42 U.S.C. § 5318 : US Code - Section 5318: Urban development action grants

Search 42 U.S.C. § 5318 : US Code - Section 5318: Urban development action grants

(a) Authorization; purpose; amount
The Secretary is authorized to make urban development action
grants to cities and urban counties which are experiencing severe
economic distress to help stimulate economic development activity
needed to aid in economic recovery. There are authorized to be
appropriated to carry out this section $225,000,000 for fiscal year
1988, and $225,000,000 for fiscal year 1989. Any amount
appropriated under this subsection shall remain available until
expended.
(b) Eligibility of cities and urban counties; criteria and
standards; regulations
(1) Urban development action grants shall be made only to cities
and urban counties which have, in the determination of the
Secretary, demonstrated results in providing housing for low- and
moderate-income persons and in providing equal opportunity in
housing and employment for low- and moderate-income persons and
members of minority groups. The Secretary shall issue regulations
establishing criteria in accordance with the preceding sentence and
setting forth minimum standards for determining the level of
economic distress of cities and urban counties for eligibility for
such grants. These standards shall take into account factors such
as the age of housing; the extent of poverty; the extent of
population lag; growth of per capita income; and the extent of
unemployment, job lag, or surplus labor. Any city that has a
population of less than 50,000 persons and is not the central city
of a metropolitan area, and that was eligible for fiscal year 1983
under this paragraph for assistance under this section, shall
continue to be eligible for such assistance until the Secretary
revises the standards for eligibility for such cities under this
paragraph and includes the extent of unemployment, job lag, or
labor surplus as a standard of distress for such cities. The
Secretary shall make such revision as soon as practicable following
November 30, 1983.
(2) A city or urban county which fails to meet the minimum
standards established pursuant to paragraph (1) shall be eligible
for assistance under this section if it meets the requirements of
the first sentence of such paragraph and -
(A) in the case of a city with a population of fifty thousand
persons or more or an urban county, contains an area (i) composed
of one or more contiguous census tracts, enumeration districts,
neighborhood statistics areas, or block groups, as defined by the
United States Bureau of the Census, having at least a population
of ten thousand persons or 10 per centum of the population of the
city or urban county; (ii) in which at least 70 per centum of the
residents have incomes below 80 per centum of the median income
of the city or urban county; and (iii) in which at least 30 per
centum of the residents have incomes below the national poverty
level; or
(B) in the case of a city with a population of less than fifty
thousand persons, contains an area (i) composed of one or more
contiguous census tracts, enumeration districts, neighborhood
statistics areas, or block groups or other areas defined by the
United States Bureau of the Census or for which data certified by
the United States Bureau of the Census are available having at
least a population of two thousand five hundred persons or 10 per
centum of the population of the city, whichever is greater; (ii)
in which at least 70 per centum of the residents have incomes
below 80 per centum of the median income of the city; and (iii)
in which at least 30 per centum of the residents have incomes
below the national poverty level.
The Secretary shall use up to, but not more than, 20 per centum of
the funds appropriated for use in any fiscal year under this
section for the purpose of making grants to cities and urban
counties eligible under this paragraph.
(c) Applications; documentation of eligibility; proposed plan;
assurance of notice and comment; assurance of consideration on
historical landmarks
Applications for assistance under this section shall -
(1) in the case of an application for a grant under subsection
(b)(2) of this section, include documentation of grant
eligibility in accordance with the standards described in that
subsection;
(2) set forth the activities for which assistance is sought,
including (A) an estimate of the costs and general location of
the activities; (B) a summary of the public and private resources
which are expected to be made available in connection with the
activities, including how the activities will take advantage of
unique opportunities to attract private investment; and (C) an
analysis of the economic benefits which the activities are
expected to produce;
(3) contain a certification satisfactory to the Secretary that
the applicant, prior to submission of its application, (A) has
held public hearings to obtain the views of citizens,
particularly residents of the area in which the proposed
activities are to be carried out; (B) has analyzed the impact of
these proposed activities on the residents, particularly those of
low and moderate income, of the residential neighborhood, and on
the neighborhood in which they are to be carried out; and (C) has
made available the analysis described in clause (B) to any
interested person or organization residing or located in the
neighborhood in which the proposed activities are to be carried
out; and
(4) contain a certification satisfactory to the Secretary that
the applicant, prior to submission of its application, (A) has
identified all properties, if any, which are included on the
National Register of Historic Places and which, as determined by
the applicant, will be affected by the project for which the
application is made; (B) has identified all other properties, if
any, which will be affected by such project and which, as
determined by the applicant, may meet the criteria established by
the Secretary of the Interior for inclusion on such Register,
together with documentation relating to the inclusion of such
properties on the Register; (C) has determined the effect, as
determined by the applicant, of the project on the properties
identified pursuant to clauses (A) and (B); and (D) will comply
with the requirements of section 5320 of this title.
