Florida Senate - 2013                                     SB 494
       By Senator Simpson
       18-00367A-13                                           2013494__
    1                        A bill to be entitled                      
    2         An act relating to community development block grants;
    3         amending s. 290.0411, F.S.; revising legislative
    4         intent; amending s. 290.402, F.S.; revising
    5         definitions; amending s. 290.044, F.S.; requiring the
    6         Department of Economic Opportunity to adopt a rule
    7         pertaining to the distribution of funds under the
    8         block grant program; requiring the department to
    9         define community development objectives in accordance
   10         with federal law and regulations; amending s.
   11         290.0455, F.S; requiring approved Section 108 loan
   12         applicants to enter into an agreement with the
   13         department; requiring the department to review all
   14         applications received from local governments;
   15         requiring that each application be deemed financially
   16         feasible by a loan underwriter approved by the
   17         department; allowing the department to submit
   18         applications to the United States Department of
   19         Housing and Urban Development under certain
   20         conditions; reducing the maximum amounts of loan
   21         guarantee commitments; removing requirement that the
   22         applicant’s past performance must be evaluated;
   23         requiring that a local government’s future community
   24         development block grant be reduced in the event of
   25         default; requiring a local government that has
   26         received a Section 108 loan through the Small Cities
   27         Community Block Grant Program but is granted
   28         entitlement community status to pledge its block grant
   29         allocation as guarantee to its previous loan and
   30         release the department as a guarantor; amending s.
   31         290.046, F.S.; granting rulemaking authority to the
   32         department; allowing local governments to submit one
   33         grant application per funding cycle with the exception
   34         of economic development projects; providing criteria
   35         for applications for economic development grants;
   36         prohibiting the department from awarding a grant until
   37         a site visit has been completed; providing conditions
   38         for the ranking of grant applications; establishing
   39         procedures for citizen input and participation;
   40         amending s. 290.047, F.S.; granting rulemaking
   41         authority to the department; providing restrictions on
   42         the expenditure of block grant funds by local
   43         governments; amending s. 290.0475, F.S.; revising
   44         provisions relating to the rejection of grant
   45         applications; amending s. 290.048, F.S.; removing
   46         requirements pertaining to written descriptions of
   47         service areas; repealing a requirement for
   48         establishment of an advisory committee; providing an
   49         effective date.
   51  Be It Enacted by the Legislature of the State of Florida:
   53         Section 1. Section 290.0411, Florida Statutes, is amended
   54  to read:
   55         290.0411 Legislative intent and purpose of ss. 290.0401
   56  290.048.—It is the intent of the Legislature to provide the
   57  necessary means to develop, preserve, redevelop, and revitalize
   58  Florida communities exhibiting signs of decline, or distress, or
   59  economic need by enabling local governments to undertake the
   60  necessary community and economic development programs. The
   61  overall objective is to create viable communities by eliminating
   62  slum and blight, fortifying communities in urgent need,
   63  providing decent housing and suitable living environments, and
   64  expanding economic opportunities, principally for persons of low
   65  or moderate income. The purpose of ss. 290.0401-290.048 is to
   66  assist local governments in carrying out effective community and
   67  economic development and project planning and design activities
   68  to arrest and reverse community decline and restore community
   69  vitality. Community development and project planning activities
   70  to maintain viable communities, revitalize existing communities,
   71  expand economic development and employment opportunities, and
   72  improve housing conditions and expand housing opportunities,
   73  providing direct benefit to persons of low or moderate income,
   74  are the primary purposes of ss. 290.0401-290.048. The
   75  Legislature, therefore, declares that the development,
   76  redevelopment, preservation, and revitalization of communities
   77  in this state and all the purposes of ss. 290.0401-290.048 are
   78  public purposes for which public money may be borrowed,
   79  expended, loaned, pledged to guarantee loans, and granted.
   80         Section 2. Subsections (1) and (6) of section 290.042,
   81  Florida Statutes, are amended to read:
   82         290.042 Definitions relating to Florida Small Cities
   83  Community Development Block Grant Program Act.—As used in ss.
   84  290.0401-290.048, the term:
   85         (1) “Administrative closeout” means the notification of a
   86  grantee by the department that all applicable administrative
   87  actions and all required work of an existing the grant have been
   88  completed with the exception of the final audit.
