COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) SUBRECIPIENT WORKSHOP FY 2015-2016 October 2014 Santa Ana, CA
COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG)
SUBRECIPIENT WORKSHOP
FY 2015-2016
October 2014
Santa Ana, CA
CDBG SUBRECIPIENT TRAINING
Overview of CDBG
Anticipated Timeline
Key Considerations
Grant Requirements
Monitoring
Considerations
Community Development Block Grant (CDBG) in 3 minutes
OVERVIEW OF CDBG
The Community Development Block Grant Program
was established by an Act of Congress, through the
Housing and Community Development Act of 1974.
The purpose of the CDBG program is to 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 local governments with the flexibility to
address the broad range of needs within lower-
income neighborhoods.
OVERVIEW OF CDBG
The City is considered an “Entitlement Community”
and receives its own annual allocation of CDBG
funds. (FY 2014-15 allocation $5,560,186)
The City has the option to elect to spend up to 15%
of its annual allocation on public service activities.
Subrecipients are entities that are provide CDBG
funds by a grantee for their use in carrying out
agreed-upon eligible activities.
ANTICIPATED TIMELINE
Date Steps
September 22 Outreach Efforts Commenced
October 6 - November 14 Application Period (6-weeks)
October 7 - 15 Mandatory CDBG Subrecipient Training
November 14Applications Due by 5 PM at City Hall 6th
Floor
November 17 – December 17Application Review – Community Redevelopment & Housing Commission (CRHC)
December 17Tentative
Presentations to CRHC
February 2015 Recommendations to FEDT
March 2015 Recommendations to City Council
KEY CONSIDERATIONS
How will subrecipients use CDBG to serve a public benefit?
Does the subrecipient have the programmatic and financial capacity to administer the grant?
Is a reasonable benefit accrued to the City as a result of the public service provided by the subrecipient?
REQUIREMENTS
Public service programs are eligible under 24 CFR 570.201(e)
An activity must meet a National Objective
Must meet a City of Santa Ana Strategic Plan Goal
Detailed goals are listed in the application
Must meet a Consolidated Plan Priority Need
Will be determined in March
NATIONAL OBJECTIVE - LMC
Public service programs that benefit low - and
moderate income persons are eligible under
24 CFR 570.208(a)(2)(i)–A, B, C, or D.
NOTE: 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 APPLICATION DOCUMENTATION
570.208(a)(2)(i)
Limited Clientele
Activities
PUBLIC SERVICE
PROGRAMS
TYPICALLY FIT IN
THIS NATIONAL
OBJECTIVE
Benefit of clientele who are generally
presumed to be principally L/M persons.
The benefits of this type of activity are
limited to a specific group of people.
(A) - Elderly persons
- Abused children
- Battered spouses
- Homeless persons
- Severely Disabled Adults
- Illiterate adults
- Migrant farm workers
- Persons with Aids
- Driver’s License; or
- Birth Certificate; or
- California Identification Card; or
- Documentation establishing that the
facility or service is designed for and
used by senior citizens.
Documentation describing how the
nature and location of the facility or
service establishes its use,
predominantly by L/M income
persons.
- Intake assessment during the
application process determines
qualification under this category.
(B) – 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; or
(C) – Have income eligibility requirements
which limit the activity exclusively to L/M
persons; or
- 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.
(D) – Be of such a nature and location that
it may be concluded that the activity's
clientele will primarily be L/M income
persons.
- Documentation describing how the
nature and the location of the facility
or service establishes its use,
predominantly by L/M income
persons.
NATIONAL OBJECTIVE APPLICATION DOCUMENTATION
570.208(a)(1) Area
Benefit Activities
An activity which meets the identified needs
of L/M income persons residing in an area
where at least 51% of the residents are L/M
income persons. The benefits of this type of
activity are available to all persons in the
area regardless of income.
- A log with names and address corresponding
with census tracts and block group(s) in the
service area.
- The boundaries of the service area generally
defined using census tracts and block groups.
- The service area corresponds to the area
were clients served by the program reside.
- Residency verification such as utility bill,
California Identification, Driver’s License,
Senior Identification.
24 CFR
570.208(a)(2)(iii).
Microenterprise
Activities
A microenterprise assistance activity carried
out in accordance with 570.201(o) with
respect to those owners of microenterprises
and persons developing microenterprises
assisted under the activity during each
program year who are low- and moderate-
income persons. Such persons determined
to be low- and moderate-income may be
presumed to continue to qualify as such for
up to a three-year period.
- Full income determination in accordance with
24 CFR Part 5 – Annual Income.
570.208(3) Housing
Activities
An eligible activity carried out for the
purpose of providing or improving
permanent residential structures which,
upon completion, will be occupied by low-
and moderate-income households.
Acquisition
Rehabilitation
New Construction
- Intake assessment during the application
process determines qualification under this
category.
- 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.
NATIONAL OBJECTIVE - LMC
24 CFR 570.208(a)(2)(i)A
A) Presumed Groups: Activities that benefit a clientele who are generally presumed to be principally low - and moderate -income persons, including the following:
Abused Children, battered spouses, elderly persons, adults meeting the Bureau of the Census’ Current Population Reports definition of “severely disabled”, homeless persons, illiterate adults, persons living with AIDS, and migrant farm workers.
