PART 1006—NATIVE HAWAIIAN HOUSING BLOCK GRANT PROGRAM Authority: 12 U.S.C. 1701x, 1701x-1; 25 U.S.C. 4221 et seq.; Source: 67 FR 40776, June 13, 2002, unless otherwise noted. Subpart A—General § 1006.1 Applicability. The requirements and procedure of this part apply to grants under the Native Hawaiian Housing Block Grant (NHHBG) Program, authorized by the Hawaiian Homelands Homeownership Act of 2000 (HHH Act), which adds Title VIII—Housing Assistance For Native Hawaiians (25 U.S.C. 4221 et seq. et seq. § 1006.10 Definitions. The following definitions apply in this part: Act Adjusted income (1) Youths, students, and persons with disabilities. (i) Who is under 18 years of age; or (ii) Who is: (A) 18 years of age or older; and (B) A person with disabilities or a full-time student. (2) Elderly and disabled families. (3) Medical and attendant expenses. (i) Medical expenses, in the case of an elderly or disabled family; and (ii) Reasonable attendant care and auxiliary apparatus expenses for each family member who is a person with disabilities, to the extent necessary to enable any member of the family (including a member who is a person with disabilities) to be employed. (4) Child care expenses. (5) Earned income of minors. (6) Travel expenses. (7) Other amounts. Affordable Housing Annual income (1) “Annual income” as defined for HUD's Section 8 programs in 24 CFR part 5, subpart F (except when determining the income of a homebuyer for an owner-occupied rehabilitation project, the value of the homeowner's principal residence may be excluded from the calculation of net family assets); or (2) The definition of income as used by the U.S. Census Bureau. This definition includes: (i) Wages, salaries, tips, commissions, etc.; (ii) Self-employment income; (iii) Farm self-employment income; (iv) Interest, dividends, net rental income, or income from estates or trusts; (v) Social security or railroad retirement; (vi) Supplemental Security Income, Aid to Families with Dependent Children, or other public assistance or public welfare programs; (vii) Retirement, survivor, or disability pensions; and (viii) Any other sources of income received regularly, including Veterans' (VA) payments, unemployment compensation, and alimony; or (3) Adjusted gross income as defined for purposes of reporting under Internal Revenue Service (IRS) Form 1040 series for individual Federal annual income tax purposes. Assistant Secretary Department of Hawaiian Home Lands (DHHL) et seq. Director Drug-Related Criminal Activity Elderly families; near-elderly families (1) In general. (i) For an elderly family, an elderly person; or (ii) For a near-elderly family, a near-elderly person. (2) Certain families included. (i) Two or more elderly persons or near-elderly persons, as the case may be, living together; and (ii) One or more persons described in paragraph (2)(i) of this definition living with one or more persons determined under the housing plan to be essential to their care or well-being. Elderly person Family Hawaiian Home Lands (1) Have the status as Hawaiian home lands under section 204 of the HHCA 1920 (42 Stat. 110); or (2) Are acquired pursuant to the HHCA 1920. Homebuyer payment Housing area Housing plan HUD Income Low-income family Median income (1) The median income for the housing area, which shall be determined by HUD; or (2) The median income for the State of Hawaii. NAHASDA et seq. Native Hawaiian (1) A citizen of the United States; and (2) A descendant of the aboriginal people, who, prior to 1778, occupied and exercised sovereignty in the area that currently constitutes the State of Hawaii, as evidenced by: (i) Genealogical records; (ii) Verification by kupuna (elders) or kama'aina (long-term community residents); or (iii) Birth records of the State of Hawaii. Native Hawaiian Housing Block Grant (NHHBG) Funds Near-elderly person Nonprofit Person with a disability, (1) Definition of person with a disability. “Person with a disability” means a person who: (i) Has a physical or mental impairment which substantially limits one or more major life activities; (ii) Has a record of having such an impairment; (iii) Is regarded as having such an impairment; (iv) Has a disability as defined in section 223 of the Social Security Act; or (v) Has a developmental disability as defined in section 102 of the Developmental Disabilities Assistance and Bill of Rights Act. (2) Definition of physical or mental impairment. For the purposes of this definition, the term “physical or mental impairment” means: (i) Any physiological disorder or condition, cosmetic disfigurement, or anatomical loss affecting one or more body systems, such as: neurological, musculoskeletal, special sense organs, respiratory (including speech organs), cardiovascular, reproductive, digestive, genitourinary, immune, circulatory, hemic, lymphatic, skin, and endocrine; or (ii) Any mental or psychological disorder such as intellectual disability, organic brain syndrome, emotional or mental illness, and specific learning disability. (3) Nonexhaustive list of physical and mental impairments. (4) Nonexhaustive list of major life activities. (i) Caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, sitting, reaching, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, writing, communicating, interacting