RD Instruction 1944-I

Table of Contents

Page 1

Part 1944 - HOUSING

Subpart I - Self-Help Technical Assistance Grants

Table of Contents

Sec. Page

1944.40l Objective. 1

1944.402 Grant purposes. 1

1944.403 Definitions. 2

(a) Agreement. 2

(b) Agreement period (or grant period). 2

(d) Direct costs. 2

(e) Disallowed costs. 2

(f) Equivalent units. 2

(g) Equivalent value of a modest house. 2

(h) Indirect costs. 2A

(i) Mutual self-help. 3

(j) Organization. 3

(k) Participating family. 3

(l) Self-help. 3

(m) Sponsor. 3

(n) Technical assistance. 4

(o) Termination of a grant. 4

1944.404 Eligibility. 4

1944.405 Authorized use of grant funds. 5

1944.406 Prohibited use of grant funds. 7

1944.407 Limitations. 7

1944.408 [Reserved] 8

1944.409 Executive Order 12372. 8

1944.410 Processing preapplications, applications, and

completing grant dockets. 8

(a) Form SF-424, “Application for Federal Assistance.” 8

(b) Preapplication review. 10

Action.” 11

(d) Self-help technical assistance grant predevelopment

agreement. 12

(e) Form SF-424, “Application for Federal Assistance.” 12

1944.411 Conditions for approving a grant. 13

1944.412 Docket preparation. 14A

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RD Instruction 1944-I

Table of Contents (Con.)

Page 2

Sec. Page

1944.413 Grant approval. 15

(a) Approval of grant. 15

(b) Cancellation of an approved grant. 15

1944.414 [Reserved] 16

1944.415 Grant approval and other approving authorities. 16

1944.416 Grant closing. 17

1944.417 Servicing actions after grant closing. 17

1944.418 [Reserved] 19

1944.419 Final grantee evaluation. 20

1944.420 Extension or revision of the grant agreement. 21

1944.421 Refunding of an existing grantee. 21

1944.422 Audit and other report requirements. 22

(a) Nonprofit organizations and others. 22

(b) State and local governments and Indian tribes. 22A

1944.423 Loan packaging and 502 RH application submittal. 23

1944.424 Dwelling construction and standards. 24

1944.425 Handling and accounting for borrower loan funds. 24B

1944.426 Grant closeout. 24B

(a) Grant purposes completed. 24B

(b) Grant purposes not completed. 25

(d) Grant termination. 26

1944.427 Grantee self-evaluation. 26

1944.428 - 1944.449 [Reserved] 27

1944.450 OMB Control Number. 27

Exhibit A Self-Help Technical Assistance Grant Agreement.

Exhibit B Evaluation Report of Self-Help Technical Assistance (TA)

Grants.

Exhibit B-1 Instructions for Preparation of Evaluation Report of

Self-Help Technical Assistance Grants.

Exhibit B-2 Breakdown of Construction Development for Determining

Percentage Construction Completed.

Exhibit B-3 Pre-Construction and Construction Phase Breakdown.

Exhibit C Amendment to Self-Help Technical Assistance Grant Agreement

Exhibit D Self-Help Technical Assistance Grant Predevelopment

Agreement.

RD Instruction 1944-I

Table of Contents (Con.)

Page 3

Exhibit E Guidance for Recipients of Self-Help Technical Assistance

Grants.

Exhibit F Site Option Loan to Technical Assistance Grantees.

Exhibit G Application Processing Checklist - New Construction.

Exhibit H Sample Technical Assistance Calculations.

Exhibit I Application Processing Checklist - Rehabilitation.

Exhibit J Template Letter of Conditions- Application Review.

Exhibit K Evaluation Report of Rehabilitation Technical Assistance

(TA)Grants.

Exhibit K-1 Instruction for Preparation of Evaluation Reports of

Rehabilitation Technical Assistance Grants.

Exhibit K-2 Equivalent Unit Tracking and Family Cost Savings for

Rehabilitation Grants.

Exhibit L Draw Request Cover Sheet-Optional.

Exhibit M High Risk Designation – Template.

Exhibit N High Risk Removal – Template.

Exhibit O Final Evaluation of Self-Help Technical Assistance Grants-

Template.

Exhibit P Indirect Costing Rate Negotiations.

oOo

(12-12-19) PN 532

RD Instruction 1944-I

PART 1944 - HOUSING

Subpart I - Self-Help Technical Assistance Grants

§ 1944.401 Objective.

