24 CFR Part 578 — Continuum of Care Program

PART 578—CONTINUUM OF CARE PROGRAM Authority: 12 U.S.C. 1701x, 1701 x-1; 42 U.S.C. 11381 et seq., Source: 77 FR 45442, July 31, 2012, unless otherwise noted. Subpart A—General Provisions § 578.1 Purpose and scope. (a) The Continuum of Care program is authorized by subtitle C of title IV of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11381-11389). (b) The program is designed to: (1) Promote communitywide commitment to the goal of ending homelessness; (2) Provide funding for efforts by nonprofit providers, States, and local governments to quickly rehouse homeless individuals (including unaccompanied youth) and families, while minimizing the trauma and dislocation caused to homeless individuals, families, and communities by homelessness; (3) Promote access to and effective utilization of mainstream programs by homeless individuals and families; and (4) Optimize self-sufficiency among individuals and families experiencing homelessness. § 578.3 Definitions. As used in this part: Act et seq. Annual renewal amount Applicant At risk of homelessness. (i) Has an annual income below 30 percent of median family income for the area, as determined by HUD; (ii) Does not have sufficient resources or support networks, e.g., (iii) Meets one of the following conditions: (A) Has moved because of economic reasons two or more times during the 60 days immediately preceding the application for homelessness prevention assistance; (B) Is living in the home of another because of economic hardship; (C) Has been notified in writing that their right to occupy their current housing or living situation will be terminated within 21 days of the date of application for assistance; (D) Lives in a hotel or motel and the cost of the hotel or motel stay is not paid by charitable organizations or by federal, State, or local government programs for low-income individuals; (E) Lives in a single-room occupancy or efficiency apartment unit in which there reside more than two persons, or lives in a larger housing unit in which there reside more than 1.5 people per room, as defined by the U.S. Census Bureau; (F) Is exiting a publicly funded institution, or system of care (such as a health-care facility, a mental health facility, foster care or other youth facility, or correction program or institution); or (G) Otherwise lives in housing that has characteristics associated with instability and an increased risk of homelessness, as identified in the recipient's approved consolidated plan; (2) A child or youth who does not qualify as “homeless” under this section, but qualifies as “homeless” under section 387(3) of the Runaway and Homeless Youth Act (42 U.S.C. 5732a(3)), section 637(11) of the Head Start Act (42 U.S.C. 9832(11)), section 41403(6) of the Violence Against Women Act of 1994 (42 U.S.C. 14043e-2(6)), section 330(h)(5)(A) of the Public Health Service Act (42 U.S.C. 254b(h)(5)(A)), section 3(m) of the Food and Nutrition Act of 2008 (7 U.S.C. 2012(m)), or section 17(b)(15) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(b)(15)); or (3) A child or youth who does not qualify as “homeless” under this section, but qualifies as “homeless” under section 725(2) of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11434a(2)), and the parent(s) or guardian(s) of that child or youth if living with her or him. Centralized or coordinated assessment system Chronically homeless (1) A “homeless individual with a disability,” as defined in section 401(9) of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11360(9)), who: (i) Lives in a place not meant for human habitation, a safe haven, or in an emergency shelter; and (ii) Has been homeless and living as described in paragraph (1)(i) of this definition continuously for at least 12 months or on at least 4 separate occasions in the last 3 years, as long as the combined occasions equal at least 12 months and each break in homelessness separating the occasions included at least 7 consecutive nights of not living as described in paragraph (1)(i). Stays in institutional care facilities for fewer than 90 days will not constitute as a break in homelessness, but rather such stays are included in the 12-month total, as long as the individual was living or residing in a place not meant for human habitation, a safe haven, or an emergency shelter immediately before entering the institutional care facility; (2) An individual who has been residing in an institutional care facility, including a jail, substance abuse or mental health treatment facility, hospital, or other similar facility, for fewer than 90 days and met all of the criteria in paragraph (1) of this definition, before entering that facility; or (3) A family with an adult head of household (or if there is no adult in the family, a minor head of household) who meets all of the criteria in paragraph (1) or (2) of this definition, including a family whose composition has fluctuated while the head of household has been homeless. Collaborative applicant Consolidated plan Continuum of Care and Continuum Developmental disability (1) A severe, chronic disability of an individual that— (i) Is attributable to a mental or physical impairment or combination of mental and physical impairments; (ii) Is manifested before the individual attains age 22; (iii) Is likely to continue indefinitely; (iv) Results in substantial functional limitations in three or more of the following areas of major life activity: (A) Self-care; (B) Receptive and expressive language; (C) Learning; (D) Mobility; (E) Self-direction; (F) Capacity for independent living; (G) Economic self-sufficiency. (v) Reflects the individual's need for a combination and sequence of special, interdisciplinary, or generic services, individualized supports, or other forms of assistance that are of lifelong or extended duration and are individually planned and coordinated. (2) An individual from birth to age 9, inclusive, who has a substantial developmental delay or specific congenital or acquired condition, may be considered to have a developmental disability without meeting three or more of the criteria described in paragraphs (1)(i) through (v) of the definition of “developmental disability” in this section if the individual, without services and supports, has a high probability of meeting these criteria later in life. Eligible applicant Emergency shelter Emergency Solutions Grants (ESG) Fair Market Rent (FMR) Federal Register High-performing community (HPC) Homeless (1) An individual or family who lacks a fixed, regular, and adequate nighttime residence, meaning: (i) An individual or family with a primary nighttime residence that is a public or private place not designed for or ordinarily used as a regular sleeping accommodation for human beings, including a car, park, abandoned building, bus or train station, airport, or camping ground; (ii) An individual or family living in a supervised publicly or privately operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by federal, State, or local government programs for low-income individuals); or (iii) An individual who is exiting an institution where he or she resided for 90 days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution; (2) An individual or family who will imminently lose their primary nighttime residence, provided that: (i) The primary nighttime residence will be lost within 14 days of the date of application for homeless assistance; (ii) No subsequent residence has been identified; and (iii) The individual or family lacks the resources or support networks, e.g., (3) Unaccompanied youth under 25 years of age, or families with children and youth, who do not otherwise qualify as homeless under this definition, but who: (i) Are defined as homeless under section 387 of the Runaway and Homeless Youth Act (42 U.S.C. 5732a), section 637 of the Head Start Act (42 U.S.C. 9832), section 41403 of the Violence Against Women Act of 1994 (42 U.S.C. 14043e-2), section 330(h) of the Public Health Service Act (42 U.S.C. 254b(h)), section 3 of the Food and Nutrition Act of 2008 (7 U.S.C. 2012), section 17(b) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(b)), or section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11434a); (ii) Have not had a lease, ownership interest, or occupancy agreement in permanent housing at any time during the 60 days immediately preceding the date of application for homeless assistance; (iii) Have experienced persistent instability as measured by two moves or more during the 60-day period immediately preceding the date of applying for homeless assistance; and (iv) Can be expected to continue in such status for an extended period of time because of chronic disabilities; chronic physical health or mental health conditions; substance addiction; histories of domestic violence or childhood abuse (including neglect); the presence of a child or youth with a disability; or two or more barriers to employment, which include the lack of a high school degree or General Education Development (GED), illiteracy, low English proficiency, a history of incarceration or detention for criminal activity, and a history of unstable employment; or (4) Any individual or family who: (i) Is fleeing, or is attempting to flee, domestic violence, dating violence, sexual assault, stalking, or other dangerous or life-threatening conditions that relate to violence against the individual or a family member, including a child, that has either taken place within the individual's or family's primary nighttime residence or has made the individual or family afraid to return to their primary nighttime residence; (ii) Has no other residence; and (iii) Lacks the resources or support networks, e.g., Homeless Management Information System (HMIS) HMIS Lead Permanent housing Permanent supportive housing Point-in-time count Private nonprofit organization (1) No part of the net earnings of which inure to the benefit of any member, founder, contributor, or individual; (2) That has a voluntary board; (3) That has a functioning accounting system that is operated in accordance with generally accepted accounting principles, or has designated a fiscal agent that will maintain a functioning accounting system for the organization in accordance with generally accepted accounting principles; and (4) That practices nondiscrimination in the provision of assistance. A private nonprofit organization does not include governmental organizations, such as public housing agencies. Program participant Project Recipient Safe haven (1) Serves hard to reach homeless persons with severe mental illness who came from the streets and have been unwilling or unable to participate in supportive services; (2) Provides 24-hour residence for eligible persons for an unspecified period; (3) Has an overnight capacity limited to 25 or fewer persons; and (4) Provides low-demand services and referrals for the residents. State Subrecipient Transitional housing Unified Funding Agency Victim service provider Subpart B—Establishing and Operating a Continuum of Care § 578.5 Establishing the Continuum of Care. (a) The Continuum of Care. (b) The board. (1) Be representative of the relevant organizations and of projects serving homeless subpopulations; and (2) Include at least one homeless or formerly homeless individual. (c) Transition. § 578.7 Responsibilities of the Continuum of Care. (a) Operate the Continuum of Care. (1) Hold meetings of the full membership, with published agendas, at least semi-annually; (2) Make an invitation for new members to join publicly available within the geographic at least annually; (3) Adopt and follow a written process to select a board to act on behalf of the Continuum of Care. The process must be reviewed, updated, and approved by the Continuum at least once every 5 years; (4) Appoint additional committees, subcommittees, or workgroups; (5) In consultation with the collaborative applicant and the HMIS Lead, develop, follow, and update annually a governance charter, which will include all procedures and policies needed to comply with subpart B of this part and with HMIS requirements as prescribed by HUD; and a code of conduct and recusal process for the board, its chair(s), and any person acting on behalf of the board; (6) Consult with recipients and subrecipients to establish performance targets appropriate for population and program type, monitor recipient and subrecipient performance, evaluate outcomes, and take action against poor performers; (7) Evaluate outcomes of projects funded under the Emergency Solutions Grants program and the Continuum of Care program, and report to HUD; (8) In consultation with recipients of Emergency Solutions Grants program funds within the geographic area, establish and operate either a centralized or coordinated assessment system that provides an initial, comprehensive assessment of the needs of individuals and families for housing and services. The Continuum must develop a specific policy to guide the operation of the centralized or coordinated assessment system on how its system will address the needs of individuals and families who are fleeing, or attempting to flee, domestic violence, dating violence, sexual assault, or stalking, but who are seeking shelter or services from nonvictim service providers. This system must comply with any requirements established by HUD by Notice. (9) In consultation with recipients of Emergency Solutions Grants program funds within the geographic