24 CFR 570.208(a)(2)(i)B
B) Income Documentation: Requires obtaining verifiable certification from the assisted person that his/her family income does not exceed the applicable income limit and supporting documentation on family size and income so that it is evident that at least 51% of the clientele are persons whose family income does not exceed the low-and moderate -income limit.
NATIONAL OBJECTIVE - LMC
24 CFR 570.208(a)(2)(i)C
C) The program has income eligibility requirements which limit the
activity exclusively to low - and moderate - income persons.
24 CFR 570.208(a)(2)(i)D
D) Be of such a nature and be in such a location that it may be
concluded that the activity’s clientele will primarily be low-and
moderate-income persons (i.e. a service activity that serves
only a Section 8 apartment complex).
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 & Certificate of Occupancy
Quarterly request for reimbursement for direct
costs associated with the program
Only eligible expenses listed in the agreement
budget will be reimbursed
REIMBURSEMENT GRANT
Must provide documentation for expenses for reimbursement:
Salaries: Timecards with hours worked, payroll records, benefits statements, canceled checks
Material and Supplies: Invoices, canceled checks, procurement documentation
Other Direct Costs – Must present a cost allocation plan to be approved by City of Santa Ana Finance Department
CLIENT FILES
Subrecipient must maintain a client file for each person served each funded program year?
Client file should include the following items:
Intake Form containing all HUD-required information
Proof of service provided to the clientsign-in sheets, case worker’s write-ups, etc.
Client-Qualifying Documentation (If Applicable)
Does the intake form collect all HUD-required information?
Age Verification (if Presumed National Objective – Elderly Persons, 62 or over)
Household Size
Household Income
Name, age and income of all family members residing in the household
Female Head of Household
Race/Ethnicity
Disabled
CLIENT INTAKE
IMPORTANT
John Smith 07/15/14
123 Main St. Santa Ana XXXXX
000 000-0000 [email protected]/00/00 14 X
X
X
X
X
Applicant Name
Guardian Name
Staff Name Guar di an Si gn
St af f Si gn
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
(07/01/14 -
06/30/15)
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
384.62 20,000.24
423.08 500.00 0.00 923.08 461.542
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
Please use as a
reference for examples
of proof of income
documentation; which
would be represented
on the “Income
Calculation” worksheet.
PROOF OF SERVICE
Documentation showing dates when service was
provided to the client. These may include:
Sign-In sheets
Case worker’s write-ups
Timesheets – that can be traced back to the services
provided
Access to client tracking database
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.
2014 INCOME LIMITS
*Effective Date: December 18, 2013
Orange County, California
FY 2014
Income
Limit Area
Median
Income
FY 2014
Income
Limit
Category
1 Person 2 Person 3 Person 4 Person 5 Person 6 Person 7 Person 8 Person
Orange
County $84,100
Extremely
Low Income
(0%-30%)
$19,000 $21,700 $24,400 $27,100 $29,300 $31,450 $33,650 $35,800
Low Income
Limits
(31%-50%)
$31,650 $36,150 $40,650 $45,150 $48,800 $52,400 $56,000 $59,600
Moderate
Income
Limits
(51%-80%)
$50,600 $57,800 $65,050 $72,250 $78,050 $83,850 $89,600 $95,400
QUARTERLY PERFORMANCE REPORTS
Subrecipient are required to report programmatic accomplishments by the 15th day of the month following the end of each quarter.
QPRs must report new clients served
Q1 - July 1-September 30 (Due Oct. 15)
Q2 – October 1-December 31(Due Jan. 15)
Q3 – January 1-March 31 (Due April 15)
Q4 – April 1 – June 30 (Due July 15)
NOTE: QPRs and Payment/Reimbursements Requests will be due on
the 15th day of the month following each quarter. 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. Failure
to submit QPRs may result in the possible suspension of CDBG funds
and/or the termination of your agreement with the City.
Agency A
Program A
10
10
0
0
0
0
0
0
0
0
20
5
0
0
0
0
0
0
0
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5
10
10
0
0
0
0
0
0
0
0
20
5
0
0
0
0
0
0
0
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5
15
20
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15
20
20
0
0
20
20
0
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10 10
10020%
50 50
Employee NameEmpl oyee Si gn
ADMINISTRATION
Program files must be maintained by the organization.
Contract
Program Policies and Procedures
Insurance Information
Financial Data
Quarterly Performance Reports
Contract Amendments
ADMINISTRATION
Program Policies and Procedures
Overview of your program
Client eligibility requirements
Program Procedures
Client Intake and Client Files
Annual Income Guidelines
Submittal of Quarterly Performance Reports (QPR)
ADMINISTRATION
Financial Policies and Procedures
Internal Controls
Organization Chart & Job Descriptions
Financial Procedures
Timecards
Submittal of Reimbursement Requests
Annual Audit
Salaries $50,000 $10,000
Agency A
Pogram A123 Main St.