with others, and working; and (ii) The operation of a major bodily function, such as the functions of the immune system, special sense organs and skin, normal cell growth, and digestive, genitourinary, bowel, bladder, neurological, brain, respiratory, circulatory, cardiovascular, endocrine, hemic, lymphatic, musculoskeletal, and reproductive systems. The operation of a major bodily function includes the operation of an individual organ within a body system. Project-based rental assistance Secretary Tenant-based rental assistance Transitional housing (1) Is designed to provide housing and appropriate supportive services to persons, including (but not limited to) deinstitutionalized individuals with disabilities, homeless individuals with disabilities, and homeless families with children; and (2) Has as its purpose facilitating the movement of individuals and families to independent living within a time period that is set by the DHHL or project owner before occupancy. [67 FR 40776, June 13, 2002, as amended at 89 FR 9760, Feb. 12, 2024] § 1006.20 Grants for affordable housing activities. (a) Annual grant. (1) The Director has submitted to HUD a housing plan for that fiscal year; and (2) HUD has determined that the housing plan complies with the requirements of § 1006.101. (b) Waiver. § 1006.30 Waivers. Upon determination of good cause, the Secretary may, subject to statutory limitations, waive any provision of this part and delegate this authority in accordance with section 106 of the Department of Housing and Urban Development Reform Act of 1989 (42 U.S.C. 3535(q)). Subpart B—Housing Plan § 1006.101 Housing plan requirements. The DHHL must submit a housing plan each year prior to the start of its fiscal year. The housing plan has two components, a five-year plan and a one-year plan, as follows: (a) Five-year plan. (1) Mission statement. (2) Goals and objectives. (3) Activities plans. (b) One-year plan. (1) Goals and objectives. (2) Statement of needs. (i) A description of the estimated housing needs and the need for assistance for the low-income families to be served by the DHHL, including a description of the manner in which the geographical distribution of assistance is consistent with: (A) The geographical needs of those families; and (B) Needs for various categories of housing assistance; and (ii) A description of the estimated housing needs for all families to be served by the DHHL. (3) Financial resources. (i) The NHHBG funds and other financial resources reasonably available to the DHHL to carry out eligible activities, including an explanation of the manner in which NHHBG funds will be used to leverage additional resources; and (ii) Eligible activities to be undertaken and their projected cost, including administrative expenses. (4) Affordable housing resources. (i) A description of the significant characteristics of the housing market in the State of Hawaii, including the availability of housing from other public sources and private market housing; (ii) The effect of the characteristics identified under paragraph (b)(4)(i) of this section, on the DHHL's decision to use the NHHBG for: (A) Rental assistance; (B) The production of new units; (C) The acquisition of existing units; or (D) The rehabilitation of units; (iii) A description of the structure, coordination, and means of cooperation between the DHHL and any other governmental entities in the development, submission, or implementation of the housing plan, including a description of: (A) The involvement of private, public, and nonprofit organizations and institutions; (B) The use of loan guarantees under section 184A of the Housing and Community Development Act of 1992; and (C) Other housing assistance provided by the United States, including loans, grants, and mortgage insurance; (iv) A description of the manner in which the plan will address the needs identified pursuant to paragraph (b)(2) of this section; (v) A description of: (A) Any existing or anticipated homeownership programs and rental programs to be carried out during the period covered by the plan; and (B) The requirements and assistance available under the programs referred to in paragraph (b)(4)(v)(A) of this section; (vi) A description of: (A) Any existing or anticipated housing rehabilitation programs necessary to ensure the long-term viability of housing to be carried out during the period covered by the plan; and (B) The requirements and assistance available under the programs referred to in paragraph (b)(4)(vi)(A) of this section; (vii) A description of: (A) All other existing or anticipated housing assistance provided by the DHHL during the period covered by the plan, including transitional housing; homeless housing; college housing; and supportive services housing; and (B) The requirements and assistance available under such programs; (viii) A description of: (A) Any housing to be demolished or disposed of; (B) A timetable for that demolition or disposition; (C) A financial analysis of the proposed demolition/disposition; and (D) Any additional information HUD may request with respect to that demolition or disposition. (ix) A description of the manner in which the DHHL will coordinate with welfare agencies