City of St Louis Timeliness of CDBG Expenditures

City of St. Louis Timeliness of CDBG Expenditures

St. Louis CDBG Profile: Approx. $16. 236 M allocation for 2017 Approx. 75 subrecipient/ intragovernmental agreements At least 100 housing units completed annually 30 employees

What is the Timeliness Test? Regulatory Basis: Under the provisions of 24 CFR 570. 902 of the CDBG regulations, a grantee is considered to be timely, if 60 days prior to the end of the grantee's program year, the balance in its line-of-credit does not exceed 1. 5 times the entitlement grant for its current program year.

Reasons for Timeliness Procedures Significant changes in 2014 (in conjunction with HUD’s One. CPD TA providers) resulted in not meeting timeliness test in 2015 Process Over became less political $7 M in funds identified for reallocation Subrecipients without sufficient capacity to expend funds timely

Management Techniques For Ensuring CDBG Timeliness Providing Subrecipient Oversight Utilizing CDBG Tracking Systems Following Up With Subrecipients With Slow Expenditure Rates Identifying a System for Reallocation of Funds Defining Staff Roles

Technique: Subrecipient Oversight Subrecipient Selection Contract Requirements Subrecipient Monitoring

Selection of Subrecipients Through a competitive process, select subrecipients and activities that will meet the timeliness standards Solicit via an RFP Look for programmatic and fiscal capacity Look for adequate program design Look for experience with CDBG and/or other federal programs Ask if applicant can accomplish goals within expected contract period

Contract Requirements Utilize adequate subrecipient agreements Project milestones Drawdown Reporting schedules provisions Tie reimbursement to milestones

Subrecipient Monitoring One of the most important techniques for ensuring timeliness Monitoring Annual is an ongoing process Subrecipient Training Completion of risk assessments Completion of monitoring schedules Technical Review assistance visits of programmatic reports Compliance Sanctions visits prior to the end of contract as needed

Technique: Establish Tracking Systems Financial Projections Expenditure & Drawdown Analysis Report Preparation

Financial Projections Use timelines from previous projects and experiences to predict expenditure schedule Generally, construction projects may take 6 months to a year to begin, if environmental conditions exist Pilot programs may take longer to start City departments with payroll expenses easy to predict Summer programs may not have expenditures in 1 st and 4 th quarters

Expenditure/Drawdown Analysis (1) Create Excel file that lists activities with columns for (a) award, (b) expenditures, and (c) remaining balance. Update monthly (2) Create Excel file that calculates maximum allowable unspent CDBG funds and the amount needed to draw by the compliance date. Include list of undrawn expenditures and future expenditures

Report Preparation Utilizing expenditure and drawdown analysis, prepare report for discussion purposes Hold monthly timeliness meetings

Technique: Mid-Contract Follow Up Send Compliance Letter/Email Require Response Monitor Progress

Timeliness Correspondence Mid contract (usually 7/1), letters are sent to subrecipients who have not yet expended over 30% of the grant amount. Letter requires: Summary of delay Summary of proposed changes Milestone schedule Drawdown projections Organizational commitment to carrying out proposed schedule and projections. Programmatic staff responsible for following up with subrecipients to ensure compliance

Technique: Reallocation of Funds Monitor Contracts Follow CPP Award New Projects Track end dates Follow procedures for substantial amendment, if applicable. Choose projects that can be completed timely

Technique: Define Staff Roles All staff should help with meeting the timeliness test… Fiscal Staff Program Staff Director Level Staff Process pay requests; Track expenditures and drawdowns. Provide TA to subrecipients; Review reports and workout plans, as needed. Initiate reallocation process; provide ongoing updates to HUD Field Office.

IMPORTANT! Communicate with your CPD Rep prior to noncompliance with timeliness test