   89         (6) “Person of low or moderate income” means any person who
   90  meets the definition established by the department in accordance
   91  with the guidelines established in Title I of the Housing and
   92  Community Development Act of 1974, as amended, and 24 C.F.R. s.
   93  570.483(b).
   94         Section 3. Subsections (2), (3), and (4) of section
   95  290.044, Florida Statutes, are amended to read:
   96         290.044 Florida Small Cities Community Development Block
   97  Grant Program Fund; administration; distribution.—
   98         (2) The department shall develop by rule guidelines for the
   99  distribution of distribute such funds as loan guarantees and
  100  grants to eligible local governments through on the basis of a
  101  competitive selection process.
  102         (3) The department shall define the broad community
  103  development objectives that meet national objectives established
  104  by 42 U.S.C. s. 5304 and 24 C.F.R. s. 570.483 objective to be
  105  achieved through the distribution of block grant funds under
  106  this section. by the activities in each of the following grant
  107  program categories, and require applicants for grants to compete
  108  against each other in these grant program categories:
  109         (a) Housing.
  110         (b) Economic development.
  111         (c) Neighborhood revitalization.
  112         (d) Commercial revitalization.
  113         (e) Project planning and design.
  114         (4) The department may set aside an amount of up to 5
  115  percent of the funds annually for use in any eligible local
  116  government jurisdiction for which an emergency or natural
  117  disaster has been declared by executive order. Such funds shall
  118  may only be provided to a local government to fund eligible
  119  emergency-related activities for which no other source of
  120  federal, state, or local disaster funds is available. The
  121  department may provide for such set-aside by rule. In the last
  122  quarter of the state fiscal year, any funds not allocated under
  123  the emergency-related set-aside shall be distributed to unfunded
  124  applications from the most recent funding cycle.
  125         Section 4. Section 290.0455, Florida Statutes, is amended,
  126  to read:
  127         290.0455 Small Cities Community Development Block Grant
  128  Loan Guarantee Program; Section 108 loan guarantees.—
  129         (1) The Small Cities Community Development Block Grant Loan
  130  Guarantee Program is created. The department shall administer
  131  the loan guarantee program pursuant to s. 108 of Title I of the
  132  Housing and Community Development Act of 1974, as amended, and
  133  as further amended by s. 910 of the Cranston-Gonzalez National
  134  Affordable Housing Act. The purpose of the Small Cities
  135  Community Development Block Grant Loan Guarantee Program is to
  136  guarantee, or to make commitments to guarantee, notes or other
  137  obligations issued by public entities for the purposes of
  138  financing activities enumerated in 24 C.F.R. s. 570.703.
  139         (2) Activities assisted under the loan guarantee program
  140  must meet the requirements contained in 24 C.F.R. ss. 570.700
  141  570.710 and may not otherwise be financed in whole or in part
  142  from the Florida Small Cities Community Development Block Grant
  143  Program.
  144         (3) The department may pledge existing revenues on deposit
  145  or future revenues projected to be available for deposit in the
  146  Florida Small Cities Community Development Block Grant Program
  147  in order to guarantee, in whole or in part, the payment of
  148  principal and interest on a Section 108 loan made under the loan
  149  guarantee program.
  150         (4) An applicant approved by the United States Department
  151  of Housing and Urban Development to receive a Section 108 loan
  152  shall enter into an agreement with the department which requires
  153  the applicant to pledge half the amount necessary to guarantee
  154  the loan in the event of default.
  155         (5)(4) The department shall review all Section 108
  156  applications received from local governments. The department
  157  shall review the applications must submit all applications it
  158  receives to the United States Department of Housing and Urban
  159  Development for loan approval, in the order received, subject to
  160  a determination by the department determining that each the
  161  application meets the all eligibility requirements contained in
  162  24 C.F.R. ss. 570.700-570.710, and has been deemed financially
  163  feasible by a loan underwriter approved by the department. If
  164  the statewide maximum available for loan guarantee commitments
  165  established in subsection (6) has not been committed, the
  166  department may submit the Section 108 loan application to the
  167  United States Department of Housing and Urban Development with a
  168  recommendation that the loan be approved, with or without
  169  conditions, or denied provided that the applicant has submitted
  170  the proposed activity to a loan underwriter to document its
  171  financial feasibility.