in the State of Hawaii to ensure that residents of the affordable housing will be provided with access to resources to assist in obtaining employment and achieving self-sufficiency; (x) A description of the requirements established by the DHHL to: (A) Promote the safety of residents of the affordable housing; (B) Facilitate the undertaking of crime prevention measures; (C) Allow resident input and involvement, including the establishment of resident organizations; and (D) Allow for the coordination of crime prevention activities between the DHHL and local law enforcement officials; and (xi) A description of the entities that will carry out the activities under the plan, including the organizational capacity and key personnel of the entities. (5) Certifications of compliance. (i) Will comply with: (A) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq. et seq. (B) Other applicable Federal statutes; (ii) Will require adequate insurance coverage for housing units that are owned and operated or assisted with NHHBG funds, in compliance with the requirements of § 1006.330; (iii) Has policies in effect and available for review by HUD and the public governing the eligibility, admission, and occupancy of families for housing assisted with NHHBG funds and governing the selection of families receiving other assistance under the Act and this part; (iv) Has policies in effect and available for review by HUD and the public governing rents charged, including the methods by which such rents or homebuyer payments are determined, for housing assisted with NHHBG funds; and (v) Has policies in effect and available for review by HUD and the public governing the management and maintenance of rental and lease-purchase housing assisted with NHHBG funds. (c) Updates to plan In general. (2) Complete plans. (d) Amendments to plan. [67 FR 40776, June 13, 2002, as amended at 89 FR 9761, Feb. 12, 2024] § 1006.110 Review of plans. (a) Review In general. (2) Limitation. (3) Incomplete plans. (b) Notice In general. (2) Notice of reasons for determination of noncompliance. (i) The reasons for noncompliance; and (ii) Any modifications necessary for the plan to be in compliance. (3) Effect of HUD's failure to take action. Subpart C—Eligible Activities § 1006.201 Eligible affordable housing activities. Eligible affordable housing activities are development, housing services, housing management services, crime prevention and safety activities, and model activities. Affordable housing activities under this part are activities conducted in accordance with subpart D of this part to develop, operate, maintain, or support housing for rental or homeownership; or provide services with respect to affordable housing through the activities described in this subpart. NHHBG funds may only be used for eligible activities that are consistent with the DHHL's housing plan. [89 FR 9761, Feb. 12, 2024] § 1006.205 Development. (a) NHHBG funds may be used for the acquisition, new construction, reconstruction, or moderate or substantial rehabilitation of affordable housing for homeownership or rental, which may include: (1) Real property acquisition; (2) Acquisition of affordable housing; (3) Financing acquisition of affordable housing by homebuyers through: (i) Down payment assistance; (ii) Closing costs assistance; (iii) Direct lending; and (iv) Interest subsidies or other financial assistance (4) New construction of affordable housing; (5) Reconstruction of affordable housing; (6) Moderate rehabilitation of affordable housing, including but not limited to: (i) Lead-based paint hazards elimination or reduction; (ii) Improvements to provide physical accessibility for disabled persons; and (iii) Energy-related improvements; (7) Substantial rehabilitation of affordable housing, including but not limited to: (i) Lead-based paint hazards elimination or reduction; (ii) Improvements to provide physical accessibility for disabled persons; and (iii) Energy-related improvements; (8) Site improvement, including recreational areas and playgrounds for use by residents of affordable housing and on-site streets and sidewalks; (9) The development and rehabilitation of utilities, necessary infrastructure, and utility services; (10) Conversion; (11) Demolition; (12) Administration and planning; and (13) Other related activities, such as environmental review and architectural and engineering plans for the affordable housing project. (b) Multi-unit projects. [67 FR 40776, June 13, 2002, as amended at 89 FR 9761, Feb. 12, 2024] § 1006.210 Housing services. NHHBG funds may be used for the provision of housing-related services for affordable housing, including: (a) Housing counseling, as defined in § 5.100, in connection with rental or homeownership assistance must be carried out in accordance with 24 CFR 5.111; (b) The establishment and support of resident organizations and resident management corporations; (c) Energy auditing; (d) Activities related to the provisions of self-sufficiency and other services; (e) Homelessness prevention activities, which may include short term subsidies to defray rent and utility bills of an eligible family; (f) Payments to prevent foreclosure on a home; (g) Other services related to assisting owners, tenants, contractors, and