New Mexico Register / Volume XXI, Number 16 / August 31, 2010
Notice of Hearing of Amendments to Rule 2.110.2 NMAC
Small Cities Community Development Block Grants
New Mexico Department of Finance and Administration
The Department of Finance and Administration (“DFA”) hereby gives notice that DFA will conduct a public hearing during the Community Development Council meeting in Room 311, State Capitol Building, 415 Old Santa Fe Trail, Santa Fe, New Mexico, 87503, on October 20, 2010 at 10:00 a.m. concerning amendments to 2.110.2.11 NMAC, 2.110.2.15 NMAC, 2.110.2.16, NMAC, 2.110.2.17, NMAC Small Cities Development Block Grants (hereinafter referred to as the “CDBG Rule”).
Interested individuals may testify at the public hearing or
submit written comments no later than 5:00 p.m. on October 19, 2010, to the
Office of the Secretary, DFA, Bataan Memorial Building, Room 180, and Santa Fe,
New Mexico, 87501. All written and oral
testimony will be considered prior to adoption of the amendments. Copies of the
text of the proposed CDBG Rule are available from Ms. Dolores Gonzales, Local
Government Division, Bataan Memorial Building, Santa Fe, New Mexico, 87501 or
at 505-827-4972 or from the DFA internet website http//www.state.nm.us/clients/dfa/index.html. These are amendments to 2.110.2.11,
2.110.2.15, 2.110.2.16, 2.110.2.17 NMAC effective XX,XX,XXXX.
2.110.2.11 ELIGIBLE
ACTIVITIES/CATEGORIES
A. Applicants may apply for funding assistance
under the following categories:
(1) community
infrastructure;
(2) housing;
(3) public facility
capital outlay;
(4) economic development;
(5) emergency;
(6) colonias;
(7) planning.
B. Eligible activities under each of the
categories are listed below.
C. Community infrastructure: Eligible activities may include, but are not
limited to, the following:
(1) real property
acquisition
(2) construction or
rehabilitation of the following:
(a)
water systems;
(b)
sewer systems;
(c)
municipal utilities;
(d)
roads;
(e)
streets;
(f)
highways;
(g)
curbs;
(h)
gutters;
(i) sidewalks;
(j)
storm sewers;
(k)
street lighting;
(l)
traffic control devices;
(m) parking facilities;
(n) solid waste disposal
facilities.
D. Housing:
Eligible activities may include, but are not limited to, the following:
(1) real property
acquisition;
(2) rehabilitation;
(3) clearance;
(4) demolition and
removal of privately-owned or acquired property for use or resale in the
provision of assisted housing;
(5) provision of public
facilities to increase housing opportunities;
(6) financing the repair,
rehabilitation and in some cases reconstruction of privately-owned residential
or other properties through either loan or grant programs;
(7)
certain types of housing modernization;
(8) temporary relocation
assistance;
(9) code enforcement;
(10) historic
preservation activities;
(11) not to exceed [fifty
thousand dollars ($50,000)] sixty five thousand dollars ($65,000) in CDBG funds per home can be used on home rehabilitation/repair
activities.
E. Public facility capital outlay: Eligible activities may include, but are not
limited to, such items as:
(1) real property
acquisition;
(2) construction or
improvement of community centers;
(3)
senior citizen centers;
(4) nonresidential
centers for the handicapped such as sheltered workshops;
(5) other community
facilities designed to provide health, social, recreational or similar
community services for residents.
F. Economic development: The economic development category is
established to assist communities in the promotion of economic development and
is described in detail in Section 26.
G. Emergency: The emergency fund provides funding for
emergency projects which address life threatening situations resulting from
disasters or imminent threats to health and safety.
(1) Applications under
this category will be accepted throughout the year.
(2)
Application shall include written verification and adequate
documentation by a state agency and with the applicant’s assessment of the life
threatening situation and shall be submitted no later than 18 months from the
certification by the applicant and documentation of the need for the emergency
project.