area, establish and consistently follow written standards for providing Continuum of Care assistance. At a minimum, these written standards must include: (i) Policies and procedures for evaluating individuals' and families' eligibility for assistance under this part; (ii) Policies and procedures for determining and prioritizing which eligible individuals and families will receive transitional housing assistance (these policies must include the emergency transfer priority required under § 578.99(j)(8)); (iii) Policies and procedures for determining and prioritizing which eligible individuals and families will receive rapid rehousing assistance (these policies must include the emergency transfer priority required under § 578.99(j)(8)); (iv) Standards for determining what percentage or amount of rent each program participant must pay while receiving rapid rehousing assistance; (v) Policies and procedures for determining and prioritizing which eligible individuals and families will receive permanent supportive housing assistance (these policies must include the emergency transfer priority required under § 578.99(j)(8)); and (vi) Where the Continuum is designated a high-performing community, as described in subpart G of this part, policies and procedures set forth in 24 CFR 576.400(e)(3)(vi), (e)(3)(vii), (e)(3)(viii), and (e)(3)(ix). (b) Designating and operating an HMIS. (1) Designate a single Homeless Management Information System (HMIS) for the geographic area; (2) Designate an eligible applicant to manage the Continuum's HMIS, which will be known as the HMIS Lead; (3) Review, revise, and approve a privacy plan, security plan, and data quality plan for the HMIS. (4) Ensure consistent participation of recipients and subrecipients in the HMIS; and (5) Ensure the HMIS is administered in compliance with requirements prescribed by HUD. (c) Continuum of Care planning. (1) Coordinating the implementation of a housing and service system within its geographic area that meets the needs of the homeless individuals (including unaccompanied youth) and families. At a minimum, such system encompasses the following: (i) Outreach, engagement, and assessment; (ii) Shelter, housing, and supportive services; (iii) Prevention strategies. (2) Planning for and conducting, at least biennially, a point-in-time count of homeless persons within the geographic area that meets the following requirements: (i) Homeless persons who are living in a place not designed or ordinarily used as a regular sleeping accommodation for humans must be counted as unsheltered homeless persons. (ii) Persons living in emergency shelters and transitional housing projects must be counted as sheltered homeless persons. (iii) Other requirements established by HUD by Notice. (3) Conducting an annual gaps analysis of the homeless needs and services available within the geographic area; (4) Providing information required to complete the Consolidated Plan(s) within the Continuum's geographic area; (5) Consulting with State and local government Emergency Solutions Grants program recipients within the Continuum's geographic area on the plan for allocating Emergency Solutions Grants program funds and reporting on and evaluating the performance of Emergency Solutions Grants program recipients and subrecipients. (d) VAWA emergency transfer plan. [77 FR 45442, July 31, 2012,as amended at 81 FR 80809, Nov. 16, 2016] § 578.9 Preparing an application for funds. (a) The Continuum must: (1) Design, operate, and follow a collaborative process for the development of applications and approve the submission of applications in response to a NOFA published by HUD under § 578.19 of this subpart; (2) Establish priorities for funding projects in the geographic area; (3) Determine if one application for funding will be submitted for all projects within the geographic area or if more than one application will be submitted for the projects within the geographic area; (i) If more than one application will be submitted, designate an eligible applicant to be the collaborative applicant that will collect and combine the required application information from all applicants and for all projects within the geographic area that the Continuum has selected funding. The collaborative applicant will also apply for Continuum of Care planning activities. If the Continuum is an eligible applicant, it may designate itself; (ii) If only one application will be submitted, that applicant will be the collaborative applicant and will collect and combine the required application information from all projects within the geographic area that the Continuum has selected for funding and apply for Continuum of Care planning activities; (b) The Continuum retains all of its responsibilities, even if it designates one or more eligible applicants other than itself to apply for funds on behalf of the Continuum. This includes approving the Continuum of Care application. § 578.11 Unified Funding Agency. (a) Becoming a Unified Funding Agency. (b) Criteria for designating a UFA. (1) The Continuum of Care it represents meets the requirements in § 578.7; (2) The collaborative applicant has financial management systems that meet the standards set forth in 2 CFR 200.302; (3) The collaborative applicant demonstrates the ability to monitor subrecipients; and (4) Such other criteria as HUD may establish by NOFA. (c) Requirements. (1) Apply to HUD for funding for all of the projects within the geographic area and enter into a grant agreement with HUD for the entire geographic area. (2) Enter into legally binding agreements with subrecipients, and receive and distribute funds to subrecipients for all projects within the geographic area. (3) Require subrecipients to establish fiscal control and accounting procedures as necessary to assure the proper disbursal of and accounting for federal funds in accordance with the requirements of 2 CFR part 200, subpart D. (4) Obtain approval of any proposed grant agreement amendments by the Continuum of Care before submitting a request for an amendment to HUD. [77 FR 45442, July 31, 2012, as amended at 80 FR 75939, Dec. 7, 2015] § 578.13 Remedial action. (a) If HUD finds that the Continuum of Care for a geographic area does not meet the requirements of the Act or its implementing regulations, or that there is no Continuum for a geographic area, HUD may take remedial action to ensure fair distribution of grant funds within the geographic area. Such measures may include: (1) Designating a replacement Continuum of Care for the geographic area; (2) Designating a replacement collaborative applicant for the Continuum's geographic area; and (3) Accepting applications from other eligible applicants within the Continuum's geographic area. (b) HUD must provide a 30-day prior written notice to the Continuum and its collaborative applicant and give them an opportunity to respond. Subpart C—Application and Grant Award Process § 578.15 Eligible applicants. (a) Who may apply. (b) Designation by the Continuum of Care. (c) Exclusion. § 578.17 Overview of application and grant award process. (a) Formula. (2) HUD will apply the formula used to determine PPRN established in paragraph (a)(3) of this section, to the amount of funds being made available under the NOFA. That amount is calculated by: (i) Determining the total amount for the Continuum of Care competition in accordance with section 413 of the Act or as otherwise directed by the annual appropriations act; (ii) From the amount in paragraph (a)(2)(i) of this section, deducting the amount published in the NOFA as being set aside to provide a bonus to geographic areas for activities that have proven to be effective in reducing homelessness generally or for specific subpopulations listed in the NOFA or achieving homeless prevention and independent living goals established in the NOFA and to meet policy priorities set in the NOFA; and (iii) Deducting the amount of funding necessary for Continuum of Care planning activities and UFA costs. (3) PPRN is calculated on the amount determined under paragraph (a)(2) of this section by using the following formula: (i) Two percent will be allocated among the four insular areas (American Samoa, Guam, the Commonwealth of the Northern Marianas, and the Virgin Islands) on the basis of the ratio of the population of each insular area to the population of all insular areas. (ii) Seventy-five percent of the remaining amount will be allocated, using the Community Development Block Grant (CDBG) formula, to metropolitan cities and urban counties that have been funded under either the Emergency Shelter Grants or Emergency Solutions Grants programs in any one year since 2004. (iii) The amount remaining after the allocation under paragraphs (a)(1) and (2) of this section will be allocated, using the CDBG formula, to metropolitan cities and urban counties that have not been funded under the Emergency Solutions Grants program in any year since 2004 and all other counties in the United States and Puerto Rico. (4) If the calculation in paragraph (a)(2) of this section results in an amount less than the amount required to renew all projects eligible for renewal in that year for at least one year, after making adjustments proportional to increases in fair market rents for the geographic area for leasing, operating, and rental assistance for permanent housing, HUD will reduce, proportionately, the total amount required to renew all projects eligible for renewal in that year for at least one year, for each Continuum of Care. HUD will publish, via the NOFA, the total dollar amount that every Continuum will be required to deduct from renewal projects Continuum-wide. (b) Calculating a Continuum of Care's maximum award amount. Establish the PPRN amount. (2) Establishing renewal demand. (3) Establishing FPRN. (4) Establishing the maximum award amount. § 578.19 Application process. (a) Notice of Funding Availability. (b) Applications. § 578.21 Awarding funds. (a) Selection. (b) Announcement of awards. (c) Satisfying conditions. § 578.23 Executing grant agreements. (a) Deadline. (b) Grant agreements. Multiple applicants for one Continuum. (2) One applicant for a Continuum. (3) Unified Funding Agencies. (c) Required agreements. (1) To ensure the operation of the project(s) in accordance with the provisions of the McKinney-Veto Act and all requirements under 24 CFR part 578; (2) To monitor and report the progress of the project(s) to the Continuum of Care and HUD; (3) To ensure, to the maximum extent practicable, that individuals and families experiencing homelessness are involved, through employment, provision of volunteer services, or otherwise, in constructing, rehabilitating, maintaining, and operating facilities for the project and in providing supportive services for the project; (4) To require certification from all subrecipients that: (i) Subrecipients will maintain the confidentiality of records pertaining to any individual or family that was provided family violence prevention or treatment services through the project; (ii) The address or location of any family violence project assisted under this part will not be made public, except with written authorization of the person responsible for the operation of such project; (iii) Subrecipients will establish policies and practices that are consistent with, and do not restrict, the exercise of rights provided by subtitle B of title VII of the Act and other laws relating to the provision of educational and related services to individuals and families experiencing homelessness; (iv) In the case of projects that provide housing or services to families, that subrecipients will designate a staff person to be responsible for ensuring that children being served in the program are enrolled in school and connected to appropriate services in the community, including early childhood programs such as Head Start, part C of the Individuals with Disabilities Education Act, and programs authorized under subtitle B of title VII of the Act; (v) The subrecipient, its officers, and employees are not debarred or suspended from doing business with the Federal Government; and (vi) Subrecipients will provide information, such as data and reports, as required by HUD; and (5) To establish such fiscal control and accounting procedures as may be necessary to assure the proper disbursal of, and accounting for grant funds in order to ensure that all financial transactions are conducted, and records maintained in accordance with generally accepted accounting principles, if the recipient is a UFA; (6) To monitor subrecipient match and report on match to HUD; (7) To take the educational needs of children into account when families are placed in housing and will, to the maximum extent practicable, place families with children as close as possible to their school of origin so as not to disrupt such children's education; (8) To monitor subrecipients at least annually; (9) To use the centralized or coordinated assessment system established by the Continuum of Care as set forth in § 578.7(a)(8). A victim service provider may choose not to use the Continuum of Care's centralized or coordinated assessment system, provided that victim service providers in the area use a centralized or coordinated assessment system that meets HUD's minimum requirements and the victim service provider uses that system instead; (10) To follow the written standards for providing Continuum of Care assistance developed by the Continuum of Care, including