other entities participating or seeking to participate in other housing activities assisted pursuant to the Act and this part. [67 FR 40776, June 13, 2002, as amended at 81 FR 90660, Dec. 14, 2016; 89 FR 9761, Feb. 12, 2024] § 1006.215 Housing management services. NHHBG funds may be used for the provision of management services for affordable housing, including: (a) The preparation of work specifications; (b) Loan processing; (c) Inspections; (d) Tenant selection; (e) Management of tenant-based rental assistance; (f) The costs of operation and maintenance of units occupied by NHHBG eligible families; and (g) Management of affordable housing projects. [67 FR 40776, June 13, 2002, as amended at 89 FR 9761, Feb. 12, 2024] § 1006.220 Crime prevention and safety activities. NHHBG funds may be used for the provision of safety, security, and law enforcement measures and activities appropriate to protect residents of affordable housing from crime, including the costs of: (a) Physical improvements for affordable housing to enhance security, such as, fences, monitors, locks, and additional lighting; (b) Security personnel for affordable housing; and (c) Equipment for patrols. § 1006.225 Model activities. NHHBG funds may be used for housing activities under model programs that are: (a) Designed to carry out the purposes of the Act and this part; and (b) Specifically approved by HUD as appropriate for those purposes. § 1006.227 Tenant-based or project-based rental assistance. NHHBG funds may be used for the provision of tenant-based rental assistance, which may include security deposits and first month's rent, and project-based rental assistance. (a) Rental assistance must comply with the requirements of this part and be provided to eligible families. (b) Rental assistance may be provided to eligible families both on and off the Hawaiian Home Lands provided such use is consistent with the applicable appropriations acts governing the use of the NHHBG funds. [89 FR 9761, Feb. 12, 2024] § 1006.230 Administrative and planning costs. Up to such amount as HUD may authorize, or such other limit as may be specified by statute, of each grant received under the Act may be used for any reasonable administrative and planning expenses of the DHHL relating to carrying out the Act and this part and activities assisted with NHHBG funds, including: (a) General management, oversight and coordination. (1) Salaries, wages, and related costs of the DHHL's staff. In charging costs to this category the DHHL may either include the entire salary, wages, and related costs allocable to the NHHBG Program of each person whose primary any (i) Developing systems and schedules for ensuring compliance with program requirements; (ii) Developing interagency agreements and agreements with entities receiving NHHBG funds; (iii) Monitoring NHHBG-assisted housing for progress and compliance with program requirements; (iv) Preparing reports and other documents related to the program for submission to HUD; (v) Coordinating the resolution of audit and monitoring findings; (vi) Evaluating program results against stated objectives; and (vii) Managing or supervising persons whose primary responsibilities with regard to the program include such assignments as those described in paragraphs (a)(1)(i) through (vi) of this section; (2) Travel costs incurred for official business in carrying out the program; (3) Administrative services performed under third party contracts or agreements, including such services as general legal services, accounting services, and audit services; and (4) Other costs for goods and services required for administration of the program, including such goods and services as rental or purchase of equipment, insurance, utilities, office supplies, and rental and maintenance (but not purchase) of office space. (b) Staff and overhead. e.g., (c) Public information. (d) Indirect costs. (e) Preparation of the housing plan and reports. (f) Other Federal requirements. [67 FR 40776, June 13, 2002, as amended at 80 FR 75945, Dec. 7, 2015; 89 FR 9761, Feb. 12, 2024] § 1006.235 Types of investments and forms of assistance. Subject to the requirements of this part and to the DHHL's housing plan, the DHHL has the discretion to use NHHBG funds for affordable housing activities in the form of equity investments, interest-bearing loans or advances, noninterest-bearing loans or advances, interest subsidies, the leveraging of private investments, and other forms of assistance that HUD determines to be consistent with the purposes of the Act. The DHHL has the right to establish the terms of assistance provided with NHHBG funds. [67 FR 40776, June 13, 2002, as amended at 89 FR 9761, Feb. 12, 2024] Subpart D—Program Requirements § 1006.301 Eligible families. (a) General. (b) Exception to low-income requirement Other Native Hawaiian families. (2) HUD approval. (3) Limitations. (ii) Non-low-income families cannot receive the same benefits provided low-income Native Hawaiian families. The amount of assistance non-low-income families may receive will be determined by DHHL as established in its written policies. (iii) The requirements set forth in paragraphs 3(i) and (ii) of this section do not apply to other families who are non-low income