(3) An
applicant for emergency funding must verify that it does not have sufficient
local resources to address the life threatening condition; and that other
federal or state resources have been explored and are unavailable to alleviate
the emergency.
H. Planning: In addition to municipalities and counties,
water associations, including water and sanitation districts, and land grants
as defined in Section 2.110.2.7, Subsection M; are eligible to apply directly
for planning grants only. Planning grant
assistance from the CDBG program, which is available only to a municipality or
county, must be used for a comprehensive plan if the applicant does not have a
current comprehensive plan (not older than five years from the date of
application). A comprehensive plan must
be adopted by ordinance, and it must include as a minimum the following
elements;
(1) elements:
(a) land use; including (i) an analysis and
mapping of existing land patterns and an inventory of the amount, type and
intensity of uses by land category, as well as an analysis of effects of
various land use patterns on greenhouse gas emissions; (ii) an analysis of
trends in the supply and demand of land by land use category, including a
projection of the distribution, location and extent of future land uses by land
use category over a twenty-year period; (iii) goals, objectives and policies
that address maintaining a broad variety of land uses, including the range of
uses existing when the plan is adopted or amended; and (iv) specific actions
and incentives that the contracting agency may use to promote planned
development, reduction in greenhouse gas emissions, or otherwise encourage
certain identified development patterns and the locations where such
development patterns should be encouraged;
(b) housing; including (i) an analysis of existing housing supply
and demand, analysis of greenhouse gas emissions from the housing sector, and
forecasted housing needs; (ii) goals, objectives and policies for the
improvement of housing quality, variety and affordability, for reduction of
greenhouse gas emissions, and for provision of adequate sites for housing and
housing opportunities for all segments of the community; and (iii) a description
of the actions that will be taken to implement housing goals, objectives and
policies; and (iv) must comply with the affordable housing act.
(c) transportation; including (i) description
and assessment of the location, type, capacity and condition of existing
transportation facilities, such as freeways, arterial and collector streets,
mass transit or other modes of transportation as may be appropriate, and
analysis of greenhouse gas emissions from the transportation sector; (ii)
goals, objectives and policies for encouraging safe, convenient, efficient and
economical transportation, including mass transit and facilities for bicyclists
and pedestrians, for reduction of greenhouse gas emissions, and a description
of proposed levels of service and funding mechanisms; and (iii) a description
and assessment of proposed location, type and capacity of proposed
transportation facilities designed to implement transportation goals,
objectives and policies and a description of funding mechanisms that will be
used to fund proposed transportation improvements;
(d) infrastructure; including (i) a
description and assessment of the location, type, capacity and condition of
existing infrastructure, including emergency services, sewage, drainage, local
utilities and other types of facilities; (ii) goals, objectives and policies
for promoting the efficient provision of infrastructure, including a
description of proposed levels of service; and (iii) a description and
assessment of proposed facility expansion and improvements designed to support
planned uses and implement infrastructure goals, objectives and policies;
(e) economic development; including (i) a
description of existing job composition and trends by industry and location
characteristics, such as access to transportation or proximity to natural or
human resources, that influence the economic development potential of the
contracting agency, and analysis of greenhouse gas emissions from the
commercial and industrial sectors; (ii) goals, objectives and policies for
promoting economic development, and for reduction of greenhouse gas emissions;
and (iii) a description of the actions that the contracting agency will take to
implement economic development goals, objectives and policies;
(f) water; including (i) description and
assessment of the sources of water supply; (ii) the demand for water by
residential, commercial, institutional, industrial and recreational sectors;
(iii) assessment of the water unaccounted for water losses due to leaks, theft
or other reasons; (iv) goals, objectives and policies for promoting the
efficient use of water and for managing periods of drought; and (v) an analysis
of the demand for water that will result from future growth projected in the
plan, when added to existing uses, and how the demand for water that will