This subpart sets forth the policies and procedures and delegates

authority for providing Technical Assistance (TA) funds to eligible

applicants to finance programs of technical and supervisory assistance for

self-help housing, as authorized under Section 523 of the Housing Act of

1949. Any processing or servicing activity conducted pursuant to this

subpart involving authorized assistance to Rural Development employees,

members of their families, known close relatives, or business or close

personal associates, is subject to the provisions of 7 CFR Part 11 and

Subpart D of Part 1900 of this chapter. Applicants for this assistance are

required to identify any known relationship or association with a Rural

Development employee. This financial assistance may pay part or all of the

cost of developing, administering, or coordinating programs of technical and

supervisory assistance to aid needy very low- and low-income families in

carrying out self-help housing efforts in rural areas. Very low-income

families must receive a priority for recruitment and participation and may

not comprise less than the percentage stated in Subpart L of Part 1940 of

this chapter of those assisted in any grant. The primary purpose is to fund

organizations that are willing to locate and work with families that

otherwise do not qualify as homeowners. Generally, these are families below

50 percent of median incomes, living in substandard housing, and/or lacking

the skills to be good homeowners. Grantees will comply with the

nondiscrimination regulation Subpart E of Part 1901 of this chapter which

states that no person in the United States shall, on the grounds of race,

color, national origin, sex, religion, marital status, mental or physical

handicap, or age, be excluded from participating in, be denied the benefits

of, or be subject to discrimination in connection with the use of grant funds

and all provisions of the Fair Housing Act of 1988. (Revised 02-04-93,

SPECIAL PN.)

§ 1944.402 Grant purposes.

Rural Development may contract or make a grant to an organization to:

(a) Give technical and supervisory assistance to eligible very low- and

low-income families as defined in Appendix 9 of HB-1-3550 (available in

any Rural Development Office), in carrying out self-help housing

efforts. (Revised 01-23-03, SPECIAL PN.)

(b) Assist other organizations to provide technical and supervisory

assistance to eligible families.

__________________________________________________________________________

Distribution: WSAL Loan and Grant Making

Housing

(Revision 3)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.402 (Con.)

activities necessary to participate under paragraph (a) of this section.

§ 1944.403 Definitions.

(a) Agreement. The Self-Help Technical Assistance Agreement, which is

a document signed by Rural Development and the grantee, sets forth the

terms and conditions under which TA funds will be made available.

(Exhibit A of this subpart).

(b) Agreement period (or grant period). The period of time for which

an agreement is in force. Generally, the period will not exceed 24

months.

completed or the date in the TA grant agreement, or any supplement or

amendment to it, when Federal assistance ends.

(d) Direct costs. Those costs that are specifically identified with a

particular project or activity. Grantees receiving funds from a single

grant source would consider all costs as direct costs.

(e) Disallowed costs. Those charges to a grant which Rural Development

determines cannot be authorized.

(f) Equivalent units. Equivalent units represent the “theoretical

number of units” arrived at by adding the equivalent percentage of

completion figure for each family in the self-help program (pre-

construction and actual construction) together at any given date during

program operations. The sum of the percentage of completion figures for

all participant families represent the total number of “theoretical

units” completed at any point in time. Equivalent units are useful in

measuring progress during the period of the grant and are not a

measurement of actual accomplishments. The number of equivalent units

for any group/project can never exceed the number of planned or

completed houses/homes for that group/project. (Revised 12-12-19,

PN 532.)

(g) Equivalent value of a modest house (aka Cost of Contractor-Built

home). The equivalent value of a modest house is the typical cost of a

recent contractor-built Rural Development financed home in the area plus

the actual or projected costs of an acceptable site and site

development. If Rural Development has not financed a contractor-built

house during the last twelve months, the value will be established by

use of the Marshall and Swift cost handbook or a similar type of

handbook. Equivalent value of a modest house is established by Rural

Development. This value is not necessarily equal to the modest housing

definition in 7 CFR §§ 3550.10 and 3550.63(a)(3). This value may be

determined periodically and published as a State Supplement. (Revised

12-12-19, PN 532.)

(Revision 3)

RD Instruction 1944-I

§ 1944.403 (Con.)

(h) Indirect costs. Those costs that are incurred for common or joint

objectives and therefore, cannot be readily and specifically identified

with a particular project or activity, e.g. self-help. See Exhibit P for

Rural Development’s indirect cost rate negotiation guidance. (Added

12-12-19, PN 532.)

