COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) Subrecipient Workshop

CDBG Subrecipient Training • CDBG Overview • Grant Requirements • Client Files • Administration • Monitoring • Considerations • Anticipated Timeline • Application

CDBG Program & Purpose • Authorized under Title I of the Housing and Community

Development Act of 1974

• US Department of Housing and Urban Development (HUD)

• Develop viable urban communities by providing decent housing, a suitable living environment, and expanding economic opportunities, principally for persons of low and moderate income

• Provides flexibility to address a wide range of community needs

CDBG Overview

CDBG Overview • Entitlement Community

• Annual CDBG Allocation (FY 2016-17 allocation $5,286,263)

• 15 % Public Service Cap

• Subrecipients: Entities that are provided CDBG funds to use in carrying out agreed upon eligible activities

Requirements • Public Services eligible under 24 CFR 570.201(e)

• National Objective Benefit to Low and Moderate Income Individuals or Households

• City of Santa Ana Strategic Plan Goal

• Consolidated Plan Priority Need

• Crime prevention, intervention, and/or suppression efforts for children, youth and/or families

• Minimum funding request of $30,000

National Objective • Activities that benefit low- and moderate-income persons

24 CFR 570.208(a)

• 51 % of participants must be low- and moderate-income

• Failure to document compliance with the National Objective specified for your grant may result in the disallowance of costs (i.e. the repayment of grant funds or the denial of invoices submitted)

National Objective - LMC • Presumed Groups

24 CFR 570.208(a)(2)(i)A • Abused Children, battered spouses, elderly persons, individual with

disabilities, homeless persons, illiterate adults, persons living with AIDS, and migrant farm workers

• Documentation

• Identification, drivers license, or birth certificate to document age • Documentation establishing that the facility or service is designed

for and used by the presumed group • Intake assessment during the application process

*Example: a senior meal program or domestic violence shelter

National Objective - LMC • Require Information on Family Size and Income

24 CFR 570.208(a)(2)(i)B & C • Require income so that it is evident that at least 51% of the

clientele are persons whose family income does not exceed the L/M limit

• Documentation

• Data showing the number of household members and annual income of EACH MEMBER over the age of eighteen, living in the household, that contributes income to the household

• Check stubs, public assistance documentation *Most common for public services

National Objective - LMC • Nature and Location

24 CFR 570.208(a)(2)(i)D • Have income eligibility requirements which limit the activity

exclusively to L/M persons

• Documentation

• Documentation describing how the nature and the location of the facility or service establishes its use, predominantly by L/M income persons * Example: Providing services in an affordable housing development to affordable housing development residents

National Objective - LMA • Area Benefit

24 CFR 570.208(a)(1) • An activity, the benefits of which are available to all the residents in

a particular area where at least 51% of the residents are low and moderate income

• Documentation

• The boundaries of the service area generally defined using census tracts and block groups

• Logs of activities conducted in the area and justification for how they benefit all residents * RARE FOR PUBLIC SERVICES - Example: A neighborhood watch program

Reimbursement Grant • Cost Reimbursement Agreement

• Insurance Required: General Liability in the amount of $1,000,000 naming the City of Santa Ana as Additional Insured, Auto, Workers Compensation

• Santa Ana Business License

• Quarterly request for reimbursement for direct costs associated with the program

• Only eligible expenses listed in the agreement budget will be reimbursed

Reimbursement • Invoices due quarterly for reimbursement

• Q1: JUL 1 - SEP 30 (Due OCT 15) • Q2: OCT 1 - DEC 30 (Due JAN 15) • Q3: JAN 1 - MAR 30 (Due APR15) • Q4: APR 1 - JUN 30 (Due JUL 15)

• Invoices must provide documentation of expenditures

• Invoices paid 30 days upon receipt. *ERRORS ON INVOICES OR MISSING DOCUMENTATION WILL DELAY THE REIMBURSEMENT. INCORRECT OR INCOMPLETE INVOICES MAY BE RETURNED FOR CORRECTIONS.