result from future projected growth will be served by current water supplies,
water conservation, water reuse or a plan to obtain additional water supplies
or increase water use efficiencies;
(g) hazards; , including (i) an analysis of
the risks of hazards such as wildfire, floods, extreme weather conditions,
accidents, and terrorism; (ii) goals, objectives and policies for hazard
mitigation; and (iii) a description of the actions that will be taken to
mitigate hazards;
(h) implementation; a compilation of the
plan’s goals, objectives, policies, standards or guidelines, along with
specific actions to be completed in a stated sequence, which start with
adoption of the comprehensive plan by ordinance;
(2)
development of additional elements of a comprehensive plan may include,
but are not limited to:
(a)
drainage;
(b)
parks, recreation and open space;
(c)
tourism;
(d)
growth management;
(e)
fiscal impact analysis;
(f)
intergovernmental cooperation;
(g)
social services;
(h) historic
preservation;
(i) asset management
plan;
(3)
if the entity has a current comprehensive plan (not older than
five years from the date of application),
it may apply for funding assistance for any of the following:
(a) data gathering
analysis and special studies;
(b)
base mapping, aerial photography, geographic information systems, or
global positioning satellite studies;
(c)
improvement of infrastructure capital improvement plans and individual
project plans;
(d)
development of codes and ordinances, that further refine the
implementation of the comprehensive plan;
(e)
climate change mitigation and adaptation plan;
(f)
preliminary engineering report (according to USDA/RUS guidelines);
(g)
related citizen participation or strategic planning process; or
(h)
other functional or comprehensive planning activities;
(i)
asset management plan;
(j)
regionalization of infrastructure and service delivery.
(4) applicants may apply
for funding assistance throughout the year as long as funds are available.
I. Colonias:
(1) The colonias category is established in
the amount of 10% of the annual CDBG allocation for specific activities including water, sewer and housing
improvements, which are the three conditions which qualify communities for
designation to be carried out in areas along the U.S. - Mexican border.
(2) Eligible applicants
for the colonias set aside are municipalities and counties located within 150
miles of the U.S. - Mexico border.
(3) Colonias must be
designated by the municipality or county in which it is located. The designation must be on the basis of
objective criteria, including:
(a)
lack of potable water supply; or
(b)
lack of adequate sewage systems; or
(c)
lack of decent, safe and sanitary housing; and
(d)
must have been in existence as a colonia prior to November, 1990.
(4) Appropriate
documentation to substantiate these conditions must be provided along with the
application for funding.
[2.110.2.11 NMAC -
Rp 2 NMAC 110.2.11, 08-30-01; A, 08-13-04; A, 08-15-05; A, 12-14-06; A,
09-28-07; A, 10-15-09; A, xx-xx-10]
2.110.2.15 PROGRAM
REQUIREMENTS SECTION A: Public participation requirements -
Applicants must provide opportunities for public participation in the
development of community development goals, objectives, and applications for
funding assistance by undertaking the following activities:
A. provide
for and encourage citizen participation within their areas of jurisdiction with
particular emphasis on participation by persons of low and moderate income;
B. provide
citizens with reasonable and timely access to local meetings, information, and
records relating to proposed and actual use of funds;
C. provide
for technical assistance to groups and representatives of low and moderate
income persons that request assistance in developing proposals;
D. {special
note}: the level and type of assistance is to be determined by the applicant;
and
E. provide
for public hearings to obtain citizen participation and respond to proposals
and questions at all stages;
F. prior
to selecting a project and submitting an application for CDBG funding
assistance, eligible applicants must conduct at least one public hearing for
the following purposes:
(1) to advise citizens of
the amount of CDBG funds expected to be made available for the current fiscal
year;
(2) to advise citizens of
the range of activities that may be undertaken with the CDBG funds;
(3) to advise citizens of the estimated amount
of CDBG funds proposed to be used for activities that will meet the national
objective to benefit to low and moderate income persons;
(4) to advise citizens of
the proposed CDBG activities likely to result in displacement, and the unit of
general local government's anti-displacement and relocation plans;
(5) to obtain
recommendations from citizens regarding the community development and housing
needs of the community:
(a)
After considering all recommendations and input provided at the public
hearing(s), the county commission or city/town/village council must select one
project for which to submit an application for funding assistance at an
official public meeting.