(Added 12-12-19, PN 532)

(11-15-90) SPECIAL PN

§1944.403 (Con.) RD Instruction 1944-I

(i) Mutual self-help. The construction method by which participating

families organized in groups generally of 4 to 10 families utilize their

own labor to reduce the total construction cost of their homes.

Participating families complete construction work on their homes by an

exchange of labor with one another. The mutual self-help method must be

used for new construction.

(j) Organization.

(1) A State, political subdivision, or public nonprofit corporation

(including Indian tribes or Tribal corporations); or

(2) A private nonprofit corporation that is owned and controlled by

private persons or interests and is organized and operated for

purposes other than making gains or profits for the corporation and

is legally precluded from distributing any gains or profits to its

members.

(k) Participating family. Individuals and/or their families who agree

to build homes by the mutual self-help method and rehabilitate homes by

the self-help method. Participants are families with very low- or low-

incomes who have the ability to furnish their share of the required

labor input regardless of the handicap, age, race, color, national

origin, religion, family status, or sex of the head of household. The

participating family must be approved for a Section 502 RH loan or

similar loans from other Federal, state, and private lenders that uses

income guidelines substantially similar to the Department of Housing and

Urban Development before the start of construction, have sufficient time

available to assist in building their own homes, and show a desire to

work with other families. Each family in the group must contribute

labor on each other’s homes to accomplish the 65 percent of the total

100 percent of tasks listed in Exhibit B-2 of this subpart. A

participating family may use a substitute to perform the labor with

prior approval of the Grantee and the Rural Development State Director.

A substitute is only permitted when the participating family is

incapacitated. For rehabilitation type grants, participating families

must complete a minimum of 10 labor hours for every $1,000 in project

costs that are not completed by a sub-contractor. (Revised 12-12-19,

PN 532.)

(l) Self-help. The construction method by which an individual family

utilizes their labor to reduce the construction cost of their home

without an exchange of labor between participating families. Unless

otherwise authorized by the District Director, this method is only

funded for repair and rehabilitation type construction (owner occupied

or acquisition rehabilitation). (Revised 12-12-19, PN 532.)

(m) Sponsor. An existing entity that is willing and able to assist an

applicant, with or without charge, in applying for a grant and in

carrying out responsibilities under the agreement. Examples of sponsors

are local rural electric cooperatives, institutions of higher education,

community action agencies and other self-help grantees. Also, when

available, regional technical and management assistance contractors may

qualify to serve as a sponsor at no charge.

(Revision 1)

(11-15-90) SPECIAL PN

§1944.403 (n)(Con.) RD Instruction 1944-I

(n) Technical assistance. The organizing and supervising of groups of

families in the construction of their own homes including:

(1) Recruiting families who are interested in sharing labor in the

construction of each other's homes and assisting such families in

obtaining housing loans.

(2) Conducting meetings of the families to explain the self-help

program and subjects related to home ownership, such as loan

payments, taxes, insurance, maintenance, and upkeep of the property.

(3) Helping families in planning and developing activities that

lead to the acquisition and development of suitable building sites.

(4) Assisting families in selecting or developing house plans for

homes which will meet their needs and which they can afford.

(5) Assisting families in obtaining cost estimates for construction

materials and any contracting that may be required.

(6) Providing assistance in the preparation of loan applications.

(7) Providing construction supervision and training for families

while they construct their homes.

(8) Providing financial supervision to individual families with

Section 502 Rural Housing (RH) loans which will minimize the time

and effort required by Rural Development in processing borrower

expenditures for materials and contract services. For

rehabilitation projects, Section 504 loans/grants may also be

included. (Revised 12-12-19, PN 532.)

(9) Assisting families in solving other housing problems.

(o) Termination of a grant. The cancellation of Federal assistance, in

whole or in part, at any time before the date of completion.

§1944.404 Eligibility.

To receive a grant, the applicant must:

(a) Be an organization as defined in §1944.403(j) of this subpart.

(Revision 1)

RD Instruction 1944-I

§ 1944.404 (Con.)

(b) Have the financial, legal, administrative, and actual capacity to

assume and carry out the responsibilities imposed by the Agreement. To

meet the requirement of actual capacity it must either:

(1) Have necessary background and experience with proven ability to

perform responsibly in the field of mutual self-help or other

business management or administrative ventures which indicate an

ability to perform responsibly in the field of mutual self-help; or

(2) Be sponsored by an organization with background experience, and

ability, which agrees in writing to help the applicant to carry out

its responsibilities.

accounting of the expenditure of such funds, and comply with the

Agreement and Rural Development regulations. (Added 12-12-19, PN 532.)