(d) Mandatory selection criteria; award of points; distribution of
funds; number of competitions per year; use of distress
conditions data by urban counties
(1) Except in the case of a city or urban county eligible under
subsection (b)(2) of this section, the Secretary shall establish
selection criteria for a national competition for grants under this
section which must include -
(A) the comparative degree of economic distress among
applicants, as measured (in the case of a metropolitan city or
urban county) by the differences in the extent of growth lag, the
extent of poverty, and the adjusted age of housing in the
metropolitan city or urban county;
(B) other factors determined to be relevant by the Secretary in
assessing the comparative degree of economic deterioration in
cities and urban counties;
(C) the following other criteria:
(i) the extent to which the grant will stimulate economic
recovery by leveraging private investment;
(ii) the number of permanent jobs to be created and their
relation to the amount of grant funds requested;
(iii) the proportion of permanent jobs accessible to lower
income persons and minorities, including persons who are
unemployed;
(iv) the extent to which the project will retain jobs that
will be lost without the provision of a grant under this
section;
(v) the extent to which the project will relieve the most
pressing employment or residential needs of the applicant by -
(I) reemploying workers in a skill that has recently
suffered a sharp increase in unemployment locally;
(II) retraining recently unemployed residents in new
skills;
(III) providing training to increase the local pool of
skilled labor; or
(IV) producing decent housing for low- and moderate-income
persons in cases where such housing is in severe shortage in
the area of the applicant, except that an application shall
be considered to produce housing for low- and moderate-income
persons under this clause only if such application proposes
that (a) not less than 51 percent of all funds available for
the project shall be used for dwelling units and related
facilities; and (b) not less than 30 percent of all funds
used for dwelling units and related facilities shall be used
for dwelling units to be occupied by persons of low and
moderate income, or not less than 20 percent of all dwelling
units made available to occupancy using such funds shall be
occupied by persons of low and moderate income, whichever
results in the occupancy of more dwelling units by persons of
low and moderate income;
(vi) the impact of the proposed activities on the fiscal base
of the city or urban county and its relation to the amount of
grant funds requested;
(vii) the extent to which State or local Government (!1)
funding or special economic incentives have been committed; and
(viii) the extent to which the project will have a
substantial impact on physical and economic development of the
city or urban county, the proposed activities are likely to be
accomplished in a timely fashion with the grant amount
available, and the city or urban county has demonstrated
performance in housing and community development programs; and
(D) additional consideration for projects with the following
characteristics:
(i) projects to be located within a city or urban county
which did not receive a preliminary grant approval under this
section during the 12-month period preceding the date on which
applications are required to be submitted for the grant
competition involved; and
(ii) twice the amount of the additional consideration
provided under clause (i) for projects to be located in cities
or urban counties which did not receive a preliminary grant
approval during the 24-month period preceding the date on which
applications under this section are required to be submitted
for the grant competition involved.
If a city or urban county has submitted and has pending more than
one application, the additional consideration provided by
subparagraph (D) of the preceding sentence shall be available
only to the project in such city or urban county which received
the highest number of points under subparagraph (C) of such
sentence.
(2) For the purpose of making grants with respect to areas
described in subsection (b)(2) of this section, the Secretary shall
establish selection criteria, which must include (A) factors
determined to be relevant by the Secretary in assessing the
comparative degree of economic deterioration among eligible areas,
and (B) such other criteria as the Secretary may determine,
including at a minimum the criteria listed in paragraph (1)(C) of
this subsection.
(3) The Secretary shall award points to each application as
follows:
(A) not more than 35 points on the basis of the criteria
referred to in paragraph (1)(A);
(B) not more than 35 points on the basis of the criteria
referred to in paragraph (1)(B);
(C) not more than 33 points on the basis of the criteria
referred to in paragraph (1)(C); and
(D)(i) 1 additional point on the basis of the criterion
referred to in paragraph (1)(D)(i); or
(ii) 2 additional points on the basis of the criterion referred
to in paragraph (1)(D)(ii).