Reimbursement Documentation Must provide documentation for expenses for reimbursement:

• Salaries: Timecards with all hours worked, payroll records, benefits statements, canceled checks

• Material and Supplies: Invoices, canceled checks, procurement documentation

• Other Costs – Must present a cost allocation plan to be approved by City of Santa Ana Finance Department

• Indirect Costs: Federally approved Indirect Cost Rate or a 10% de minimus applied per 2 CFR 200

Client Files Client file should include the following items:

• Intake Form containing all HUD-required information

• Client-Qualifying Documentation (If Applicable)

• Proof of service provided to the client sign-in sheets, case worker’s write-ups, etc.

Client Intake • Does the intake form collect all HUD-required

information?

• Household Size • Household Income • Name, age and income of all family members residing in the

household • Female Head of Household • Race/Ethnicity • Age Verification (if Presumed Benefit–62 or over) • Disability (if Presumed Benefit)

John Smith 07/15/14 123 Main St. Santa Ana XXXXX

000 000-0000 myemailaddress@yahoo.com 00/00/00 14 X

X

X X

X

Applicant Name Guardian Name Staff Name

Guardian Sign Staff Sign

07/15/14 07/15/14 07/15/14

The participant name must be that of the person who is receiving the service. Please verify that one

(1) box is checked in each section.

The date must be within the current CDBG Program Year (07/01/17 - 06/30/18)

Please verify that the applicant signs, or head of household is signing the intake form if the applicant is under 18 years old.

Verify that the applicant circles the correct household size and income amount.

The person who verifies that the information on the intake form is correct must date, print and sign their name

Weekly - 7 day pay period, multiply avg. gross by 52

Bi-Weekly – 14 day pay period, multiply avg gross by 26

Bi-Monthly - 1st – 15th and 16th to 30th/31st – multiply avg. gross by 24

Use gross not net amount when calculating income.

SAMPLE PAYSTUB

Brenda Smith

John Smith Sr.

Stacy Smith

400.00

375.00

378.85

1,153.85

384.62 384.6

2 20,000.24

423.08

500.00

0.00

923.08

461.54 2 461.

54 12,000.04

208.33

0.00

0.00 1 208.

33 208.33

4,999.92

208.33

$ 37,000.02

Please be sure to verify the household size and income are correct on the applicant intake form.

An example of a person who receives a week, bi-weekly and semi-monthly paycheck. Please obtain three (3) pay-stub amounts.

Qualifying Documentation • If presumed, client eligibility supporting documentation:

• Statement of abuse (abused children/battered spouses) • Age verification (elderly persons) • Statement of disability (severely disabled persons) • Statement of homelessness (homeless persons) • Program Determination of Literacy (illiterate adults) • Statement of Medical Condition (persons living with AIDS) • Verification of Migrant Farm Worker Status (migrant farm workers)

• If limited clientele:

• Income documentation for all persons working in the household

Income Limits • Program must serve at minimum 51% low- and moderate-

income individuals.

• The HUD Income Limits are revised each program year. Typically this has been in the month of December.

• The income limits are based on the area median income (AMI) adjusted for household size.

• For the CDBG Program, the maximum household income allowable is 80% of the AMI adjusted for household size.

HUD FY 2016 Income Limits FY 2016 Income

Limit Area

Median Income

FY 2016 Income

Limit Category

Persons in Family

1 2 3 4 5 6 7 8

Orange County

Effective 2/28/16

$85,000

Very Low (50%)

Income Limits ($)

34,150 39,000 43,900 48,750 52,650 56,550 60,450 64,350

Extremely Low

Income Limits ($)*

20,500 23,400 26,350 29,250 31,600 33,950 36,730 40,890

Low (80%) Income

Limits ($) 54,600 62,400 70,200 78,000 84,250 90,500 96,750 103,000

Proof of Service Documentation demonstrating dates and/or services provided:

• Sign-in sheets

• Case worker write-ups

• Access to client tracking database/or printouts

Quarterly Performance Reports • Required to report programmatic accomplishments by the

15th day of the month following the end of each quarter

• Reports must report new clients served

• Q1: JUL 1 - SEP 30 (Due OCT 15) • Q2: OCT 1 - DEC 30 (Due JAN 15) • Q3: JAN 1 - MAR 30 (Due APR15) • Q4: APR 1 - JUN 30 (Due JUL 15) NOTE: If the 15th falls on a weekend or a City-recognized holiday, the documents must be submitted on the following business day no later than 9:00 A.M.