the minimum requirements set forth in § 578.7(a)(9); (11) Enter into subrecipient agreements requiring subrecipients to operate the project(s) in accordance with the provisions of this Act and all requirements under 24 CFR part 578; and (12) To comply with such other terms and conditions as HUD may establish by NOFA. § 578.25 Site control. (a) In general. (b) Evidence. (c) Tax credit projects. (i) To have control of the limited partnership, the applicant or subrecipient must be the general partner of the limited partnership or have a 51 percent controlling interest in that general partner. (ii) To have control of the limited liability company, the applicant or subrecipient must be the sole managing member. (2) If grant funds are to be used for acquisition, rehabilitation, or new construction, the recipient or subrecipient must maintain control of the partnership or corporation and must ensure that the project is operated in compliance with law and regulation for 15 years from the date of initial occupancy or initial service provision. The partnership or corporation must own the project site throughout the 15-year period. If grant funds were not used for acquisition, rehabilitation, or new construction, then the recipient or subrecipient must maintain control for the term of the grant agreement and any renewals thereof. § 578.27 Consolidated plan. (a) States or units of general local government. (b) Other applicants. (c) Timing of consolidated plan certification submissions. § 578.29 Subsidy layering. HUD may provide assistance under this program only in accordance with HUD subsidy layering requirements in section 102 of the Housing and Urban Development Reform Act of 1989 (42 U.S.C. 3545) and 24 CFR part 4, subpart A. An applicant must submit information in its application on other sources of governmental assistance that the applicant has received, or reasonably expects to receive, for a proposed project or activities. HUD's review of this information is intended to prevent excessive public assistance for proposed project or activities by combining (layering) assistance under this program with other governmental housing assistance from federal, State, or local agencies, including assistance such as tax concessions or tax credits. § 578.31 Environmental review. (a) Activities under this part are subject to environmental review by HUD under 24 CFR part 50. The recipient or subrecipient shall supply all available, relevant information necessary for HUD to perform, for each property, any environmental review required by 24 CFR part 50. The recipient or subrecipient must carry out mitigating measures required by HUD or select an alternate eligible property. HUD may eliminate from consideration any application that would require an Environmental Impact Statement. (b) The recipient or subrecipient, its project partners, and their contractors may not acquire, rehabilitate, convert, lease, repair, dispose of, demolish, or construct property for a project under this part, or commit or expend HUD or local funds for such eligible activities under this part, until HUD has performed an environmental review under 24 CFR part 50 and the recipient or subrecipient has received HUD approval of the property. § 578.33 Renewals. (a) In general. (b) Length of renewal. (c) Assistance available. (i) Up to 100 percent of the amount for supportive services and HMIS costs in the final year of the prior funding period; (ii) Up to 100 percent of the amount for leasing and operating in the final year of the prior funding period adjusted in proportion to changes in the FMR for the geographic area; and (iii) For rental assistance, up to 100 percent of the result of multiplying the number and unit size(s) in the grant agreement by the number of months in the renewal grant term and the applicable FMR. (d) Review criteria. (2) Renewal of awards made after August 30, 2012. (e) Unsuccessful projects. (f) Annual Performance Report condition. (1) The recipient fails to timely submit a HUD Annual Performance Report (APR) for the grant year immediately prior to renewal; or (2) The recipient submits an APR that HUD deems unacceptable or shows noncompliance with the requirements of the grant and this part. [77 FR 45442, July 31, 2012, as amended at 91 FR 20899, Apr. 20, 2026] § 578.35 Appeal. (a) In general. (b) Solo applicants. Who may appeal. (2) Notice of intent to appeal. (3) Deadline for submitting proof. (4) Response from the Continuum of Care. (5) Decision. (6) Funding. (c) Denied or decreased funding. Who may appeal. (2) Decision. (3) Funding. (d) Competing Continuums of Care. In general. (2) Who may appeal. (3) Decision. (e) Consolidated plan certification. In general. (2) Procedure. (i) A copy of the applicant's request to the jurisdiction for the certification of consistency with the Consolidated Plan; (ii) A copy of the jurisdiction's response stating the reasons for denial, including the reasons the proposed project is not consistent with the jurisdiction's Consolidated Plan in accordance with 24 CFR 91.500(c); and (iii) A statement of the reasons why the applicant believes its project is consistent with the jurisdiction's Consolidated Plan. (3) Jurisdiction response. (4) HUD review. (A) Whether the applicant submitted the request to the appropriate political jurisdiction; and (B) The reasonableness of the jurisdiction's refusal to provide the certificate. (ii) If the jurisdiction did not provide written reasons for refusal, including the reasons why the project is not consistent with the jurisdiction's Consolidated Plan in its initial response to the applicant's request for a certification, HUD will find for the applicant without further inquiry or response from the political jurisdiction. Subpart D—Program Components and Eligible Costs § 578.37 Program components and uses of assistance. (a) Continuum of Care funds may be used to pay for the eligible costs listed in § 578.39 through § 578.63 when used to establish and operate projects under five program components: permanent housing; transitional housing; supportive services only; HMIS; and, in some cases, homelessness prevention. Although grant funds may be used by recipients and subrecipients in all components for the eligible costs of contributing data to the HMIS designated by the Continuum of Care, only HMIS Leads may use grant funds for an HMIS component. Administrative costs are eligible for all components. All components are subject to the restrictions on combining funds for certain eligible activities in a single project found in § 578.87(c). The eligible program components are: (1) Permanent housing (PH). (i) Permanent supportive housing for persons with disabilities (PSH). (ii) Rapid rehousing. (A) Must follow the written policies and procedures established by the Continuum of Care for determining and prioritizing which eligible families and individuals will receive rapid rehousing assistance, as well as the amount or percentage of rent that each program participant must pay. (B) May set a maximum amount or percentage of rental assistance that a program participant may receive, a maximum number of months that a program participant may receive rental assistance, and/or a maximum number of times that a program participant may receive rental assistance. The recipient or subrecipient may also require program participants to share in the costs of rent. For the purposes of calculating rent for rapid rehousing, the rent shall equal the sum of the total monthly rent for the unit and, if the tenant pays separately for utilities, the monthly allowance for utilities (excluding telephone) established by the public housing authority for the area in which the housing is located. (C) Limit rental assistance to no more than 24 months to a household. (D) May provide supportive services for no longer than 6 months after rental assistance stops. (E) Must re-evaluate, not less than once annually, that the program participant lacks sufficient resources and support networks necessary to retain housing without Continuum of Care assistance and the types and amounts of assistance that the program participant needs to retain housing. The recipient or subrecipient may require each program participant receiving assistance to notify the recipient or subrecipient of changes in the program participant's income or other circumstances ( e.g., (F) Require the program participant to meet with a case manager not less than once per month to assist the program participant in ensuring long-term housing stability. The project is exempt from this requirement if the Violence Against Women Act of 1994 (42 U.S.C. 13925 et seq. et seq. (2) Transitional Housing (TH). (3) Supportive Service Only (SSO). (4) HMIS. (5) Homelessness prevention. (b) Uses of assistance. (1) Establish new housing or new facilities to provide supportive services; (2) Expand existing housing and facilities in order to increase the number of homeless persons served; (3) Bring existing housing and facilities into compliance with State and local government health and safety standards, as described in § 578.87; (4) Preserve existing permanent housing and facilities that provide supportive services; (5) Provide supportive services for residents of supportive housing or for homeless persons not residing in supportive housing; (6) Continue funding permanent housing when the recipient has received funding under this part for leasing, supportive services, operating costs, or rental assistance; (7) Establish and operate an HMIS or comparable database; and (8) Establish and carry out a Continuum of Care planning process and operate a Continuum of Care. (c) Multiple purposes. § 578.39 Continuum of Care planning activities. (a) In general. (1) Designing and carrying out a collaborative process for the development of an application to HUD; (2) Evaluating the outcomes of projects for which funds are awarded in the geographic area under the Continuum of Care and the Emergency Solutions Grants programs; and (3) Participating in the consolidated plan(s) for the geographic area(s). (b) Continuum of Care planning activities. (1) Developing a communitywide or regionwide process involving the coordination of nonprofit homeless providers, victim service providers, faith-based organizations, governments, businesses, advocates, public housing agencies, school districts, social service providers, mental health agencies, hospitals, universities, affordable housing developers, law enforcement, organizations that serve veterans, and homeless and formerly homeless individuals; (2) Determining the geographic area that the Continuum of Care will serve; (3) Developing a Continuum of Care system; (4) Evaluating the outcomes of projects for which funds are awarded in the geographic area, including the Emergency Solutions Grants program; (5) Participating in the consolidated plan(s) of the jurisdiction(s) in the geographic area; and (6) Preparing and submitting an application to HUD on behalf of the entire Continuum of Care membership, including conducting a sheltered and unsheltered point-in-time count and other data collection as required by HUD. (c) Monitoring costs. § 578.41 Unified Funding Agency costs. (a) In general. (b) UFA costs. (c) Monitoring costs. § 578.43 Acquisition. Grant funds may be used to pay up to 100 percent of the cost of acquisition of real property selected by the recipient or subrecipient for use in the provision of housing or supportive services for homeless persons. § 578.45 Rehabilitation. (a) Use. (b) Eligible costs. (c) Ineligible costs. (d) Broadband infrastructure. (1) The location of the substantial rehabilitation makes installation of broadband infrastructure infeasible; (2) The cost of installing broadband infrastructure would result in a fundamental alteration in the nature of its program or activity or in an undue financial burden; or (3) The structure of the housing to be substantially rehabilitated makes installation of broadband infrastructure infeasible. [77 FR 45442, July 31, 2012, as amended at 81 FR 92637, Dec. 20, 2016] § 578.47 New construction. (a) Use. (1) Pay up to 100 percent of the cost of new construction, including the building of a new structure or building an addition to an existing structure that increases the floor area by 100 percent or more, and the cost of land associated with that construction, for use as housing. (2) If grant funds are used for new construction, the applicant must demonstrate that the costs of new construction are substantially less than the costs of rehabilitation or that there is a lack of available appropriate units that could be rehabilitated at a cost less than new construction. For purposes of this cost comparison, costs of rehabilitation or new construction may include the cost of real property acquisition. (b) Ineligible costs. (c) Broadband infrastructure. (1) The location of the new construction makes installation of broadband infrastructure infeasible; or (2) The cost of installing broadband infrastructure would result in a fundamental alteration in the nature of its program or activity or in an undue financial burden. [77 FR 45442, July 31, 2012, as amended at 81 FR 92637, Dec. 20, 2016] § 578.49 Leasing. (a) Use. (2) Any request for an exception must include the following: (i) A description of how leasing these structures is in the best interest of the program; (ii) Supporting documentation showing that the leasing charges paid with grant funds are reasonable for the market; and (iii) A copy of the written policy for resolving disputes between the landlord and tenant, including a recusal for officers, agents, and staff who work for both the landlord and tenant. (b) Requirements. Leasing structures. (2) Leasing individual units. (3) Utilities. (4) Security deposits and first and last month's rent. (5) Occupancy agreements and subleases. (6) Calculation of occupancy charges and rent. (7) Program income. (8) Transition. § 578.51 Rental assistance. (a) Use. (i) The rental assistance may be short-term, up to 3 months of rent; medium-term, for 3 to 24 months of rent; or long-term, for longer than 24 months of rent and must be administered in accordance with the policies and procedures established by the Continuum as set forth in § 578.7(a)(9) and this section. (ii) The rental assistance may be tenant-based, project-based, or sponsor-based, and may be for transitional or permanent housing. (2) Grant funds may be used for security deposits in an amount not to exceed 2 months of rent. An advance payment of the last month's rent may be provided to the landlord, in addition to the security deposit and payment of first month's rent. (b) Rental assistance administrator. (c) Tenant-based rental assistance. (1) When necessary to facilitate the coordination of supportive services, recipients and subrecipients may require program participants to live in a specific area for their entire period of participation, or in a specific structure for the first year and in a specific area for the remainder of their period of participation. Program participants who are receiving rental assistance in transitional housing may be required to live in a specific structure for their entire period of participation in transitional housing. (2) Program participants who have complied with all program requirements during their residence retain the rental assistance if they move. (3) Program participants who have complied with all program requirements during their residence, who have been a victim of domestic violence, dating violence, sexual assault, or stalking, who reasonably believe they are imminently threatened by harm from further domestic violence, dating violence, sexual assault, or stalking (which would include threats from a third party, such as a friend or family member of the perpetrator of the violence) if they remain in the assisted unit, and who are able to document the violence and basis for their belief, may retain the rental assistance and move to a different Continuum of Care geographic area if they move out of the assisted unit to protect their health and safety. These program participants may move to a different Continuum of Care's geographic service area even if the recipient or subrecipient cannot meet all regulatory requirements of this part in the new geographic area where the unit is located. The recipient or subrecipient, however, must be able to meet all statutory requirements of the Continuum of Care program either directly or through a third-party contract or agreement. (4) Program participants other than those described in paragraph (c)(3) of this section may choose housing outside of the Continuum of Care's geographic area if the recipient or subrecipient, through its employees or contractors, is able to meet all requirements of this part in the geographic area where the program participant chooses housing. If the recipient or subrecipient is unable to meet the requirements of this part, either directly or through a third-party contract or agreement, the recipient or subrecipient may refuse to permit the program participant to retain the tenant-based rental assistance if the program participant chooses to move outside of the Continuum of Care's geographic area. (d) Sponsor-based rental assistance. (e) Project-based rental assistance. (f) Grant amount. (g) Rent reasonableness. (h) Payment of grant. (2) For tenant-based rental assistance, on demonstration of need: (i) Up to 25 percent of the total rental assistance awarded may be spent in any year of a 5-year grant term; or (ii) A higher percentage if approved in advance by HUD, if the recipient provides evidence satisfactory to HUD that it is financially committed to providing the housing assistance described in the application for the full 5-year period. (3) A recipient must serve at least as many program participants as shown in its application for assistance. (4) If the amount in each grant reserved for rental assistance over the grant period exceeds the amount that will be needed to pay the actual costs of rental assistance, due to such factors as contract rents being lower than FMRs and program participants being able to pay a portion of the rent, recipients or subrecipients may use the excess funds for covering the costs of rent increases, or for serving a greater number of program participants. (i) Vacancies. (j) Property damage. (k) Resident rent. (l) Leases. Initial lease. (2) Initial lease for transitional housing. (m) VAWA emergency transfer plan costs. [77 FR 45442, July 31, 2012, as amended at 81 FR 38584, June 14, 2016; 81 FR 80810, Nov. 16, 2016] § 578.53 Supportive services. (a) In general. (1) Supportive services must be necessary to assist program participants obtain and maintain housing. (2) Recipients and subrecipients shall conduct an annual assessment of the service needs of the program participants and should adjust services accordingly. (b) Duration. (2) Permanent supportive housing projects must provide supportive services for the residents to enable them to live as independently as is practicable throughout the duration of their residence in the project. (3) Services may also be provided to former residents of transitional housing and current residents of permanent housing who were homeless in the prior 6 months, for no more than 6 months after leaving transitional housing or homelessness, respectively, to assist their adjustment to independent living. (4) Rapid rehousing projects must require the program participant to meet with a case manager not less than once per month as set forth in § 578.37(a)(1)(ii)(F), to assist the program participant in maintaining long-term housing stability. (c) Special populations. (d) Ineligible costs. (e) Eligible costs. Annual Assessment of Service Needs. (2) Assistance with moving costs. (3) Case management. (i) Counseling; (ii) Developing, securing, and coordinating services; (iii) Using the centralized or coordinated assessment system as required under § 578.23(c)(9). (iv) Obtaining federal, State, and local benefits; (v) Monitoring and evaluating program participant progress; (vi) Providing information and referrals to other providers; (vii) Providing ongoing risk assessment and safety planning with victims of domestic violence, dating violence, sexual assault, and stalking; and (viii) Developing an individualized housing and service plan, including planning a path to permanent housing stability. (4) Child care. (i) The children must be under the age of 13, unless they are disabled children. (ii) Disabled children must be under the age of 18. (iii) The child-care center must be licensed by the jurisdiction in which it operates in order for its costs to be eligible. (5) Education services. (i) Services include instruction or training in consumer education, health education, substance abuse prevention, literacy, English as a Second Language, and General Educational Development (GED). (ii) Component services or activities are screening, assessment and testing; individual or group instruction; tutoring; provision of books, supplies, and instructional material; counseling; and referral to community resources. (6) Employment assistance and job training. (i) Learning skills include those skills that can be used to secure and retain a job, including the acquisition of vocational licenses and/or certificates. (ii) Services that assist individuals in securing employment consist of: (A) Employment screening, assessment, or testing; (B) Structured job skills and job-seeking skills; (C) Special training and tutoring, including literacy training and pre-vocational training; (D) Books and instructional material; (E) Counseling or job coaching; and (F) Referral to community resources. (7) Food. (8) Housing search and counseling services. (i) Component services or activities are tenant counseling; assisting individuals and families to understand leases; securing utilities; and making moving arrangements. (ii) Other eligible costs are: (A) Mediation with property owners and landlords on behalf of eligible program participants; (B) Credit counseling, accessing a free personal credit report, and resolving personal credit issues; and (C) The payment of rental application fees. (iii) Housing counseling, as defined in § 5.100, that is funded with or provided in connection with grant funds must be carried out in accordance with § 5.111. When recipients or subrecipients provide housing services to eligible persons that are incidental to a larger set of holistic case management services, these services do not meet the definition of Housing counseling, as defined in § 5.100, and therefore are not required to be carried out in accordance with the certification requirements of § 5.111. (9) Legal services. (i) Eligible subject matters are child support; guardianship; paternity; emancipation; legal separation; orders of protection and other civil remedies for victims of domestic violence, dating violence, sexual assault, and stalking; appeal of veterans and public benefit claim denials; landlord tenant disputes; and the resolution of outstanding criminal warrants. (ii) Component services or activities may include receiving and preparing cases for trial, provision of legal advice, representation at hearings, and counseling. (iii) Fees based on the actual service performed (i.e., fee for service) are also eligible, but only if the cost would be less than the cost of hourly fees. Filing fees and other necessary court costs are also eligible. If the subrecipient is a legal services provider and performs the services itself, the eligible costs are the subrecipient's employees' salaries and other costs necessary to perform the services. (iv) Legal services for immigration and citizenship matters and issues related to mortgages and homeownership are ineligible. Retainer fee arrangements and contingency fee arrangements are ineligible. (10) Life skills training. (11) Mental health services. (12) Outpatient health services. (i) Providing an analysis or assessment of an individual's health problems and the development of a treatment plan; (ii) Assisting individuals to understand their health needs; (iii) Providing directly or assisting individuals to obtain and utilize appropriate medical treatment; (iv) Preventive medical care and health maintenance services, including in-home health services and emergency medical services; (v) Provision of appropriate medication; (vi) Providing follow-up services; and (vii) Preventive and noncosmetic dental care. (13) Outreach services. (i) Eligible costs include the outreach worker's transportation costs and a cell phone to be used by the individual performing the outreach. (ii) Component activities and services consist of: initial assessment; crisis counseling; addressing urgent physical needs, such as providing meals, blankets, clothes, or toiletries; actively connecting and providing people with information and referrals to homeless and mainstream programs; and publicizing the availability of the housing and/or services provided within the geographic area covered by the Continuum of Care. (14) Substance abuse treatment services. (15) Transportation. (i) The costs of program participant's travel on public transportation or in a vehicle provided by the recipient or subrecipient to and from medical care, employment, child care, or other services eligible under this section. (ii) Mileage allowance for service workers to visit program participants and to carry out housing quality inspections; (iii) The cost of purchasing or leasing a vehicle in which staff transports program participants and/or staff serving program participants; (iv) The cost of gas, insurance, taxes, and maintenance for the vehicle; (v) The costs of recipient or subrecipient staff to accompany or assist program participants to utilize public transportation; and (vi) If public transportation options are not sufficient within the area, the recipient may make a one-time payment on behalf of a program participant needing car repairs or maintenance required to operate a personal vehicle, subject to the following: (A) Payments for car repairs or maintenance on behalf of the program participant may not exceed 10 percent of the Blue Book value of the vehicle (Blue Book refers to the guidebook that compiles and quotes prices for new and used automobiles and other vehicles of all makes, models, and types); (B) Payments for car repairs or maintenance must be paid by the recipient or subrecipient directly to the third party that repairs or maintains the car; and (C) The recipients or subrecipients may require program participants to share in the cost of car repairs or maintenance as a condition of receiving assistance with car repairs or maintenance. (16) Utility deposits. (17) Direct provision of services. (i) The costs of labor or supplies, and materials incurred by the recipient or subrecipient in directly providing supportive services to program participants; and (ii) The salary and benefit packages of the