(4) The Secretary shall distribute grant funds under this section
so that to the extent practicable during each funding cycle -
(A) 65 percent of the funds is first made available utilizing
all of the criteria set forth in paragraph (1); and
(B) 35 percent of the funds is then made available solely on
the basis of the factors referred to in subparagraphs (C) and (D)
of paragraph (1).
(5)(A) Within 30 days of the start of each fiscal year, the
Secretary shall announce the number of competitions for grants to
be held in that fiscal year. The number of competitions shall be
not less than two nor more than three.
(B) Each competition for grants described in any clause of
subparagraph (A) shall be for an amount equal to the sum of -
(i) approximately the amount of the funds available for such
grants for the fiscal year divided by the number of competitions
for those funds;
(ii) any funds available for such grants in any previous
competition that are not awarded; and
(iii) any funds available for such grants in any previous
competition that are recaptured.
(C) Notwithstanding any other provision of this section, in each
competition for grants under this section, no city or urban county
may be awarded a grant or grants in an amount in excess of
$10,000,000 until all cities and urban counties which submitted
fundable applications have been awarded a grant. If funds are
available for additional grants after each city and urban county
submitting a fundable application is awarded one or more grants
under the preceding sentence, then additional grants shall be made
so that each city or urban county that has submitted multiple
applications is awarded one additional grant in order of ranking,
with no single city or urban county receiving more than one grant
approval in any subsequent series of grant determinations within
the same competition.
(D) All grants under this section, including grants to cities and
urban counties described in subsection (b)(2) of this section,
shall be awarded in accordance with subparagraph (C) so that all
grants under this section are made in order of ranking.
(e) Limitations on power of Secretary to approve grants; waiver
The Secretary may not approve any grant to a city or urban county
eligible under subsection (b)(2) of this section unless -
(1) the grant will be used in connection with a project located
in an area described in subsection (b)(2) of this section, except
that the Secretary may waive this requirement where the Secretary
determines (A) that there is no suitable site for the project
within that area, (B) the project will be located directly
adjacent to that area, and (C) the project will contribute
substantially to the economic development of that area;
(2) the city or urban county has demonstrated to the
satisfaction of the Secretary that basic services supplied by the
city or urban county to the area described in subsection (b)(2)
of this section are at least equivalent, as measured by per
capita expenditures, to those supplied to other areas within the
city or urban county which are similar in population size and
physical characteristics and which have median incomes above the
median income for the city or urban county;
(3) the grant will be used in connection with a project which
will directly benefit the low- and moderate-income families and
individuals residing in the area described in subsection (b)(2)
of this section; and
(4) the city or urban county makes available, from its own
funds or from funds received from the State or under any Federal
program which permits the use of financial assistance to meet the
non-Federal share requirements of Federal grant-in-aid programs,
an amount equal to 20 per centum of the grant to be available
under this section to be used in carrying out the activities
described in the application.
(f) Permissibility of consistent but unenumerated activities;
report on use of repaid grant funds for economic development
activities
Activities assisted under this section may include such
activities, in addition to those authorized under section 5305(a)
of this title, as the Secretary determines to be consistent with
the purposes of this section. In any case in which the project
proposes the repayment to the applicant of the grant funds, such
funds shall be made available by the applicant for economic
development activities that are eligible activities under this
section or section 5305 of this title. The applicant shall annually
provide the Secretary with a statement of the projected receipt and
use of repaid grant funds during the next year together with a
report acceptable to the Secretary on the use of such funds during
the most recent preceding full fiscal year of the applicant.
(g) Annual review and audit; adjustments, withdrawals and reduction
permitted
The Secretary shall, at least on an annual basis, make reviews
and audits of recipients of grants under this section as necessary
to determine the progress made in carrying out activities
substantially in accordance with approved plans and timetables. The
Secretary may adjust, reduce, or withdraw grant funds, or take
other action as appropriate in accordance with the findings of
these reviews and audits, except that funds already expended on
eligible activities under this chapter shall not be recaptured or
deducted from future grants made to the recipient.
(h) Limitations on grants for industrial or commercial relocations
or expansions; appeal of denial or cancellation of assistance;
grants to adversely affected individuals
(1) Speculative projects
No assistance may be provided under this section for projects
intended to facilitate the relocation of industrial or commercial
plants or facilities from one area to another, unless the
Secretary finds that the relocation does not significantly and
adversely affect the unemployment or economic base of the area
from which the industrial or commercial plant or facility is to
be relocated. The provisions of this paragraph shall apply only
to projects that do not have identified intended occupants.
