funded from Federal fiscal year 1982 or 

1983 appropriations (excluding program income and any assistance 

received under Public Law 98-8), may obligate more CDBG funds than 

allowable under paragraph (e)(1) of this section, so long as the total 

amount obligated in any program year does not exceed:

    (i) For an entitlement grantee, 15% of the program income it 

received during the preceding program year; plus

    (ii) A portion of the grant received for the program year which is 

the highest of the following amounts:

    (A) The amount determined by applying the percentage of the grant it 

obligated for public services in the 1982 program year against the grant 

for its current program year;

    (B) The amount determined by applying the percentage of the grant it 

obligated for public services in the 1983 program year against the grant 

for its current program year;

    (C) The amount of funds it obligated for public services in the 1982 

program year; or,

    (D) The amount of funds it obligated for public services in the 1983 

program year.

    (f) Interim assistance. (1) The following activities may be 

undertaken on an interim basis in areas exhibiting objectively 

determinable signs of physical deterioration where the recipient has 

determined that immediate action is necessary to arrest the 

deterioration and that permanent improvements will be carried out as 

soon as practicable:

    (i) The repairing of streets, sidewalks, parks, playgrounds, 

publicly owned utilities, and public buildings; and

    (ii) The execution of special garbage, trash, and debris removal, 

including neighborhood cleanup campaigns, but



[[Page 43]]



not the regular curbside collection of garbage or trash in an area.

    (2) In order to alleviate emergency conditions threatening the 

public health and safety in areas where the chief executive officer of 

the recipient determines that such an emergency condition exists and 

requires immediate resolution, CDBG funds may be used for:

    (i) The activities specified in paragraph (f)(1) of this section, 

except for the repair of parks and playgrounds;

    (ii) The clearance of streets, including snow removal and similar 

activities, and

    (iii) The improvement of private properties.

    (3) All activities authorized under paragraph (f)(2) of this section 

are limited to the extent necessary to alleviate emergency conditions.

    (g) Payment of non-Federal share. Payment of the non-Federal share 

required in connection with a Federal grant-in-aid program undertaken as 

part of CDBG activities, provided, that such payment shall be limited to 

activities otherwise eligible and in compliance with applicable 

requirements under this subpart.

    (h) Urban renewal completion. Payment of the cost of completing an 

urban renewal project funded under title I of the Housing Act of 1949 as 

amended. Further information regarding the eligibility of such costs is 

set forth in Sec.  570.801.

    (i) Relocation. Relocation payments and other assistance for 

permanently and temporarily relocated individuals families, businesses, 

nonprofit organizations, and farm operations where the assistance is (1) 

required under the provisions of Sec.  570.606 (b) or (c); or (2) 

determined by the grantee to be appropriate under the provisions of 

Sec.  570.606(d).

    (j) Loss of rental income. Payments to housing owners for losses of 

rental income incurred in holding, for temporary periods, housing units 

to be used for the relocation of individuals and families displaced by 

program activities assisted under this part.

    (k) Housing services. Housing services, as provided in section 

105(a)(21) of the Act (42 U.S.C. 5305(a)(21)).

    (l) Privately owned utilities. CDBG funds may be used to acquire, 

construct, reconstruct, rehabilitate, or install the distribution lines 

and facilities of privately owned utilities, including the placing 

underground of new or existing distribution facilities and lines.

    (m) Construction of housing. CDBG funds may be used for the 

construction of housing assisted under section 17 of the United States 

Housing Act of 1937.

    (n) Homeownership assistance. CDBG funds may be used to provide 

direct homeownership assistance to low- or moderate-income households in 

accordance with section 105(a) of the Act.

    (o)(1) The provision of assistance either through the recipient 

directly or through public and private organizations, agencies, and 

other subrecipients (including nonprofit and for-profit subrecipients) 

to facilitate economic development by:

    (i) Providing credit, including, but not limited to, grants, loans, 

loan guarantees, and other forms of financial support, for the 

establishment, stabilization, and expansion of microenterprises;

    (ii) Providing technical assistance, advice, and business support 

services to owners of microenterprises and persons developing 

microenterprises; and

    (iii) Providing general support, including, but not limited to, peer 

support programs, counseling, child care, transportation, and other 

similar services, to owners of microenterprises and persons developing 

microenterprises.

    (2) Services provided this paragraph (o) shall not be subject to the 

restrictions on public services contained in paragraph (e) of this 

section.

    (3) For purposes of this paragraph (o), ``persons developing 

microenterprises'' means such persons who have expressed interest and 

who are, or after an initial screening process are expected to be, 

actively working toward developing businesses, each of which is expected 

to be a microenterprise at the time it is formed.

    (4) Assistance under this paragraph (o) may also include training, 

technical assistance, or other support services to increase the capacity 

of the recipient or subrecipient to carry out the activities under this 

paragraph (o).



[[Page 44]]



    (p) Technical assistance. Provision of technical assistance to 

public or nonprofit entities to increase the capacity of such entities 

to carry out eligible neighborhood revitalization or economic 

development activities. (The recipient must determine, prior to the 

provision of the assistance, that the activity for which it is 

attempting to build capacity would be eligible for assistance under this 

subpart C, and that the national objective claimed by the grantee for 

this assistance can reasonably be expected to be met once the entity has 

received the technical assistance and undertakes the activity.) Capacity 

building for private or public entities (including grantees) for other 

purposes may be eligible under Sec.  570.205.

    (q) Assistance to institutions of higher education. Provision of 

assistance by the recipient to institutions of higher education when the 

grantee determines that such an institution has demonstrated a capacity 

to carry out eligible activities under this subpart C.



[53 FR 34439, Sept. 6, 1988, as amended at 53 FR 31239, Aug. 17, 1988; 

55 FR 29308, July 18, 1990; 57 FR 27119, June 17, 1992; 60 FR 1943, Jan. 

5, 1995; 60 FR 56911, Nov. 9, 1995; 61 FR 18674, Apr. 29, 1996; 65 FR 

70215, Nov. 21, 2000; 67 FR 47213, July 17, 2002]