  172         (6)(5) The maximum amount of any individual loan guarantee
  173  commitment that an commitments that any eligible local
  174  government may receive shall may be limited to $5 $7 million
  175  pursuant to 24 C.F.R. s. 570.705, and the maximum amount of loan
  176  guarantee commitments statewide may not exceed an amount equal
  177  to two five times the amount of the most recent grant received
  178  by the department under the Florida Small Cities Community
  179  Development Block Grant Program.
  180         (7)(6)Section 108 loans guaranteed by the Small Cities
  181  Community Development Block Grant Program loan guarantee program
  182  must be repaid within 20 years.
  183         (8)(7)Section 108 loan applicants must provide Loan
  184  guarantees may be used for an activity only if the local
  185  government provides evidence to the department that alternative
  186  financing services were investigated and were unavailable or
  187  insufficient to meet the financing needs of the proposed
  188  activity.
  189         (9) If a local government defaults on a Section 108 loan
  190  received from the United States Department of Housing and Urban
  191  Development and guaranteed through the Florida Small Cities
  192  Community Development Block Grant Program, thereby requiring the
  193  department to reduce its annual grant award in order to pay the
  194  annual debt service on the loan, any future community
  195  development block grants that the local government receives must
  196  be reduced in an amount equal to the amount of the state’s grant
  197  award used in the payment of the loan debt service.
  198         (10) If a local government that is the recipient of a
  199  Section 108 loan guaranteed through the Small Cities Community
  200  Development Block Grant Program is granted entitlement community
  201  status, as defined in 24 C.F.R. s. 570, subpart D, by the United
  202  States Department of Housing and Urban Development before paying
  203  the loan in full, the local government must pledge its community
  204  development block grant entitlement allocation as a guarantee of
  205  its previous loan and request that the United States Department
  206  of Housing and Urban Development release the department as a
  207  guarantor of the loan.
  208         (8) The department must, before approving an application
  209  for a loan, evaluate the applicant’s prior administration of
  210  block grant funds for community development. The evaluation of
  211  past performance must take into account the procedural aspects
  212  of previous grants or loans as well as substantive results. If
  213  the department finds that any applicant has failed to
  214  substantially accomplish the results proposed in the applicant’s
  215  last previously funded application, the department may prohibit
  216  the applicant from receiving a loan or may penalize the
  217  applicant in the rating of the current application.
  218         Section 5. Section 290.046, Florida Statutes, is amended to
  219  read:
  220         (Substantial rewording of section. See
  221         s. 290.046, F.S., for present text.)
  222         290.046 Applications for grants; procedures; requirements.—
  223         (1) The department shall establish application procedures
  224  by rule.
  225         (2)(a) Except for economic development projects, each local
  226  government that is eligible by rule to apply for a grant during
  227  a funding cycle may submit one application for a noneconomic
  228  development project during the application cycle. A local
  229  government that is eligible by rule to apply for an economic
  230  development grant may apply up to three times each funding cycle
  231  for an economic development grant and may have more than one
  232  open economic development grant.
  233         (b)The department shall establish minimum criteria
  234  pertaining to the number of jobs created for persons of low or
  235  moderate income, the degree of private sector financial
  236  commitment, and the economic feasibility of the proposed
  237  project, and shall establish any other criteria the department
  238  deems appropriate.
  239         (c) The department may not award a grant until the
  240  department has completed a site visit to verify the information
  241  contained in the application.
  242         (3)(a) The department shall rank each application received
  243  during the application cycle based on criteria established by
  244  rule. The rule may take into consideration factors including,
  245  but not limited to: community need, unemployment, poverty
  246  levels, low and moderate income populations, health and safety,
  247  and condition of physical structures. The department shall
  248  incorporate into its ranking system a procedure intended to
  249  eliminate or reduce any existing population-related bias that
  250  places exceptionally small communities at a disadvantage in the
  251  competition for funds.
  252         (b) Project funding must be determined by the rankings
  253  established in each application cycle. If economic development
  254  funding remains available after the application cycle closes,
  255  funding will be awarded to eligible projects on a first-come,
  256  first-served basis until funding for this category has been
  257  fully obligated.
  258         (4) In order to provide the public with information
  259  concerning an applicant’s proposed program before an application
  260  is submitted to the department, the applicant shall, for each
  261  funding cycle:
  262         (a) Conduct an initial public hearing to inform the public
  263  of funding opportunities available to meet community needs and
  264  eligible activities and to solicit public input on community
  265  needs.