that DHHL has determined to be essential under paragraph (c) of this section. (c) Other families. (1) The presence of the family in the housing involved is essential to the well-being of Native Hawaiian families; and (2) The need for housing for the family cannot be reasonably met without the assistance. (d) Written policies. [89 FR 9761, Feb. 12, 2024] § 1006.305 Low-income requirement and income targeting. (a) In general. (1) In the case of rental housing, at the time of the family's initial occupancy of such unit; (2) In the case of housing for homeownership, at the time of purchase. When DHHL enters into a loan contract with the family for NHHBG assistance to purchase or construct a homeownership unit, the time of purchase means the time that loan contract is executed; (3) In the case of owner-occupied housing units, at the time the family receives NHHBG assistance; (4) In the case of a lease-purchase agreement for existing housing or for housing to be constructed, at the time the lease-purchase agreement is signed; and (5) In the case of emergency assistance to prevent homelessness or foreclosure, at the time the family receives NHHBG assistance. (b) Affordability requirements. (c) Enforceable agreements. (2) The agreements referred to in paragraph (c)(1) of this section shall provide for: (i) To the extent allowable by Federal and State law, the enforcement of the provisions of the Act and this part by the DHHL and HUD; and (ii) Remedies for breach of the provisions of the Act and this part. (d) Exception. [67 FR 40776, June 13, 2002, as amended at 89 FR 9762, Feb. 12, 2024] § 1006.306 Income verification for receipt of NHHBG assistance. (a) Initial determination of eligibility. (b) Periodic verification. [89 FR 9762, Feb. 12, 2024] § 1006.307 Non-low-income families. A family that was low-income at the times described in § 1006.305 but subsequently becomes a non-low-income family may continue to participate in the program in accordance with DHHL's admission and occupancy policies. The 10 percent limitation in § 1006.301(b)(3)(i) in this part shall not apply to such families. Such families may be made subject to the additional requirements in § 1006.301(b)(3)(ii) of this part based on those policies. [89 FR 9762, Feb. 12, 2024] § 1006.310 Rent and lease-purchase limitations. (a) Rents. (1) Maximum and minimum rent. (2) Flat or income-adjusted rent. i.e., (3) Utilities. (b) Lease-purchase. i.e., i.e., (c) Exception for certain homeownership payments. (d) Applicability. [89 FR 9762, Feb. 12, 2024] § 1006.315 Lease requirements. Except to the extent otherwise provided by or inconsistent with the laws of the State of Hawaii, in renting dwelling units in affordable housing assisted with NHHBG funds, the DHHL, owner, or manager must use leases that: (a) Do not contain unreasonable terms and conditions; (b) Require the DHHL, owner, or manager to maintain the housing in compliance with applicable local housing codes and quality standards; (c) Require the DHHL, owner, or manager to give adequate written notice of termination of the lease, which shall be the period of time required under applicable State or local law; (d) Specify that, with respect to any notice of eviction or termination, notwithstanding any State or local law, a resident shall be informed of the opportunity, before any hearing or trial, to examine any relevant documents, record, or regulations directly related to the eviction or termination; (e) Require that the DHHL, owner, or manager may not terminate the tenancy, during the term of the lease, except for serious or repeated violation of the terms and conditions of the lease, violation of applicable Federal, State, or local law, or for other good cause; and (f) Provide that the DHHL, owner, or manager may terminate the tenancy of a resident for any activity, engaged in by the resident, any member of the household of the resident, or any guest or other person under the control of the resident, that: (1) Threatens the health or safety of, or right to peaceful enjoyment of the premises by, other residents or employees of the DHHL, owner, or manager; (2) Threatens the health or safety of, or right to peaceful enjoyment of their premises by, persons residing in the immediate vicinity of the premises; or (3) Involves criminal activity (including drug-related criminal activity) on or off the premises. § 1006.320 Tenant or homebuyer selection. As a condition to receiving grant amounts under the Act, the DHHL must adopt and use written tenant and homebuyer selection policies and criteria that: (a) Are consistent with the purpose of providing housing for low-income families; (b) Are reasonably related to program eligibility and the ability of the tenant or homebuyer assistance applicant to perform the obligations of the lease; and (c) Provide for: (1) The selection of tenants and homebuyers from a written waiting list in accordance with the policies and goals set forth in the housing plan; and (2) The prompt notification in writing of any rejected applicant of the grounds for that rejection. § 1006.325 Maintenance, management and efficient operation. (a) Written policies. (b) Disposal of housing. § 1006.330 Insurance coverage. (a) In general. (b) Adequate insurance. (c) Loss