(2) Projects with identified intended occupants
No assistance may be provided or utilized under this section
for any project with identified intended occupants that is likely
to facilitate -
(A) a relocation of any operation of an industrial or
commercial plant or facility or other business establishment -
(i) from any city, urban county, or identifiable community
described in subsection (p) of this section, that is eligible
for assistance under this section; and
(ii) to the city, urban county, or identifiable community
described in subsection (p) of this section, in which the
project is located; or
(B) an expansion of any such operation that results in a
reduction of any such operation in any city, county, or
community described in subparagraph (A)(i).
(3) Significant and adverse effect
The restrictions established in paragraph (2) shall not apply
if the Secretary determines that the relocation or expansion does
not significantly and adversely affect the employment or economic
base of the city, county, or community from which the relocation
or expansion occurs.
(4) Appeal of adverse determination
Following notice of intent to withhold, deny, or cancel
assistance under paragraph (1) or (2), the Secretary shall
provide a period of not less than 90 days in which the applicant
can appeal to the Secretary the withholding, denial, or
cancellation of assistance. Notwithstanding any other provision
of this section, nothing in this section or in any legislative
history related to the enactment of this section may be construed
to permit an inference or conclusion that the policy of the
Congress in the urban development action grant program is to
facilitate the relocation of businesses from one area to another.
(5) Assistance for individuals adversely affected by prohibited
relocations
(A) Any amount withdrawn by, recaptured by, or paid to the
Secretary due to a violation (or a settlement of an alleged
violation) of this subsection (or of any regulation issued or
contractual provision entered into to carry out this subsection)
by a project with identified intended occupants shall be made
available by the Secretary as a grant to the city, county, or
community described in subsection (p) of this section, from which
the operation of an industrial or commercial plant or facility or
other business establishment relocated or in which the operation
was reduced.
(B)(i) Any amount made available under this paragraph shall be
used by the grantee to assist individuals who were employed by
the operation involved prior to the relocation or reduction and
whose employment or terms of employment were adversely affected
by the relocation or reduction. The assistance shall include job
training, job retraining, and job placement.
(ii) If any amount made available to a grantee under this
paragraph is more than is required to provide assistance under
clause (i), the grantee shall use the excess amount to carry out
community development activities eligible under section 5305(a)
of this title.
(C)(i) The provisions of this paragraph shall be applicable to
any amount withdrawn by, recaptured by, or paid to the Secretary
under this section, including any amount withdrawn, recaptured,
or paid before the effective date of this paragraph.
(ii) Grants may be made under this paragraph only to the extent
of amounts provided in appropriation Acts.
(6) Definition
For purposes of this subsection, the term "operation" includes
any plant, equipment, facility, position, employment opportunity,
production capacity, or product line.
(7) Regulations
Not later than 60 days after February 5, 1988, the Secretary
shall issue such regulations as may be necessary to carry out the
provisions of this subsection. Such regulations shall include
specific criteria to be used by the Secretary in determining
whether there is a significant and adverse effect under paragraph
(3).
(i) Minimum percentage of funds to be allocated to certain
noncentral cities; application by consortia of cities of less
than 50,000 population
Not less than 25 per centum of the funds made available for
grants under this section shall be used for cities with populations
of less than fifty thousand persons which are not central cities of
a metropolitan statistical area. The Secretary shall encourage
cooperation by geographically proximate cities of less than 50,000
population by permitting consortia of such cities, which may also
include county governments that are not urban counties, to apply
for grants on behalf of a city that is otherwise eligible for
assistance under this section. Any grants awarded to such consortia
shall be administered in compliance with eligibility requirements
applicable to individual cities.
(j) Grant contingent on factors related to non-Federal funds
A grant may be made under this section only where the Secretary
determines that there is a strong probability that (1) the non-
Federal investment in the project would not be made without the
grant, and (2) the grant would not substitute for non-Federal funds
which are otherwise available to the project.
(k) Duty of Secretary to minimize amount
In making grants under this section, the Secretary shall take
such steps as the Secretary deems appropriate to assure that the
amount of the grant provided is the least necessary to make the
project feasible.
(l) Power of Secretary to waive requirement that town or township
be closely settled
For purposes of this section, the Secretary may reduce or waive
the requirement in section 5302(a)(5)(B)(ii) of this title that a
town or township be closely settled.