recipient and subrecipient staff who directly deliver the services. [77 FR 45442, July 31, 2012, as amended at 81 FR 90660, Dec. 14, 2016] § 578.55 Operating costs. (a) Use. (b) Eligible costs. (2) Property taxes and insurance; (3) Scheduled payments to a reserve for replacement of major systems of the housing (provided that the payments must be based on the useful life of the system and expected replacement cost); (4) Building security for a structure where more than 50 percent of the units or area is paid for with grant funds; (5) Electricity, gas, and water; (6) Furniture; and (7) Equipment. (c) Ineligible costs. § 578.57 Homeless Management Information System. (a) Eligible costs. (i) Purchasing or leasing computer hardware; (ii) Purchasing software or software licenses; (iii) Purchasing or leasing equipment, including telephones, fax machines, and furniture; (iv) Obtaining technical support; (v) Leasing office space; (vi) Paying charges for electricity, gas, water, phone service, and high-speed data transmission necessary to operate or contribute data to the HMIS; (vii) Paying salaries for operating HMIS, including: (A) Completing data entry; (B) Monitoring and reviewing data quality; (C) Completing data analysis; (D) Reporting to the HMIS Lead; (E) Training staff on using the HMIS; and (F) Implementing and complying with HMIS requirements; (viii) Paying costs of staff to travel to and attend HUD-sponsored and HUD-approved training on HMIS and programs authorized by Title IV of the McKinney-Vento Homeless Assistance Act; (ix) Paying staff travel costs to conduct intake; and (x) Paying participation fees charged by the HMIS Lead, as authorized by HUD, if the recipient or subrecipient is not the HMIS Lead. (2) If the recipient or subrecipient is the HMIS Lead, it may also use Continuum of Care funds to pay the costs of: (i) Hosting and maintaining HMIS software or data; (ii) Backing up, recovering, or repairing HMIS software or data; (iii) Upgrading, customizing, and enhancing the HMIS; (iv) Integrating and warehousing data, including development of a data warehouse for use in aggregating data from subrecipients using multiple software systems; (v) Administering the system; (vi) Reporting to providers, the Continuum of Care, and HUD; and (vii) Conducting training on using the system, including traveling to the training. (3) If the recipient or subrecipient is a victim services provider, or a legal services provider, it may use Continuum of Care funds to establish and operate a comparable database that complies with HUD's HMIS requirements. (b) General restrictions. § 578.59 Project administrative costs. (a) Eligible costs. (1) General management, oversight, and coordination. (i) Salaries, wages, and related costs of the recipient's staff, the staff of subrecipients, or other staff engaged in program administration. In charging costs to this category, the recipient may include the entire salary, wages, and related costs allocable to the program of each person whose primary responsibilities with regard to the program involve program administration assignments, or the pro rata share of the salary, wages, and related costs of each person whose job includes any program administration assignments. The recipient may use only one of these methods for each fiscal year grant. Program administration assignments include the following: (A) Preparing program budgets and schedules, and amendments to those budgets and schedules; (B) Developing systems for assuring compliance with program requirements; (C) Developing agreements with subrecipients and contractors to carry out program activities; (D) Monitoring program activities for progress and compliance with program requirements; (E) Preparing reports and other documents directly related to the program for submission to HUD; (F) Coordinating the resolution of audit and monitoring findings; (G) Evaluating program results against stated objectives; and (H) Managing or supervising persons whose primary responsibilities with regard to the program include such assignments as those described in paragraph (a)(1)(i)(A) through (G) of this section. (ii) Travel costs incurred for monitoring of subrecipients; (iii) Administrative services performed under third-party contracts or agreements, including general legal services, accounting services, and audit services; and (iv) Other costs for goods and services required for administration of the program, including rental or purchase of equipment, insurance, utilities, office supplies, and rental and maintenance (but not purchase) of office space. (2) Training on Continuum of Care requirements. (3) Environmental review. (b) Sharing requirement. UFAs. (2) Recipients that are not UFAs. § 578.61 Relocation costs. (a) In general. (b) Eligible relocation costs. § 578.63 Indirect costs. (a) In general. (b) Allocation. (c) Expenditure limits. [77 FR 45442, July 31, 2012, as amended at 80 FR 75939, Dec. 7, 2015] Subpart E—High-Performing Communities § 578.65 Standards. (a) In general. (b) Applying for HPC designation. (1) A report showing how the Continuum of Care program funds received in the preceding year were expended; (2) A specific plan for how grant funds will be expended; and (3) Information establishing that the Continuum of Care meets the standards for HPCs. (c) Standards for qualifying as an HPC. (1) Reliable data generated by the Continuum of Care's HMIS that it meets all of the following standards: (i) Mean length of homelessness. (ii) Reduced recidivism. (iii) HMIS coverage. (iv) Serving families and youth. (A) 95 percent of those families and youth did not become homeless again within a 2-year period following termination of assistance; or (B) 85 percent of those families achieved independent living in permanent housing for at least 2 years following termination of assistance. (2) Reliable data generated from sources other than the Continuum's HMIS that is provided in a narrative or other form prescribed by HUD that it meets both of the following standards: (i) Community action. (ii) Renewing HPC status. § 578.67 Publication of application. HUD will publish the application to be designated an HPC through the HUD Web site, for public comment as to whether the Continuum seeking designation as an HPC meets the standards for being one. § 578.69 Cooperation among entities. An HPC must cooperate with HUD in distributing information about its successful efforts to reduce homelessness. § 578.71 HPC-eligible activities. In addition to using grant funds for the eligible costs described in subpart D of this part, recipients and subrecipients in Continuums of Care designated as HPCs may also use grant funds to provide housing relocation and stabilization services and short- and/or medium-term rental assistance to individuals and families at risk of homelessness as set forth in 24 CFR 576.103 and 24 CFR 576.104, if necessary to prevent the individual or family from becoming homeless. Activities must be carried out in accordance with the plan submitted in the application. When carrying out housing relocation and stabilization services and short- and/or medium-term rental assistance, the written standards set forth in § 578.7(a)(9)(v) and recordkeeping requirements of 24 CFR 576.500 apply. Subpart F—Program Requirements § 578.73 Matching requirements. (a) In general. (b) Cash sources. (c) In-kind contributions. (2) The requirements of 2 CFR 200.306, with the exception of § 200.306(b)(5) apply. (3) Before grant execution, services to be provided by a third party must be documented by a memorandum of understanding (MOU) between the recipient or subrecipient and the third party that will provide the services. Services provided by individuals must be valued at rates consistent with those ordinarily paid for similar work in the recipient's or subrecipient's organization. If the recipient or subrecipient does not have employees performing similar work, the rates must be consistent with those ordinarily paid by other employers for similar work in the same labor market. (i) The MOU must establish the unconditional commitment, except for selection to receive a grant, by the third party to provide the services, the specific service to be provided, the profession of the persons providing the service, and the hourly cost of the service to be provided. (ii) During the term of the grant, the recipient or subrecipient must keep and make available, for inspection, records documenting the service hours provided. [77 FR 45442, July 31, 2012, as amended at 80 FR 75940, Dec. 7, 2015] § 578.75 General operations. (a) State and local requirements. (2) Services provided with assistance under this part must be provided in compliance with all applicable State and local requirements, including licensing requirements. (b) Housing standards. (1) Before any assistance will be provided on behalf of a program participant, the recipient, or subrecipient, must physically inspect each unit to assure that the unit meets 24 CFR 5.703. Assistance will not be provided for units that fail to meet 24 CFR 5.703, unless the owner corrects any deficiencies within 30 days from the date of the initial inspection and the recipient or subrecipient verifies that all deficiencies have been corrected. (2) Recipients or subrecipients must inspect all units at least annually during the grant period to ensure that the units continue to meet 24 CFR 5.703. (3) The requirements in 24 CFR 5.705 through 5.713 do not apply. (c) Suitable dwelling size. (1) Children of opposite sex, other than very young children, may not be required to occupy the same bedroom or living/sleeping room. (2) If household composition changes during the term of assistance, recipients and subrecipients may relocate the household to a more appropriately sized unit. The household must still have access to appropriate supportive services. (d) Meals. (e) Ongoing assessment of supportive services. (f) Residential supervision. (g) Participation of homeless individuals. (2) Each recipient and subrecipient of assistance under this part must, to the maximum extent practicable, involve homeless individuals and families through employment; volunteer services; or otherwise in constructing, rehabilitating, maintaining, and operating the project, and in providing supportive services for the project. (h) Supportive service agreement. (i) Retention of assistance after death, incarceration, or institutionalization for more than 90 days of qualifying member. (j) Remaining program participants following bifurcation of a lease or eviction as a result of domestic violence. [77 FR 45442, July 31, 2012, as amended at 81 FR 80810, Nov. 16, 2016; 88 FR 30499, May 11, 2023] § 578.77 Calculating occupancy charges and rent. (a) Occupancy agreements and leases. (b) Calculation of occupancy charges. (1) 30 percent of the family's monthly adjusted income (adjustment factors include the number of people in the family, age of family members, medical expenses, and child-care expenses); (2) 10 percent of the family's monthly income; or (3) If the family is receiving payments for welfare assistance from a public agency and a part of the payments (adjusted in accordance with the family's actual housing costs) is specifically designated by the agency to meet the family's housing costs, the portion of the payments that is designated for housing costs. (4) Income. e.g., (c) Resident rent. Amount of rent. (ii) Income of program participants must be calculated in accordance with 24 CFR 5.609 and 24 CFR 5.611(a). (2) Review. (3) Verification. § 578.79 Limitation on transitional housing. A homeless individual or family may remain in transitional housing for a period longer than 24 months, if permanent housing for the individual or family has not been located or if the individual or family requires additional time to prepare for independent living. However, HUD may discontinue assistance for a transitional housing project if more than half of the homeless individuals or families remain in that project longer than 24 months. § 578.81 Term of commitment, repayment of grants, and prevention of undue benefits. (a) In general. (b) Conversion. (c) Repayment of grant funds. (d) Prevention of undue benefits. (e) Exception. (1) The sale or disposition of the property used for the project results in the use of the property for the direct benefit of very low-income persons; (2) All the proceeds are used to provide transitional or permanent housing that meet the requirements of this part; (3) Project-based rental assistance or operating cost assistance from any federal program or an equivalent State or local program is no longer made available and the project is meeting applicable performance standards, provided that the portion of the project that had benefitted from such assistance continues to meet the tenant income and rent restrictions for low-income units under section 42(g) of the Internal Revenue Code of 1986; or (4) There are no individuals and families in the Continuum of Care geographic area who are homeless, in which case the project may serve individuals and families at risk of homelessness. § 578.83 Displacement, relocation, and acquisition. (a) Minimizing displacement. (b) Temporary relocation. Existing Building Not Assisted under Title IV of the McKinney-Vento Act. (2) Existing Transitional Housing or Permanent Housing Projects Assisted Under Title IV of the McKinney-Vento Act. (i) Reimbursement for all reasonable out-of-pocket expenses incurred in connection