covered. (d) Exception. (e) Contractor's coverage. § 1006.335 Use of nonprofit organizations and public-private partnerships. (a) Nonprofit organizations. (b) Public-private partnerships. § 1006.340 Treatment of program income. (a) Defined. (b) Authority to retain. (1) That income was realized after the initial disbursement of the NHHBG funds received by the DHHL; and (2) The DHHL agrees to use the program income for affordable housing activities in accordance with the provisions of the Act and this part; and (3) The DHHL disburses program income before disbursing additional NHHBG funds in accordance with 2 CFR 200.305. (c) Exclusion of amounts. [67 FR 40776, June 13, 2002, as amended at 80 FR 75945, Dec. 7, 2015; 89 FR 9763, Feb. 12, 2024] § 1006.345 Labor standards. (a) Davis-Bacon wage rates. (2) When NHHBG assistance is only used to assist homebuyers to acquire single family housing, the Davis-Bacon wage rates apply to the construction of the housing if there is a written agreement with the owner or developer of the housing that NHHBG assistance will be used to assist homebuyers to buy the housing. (3) Prime contracts not in excess of $2000 are exempt from Davis-Bacon wage rates. (b) HUD-determined wage rates. (c) Contract Work Hours and Safety Standards Act. (d) Volunteers. (e) Other laws and issuances. § 1006.350 Environmental review. (a) In order to ensure that the policies of the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. (b) An environmental review does not have to be completed before a HUD finding of compliance for the housing plan or amendments to the housing plan submitted by the DHHL. (c) No funds may be committed to a grant activity or project before the completion of the environmental review and approval of the request for release of funds and related certification required by sections 806(b) and 806(c) of the Act, except as authorized by 24 CFR part 58. (d) As set forth in section 806(a)(2)(B) of the Act and 24 CFR 58.77, HUD will: (1) Provide for the monitoring of environmental reviews performed by the DHHL under this section; (2) At its discretion, facilitate training for the performance of such reviews by the DHHL; and, (3) At its discretion, provide for the suspension or termination of the assumption of responsibilities under this section based upon a finding of substantial failure of the DHHL to execute responsibilities under this section. [67 FR 40776, June 13, 2002, as amended at 89 FR 9763, Feb. 12, 2024] § 1006.355 Nondiscrimination requirements. Program eligibility under the Act and this part may be restricted to Native Hawaiians. Subject to the preceding sentence, no person may be discriminated against on the basis of race, color, national origin, religion, sex, familial status, or disability, or excluded from program eligibility because of actual or perceived sexual orientation, gender identity, or marital status. The following nondiscrimination requirements are applicable to the use of NHHBG funds: (a) The requirements of the Age Discrimination Act of 1975 (42 U.S.C. 6101-6107) and HUD's implementing regulations in 24 CFR part 146; (b) Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) and HUD's regulations at 24 CFR part 8; and (c) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq. et seq. (1) To the DHHL on the basis that the DHHL served Native Hawaiians; or (2) To an eligible family on the basis that the family is a Native Hawaiian family. (d) The equal access to HUD-assisted or -insured housing requirements in 24 CFR 5.105(a)(2). [67 FR 40776, June 13, 2002, as amended at 81 FR 80993, Nov. 17, 2016] § 1006.360 Conflict of interest. In the procurement of property and services by the DHHL and contractors, the conflict of interest provisions in 2 CFR 200.317 (for DHHL) and 2 CFR 200.318 (for subrecipients). [67 FR 40776, June 13, 2002, as amended at 80 FR 75945, Dec. 7, 2015] § 1006.365 Program administration responsibilities. (a) Responsibilities. (b) Agreements with contractors. [67 FR 40776, June 13, 2002, as amended at 80 FR 75945, Dec. 7, 2015] § 1006.370 Uniform administrative, requirements, cost principles, and audit requirements for Federal awards. (a) The DHHL and subrecipients receiving NHHBG funds shall comply with the requirements and standards of 2 CFR part 200, “Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards”. (b)(1) With respect to the applicability of cost principles, all items of cost listed in 2 CFR part 200, subpart E, which require prior Federal agency approval are allowable without the prior approval of HUD to the extent that they comply with the general policies and principles stated in 2 CFR part 200, subpart E, and are otherwise eligible under this part, except for the following: (i) Depreciation methods for fixed assets shall not be changed without the approval of the Federal cognizant agency. (ii) Fines, penalties, damages, and other settlements are unallowable costs to the NHHBG program. (iii) Costs of housing ( e.g., (iv) Organization costs (2 CFR 200.455). (2) In addition, no person providing consultant services in an employer-employee type of relationship shall receive funds. In no event, however, shall such compensation exceed the equivalent of the daily rate paid for Level IV of the Executive