(m) Notice to State historic preservation officer and Secretary of
the Interior required with regard to affected landmark property;
opportunity for comment
In the case of any application which identifies any property in
accordance with subsection (c)(4)(B) of this section, the Secretary
may not commit funds with respect to an approved application unless
the applicant has certified to the Secretary that the appropriate
State historic preservation officer and the Secretary of the
Interior have been provided an opportunity to take action in
accordance with the provisions of section 5320(b) of this title.
(n) Territories, tribes, and certain Hawaiian counties included in
term "city"
(1) For the purposes of this section, the term "city" includes
Guam, American Samoa, the Northern Mariana Islands, the Virgin
Islands, and Indian tribes. Such term also includes the counties of
Kauai, Maui and Hawaii in the State of Hawaii.
(2) The Secretary may not approve a grant to an Indian tribe
under this section unless the tribe (A) is located on a
reservation, or on former Indian reservations in Oklahoma as
determined by the Secretary of the Interior, or in an Alaskan
Native Village, and (B) was an eligible recipient under chapter 67
of title 31 prior to the repeal of such chapter.
(o) Special provisions for years after 1983
If no amounts are set aside under, or amounts are precluded from
being appropriated for this section for fiscal years after fiscal
year 1983, any amount which is or becomes available for use under
this section after fiscal year 1983 shall be added to amounts
appropriated under section 5303 of this title, except that amounts
available to the Secretary for use under this subsection as of
October 1, 1993, and amounts released to the Secretary pursuant to
subsection (t) of this section may be used to provide grants under
section 5308(q) of this title..(!2)
(p) Unincorporated portions of urban counties
An unincorporated portion of an urban county that is approved by
the Secretary as an identifiable community for purposes of this
section is eligible for a grant under subsection (b)(2) of this
section if such portion meets the eligibility requirements
contained in the first sentence of subsection (b)(1) of this
section and the requirements of subsection (b)(2)(B) of this
section (applied to the population of the portion of the urban
county) and if it otherwise complies with the provisions of this
section.
(q) Technical assistance grants
Of the amounts appropriated for purposes of this section for any
fiscal year, not more than $2,500,000 may be used by the Secretary
to make technical assistance grants to States or their agencies,
municipal technical advisory services operated by universities, or
State associations of counties or municipalities, to enable such
entities to assist units of general local government described in
subsection (i) of this section in developing, applying for
assistance for, and implementing programs eligible for assistance
under this section.
(r) Nondiscrimination by Secretary against type of activity or
applicant
In utilizing the discretion of the Secretary when providing
assistance and applying selection criteria under this section, the
Secretary may not discriminate against applications on the basis of
(1) the type of activity involved, whether such activity is
primarily housing, industrial, or commercial; or (2) the type of
applicant, whether such applicant is a city or urban county.
(s) Maximum grant amount for fiscal years 1988 and 1989
For fiscal years 1988 and 1989, the maximum grant amount for any
project under this section is $10,000,000.
(t) UDAG retention program
If a grant or a portion of a grant under this section remains
unexpended upon the issuance of a notice implementing this
subsection, the grantee may enter into an agreement, as provided
under this subsection, with the Secretary to receive a percentage
of the grant amount and relinquish all claims to the balance of the
grant within 90 days of the issuance of notice implementing this
subsection (or such later date as the Secretary may approve). The
Secretary shall not recapture any funds obligated pursuant to this
section during a period beginning on April 11, 1994, until 90 days
after the issuance of a notice implementing this subsection. A
grantee may receive as a grant under this subsection -
(1) 33 percent of such unexpended amounts if -
(A) the grantee agrees to expend not less than one-half of
the amount received for activities authorized pursuant to
section 5308(q) of this title and to expend such funds in
conjunction with a loan guarantee made under section 5308 of
this title at least equal to twice the amount of the funds
received; and
(B)(i) the remainder of the amount received is used for
economic development activities eligible under this chapter;
and
(ii) except when waived by the Secretary in the case of a
severely distressed jurisdiction, not more than one-half of the
costs of activities under subparagraph (B) are derived from
such unexpended amounts; or
(2) 25 percent of such unexpended amounts if -
(A) the grantee agrees to expend such funds for economic
development activities eligible under this chapter; and
(B) except when waived by the Secretary in the case of a
severely distressed jurisdiction, not more than one-half of the
costs of such activities are derived from such unexpended
amount.