Employee NameEmpl oyee Si gn
Employee Title
$0 $10,000$20,000 $10,000 $20,000
Employee NameEmpl oyee Si gn
Employee Title
ADMINISTRATION
The programmatic requirements of the CDBG program can be found at 24 CFR Part 570.
The uniform administrative requirements of 24 CFRPart 84 (Non-Profit) and 85 (Government) must be followed.
Other programmatic requirements:
Conflict of Interest
Equal Employment Opportunity Act
AUDIT TRAIL (FINANCIAL)
The City allows subrecipients to be reimbursed for
direct personnel costs (salary and benefits of
program staff members who work directly on the
CDBG-funded program).
The City will permit the purchase of supplies and
material directly related to, and to be used
exclusively for the CDBG-funded activity upon prior
notification of purchase of said items.
Other expenses must be pre-approved by City of
Santa Ana Finance Department. Cost allocation
plan is required.
AUDIT TRAIL (FINANCIAL)
Can you show where the money goes?
Maintain Financial and Accounting Records
Direct Personnel Costs (Most Subrecipients):
Timecards – separating time spent on the City-funded CDBG
activity and all other activities signed by both the employee and
immediate supervisor. For Executive Director’s time spent, please
have a board member authorize the hours worked.
Payroll Journal/Register
Benefits agreements & cancelled checks
Reconciled General Ledger
AUDIT TRAIL (FINANCIAL)
Can you show where the money goes?
Maintain Financial and Accounting Records
Non-Personnel Costs (With written consent on a
case-by-case basis):
Procurement: Small/Informal Bid Sheet or RFP
documenting the reasonableness of costs from a
minimum of three vendors – please get this approved by
City Staff in advance.
Vendor Invoice, Receipt, or Purchase Order
Cancelled Checks or Bank/Credit Card Statements
Reconciled General Ledger
Date must be
before the
purchase date.
Please note that in our
example, “Vendor
Number 1” would be
awarded because they
are the lowest bidder.
Small purchases
require a minimum of
three (3) bids.
X
4 letter-sized wooden clipboards, 40 blue ball-point pens,
4 boxes of staples, 4 staplers, etc…
Vendor Number 1
123 Main St.
City, CA ZIP
(555) 123-4567
Jason Jefferson
XTotal Package
$125.00
(plus tax)
Please see details
on attached sheet
Vendor Number 2
456 2nd St.
City, CA ZIP
(555) 456-4567
Peggy Jackson
Total Package
$150.00
(plus tax)
Please see details
on attached sheet
Vendor Number 3
1210 Slauson St.
City, CA ZIP
(555) 555-9876
Cristy Schwartz
Total Package
$200.00
(plus tax)
Please see details
on attached sheet
Employee Name Employee Title
Employee Sign 07/05/14
X
X
X
X
AUDIT TRAIL (FINANCIAL)
Are all costs allowable?
Expenditures must be allowable, allocable, and
reasonable
Expenditures must directly relate to the CDBG-funded
activity
AUDIT TRAIL (FINANCIAL)
Do you have appropriate internal controls?
Accounting procedures must create checks and balances.
Financial staff must have the capacity to administer a variety of grants from all sectors.
Are you requesting reimbursement for costs incurred outside of the contract period?
No reimbursement will be made for costs incurred outside of the contract period (July 1, 2015 through June 30, 2016).
AUDIT TRAIL (FINANCIAL)
The City will examine audit reports during its annual
monitoring visits.
An A-133 Single Audit is required for subrecipients
that expend $500,000 or more in Federal funds in a
year.
SUBRECIPIENT MONITORING
The City is required to monitor its subrecipients. It fulfills this responsibility in a variety of ways:
Desk Monitoring: Examination of QPRs and Reimbursement Requests, request for submittal of supporting documentation.
Technical Assistance: Provision of this Workshop and/or individualized technical assistance visits.
On-Site Monitoring: A comprehensive on-site programmatic and financial monitoring visit.
SUBRECIPIENT MONITORING
What are monitoring findings?
Findings are violations of the applicable Federal and local regulations governing the administration of the grant.
SUBRECIPIENT MONITORING
What happens if a subrecipient monitoring results in findings?
The subrecipient will be provided with a detailed written explanation of the regulatory violation and a “required corrective action” to resolve the deficiency.
Technical assistance to resolve any deficiencies is available from the City upon request.
Some findings may require third-party professional service providers to resolve (i.e. accountants, I.T. support, etc.).
SUBRECIPIENT MONITORING
What happens if a subrecipient fails to address monitoring findings?
Subrecipients who do not address monitoring findings in a timely manner may have their CDBG grant suspended or terminated, and may not be recommended for future funding.
CONSIDERATIONS
Before submitting your applications, please consider the following:
Does the organization have the capacity to administer the programmatic and administrative requirements:
Playing by the Rules – A Handbook on Administrative Systems
24 CFR Part 570, OMB Circular A-122
Does the application describe the following clearly:
CDBG funded activity
Proposed goal to be served
Budget Suggestions:
Reimburse for direct costs only
Limit number of budget categories for those easilydocumented (i.e. personnel)
QUESTIONS?
Sylvia Vazquez
(714) 647-5445
Subject Line: CDBG Application Question