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Federal Register / Vol. 86, No. 117 / Tuesday, June 22, 2021 / Notices funds provided under the Appropriations Act for electrical power system improvements and related program income, and not to all CDBG
funds received by the grantee during another period selected by the grantee in accordance with 570.484a.
CDBGDR electrical power system improvements will be considered to meet the criteria for activities benefitting lowand moderate-income personsarea benefit activities at 24
CFR 570.483b1 if, at grant closeout, they meet the following criteria unless there is substantial evidence to the contrary. In assessing any such evidence, the full range of direct effects of the assisted activity will be considered. The recipient shall appropriately ensure that activities that meet these criteria do not benefit moderate income persons to the exclusion of low-income persons. The criteria are that at least 70 percent of the grant funds allocated by this notice, not including planning and administrative costs, have been used to:
i Provide at least fifty-one percent of the grantees lowand moderate-income residents with either a subsidized rate for electricity below that charged to other residential ratepayers or a lower rate for electricity than was charged prior to complete implementation of the CDBGDR funding electrical power system improvements; or ii measurably improve the reliability of the electrical power system in lowand moderate-income areas that are primarily residential. For purposes of this paragraph, measurably improved reliability shall mean a documented decrease in power supply interruptions, excluding planned interruptions and interruptions caused by major events.
To document compliance with this national objective criterion, a grantees policies and procedures shall provide for the measurement of improved reliability in lowand moderate income areas that are primarily residential, using relevant legal and regulatory standards, as amended from time to time, including those identified by Puerto Rico Act 172019 for Puerto Rico only, FEMA Section 1235b Consensus-Based Codes and Standards, RUS Bulletins for Electric Power, Institute of Electrical and Electronics Engineers IEEE standards and guidance, EPA environmental protections, and, as appropriate, North American Electric Reliability Corporation NERC standards and guidance.
HUD will monitor the grantee and its subrecipients for the duration of the grant to substantiate that the grantee is demonstrating adequate progress in
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documenting CDBGDR expenditures that will result in subsidized or lower electricity costs of lowand moderateincome residents, or improved reliability for lowand moderate-income areas, as applicable.
Grantees may also use CDBGDR
funds allocated pursuant to this notice to meet the urgent need national objective, pursuant to the waiver and alternative requirement provided below.
Unless a grantee has received prior approval from HUD, CDBGDR funds for electrical power system improvements cannot meet the CDBG
national objective for the elimination of slum and blight as provided at 24 CFR
570.208b and 24 CFR 570.483c.
Grantees shall not rely on the national objective criteria for elimination of slum and blighting conditions without approval from HUD because this national objective generally is not appropriate in the context of electrical power system improvements.
The CDBG certification requirements for documentation of urgent need, located at 24 CFR 570.483d, are waived for the grants under this notice and replaced with the following alternative requirement. In the context of disaster recovery, the standard urgent need certification requirements may impede recovery. Since the Department only provides CDBGDR awards to grantees with documented disasterrelated impacts and each grantee is limited to spending funds only for the benefit of areas that received a presidential disaster declaration as identified in Table 1 of this notice, the following streamlined alternative requirement recognizes the urgency in addressing serious threats to community welfare following a major disaster. A
grantee need not issue formal certification statements to qualify an activity as meeting the urgent need national objective. Instead, it must document how each program and/or activity funded under the urgent need national objective responds to a disaster-related impact. For each activity that will meet an urgent need national objective, the grantee must reference in its action plan needs assessment the type, scale, and location of the disaster-related impacts that each program and/or activity is addressing over the course of the applicable deadline for the expenditure of obligated grant funds.
To meet the 70 percent overall benefit requirement, grantees may also use the lowand moderate-income benefit national objective criteria at 24 CFR
570.483b to the extent that an eligible activity authorized by this notice qualifies under the criteria for that
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national objective. At least 70 percent of the entire CDBGDR grant must be used for activities that benefit lowand moderate-income persons.
V.A.9. Use of subrecipients. The State CDBG program rule does not make specific provisions for the treatment of entities that the CDBG Entitlement program calls subrecipients. The waiver allowing the state to directly carry out activities creates a situation in which the state may use subrecipients to carry out activities in a manner similar to an entitlement community. Therefore, in taking advantage of the waiver to carry out activities directly, grantees shall be subject to the requirements at 24 CFR 570.503 and 570.500c, except that in compliance with 570.489g, grantees shall establish procurement requirements for local governments and subrecipients which may or may not include procurement provisions of 2
CFR part 200 that are applicable to a grantees subrecipients.
V.A.10. Recordkeeping. When a grantee receiving CDBGDR grants for electrical power system improvements under Public Law 115123 carries out activities directly, 24 CFR 570.490b is waived, and the following alternative provision shall apply: The grantee shall establish and maintain such records as may be necessary to facilitate review and audit by HUD of the grantees administration of CDBGDR funds, under 24 CFR 570.493. Consistent with applicable statutes, regulations, waivers and alternative requirements, and other Federal requirements, the content of records maintained by the grantee shall be sufficient to: 1 Enable HUD to make the applicable determinations described at 24 CFR 570.493; 2 make compliance determinations for activities carried out directly by the grantee; and 3 show how activities funded are consistent with the descriptions of activities proposed for funding in the action plan and/or DRGR system. For fair housing and equal opportunity FHEO
purposes, as applicable, such records shall include data on the racial, ethnic, and gender characteristics of persons who are applicants for, participants in, or beneficiaries of the program. The grantee must report FHEO data in the DRGR system at the activity level.
V.A.11. Responsibility for review and handling of noncompliance. This change is in conformance with the waiver allowing the grantee to carry out activities directly. 24 CFR 570.492 is waived and the following alternative requirement applies to grantees receiving CDBGDR grants for electrical power system improvements under Public Law 115123: The grantee shall make reviews and audits, including on-

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