(b)
The applicant must conduct a second public hearing to review program
performance, past use of funds and make available to the public its community
development and housing needs including the needs of low and moderate income
families and the activities to be undertaken to meet such needs.
(c)
This public hearing may occur subsequent to the submission of the
application for funding assistance.
(d)
Public hearing notices must be published in the non-legal section of
newspapers [and in other local media], or posted in a minimum
of three prominent public places within the project area, with reasonable time
and public access.
(e)
Evidence of compliance with these regulations must be provided with each
application, i.e., hearing notice, minutes of public meetings, list of needs
and activities to be undertaken, etc.
(f) Amendments to goals,
objectives, and applications are also subject to public participation.
(6)
provide for timely written answers to written complaints and grievances
within 15 working days where practicable;
(7)
identify how the needs of non-English speaking residents will be met in
the case of public hearings where a significant number of residents can be
reasonably expected to participate.
[2.110.2.15 NMAC -
Rp 2 NMAC 110.2.15, 08-30-01; A, xx-xx-10]
2.110.2.16 PROGRAM
REQUIREMENTS Section B: Each CDBG application must meet at least one of
the three national objectives, low and moderate income benefit, prevention or
elimination of slums or blight or urgent need, which are herein described.
A. Low
and moderate income benefit - An activity identified as principally benefiting
(51%) persons of low and moderate income will be considered eligible only if it
meets one of the criteria below:
(1)
the activity must be carried out in a neighborhood or area consisting
predominantly of persons of low and moderate income and provide services to
such persons;
(2) the activity must
involve facilities designed for use by a specific group of people or clientele
predominantly of low and moderate income; or
(3)
the activity must add or improve permanent residential structures which
will be occupied by low and moderate income households upon completion; or
(4) the activity must involve
creating or retaining jobs, the majority of which must be for persons of low
and moderate income;
(5) the above can be
substantiated with data from:
(a)
the most recent low and moderate income data from the U.S. census (see
attachment A);
(b) a
special survey conducted using HUD approved methodology;
(c)
income eligibility requirements consistent with HUD approved income
limits.
B. Prevention
or elimination of slums or blight - An activity identified as aiding in the
prevention or elimination of a slum or blighted area must meet all of the
following five criteria.
(1)
The area must be designated by the applicant and must meet a definition
of a slum, blighted, deteriorated or deteriorating area under state or local
law (see definitions section of 2.110.2 NMAC).
(2) The area must exhibit at least one of the following physical signs of blight or decay.
(a) The area shall possess a substantial number of deteriorated or deteriorating buildings throughout; meaning at least one quarter of all the buildings in the area must be in a state of deterioration.
(b) The area shall possess public improvements throughout the area which must be in a general state of deterioration. For example, it would be insufficient for only one type of public improvement, such as the sewer system, to be in a state of deterioration; rather, the public improvements taken as a whole must clearly exhibit signs of deterioration.
(3)
Documentation must be maintained by the applicant on the boundaries of
the area and the condition which qualified the area at the time of its
designation.
(4) The activity must
address one or more of the conditions which contributed to the deterioration of
the area.
(5) To
comply with this objective on a spot basis outside of a slum or blighted area
the proposed activity must be designated to eliminate, specific conditions of
blight or physical decay.
(a) acquisition and clearance of blighted properties;
(b) renovation and reuse of abandoned, historic properties;
(c) commercial revitalization through façade improvements;
(d) removal of environmental contamination on
property to enable it to be redeveloped.
C. Urgent
need - An activity identified as meeting community development needs having a
particular urgency will be considered only if the applicant certifies the
following:
(1) that the activity is
designed to alleviate existing conditions which pose a serious and immediate
threat to the health and welfare of the community;
(2)
that the condition(s) to be alleviated is of recent origin, i.e., it
developed or became critical within 18 months preceding the certification by
the applicant;
(3)
that the applicant is unable to finance the activity on its own and
other sources of funding are not available;
(4) in
addition, verification of the urgency of the need must be provided with written
documentation by the appropriate state agency;
(5) planning grants are not allowed under
urgent need.