  266         (b) Publish a summary of the proposed application which
  267  affords the public an opportunity to examine the contents of the
  268  application and submit comments.
  269         (c) Conduct a second public hearing to obtain public
  270  comments on the proposed application and make appropriate
  271  modifications to the application.
  272         Section 6. Section 290.047, Florida Statutes, is amended to
  273  read:
  274         (Substantial rewording of section. See
  275         s. 290.047, F.S., for present text.)
  276         290.047 Establishment of grant ceilings and maximum
  277  administrative cost percentages.—
  278         (1) The department shall adopt rules to establish:
  279         (a) Grant ceilings.
  280         (b) The maximum percentage of block grant funds which can
  281  be spent on administrative costs by an eligible local
  282  government.
  283         (c) Grant administration procurement procedures for
  284  eligible local governments.
  285         (2) An eligible local government may not contract with the
  286  same individual or business entity for more than one service to
  287  be performed in connection with a community development block
  288  grant, including, but not limited to, application preparation
  289  services, administrative services, architectural and engineering
  290  services, and construction services, unless it can be
  291  demonstrated by the eligible local government that such
  292  individual or business entity is the sole source of the service
  293  or is the responsive proposer whose proposal is determined in
  294  writing as a result of a competitive process to be the most
  295  advantageous to the local government.
  296         (3) The maximum amount of block grant funds that may be
  297  spent on architectural and engineering costs by an eligible
  298  local government must be determined in accordance with a
  299  methodology adopted by the department by rule.
  300         Section 7. Section 290.0475, Florida Statutes, is amended
  301  to read:
  302         290.0475 Rejection of grant applications; penalties for
  303  failure to meet application conditions.—Applications received
  304  for funding under all program categories shall be deemed
  305  ineligible if rejected without scoring only in the event that
  306  any of the following circumstances arise:
  307         (1) The application is not received by the department by
  308  the application deadline.
  309         (2) The proposed project does not meet one of the three
  310  national objectives as contained in federal and state
  311  legislation.
  312         (3) The proposed project is not an eligible activity as
  313  contained in the federal legislation.
  314         (4) The application is not consistent with the local
  315  government’s comprehensive plan adopted pursuant to s. 163.3184.
  316         (5) The applicant has an open community development block
  317  grant, except as provided in s. 290.046(2)(a) and department
  318  rule 290.046(2)(c).
  319         (6) The local government is not in compliance with the
  320  citizen participation requirements prescribed in ss. 104(a)(1)
  321  and (2) and 106(d)(5)(c) of Title I of the Housing and Community
  322  Development Act of 1984, s. 290.046(4), and department rule
  323  rules.
  324         (7) Any information provided in the application that
  325  affects eligibility or scoring is found to have been
  326  misrepresented, and the information is not a mathematical error
  327  which may be discovered and corrected by readily computing
  328  available numbers or formulas provided in the application.
  329         Section 8. Subsections (5) and (7) of section 290.048,
  330  Florida Statutes, are amended, and present subsection (6) of
  331  that section is renumbered as subsection (5), to read:
  332         290.048 General powers of department under ss. 290.0401
  333  290.048.—The department has all the powers necessary or
  334  appropriate to carry out the purposes and provisions of the
  335  program, including the power to:
  336         (5) Adopt and enforce strict requirements concerning an
  337  applicant’s written description of a service area. Each such
  338  description shall contain maps which illustrate the location of
  339  the proposed service area. All such maps must be clearly legible
  340  and must:
  341         (a) Contain a scale which is clearly marked on the map.
  342         (b) Show the boundaries of the locality.
  343         (c) Show the boundaries of the service area where the
  344  activities will be concentrated.
  345         (d) Display the location of all proposed area activities.
  346         (e) Include the names of streets, route numbers, or easily
  347  identifiable landmarks where all service activities are located.
  348         (5)(6) Pledge community development block grant revenues
  349  from the Federal Government in order to guarantee notes or other
  350  obligations of a public entity which are approved pursuant to s.
  351  290.0455.
  352         (7) Establish an advisory committee of no more than 13
  353  members to solicit participation in designing, administering,
  354  and evaluating the program and in linking the program with other
  355  housing and community development resources.
  356         Section 9. This act shall take effect July 1, 2013.