with the temporary relocation, including the cost of moving to and from the temporarily occupied housing and any increase in monthly rent/occupancy charges and utility costs; and (ii) Appropriate advisory services, including reasonable advance written notice of: (A) The date and approximate duration of the temporary relocation; (B) The location of the suitable, decent, safe, and sanitary dwelling to be made available for the temporary period; (C) The reasonable terms and conditions under which the program participant will be able to occupy a suitable, decent, safe, and sanitary dwelling in the building or complex upon completion of the project; and (D) The provisions of paragraph (b)(2)(i) of this section. (c) Relocation assistance for displaced persons. In general. (2) Displaced person. (A) After the owner (or person in control of the site) issues a notice to move permanently from the property, or refuses to renew an expiring lease, if the move occurs after the date of the submission by the recipient or subrecipient of an application for assistance to HUD (or the recipient, as applicable) that is later approved and funded and the recipient or subrecipient has site control as evidenced in accordance with § 578.25(b); or (B) After the owner (or person in control of the site) issues a notice to move permanently from the property, or refuses to renew an expiring lease, if the move occurs after the date the recipient or subrecipient obtains site control, as evidenced in accordance with § 578.25(b), if that occurs after the application for assistance; or (C) Before the date described under paragraph (c)(2)(i)(A) or (B) of this section, if the recipient or HUD determines that the displacement resulted directly from acquisition, rehabilitation, or demolition for the project; or (D) By a tenant of a building that is not assisted under Title IV of the McKinney-Vento Act, if the tenant moves after execution of the agreement covering the acquisition, rehabilitation, or demolition of the property for the project; or (ii) For the purposes of paragraph (c) of this section, the term “displaced person” means any person (family, individual, business, nonprofit organization, or farm) that moves from real property, or moves personal property from real property, permanently, as a direct result of acquisition, rehabilitation, or demolition for a project. This includes any permanent, involuntary move for a project that is made by a program participant occupying transitional housing or permanent housing assisted under Title IV of the McKinney-Vento Act, if any one of the following three situations occurs: (A) The program participant moves after execution of the agreement covering the acquisition, rehabilitation, or demolition of the property for the project and is either not eligible to return upon project completion or the move occurs before the program participant is provided written notice offering the program participant an opportunity to occupy a suitable, decent, safe, and sanitary dwelling in the same building or complex upon project completion under reasonable terms and conditions. Such reasonable terms and conditions must include a lease (or occupancy agreement, as applicable) consistent with Continuum of Care program requirements, including a monthly rent or occupancy charge and monthly utility costs that does not exceed the maximum amounts established in § 578.77; or (B) The program participant is required to relocate temporarily, does not return to the building or complex, and any one of the following situations occurs: ( 1 ( 2 ( 3 (C) The program participant is required to move to another unit in the same building or complex, and any one of the following situations occurs: ( 1 ( 2 ( 3 (iii) Notwithstanding the provisions of paragraph (c)(2)(i) or (ii) of this section, a person does not qualify as a “displaced person” if: (A) The person has been evicted for serious or repeated violation of the terms and conditions of the lease or occupancy agreement; the eviction complied with applicable federal, State, or local requirements (see § 578.91); and the recipient or subrecipient determines that the eviction was not undertaken for the purpose of evading the obligation to provide relocation assistance; (B) The person moved into the property after the submission of the application but, before signing a lease or occupancy agreement and commencing occupancy, was provided written notice of the project's possible impact on the person ( e.g., (C) The person is ineligible under 49 CFR 24.2(a)(9)(ii)); (D) The person is a program participant occupying transitional housing or permanent housing assisted under Title IV of the Act who must move as a direct result of the length-of- occupancy restriction under § 578.79; or (E) HUD determines that the person was not displaced as a direct result of acquisition, rehabilitation, or demolition for the project. (iv) The recipient may request, at any time, HUD's determination of whether a displacement is or would be covered under this section. (3) Initiation of negotiations. (d) Real property acquisition requirements. (e) Appeals. § 578.85 Timeliness standards. (a) In general. (b) Construction activities. (1) Construction activities must begin within 9 months of the later of signing of the grant agreement or of signing an addendum to the grant agreement authorizing use of grant funds for the project. (2) Construction activities must be completed within 24 months of signing the grant agreement. (3) Activities that cannot begin until after construction activities are completed must begin within 3 months of the date that construction activities are completed. (c) Distribution. (1) Distribute the funds to subrecipients (in advance of expenditures by the subrecipients); (2) Distribute the appropriate portion of the funds to a subrecipient no later than 45 days after receiving an approvable request for such distribution from the subrecipient; and (3) Draw down funds at least once per quarter of the program year, after eligible activities commence. § 578.87 Limitation on use of funds. (a) Maintenance of effort. (b) Equal participation of faith-based organizations. (c) Restriction on combining funds. (1) Leasing and acquisition, rehabilitation, or new construction; (2) Tenant-based rental assistance and acquisition, rehabilitation, or new construction; (3) Short- or medium-term rental assistance and acquisition, rehabilitation, or new construction; (4) Rental assistance and leasing; or (5) Rental assistance and operating. (d) Program fees. [77 FR 45442, July 31, 2012, as amended at 80 FR 75804, Dec. 4, 2015;80 FR 75940, Dec. 7, 2015; 81 FR 19418, Apr. 4, 2016] § 578.89 Limitation on use of grant funds to serve persons defined as homeless under other federal laws. (a) Application requirement. (b) Limit. (c) Exception. § 578.91 Termination of assistance to program participants. (a) Termination of assistance. (b) Due process. (1) Providing the program participant with a written copy of the program rules and the termination process before the participant begins to receive assistance; (2) Written notice to the program participant containing a clear statement of the reasons for termination; (3) A review of the decision, in which the program participant is given the opportunity to present written or oral objections before a person other than the person (or a subordinate of that person) who made or approved the termination decision; and (4) Prompt written notice of the final decision to the program participant. (c) Hard-to-house populations. § 578.93 Fair Housing and Equal Opportunity. (a) Nondiscrimination and equal opportunity requirements. (b) Housing for specific subpopulations. (1) The housing may be limited to one sex where such housing consists of a single structure with shared bedrooms or bathing facilities such that the considerations of personal privacy and the physical limitations of the configuration of the housing make it appropriate for the housing to be limited to one sex; (2) The housing may be limited to a specific subpopulation, so long as admission does not discriminate against any protected class under federal nondiscrimination laws in 24 CFR 5.105 ( e.g., (3) The housing may be limited to families with children. (4) If the housing has in residence at least one family with a child under the age of 18, the housing may exclude registered sex offenders and persons with a criminal record that includes a violent crime from the project so long as the child resides in the housing. (5) Sober housing may exclude persons who refuse to sign an occupancy agreement or lease that prohibits program participants from possessing, using, or being under the influence of illegal substances and/or alcohol on the premises. (6) If the housing is assisted with funds under a federal program that is limited by federal statute or Executive Order to a specific subpopulation, the housing may be limited to that subpopulation ( e.g., (7) Recipients may limit admission to or provide a preference for the housing to subpopulations of homeless persons and families who need the specialized supportive services that are provided in the housing ( e.g., (c) Affirmatively furthering fair housing. (1) Affirmatively market their housing and supportive services to eligible persons regardless of race, color, national origin, religion, sex, age, familial status, or handicap who are least likely to apply in the absence of special outreach, and maintain records of those marketing activities; (2) Where a recipient encounters a condition or action that impedes fair housing choice for current or prospective program participants, provide such information to the jurisdiction that provided the certification of consistency with the Consolidated Plan; and (3) Provide program participants with information on rights and remedies available under applicable federal, State and local fair housing and civil rights laws. (d) Accessibility and integrative housing and services for persons with disabilities. (e) Prohibition against involuntary family separation. § 578.95 Conflicts of interest. (a) Procurement. (b) Continuum of Care board members. (c) Organizational conflict. (d) Other conflicts. (1) No covered person, meaning a person who is an employee, agent, consultant, officer, or elected or appointed official of the recipient or its subrecipients and who exercises or has exercised any functions or responsibilities with respect to activities assisted under this part, or who is in a position to participate in a decision-making process or gain inside information with regard to activities assisted under this part, may obtain a financial interest or benefit from an assisted activity, have a financial interest in any contract, subcontract, or agreement with respect to an assisted activity, or have a financial interest in the proceeds derived from an assisted activity, either for him or herself or for those with whom he or she has immediate family or business ties, during his or her tenure or during the one-year period following his or her tenure. (2) Exceptions. (i) Threshold requirements. (A) Disclosure of the nature of the conflict, accompanied by a written assurance, if the recipient is a government, that there has been public disclosure of the conflict and a description of how the public disclosure was made; and if the recipient is a private nonprofit organization, that the conflict has been disclosed in accordance with their written code of conduct or other conflict-of-interest policy; and (B) An opinion of the recipient's attorney that the interest for which the exception is sought would not violate State or local law, or if the subrecipient is a private nonprofit organization, the exception would not violate the organization's internal policies. (ii) Factors to be considered for exceptions. (A) Whether the exception would provide a significant cost benefit or an essential degree of expertise to the program or project that would otherwise not be available; (B) Whether an opportunity was provided for open competitive bidding or negotiation; (C) Whether the affected person has withdrawn from his or her functions, responsibilities, or the decision-making process with respect to the specific activity in question; (D) Whether the interest or benefit was present before the affected person was in the position described in paragraph (c)(1) of this section; (E) Whether undue hardship will result to the recipient, the subrecipient, or the person affected, when weighed against the public interest served by avoiding the prohibited conflict; (F) Whether the person affected is a member of a group or class of persons intended to be the beneficiaries of the assisted activity, and the exception will permit such person to receive generally the same interests or benefits as are being made available or provided to the group or class; and (G) Any other relevant considerations. [77 FR 45442, July 31, 2012, as amended at 80 FR 75940, Dec. 7, 2015] § 578.97 Program income. (a) Defined. (b) Use. (c) Rent and occupancy charges. § 578.99 Applicability of other Federal requirements. In addition to the requirements set forth in 24 CFR part 5, use of assistance provided under this part must comply with the following federal requirements: (a) Environmental review. (b) Section 6002 of the Solid Waste Disposal Act. (1) Procure items designated in guidelines of the Environmental Protection Agency (EPA) at 40 CFR part 247 that contain the highest percentage of recovered materials