[2.110.2.16 NMAC -
Rp 2 NMAC 110.2.16, 08-30-01; A, 10-15-09; A, xx-xx-10]
2.110.2.17 APPLICATION
REQUIREMENTS
A. Number of applications - All eligible applicants may submit one application for CDBG funding assistance in the infrastructure, housing, public facility capital outlay, or colonias categories.
(1) Planning applicants
may submit at anytime an additional application for funding and shall not
exceed fifty thousand dollars ($50,000).
(2) Applicants in the economic
development or emergency may be
submitted at any time and shall not exceed five hundred thousand dollars
($500,000), subject to funding availability.
(3) Counties may submit multiple applications for planning grants for water associations.
(4) Planning, economic
development and emergency applications may be submitted, at anytime, even if
the applicant has not completed other CDBG projects.
B. Single purpose application -An application for CDBG funding must be limited to a project specific activity or set of activities which address a particular need in a designated target area of a unit of local government. The target area may not be the entire municipality or county.
C. Joint applications - Joint applications will be allowed when two or more eligible applicants within reasonable proximity of each other wish to address a common problem.
(1) One community will be designated to serve as the lead applicant and will be subject to administrative requirements and to the application limit requirements.
(2)
However, other parties to the joint application may submit another
application.
(3) Joint applications must satisfy certain federal criteria and must receive division approval prior to submitting an application for funding assistance.
(4) It should be noted that satisfying the required criteria, which is available from the division upon request, may take a significant period of time.
D. Application
requirements for the following minimum requirements apply to all applications
for CDBG funding:
(1) applications must involve a project that will be fully functional on a stand-alone basis once awarded CDBG and other committed funds have been expended and;
(2) projects shall be
completed within twenty-four months of an [award of funding] executed
grant agreement signed by both parties;
(3) applications may not
exceed $500,000;
(4) if the applicant, after conducting the required public hearing, determines that the previous year's CDBG unfunded application is still a priority, the applicant must submit the original along with a current year's resolution, updated project budget and schedule and any other information required by division staff.
(5) application must be complete, with all
documentation provided as listed on the submission and attachment checklist
included in the application, otherwise application will be deemed ineligible;
application will be returned to the applicant and will not be considered for
funding.
E. Threshold
requirements - To encourage timely completion of projects and to maximize
participation the following threshold requirements shall be met prior to the
application deadline.
(1) All projects for the eligible activities in the categories listed in Subsections C, D, E, and I of 2.110.2.11 NMAC must be completed at the time of application. (certificate of occupancy or certification of operation must be in place).
(2) All audit and monitoring findings and
or concerns, for CDBG projects, must be resolved. A letter from the community to
include documentation as applicable, clearing the findings and/or
concerns. A letter from local government
division (LGD) clearing all findings and or concerns.
(3) The current fiscal operating budget for any local public body as defined in Section 6-6-1 NMSA 1978 (as amended) applying for CDBG funds must be approved.
(4) The local government
division financial management bureau will verify that financial quarterly/
monthly reports are current before CDBG applications deadline.
(5) The local government division, budget and finance bureau, shall report the applicant’s most current audit filing with the state auditor office for all applicants that are counties and municipalities. They determine compliance with the budget certification rule, 2.2.3 NMAC. The CDC will take into consideration whether the counties or municipalities are in compliance with the budget certification rule.
(6)
The set aside categories are exempt from threshold requirements set
forth in Subsection E of 2.110.2.17 NMAC: planning, economic development, and
emergency categories.
F. Matching
requirements - In order to assist the council in making funding resources go
further and to ensure there is a local investment in applications submitted to
the council for funding consideration, the following will be required.
(1) Rural applicants must provide, at a minimum, a 5% cash match during the project period from local, state, federal or other resources, this cannot include local work force or local equipment.
