Approximately $4 million in federal Community Development Block Grant (CDBG) funds are available on an annual basis to cities and counties through the state of Iowa’s Housing Sustainability Fund.
This program funds housing rehabilitation for owner-occupied, single-family units under the following three areas of improvements:
- Architectural Barrier Removal
- Assist houseowners that they themselves meet or have a family member residing in the residence that meets the definition of elderly (60+) or “Severely Disabled” in removing physical architectural barriers which will allow them to remain in their home.
- Energy Efficiency Improvements
- Assist homeowners to implement energy efficiency improvement in their home.
- Exterior Home Improvements
- Assist homeowners to improve the outside envelope of their home.
Applications for funding are accepted and reviewed on an on-going basis, as funds are available. Please note, an application for any of the above listed rehabilitation programs may be submitted individually; OR the Architectural Barrier Removal program may be combined with an Energy Efficiency Improvements OR an Exterior Home Improvements application. No other applications may be submitted concurrently. If awarded, the term of the contract will be for a period of two years.
The maximum amount of CDBG assistance for each single-family unit included in a project is $38,500 plus administrative cost. Please note: the administrative cost MAY NOT exceed 10% of the total CDBG award amount. The $38,500 per unit limit includes all applicable costs including, but not limited to, the hard costs of rehabilitation; technical service costs including radon testing and lead hazard reduction carry costs; lead hazard reduction costs; and temporary relocation. All rehabilitation hard costs are limited to $24,999 per unit. All applicable technical service costs, including radon testing and any lead hazard reduction carry costs, are limited to $5,500 in total federal funds per unit.
All incorporated cities and all counties in the State, except those designated as HUD entitlement areas, are eligible to apply for and receive funds under this program.
To be eligible for funding, assisted homeowners (residents served by the project) must be low to moderate income. For purposes of the CDBG program, “low and moderate income” is defined at persons with incomes at or below 80% of the area median income as defined by the U.S. Department of Housing and Urban Development (HUD). Current income levels can be found on the IEDA website: https://www.iowaeda.com/cdbg/management-guide/.
2 CFR 200 Audit Requirements
CDBG contracts may be subject to audit. Federal Code (2 CFR 200) requires that recipients that expend $750,000 or more in federal funds within a fiscal year must have a single or program specific audit. When budgeting for CDBG funds, applicants should be aware of these audit requirements:
- For recipients of $750,000 or more in federal funds received from more than one source of federal funding, an organization-wide audit must be conducted in accordance with federal requirements outlined in 2 CFR 200.514
- For recipients of $750,000 or more in federal funds received from a single source, a project audit, targeting only transactions dealing specifically with the project, may be performed in lieu of an organization-wide audit.
Communities should consult with their accountants regarding the applicability of an audit and audit requirements.
Audit costs are a CDBG-eligible expense. Organization-wide audits can be paid with CDBG funds proportional to the amount of all other funds included in the audit. The total cost of a project audit can be paid with CDBG funds.
Historic Preservation Review Requirements
Federally funded activities are subject to the review requirements of Section 106 of the National Historic Preservation Act. The goal of the review process is to identify historic properties, both above and below the ground potentially affected by the undertaking, assess the effects of the undertaking and seek ways to avoid, minimize or mitigate any adverse effects on historic properties.
The review process involves review by IEDA and possible consultation with various agencies, groups and individuals, including the State Historical Preservation Office (SHPO), located in the Department of Cultural Affairs. Although consultation is not required prior to a CDBG award, if the project includes a property that may have historical significance, it is a good idea to contact IEDA early in the project development. For more information regarding Section 106 review and compliance, you may call IEDA at 515.348.6202
Uniform Relocation Assistance and Real Property Acquisition Policies Act
For projects that include acquisition and relocation, all recipients given the authority to acquire property are required to follow the guidelines in HUD Handbook 1378 – Tenant Assistance, Relocation and Real Property Acquisition. Cost estimates for the proposed project should reflect compliance with these requirements. For information, call IEDA (515.348.6207).
Environmental Review and project initiation
No HUD Funds or non-HUD funds may be committed to the project until the applicant has secured environmental approval from the State, as provided in HUD regulation 24 CFR Part 58. In addition, pending environmental approval and pursuant to 24 CFR Part 58.22(a), no grant recipient or participant in the development process, including contractors or sub-contractors, may undertake an activity that may limit the choice of reasonable alternatives. Such choice limiting actions include real property acquisition, conducting a competitive sealed bid process for the project, leasing, rehabilitation, repair, demolition, conversion, and new construction.
- All assisted units must be verified as the homeowner's principal place of residence and must remain that way throughout the term of affordability (5 years). Assistance to homeowners must be in the form of a 5-year forgivable loan.
- All single-family housing rehabilitation construction shall be in accordance with any locally adopted building codes, standards and ordinances. In the absence of locally adopted and enforced building or housing codes, the requirements of the most current version of Iowa's Minimum Housing Rehabilitation Standards shall apply.
- All homeowners must be identified and pre-determined eligible.
- Income verifications must be completed and in accordance with 2 CFR 5.609 (Part 5 Annual Income)
- For Architectural Barrier Removal ONLY, verification that the owner or family member residing in the home, either meets the definition of elderly (60+) or “Severely Disabled”.
For more information on the Housing Sustainability program and applicable requirements, contact email@example.com or 515.348.6209.