Schedule. The Executive Pay Schedule may be obtained by https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages. [80 FR 75945, Dec. 7, 2015] § 1006.375 Other Federal requirements. (a) Lead-based paint. (1) Subpart A (§§ 35.80 through 35.98) for disclosures of known lead-based paint hazards upon sale or lease of residential property; (2) Subpart B (§§ 35.100 through 35.175) for general lead-based paint requirements and definitions; (3) Subpart H (§§ 35.700 through 35.830) for project-based rental assistance; (4) Subpart J (§§ 35.900 through 35.940) for rehabilitation; (5) Subpart K (§§ 35.1000 through 35.1020) for acquisition, leasing, support services, or operation; (6) Subpart M (§§ 35.1200 through 35.1225) for tenant-based rental assistance; and (7) Subpart R (§§ 35.1300 through 35.1355) for methods and standards for lead-based paint hazard evaluation and Reduction activities. (b) Drug-free workplace. et seq. (c) Audits. (d) Housing counseling. (e) Section 3. (f) Debarment and suspension. [89 FR 9763, Feb. 12, 2024] § 1006.377 Other Federal requirements: Displacement, Relocation, and Acquisition. The following relocation and real property acquisition policies are applicable to programs developed or operated under the Act and this part: (a) Real property acquisition requirements. et seq. (b) Minimize displacement. (c) Relocation assistance for displaced persons. et seq. (d) Appeals to the DHHL. (e) Responsibility of DHHL. (2) The cost of required relocation assistance is an eligible project cost in the same manner and to the same extent as other project costs. However, such assistance may also be paid for with funds available to the DHHL from any other source. (3) DHHL must provide proper and timely distribution of notices to residents in accordance with the URA regulations. This includes the General Information Notice (GIN), the Notice of Relocation Eligibility, the Notice to Owner, and the 90-Day Notice. All notices must be sent in accordance with 49 CFR 24.203 and 24.102. Notices of Relocation Eligibility are typically triggered by the Initiation of Negotiation (ION). (4) The DHHL shall maintain records in sufficient detail to demonstrate compliance with this section. (f) Definition of displaced person. (i) A tenant-occupant of a dwelling unit who moves from the building/complex permanently after the submission to HUD of a housing plan that is later approved; (ii) Any person, including a person who moves before the date the housing plan is submitted to HUD, that the DHHL determines was displaced as a direct result of acquisition, rehabilitation, or demolition for the assisted project; (iii) A tenant-occupant of a dwelling unit who moves from the building/complex permanently after execution of the agreement between the DHHL and HUD, if the move occurs before the tenant is provided written notice offering him or her the opportunity to lease and occupy a suitable, decent, safe and sanitary dwelling in the same building/complex, under reasonable terms and conditions, upon completion of the project. Such reasonable terms and conditions include a monthly rent and estimated average monthly utility costs that do not exceed the greater of: (A) The tenant-occupant's monthly rent and estimated average monthly utility costs before the agreement; or (B) Thirty percent of gross household income. (iv) A tenant-occupant of a dwelling who is required to relocate temporarily, but does not return to the building/complex, if: (A) The tenant-occupant is not offered payment 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 unit, any increased housing costs and incidental expenses; (B) The tenant-occupant is required to temporarily relocate for more than one year; or (C) Other conditions of the temporary relocation are not reasonable. (v) A tenant-occupant of a dwelling who moves from the building/complex after he or she has been required to move to another dwelling unit in the same building/complex in order to carry out the project, if either: (A) The tenant-occupant is not offered reimbursement for all reasonable out-of-pocket expenses incurred in connection with the move; or (B) Other conditions of the move are not reasonable. (2) Notwithstanding the provisions of this section for the definition of “Displaced Person,” a person does not qualify as a “displaced person” (and is not eligible for relocation assistance under the URA or this section), if: (i) The person moved into the property after the submission of the housing plan to HUD, but before signing a lease or commencing occupancy, was provided written notice of the project, its possible impact on the person ( e.g., (ii) The person meets the definition of “persons not displaced” as defined in 49 CFR 24.2; or (iii) The DHHL determines the person is not displaced as a direct result of acquisition, rehabilitation, or demolition for an assisted project. To exclude a person on this basis, HUD must concur in that determination in accordance with 49 CFR 24.2. (3) The DHHL may at any time ask HUD to determine whether a specific displacement is or would be covered under this section. (g) Definition of initiation of negotiations. See [89 FR 9763, Feb. 12, 2024] Subpart E—Monitoring and Accountability § 1006.401 Monitoring of compliance. (a) Periodic