(2) Non-rural applicants must provide, at a minimum, a 10% cash match during the project period from local, state, federal or other resources, this cannot include local work force or local equipment.
(3) Consistent with 2.110.2 NMAC, all applications in the economic development category must provide at least one private dollar for each dollar of CDBG funds requested.
(4) Local funds expended by eligible applicants for engineering, architectural design or environmental reviews prior to project approval can be applied towards the required match.
(5) Applicants may request a waiver of the matching requirement from the council if documentation can be provided which demonstrates the absence of local resources to meet the required match. Criteria used to recommend approval/disapproval will be as follows:
(a)
the required match must exceed 5% of the applicant’s general fund
budget;
(b) the required match must equal or exceed the non-earmarked balance of funds in the applicant’s budget.
G. Other funding commitments - If other funding is necessary to make a proposed project feasible, funding commitments or commitments subject to CDBG approval, must be in place and letters of commitments from the funding agency must be submitted with the application.
H. Water conservation and drought commitments - In order
to make the state’s water supplies go further and to ensure proper levels of
preparations are taken locally for periodic droughts, the following is encouraged.
(1) Applicants develop, adopt and submit to
the state engineer a comprehensive water conservation ordinance.
(2) Applicants develop, adopt and submit to the state engineer a drought management plan.
(3) The ordinance and plan shall be
accompanied by a program for its implementation.
(a) in developing a water conservation ordinance pursuant to this section: applicants shall adopt ordinances and codes to encourage water conservation measures; they shall identify and implement best management practices in their operations to improve conservation of the resources; and
(b) applicants shall consider and incorporate into its plan if appropriate, at least the following:
(i) water-efficient fixtures and appliances,
including toilets, urinals, showerheads and faucets;
(ii) low-water-use landscaping and efficient
irrigation;
(iii) water-efficient commercial and industrial
water-use processes;
(iv) water reuse systems for both potable and non-potable water;
(v) distribution system leak repair;
(vi) dissemination of information regarding water-use efficiency measures, including public education programs and demonstrations of water-saving techniques;
(vii) water rate structures establishing rates or revenues that support the long term operation, maintenance, repair, and replacement of the system or facility and are designed to encourage water-use efficiency and reuse in a fiscally responsible manner and
(viii) incentives to implement water-use efficiency techniques, including rebates to customers or others, to encourage the installation of water-use efficiency and reuse measures.
(c) the council shall encourage the applicant to submit a copy of its water conservation plan with applications for construction of any facility.
I. Asset
management - In order to support the long term operation, maintenance, repair
and replacement of system facilities, infrastructure, public facilities, or
other eligible activities the following will be required.
(1) In order to ensure water and wastewater infrastructure is managed within a strategic framework driven by program and service delivery needs, communities that implement an asset management program and use that approach as the basis for their rate analysis will be credited in the application process for their achievement. The model for the asset management program is the international infrastructure asset management model, adopted by EPA. This approach includes five core components, which are as follows:
(a) current state of the assets: an asset inventory that includes the following at a minimum: asset name, asset location, asset condition, useful life, and an estimate of replacement value;
(b) level of service: a description of what the utility wishes to provide its customers;
(c) criticality: an evaluation of which assets are critical to the sustained operation of the utility;
(d) life cycle costing: at a minimum, a capital improvement plan that describes the replacement of assets and some consideration of operation and maintenance of the assets;
(e) financing plan: a description of the
funding sources that will be used to pay for the capital and operational needs
of the utility.
(2) For community
infrastructure and public facilities, or other eligible activities an asset
management plan will be required to be submitted at the time of
application. The approach will
follow the same five components described in Subparagraphs (a) - (e) of
Paragraph (1) of Subsection I of 2.110.2.17 NMAC above.
[2.110.2.17 NMAC -
Rp 2 NMAC 110.2.17, 08-30-01; A, 08-13-04; A, 08-15-05; A, 12-14-06; A,
09-28-07; A, 09-30-08; A, 10-15-09; A, xx-xx-10]