practicable, consistent with maintaining a satisfactory level of competition, where the purchase price of the item exceeds $10,000 or the value of the quantity acquired in the preceding fiscal year exceeded $10,000; (2) Procure solid waste management services in a manner that maximizes energy and resource recovery; and (3) Must have established an affirmative procurement program for the procurement of recovered materials identified in the EPA guidelines. (c) Transparency Act Reporting. www.fsrs.gov (d) The Coastal Barrier Resources Act of 1982 et seq. (e) Applicability of uniform administrative requirements, cost principles, and audit requirements for Federal awards. (f) Lead-based paint. (g) Audit. (h) Davis-Bacon Act. (i) Section 3 of the Housing and Urban Development Act. (j) Protections for victims of domestic violence, dating violence, sexual assault, or stalking General. (2) Definition of covered housing provider. (i) The owner or landlord, which may be the recipient or subrecipient, for purposes of 24 CFR 5.2005(d)(1) and 5.2009(a); (ii) The recipient, subrecipient, and owner or landlord for purposes of 24 CFR 5.2005(d)(2) through (d)(4); and (iii) The recipient, subrecipient, and owner or landlord for purposes of 24 CFR 5.2007. However, the recipient or subrecipient may limit documentation requests under § 5.2007 to only the recipient or subrecipient, provided that: (A) This limitation is made clear in both the notice described under 24 CFR 5.2005(a)(1) and the rental assistance agreement; (B) The entity designated to receive documentation requests determines whether the program participant is entitled to protection under VAWA and immediately advise the program participant of the determination; and (C) If the program participant is entitled to protection, the entity designated to receive documentation requests must notify the owner in writing that the program participant is entitled to protection under VAWA and work with the owner on the program participant's behalf. Any further sharing or disclosure of the program participant's information will be subject to the requirements in 24 CFR 5.2007. (3) Effective date. (4) Notification requirements. (A) When an individual or family is denied permanent housing or transitional housing; (B) When a program participant is admitted to permanent housing or transitional housing; (C) When a program participant receives notification of eviction; and (D) When a program participant is notified of termination of assistance. (ii) When grant funds are used for rental assistance, the recipient or subrecipient must ensure that the owner or manager of the housing provides the notice and certification form described in 24 CFR 5.2005(a) to the program participant with any notification of eviction. This commitment and the confidentiality requirements under 24 CFR 5.2007(c) must be set forth in a contract with the owner or landlord. (5) Contract, lease, and occupancy agreement provisions. (A) The requirement to comply with 24 CFR part 5, subpart L; and (B) Where the owner or landlord of the housing will have a lease with a program participant, the requirement to include a lease provision that include all requirements that apply to tenants, the owner or the lease under 24 CFR part 5, subpart L, as supplemented by this part, including the prohibited bases for eviction and restrictions on construing lease terms under 24 CFR 5.2005(b) and (c). (ii) The recipient or subrecipient must include in any lease, sublease, and occupancy agreement with the program participant a provision that include all requirements that apply to tenants, the owner or the lease under 24 CFR part 5, subpart L, as supplemented by this part, including the prohibited bases for eviction and restrictions on construing lease terms under 24 CFR 5.2005(b) and (c). The lease, sublease, and occupancy agreement may specify that the protections under 24 CFR part 5, subpart L, apply only during the period of assistance under the Continuum of Care Program. The period of assistance for housing where grant funds were used for acquisition, construction, or rehabilitation is 15 years from the date of initial occupancy or date of initial service provision. (iii) Except for tenant-based rental assistance, recipients and subrecipients must require that any lease, sublease, or occupancy agreement with a program participant permits the program participant to terminate the lease, sublease, or occupancy agreement without penalty if the recipient or subrecipient determines that the program participant qualifies for an emergency transfer under the emergency transfer plan established under paragraph (j)(8) of this section. (iv) For tenant-based rental assistance, the recipient or subrecipient must enter into a contract with the owner or landlord of the housing that: (A) Requires the owner or landlord of the housing to comply with the provisions of 24 CFR part 5, subpart L; and (B) Requires the owner or landlord of the housing to include a lease provision that include all requirements that apply to tenants, the owner or the lease under 24 CFR part 5, subpart L, as supplemented by this part, including the prohibited bases for eviction and restrictions on construing lease terms under 24 CFR 5.005(b) and (c). The lease may specify that the protections under 24 CFR part 5, subpart L, only apply while the program participant receives tenant-based rental assistance under the Continuum of Care Program. (6) Transition. (ii) For leases for tenant-based rental assistance existing prior to the effective date in paragraph (j)(2) of this section, recipients and subrecipients must enter into a contract under paragraph (j)(6)(iv) of this section before the next renewal of the lease. (7) Bifurcation. (i) If a family who is receiving tenant-based rental assistance under this part separates under 24 CFR 5.2009(a), the family's tenant-based rental assistance and any utility assistance shall continue for the family member(s) who are not evicted or removed. (ii) If a family living in permanent supportive housing separates under 24 CFR 5.2009(a), and the family's eligibility for the housing was based on the evicted individual's disability or chronically homeless status, the remaining tenants may stay in the project as provided under § 578.75(i)(2). Otherwise, if a family living in a project funded under this part separates under 24 CFR 5.2009(a), the remaining tenant(s) will be eligible to remain in the project. (8) Emergency transfer plan. (i) For families receiving tenant-based rental assistance, the plan must specify what will happen with respect to the non-transferring family member(s), if the family separates in order to effect an emergency transfer. (ii) For families living in units that are otherwise assisted under this part (assisted units), the required policies must provide that for program participants who qualify for an emergency transfer but a safe unit is not immediately available for an internal emergency transfer, the individual or family shall have priority over all other applicants for rental assistance, transitional housing, and permanent supportive housing projects funded under this part, provided that: The individual or family meets all eligibility criteria required by Federal law or regulation or HUD NOFA; and the individual or family meets any additional criteria or preferences established in accordance with § 578.93(b)(1), (4), (6), or (7). The individual or family shall not be required to meet any other eligibility criteria or preferences for the project. The individual or family shall retain their original homeless or chronically homeless status for the purposes of the transfer. (9) Protections with respect to safe havens. (i) No individual may be denied admission to or removed from the safe haven on the basis or as a direct result of the fact that the individual is or has been a victim of domestic violence, dating violence, sexual assault, or stalking, if the individual otherwise qualifies for admission or occupancy. (iii) The terms “affiliated individual,” “dating violence,” “domestic violence,” “sexual assault,” and “stalking” are defined in 24 CFR 5.2003. [77 FR 45442, July 31, 2012, as amended at 80 FR 75940, Dec. 7, 2015; 81 FR 80810, Nov. 16, 2016; 81 FR 87812, Dec. 6, 2016; 85 FR 61568, Sept. 29, 2020] Subpart G—Grant Administration § 578.101 Technical assistance. (a) Purpose. (b) Defined. (c) Set-aside. (d) Awards. § 578.103 Recordkeeping requirements. (a) In general. (1) Continuum of Care records. (i) Evidence that the Board selected by the Continuum of Care meets the requirements of § 578.5(b); (ii) Evidence that the Continuum has been established and operated as set forth in subpart B of this part, including published agendas and meeting minutes, an approved Governance Charter that is reviewed and updated annually, a written process for selecting a board that is reviewed and updated at least once every 5 years, evidence required for designating a single HMIS for the Continuum, and monitoring reports of recipients and subrecipients; (iii) Evidence that the Continuum has prepared the application for funds as set forth in § 578.9, including the designation of the eligible applicant to be the collaborative applicant. (2) Unified funding agency records. (3) Homeless status. (4) Chronically homeless status. (i) For paragraph (1) of the “Chronically homeless” definition in § 578.3, evidence that the individual is a “homeless individual with a disability” as defined in section 401(9) of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11360(9)) must include: (A) Evidence of homeless status as set forth in paragraph (a)(3) of this section; and (B) Evidence of a disability. In addition to the documentation required under paragraph (a)(4)(i)(A) of this section, the procedures must require documentation at intake of the evidence relied upon to establish and verify the disability of the person applying for homeless assistance. The recipient must keep these records for 5 years after the end of the grant term. Acceptable evidence of the disability includes: ( 1 ( 2 ( 3 e.g., ( 4 1 2 3 5 ( 5 (ii) For paragraph (1)(i) of the “Chronically homeless” definition in § 578.3, evidence that the individual lives in a place not meant for human habitation, a safe haven, or an emergency shelter, which includes: (A) An HMIS record or record from a comparable database; (B) A written observation by an outreach worker of the conditions where the individual was living; (C) A written referral by another housing or service provider; or (D) Where evidence in paragraphs (a)(4)(ii)(A) through (C) of this section cannot be obtained, a certification by the individual seeking assistance, which must be accompanied by the intake worker's documentation of the living situation of the individual or family seeking assistance and the steps taken to obtain evidence in paragraphs (a)(4)(ii)(A) through (C). (iii) For paragraph (1)(ii) of the “Chronically homeless” definition in § 578.3, evidence must include a combination of the evidence described in paragraphs (a)(4)(ii)(A) through (D) of this section, subject to the following conditions: (A) Third-party documentation of a single encounter with a homeless service provider on a single day within 1 month is sufficient to consider an individual as homeless and living or residing in a place not meant for human habitation, a safe haven, or an emergency shelter for the entire calendar month (e.g., an encounter on May 5, 2015, counts for May 1—May 31, 2015), unless there is evidence that there have been at least 7 consecutive nights not living or residing in a place not meant for human habitation, a safe haven, or an emergency shelter during that month (e.g., evidence in HMIS of a stay in transitional housing); (B) Each break in homelessness of at least 7 consecutive nights not living or residing in a place not meant for human habitation, a safe haven, or in an emergency shelter between separate occasions must be documented with the evidence described in paragraphs (a)(4)(ii)(A) through (D) of this section; (C) Evidence of stays in institutional care facilities fewer than 90 days included in the total of at least 12 months of living or residing in a place not meant for human habitation, a safe haven, or an emergency shelter must include the evidence in paragraphs (a)(4)(iv)(A) through (B) of this section and evidence described in paragraphs (a)(4)(ii)(A) through (D) of this section that the individual was living or residing in a place not meant for human habitation, a safe haven, or an emergency shelter immediately prior to entering the institutional care facility; and (D) For at least 75 percent of the chronically homeless individuals and families assisted by a recipient in a project during an operating year, no more than 3 months of living or residing in a place not meant for human habitation, a safe haven, or an emergency shelter may be documented using the evidence in paragraph (a)(4)(ii)(D) of this section for each assisted chronically homeless individual or family. This limitation does not apply to documentation of breaks in homelessness between separate occasions, which may be documented entirely based on a self-report by the individual seeking assistance. (iv) If an individual qualifies as chronically homeless under paragraph (2) of the “Chronically homeless” definition in § 578.3 because he or she has been residing in an institutional care facility for fewer than 90 days and met all of the criteria