Administration Program files must be maintained by the subrecipient:

• Contract/Amendments

• Program Polices and Procedures

• Financial Data

• Quarterly Performance Reports

Program Polies and Procedures • Overview of program

• Client eligibility requirements

• Client intake and client files

• Annual income guidelines

• Submittal of Quarterly Performance Reports

Financial Policies and Procedures • Internal Controls

• Financial Procedures

• Time and Effort

• Procurement

Federal Requirements • CDBG program requirements

24 CFR 570

• Eligible activities, ineligible activities, national objectives, grant administration, other program requirements, record keeping

• Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards 2 CFR 200

• Cost principles, standards for financial and program management, procurement standards, record retention, audit requirements, indirect costs

Personnel Expenses - 2 CFR 200 Standards for Documentation of Personnel Expenses §200.430 Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:

• Be supported by a system of internal control - accurate, allowable, and properly allocated

• Be incorporated into the official records

• Reasonably reflect the total activity for which the employee is compensated

• Encompass both federally assisted and all other activities compensated by the nonprofit

• Comply with the established accounting policies and practices

• Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award;

Procurement Standards - 2 CFR 200 • General procurement standards §200.318

• Must use organizations policy and procedure • AND Must comply with federal requirements • SAM.gov check for contracts

• Competition §200.319

• Full and open completion

• Methods of procurement to be followed §200.320*

• Micro Purchase (Under 3K) - No soliciting competitive quotes • Small Purchase (3K+) - Quotations (3 recommended) • Competitive proposals (150K+) - Formally advertised *MUST ENSURE ORGANIZATIONS POLICY IS FOLLOWED

Allowable Expenses Necessary, allocable and reasonable for the administration of the program.

• Salaries (timecards, payroll record, proof of payment)

• Benefits (statements, proof of payment)

• Material & Supplies (invoices, proof of payment)

• Rent (cost allocation plan must be approved by the City)

*MUST BE INCURRED DURING THE AGREEMENT PERIOD TO BE ELIGIBLE FOR REIMBURSEMENT

Unallowable Expenses • Equipment

• Food - except for a meal program

• Late fees, fines

• Political activities/lobbying

* SEE GENERAL PROVISION FOR SELECTED ITEMS OF COST FOR FULL LISTING §200.420 et. al.

Subrecipient Monitoring The City is required to monitor subrecipients. It fulfills this responsibility by:

• Desk Monitoring: Examination of QPRs and Reimbursement Requests

• Technical Assistance: Provision of workshops and/or individualized technical assistance

• On-Site Monitoring: A comprehensive on-site programmatic and financial monitoring visit

• Single Audit Review: For organizations expending $750K+ in federal funds

Subrecipient Monitoring What happens if a subrecipient monitoring results in findings?

• Subrecipient will receive detailed explanation of the regulatory violation and a “required corrective action” to resolve the deficiency

• City may provide technical assistance

• May require third-party professional service providers to resolve (i.e. accountants)

• May have CDBG grant suspended or terminated if left unresolved

Considerations • Does your organization have the capacity to administer

the program:

• Internal controls • Experienced staff • Cash flow due to quarterly reimbursements

• Will your organization be able to document the national objective of a benefit to low and moderate income individuals:

• Collection of income documentation for all family members • Documentation of a presumed benefit activity

Anticipated Timeline Date Action

MAR 8 Applications Due by 5:00 PM

MAR 9 Staff Review

MAR 10 Community Redevelopment & Housing Commission (CRHC) review

MAR 22 CRHC Public Hearing & Nonprofit Presentations

MAR 29 CRHC Ratings Due

APR 5 CRHC funding recommendations

APR 18 City Council Public Hearing & Recommendations

JUN 15 Execute Agreements

www.santa-ana.org/cdbg

Application Logon Page

Create Account

Application Page

File Upload

Tips • Ensure questions are thoroughly answered

• Ensure correct and complete documents are uploaded *Excel budget templates have TWO worksheets/tabs that must be complete.

• Don’t wait until the last minute to submit the application *City will not accept late applications. It is the nonprofits responsibility to ensure sufficient time is allotted for unexpected computer glitches.

Q&A • Q&A will be posted on:

www.santa-ana.org/cdbg

• Summit questions via email to: CDBG-ESGgrants@santa-ana.org

Thank You