reviews and monitoring. (b) Review. (c) Results. (1) Included in a performance report of the DHHL submitted to HUD under § 1006.410; and (2) Made available to the public. § 1006.410 Performance reports. (a) Requirement. (1) Review the progress the DHHL has made during that fiscal year in achieving goals stated in its housing plan; and (2) Submit a report in a form acceptable to HUD, within 90 days of the end of the DHHL's fiscal year, describing the conclusions of the review. (3) DHHL may submit a written request for an extension of the deadline. HUD will establish a new date for submission if the extension is granted. (b) Content. (1) Describe the use of grant amounts provided to the DHHL for that fiscal year; (2) Assess the relationship of the use referred to in paragraph (b)(1), of this section, to the goals identified in its housing plan; (3) Indicate the programmatic accomplishments of the DHHL; and (4) Describe the manner in which the DHHL would change its housing plan as a result of its experiences administering the grant under the Act. (c) Public availability Comments by Native Hawaiians. (2) Summary of comments. (d) HUD review. (1) Review each report submitted under the Act and this part; and (2) With respect to each such report, make recommendations as HUD considers appropriate to carry out the purposes of the Act. [67 FR 40776, June 13, 2002, as amended at 89 FR 9764, Feb. 12, 2024] § 1006.420 Review of DHHL's performance. (a) Objective. (1) Carried out eligible activities in a timely manner; (2) Carried out and made certifications in accordance with the requirements and the primary objectives of the Act and this part and with other applicable laws; (3) A continuing capacity to carry out the eligible activities in a timely manner; (4) Complied with its housing plan; and (5) Submitted accurate performance reports. (b) Basis for review. (1) The DHHL's housing plan and any amendments thereto; (2) Reports prepared by the DHHL; (3) Records maintained by the DHHL, including their retention under 2 CFR 200.333, noting that the NHHBG Annual Performance Report is the program's final expenditure report; (4) Results of HUD's monitoring of the DHHL's performance, including field evaluation of the quality of the work performed; (5) Audit reports; (6) Records of drawdowns on the line of credit; (7) Records of comments and complaints by citizens and organizations; and (8) Litigation. (c) Failure to maintain records. [67 FR 40776, June 13, 2002, as amended at 80 FR 75945, Dec. 7, 2015; 89 FR 9764, Feb. 12, 2024] § 1006.430 Corrective and remedial action. (a) General. (1) Complied with the requirements of the Act and this part and other applicable laws and regulations, including the environmental responsibilities assumed under § 1006.350; (2) Carried out its activities substantially as described in its housing plan; (3) Made substantial progress in carrying out its program and achieving its quantifiable goals as described in its housing plan; or (4) Shown the continuing capacity to carry out its approved activities in a timely manner. (b) Action. (1) Issue a letter of warning advising the DHHL of the performance problem(s), describing the corrective actions that HUD believes should be taken, establishing a completion date for corrective actions, and notifying the DHHL that more serious actions may be taken if the performance problem(s) is not corrected or is repeated; (2) Request the DHHL to submit progress schedules for completing activities or complying with the requirements of the Act and this part; (3) Recommend that the DHHL suspend, discontinue, or not incur costs for the affected activity; (4) Recommend that the DHHL redirect funds from affected activities to other eligible activities; (5) Recommend that the DHHL reimburse its program account or line of credit under the Act in the amount improperly expended and reprogram the use of the funds; and (6) Recommend that the DHHL obtain appropriate technical assistance using existing grant funds or other available resources to overcome the performance problem(s). § 1006.440 Remedies for noncompliance. (a) Remedies. (1) Terminate payments to the DHHL; (2) Reduce payments to the DHHL by an amount equal to the amount not expended in accordance with the Act or this part; (3) Limit the availability of payments to programs, projects, or activities not affected by such failure to comply; or (4) Adjust, reduce or withdraw grant amounts or take other action as appropriate in accordance with reviews and audits. (b) Exception. (c) HUD may, upon due notice, suspend payments at any time after the issuance of the opportunity for hearing pending such hearing and final decision, to the extent HUD determines such action necessary to preclude the further expenditure of funds for activities affected by such failure to comply. (d) Hearing requirement. (1) Take at least one of the corrective or remedial actions specified under § 1006.430 and permit the DHHL to make an appropriate and timely response; (2) Provide the DHHL with the opportunity for an informal consultation with HUD regarding the proposed action; and (3) Provide DHHL with reasonable notice and opportunity for a hearing. (e) Continuance of actions. (f) Referral to the Attorney General.