in paragraph (1) of the definition, before entering that facility, evidence must include the following: (A) Discharge paperwork or a written or oral referral from a social worker, case manager, or other appropriate official of the institutional care facility stating the beginning and end dates of the time residing in the institutional care facility. All oral statements must be recorded by the intake worker; or (B) Where the evidence in paragraph (a)(4)(iv)(A) of this section is not obtainable, a written record of the intake worker's due diligence in attempting to obtain the evidence described in paragraph (a)(4)(iv)(A) and a certification by the individual seeking assistance that states that he or she is exiting or has just exited an institutional care facility where he or she resided for fewer than 90 days; and (C) Evidence as set forth in paragraphs (a)(4)(i) through (iii) of this section that the individual met the criteria in paragraph (1) of the definition for “Chronically homeless” in § 578.3, immediately prior to entry into the institutional care facility. (v) If a family qualifies as chronically homeless under paragraph (3) of the “Chronically homeless” definition in § 578.3, evidence must include the evidence as set forth in paragraphs (a)(4)(i) through (iv) of this section that the adult head of household (or if there is no adult in the family, a minor head of household) met all of the criteria in paragraph (1) or (2) of the definition. (5) At risk of homelessness status. (6) Moves for victims of domestic violence, dating violence, sexual assault, and stalking. (i) For each program participant who moved to a different Continuum of Care due to imminent threat of further domestic violence, dating violence, sexual assault, or stalking under § 578.51(c)(3), each recipient or subrecipient of assistance under this part must retain: (A) Documentation of the original incidence of domestic violence, dating violence, sexual assault, or stalking, only if the original violence is not already documented in the program participant's case file. This may be written observation of the housing or service provider; a letter or other documentation from a victim service provider, social worker, legal assistance provider, pastoral counselor, mental health provider, or other professional from whom the victim has sought assistance; medical or dental records; court records or law enforcement records; or written certification by the program participant to whom the violence occurred or by the head of household. (B) Documentation of the reasonable belief of imminent threat of further domestic violence, dating violence, or sexual assault or stalking, which would include threats from a third-party, such as a friend or family member of the perpetrator of the violence. This may be written observation by the housing or service provider; a letter or other documentation from a victim service provider, social worker, legal assistance provider, pastoral counselor, mental health provider, or other professional from whom the victim has sought assistance; current restraining order; recent court order or other court records; law enforcement report or records; communication records from the perpetrator of the violence or family members or friends of the perpetrator of the violence, including emails, voicemails, text messages, and social media posts; or a written certification by the program participant to whom the violence occurred or the head of household. (ii) Data on emergency transfers requested under 24 CFR 5.2005(e) and § 578.99, pertaining to victims of domestic violence, dating violence, sexual assault, or stalking, including data on the outcomes of such requests. (7) Annual income. (i) Income evaluation form specified by HUD and completed by the recipient or subrecipient; and (ii) Source documents ( e.g., (iii) To the extent that source documents are unobtainable, a written statement by the relevant third party ( e.g., (iv) To the extent that source documents and third-party verification are unobtainable, the written certification by the program participant of the amount of income that the program participant is reasonably expected to receive over the 3-month period following the evaluation. (8) Program participant records. (i) The services and assistance provided to that program participant, including evidence that the recipient or subrecipient has conducted an annual assessment of services for those program participants that remain in the program for more than a year and adjusted the service package accordingly, and including case management services as provided in § 578.37(a)(1)(ii)(F); and (ii) Where applicable, compliance with the termination of assistance requirement in § 578.91. (9) Housing standards. (10) Services provided. (11) Match. (12) Conflicts of interest. (13) Homeless participation. (14) Faith-based activities. (15) Affirmatively Furthering Fair Housing. (16) Other federal requirements. (17) Subrecipients and contractors. (ii) The recipient must retain documentation of monitoring subrecipients, including any monitoring findings and corrective actions required. (iii) The recipient and its subrecipients must retain copies of all procurement contracts and documentation of compliance with the procurement requirements in 2 CFR part 200, subpart D. (18) Other records specified by HUD. (b) Confidentiality. (1) All records containing protected identifying information of any individual or family who applies for and/or receives Continuum of Care assistance will be kept secure and confidential; (2) The address or location of any family violence project assisted with Continuum of Care funds will not be made public, except with written authorization of the person responsible for the operation of the project; and (3) The address or location of any housing of a program participant will not be made public, except as provided under a preexisting privacy policy of the recipient or subrecipient and consistent with State and local laws regarding privacy and obligations of confidentiality; (c) Period of record retention. (1) Documentation of each program participant's qualification as a family or individual at risk of homelessness or as a homeless family or individual and other program participant records must be retained for 5 years after the expenditure of all funds from the grant under which the program participant was served; and (2) Where Continuum of Care funds are used for the acquisition, new construction, or rehabilitation of a project site, records must be retained until 15 years after the date that the project site is first occupied, or used, by program participants. (d) Access to records. Federal Government rights. (2) Public rights. (e) Reports. [77 FR 45442, July 31, 2012, as amended at 80 FR 75804, Dec. 4, 2015; 80 FR 75940, Dec. 7, 2015; 80 FR 80258, Dec. 24, 2015; 81 FR 80811, Nov. 16, 2016] § 578.105 Grant and project changes. (a) For Unified Funding Agencies and Continuums having only one recipient. (2) Approval of substitution of the recipient is contingent on the new recipient meeting the capacity criteria in the NOFA under which the grant was awarded, or the most recent NOFA. Approval of shifting funds between activities and changing subpopulations is contingent on the change being necessary to better serve eligible persons within the geographic area and ensuring that the priorities established under the NOFA in which the grant was originally awarded, or the most recent NOFA, are met. (b) For Continuums having more than one recipient. (2) Approval of substitution of the recipient is contingent on the new recipient meeting the capacity criteria in the NOFA under which the grant was awarded, or the most recent NOFA. Approval of shifting funds between activities and changing subpopulations is contingent on the change being necessary to better serve eligible persons within the geographic area and ensuring that the priorities established under the NOFA in which the grant was originally awarded, or the most recent NOFA, are met. (c) Documentation of changes not requiring a grant amendment. § 578.107 Sanctions. (a) Performance reviews. e.g., (2) If HUD determines preliminarily that the recipient or one of its subrecipients has not complied with a program requirement, HUD will give the recipient notice of this determination and an opportunity to demonstrate, within the time prescribed by HUD and on the basis of substantial facts and data that the recipient has complied with the requirements. HUD may change the method of payment to require the recipient to submit documentation before payment and obtain HUD's prior approval each time the recipient draws down funds. To obtain prior approval, the recipient may be required to manually submit its payment requests and supporting documentation to HUD in order to show that the funds to be drawn down will be expended on eligible activities in accordance with all program requirements. (3) If the recipient fails to demonstrate to HUD's satisfaction that the activities were carried out in compliance with program requirements, HUD may take one or more of the remedial actions or sanctions specified in paragraph (b) of this section. (b) Remedial actions and sanctions. (1) HUD may instruct the recipient to submit and comply with proposals for action to correct, mitigate, and prevent noncompliance with program requirements, including: (i) Preparing and following a schedule of actions for carrying out activities and projects affected by the noncompliance, including schedules, timetables, and milestones necessary to implement the affected activities and projects; (ii) Establishing and following a management plan that assigns responsibilities for carrying out the remedial actions; (iii) Canceling or revising activities or projects likely to be affected by the noncompliance, before expending grant funds for them; (iv) Reprogramming grant funds that have not yet been expended from affected activities or projects to other eligible activities or projects; (v) Suspending disbursement of grant funds for some or all activities or projects; (vi) Reducing or terminating the remaining grant of a subrecipient and either reallocating those funds to other subrecipients or returning funds to HUD; and (vii) Making matching contributions before or as draws are made from the recipient's grant. (2) HUD may change the method of payment to a reimbursement basis. (3) HUD may suspend payments to the extent HUD determines necessary to preclude the further expenditure of funds for affected activities or projects. (4) HUD may continue the grant with a substitute recipient of HUD's choosing. (5) HUD may deny matching credit for all or part of the cost of the affected activities and require the recipient to make further matching contributions to make up for the contribution determined to be ineligible. (6) HUD may require the recipient to reimburse the recipient's line of credit in an amount equal to the funds used for the affected activities. (7) HUD may reduce or terminate the remaining grant of a recipient. (8) HUD may condition a future grant. (9) HUD may take other remedies that are legally available. (c) Recipient sanctions. (d) Deobligation. (1) If the timeliness standards in § 578.85 are not met; (2) If HUD determines that delays completing construction activities for a project will mean that the funds for other funded activities cannot reasonably be expected to be expended for eligible costs during the remaining term of the grant; (3) If the actual total cost of acquisition, rehabilitation, or new construction for a project is less than the total cost agreed to in the grant agreement; (4) If the actual annual leasing costs, operating costs, supportive services costs, rental assistance costs, or HMIS costs are less than the total cost agreed to in the grant agreement for a one-year period; (5) Program participants have not moved into units within 3 months of the time that the units are available for occupancy; and (6) The grant agreement may set forth in detail other circumstances under which funds may be deobligated and other sanctions may be imposed. § 578.109 Closeout. (a) In general. (b) Reports. (c) Closeout agreement. (1) Identification of any closeout costs or contingent liabilities subject to payment with Continuum of Care program funds after the closeout agreement is signed; (2) Identification of any unused grant funds to be deobligated by HUD; (3) Identification of any program income on deposit in financial institutions at the time the closeout agreement is signed; (4) Description of the recipient's responsibility after closeout for: (i) Compliance with all program requirements in using program income on deposit at the time the closeout agreement is signed and in using any other remaining Continuum of Care program funds available for closeout costs and contingent liabilities; (ii) Use of real property assisted with Continuum of Care program funds in accordance with the terms of commitment and principles; (iii) Use of personal property purchased with Continuum of Care program funds; and (iv) Compliance with requirements governing program income received subsequent to grant closeout. (5) Other provisions appropriate to any special circumstances of the grant closeout, in modification of or in addition to the obligations in paragraphs (c)(1) through (4) of this section. [77 FR 45442, July 31, 2012, as amended at 80 FR 75940, Dec. 7, 2015]

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