(d) If the organization is a private nonprofit corporation, be a

corporation that:

(1) Is organized under State and local laws.

(2) Is qualified under Section 501(c)(3) of the Internal Revenue

Code of 1986.

(3) Has as one of its purposes the production of affordable

housing.

(4) Has a Board of Directors which consist of not less than five.

For smaller organizations (i.e. less than 5 staff members) a board

of 3 is authorized. (Revised 12-12-19, PN 532.)

§ 1944.405 Authorized use of grant funds.

(a) Payment of salaries of personnel as authorized in the Agreement.

(b) Payment of necessary and reasonable office expenses such as office

rental, office utilities, and office equipment rental. The purchase of

office equipment is permissible when the grantee determines it to be

more economical than renting. As a general rule, these types of

expenses would be classified as indirect costs in multiple funded

organizations.

(Revision 1)

(11-15-90) SPECIAL PN

§1944.405 (Con.) RD Instruction 1944-I

magazines.

(d) Payment of necessary employee benefit costs including but not

limited to items such as Worker's Compensation, employer's share of

social security, health benefits, and a reasonable tax deferred pension

plan for permanent employees.

(e) Purchase, lease, or maintenance of power or specialty tools such as

a power saw, electric drill, saber saw, ladders, and scaffolds, which

are needed by the participating families. The participating families,

however, are expected to provide their own hand tools such as hammers

and handsaws. If the grant award will not cover all tools, any proposal

to charge a tool rental fee directly to a program participant must meet

the following criteria:

(1) The fee amount must be reasonable and approved by Rural

Development. (Added 12-12-19, PN 532.)

(2) The proposal must demonstrate that the program participants

are receiving the best value as compared to renting from other

sources. These funds may only be used for the rental of tools and

other miscellaneous shared cost items for the building group (i.e.

porta- potty, scaffolding, temporary power supply, etc.). (Added

12-12-19, PN 532.)

(3) All rental fees must be tracked as a separate ledger item with

disbursements approved and reviewed annually by the Technical and

Management Assistance (T&MA) Contractor and Rural Development.

(Added 12-12-19, PN 532.)

(f) Payment of liability insurance and special purpose audit costs

associated with self-help activities. These would be considered direct

costs, even though the grantee's general liability insurance cost and

the cost of audits for the organization are generally indirect costs.

The amount of required liability insurance will vary based on the

organization’s assets at risk. For example, assets that could be lost

due to employee dishonesty at $100,000 requires matching liability

coverage. (Revised 12-12-19, PN 532.)

(g) Payment of reasonable fees for training of grantee personnel

including board members. This may include the cost of travel and per

diem to attend in or out-of-state training as authorized by the board of

directors and, when necessary, for the employee to do the current job.

These costs are generally direct costs.

(Revision 1)

RD Instruction 1944-I

§ 1944.405 (Con.)

(h) Payment of services rendered by a sponsor or other organization

after the grant is closed and when it is determined the sponsor can

provide the necessary services which will result in an overall reduction

in the cost of assistance. Typically, this will be limited to new

grantees and an existing grantee for the period of time that its size or

activity does not justify a full staff. A full staff is a full or part-

time director, project worker, secretary-bookkeeper, and a construction

supervisor. This type of cost is generally direct.

(i) Payment of certain consulting and legal costs required in the

administration of the grant if such service is not available without

cost. This does not include legal expenses for claims against the

Federal Government. (Legal costs that may be incurred by the

organization for the benefit of the participating families may be paid

with prior approval of the State Director).

(j) Payments of the cost of an accountant to set up an accounting

system and perform audits that may be required. Generally, these costs

are indirect.

(k) Payments of reasonable expenses of board members for attending

regular or special board meetings. These costs are indirect.

(Added 12-12-19, PN 532)

RD Instruction 1944-I

§ 1944.406 Prohibited use of grant funds.

(a) Hiring personnel specifically for the purpose of performing any of

the construction work for participating families in the self-help

projects.

(b) Buying real estate or building materials or other property of any

kind for participating families.

the participating families in the self-help projects should be.

(d) Paying for training of an employee as authorized by 2 CFR part 200

adopted by USDA through 2 CFR part 400.

(e) Paying costs other than approved indirect (including salaries) that

are not directly related to helping very low- and low-income families

obtain housing consistent with the objectives of this program.

§ 1944.407 Limitations.

The amount of the TA grant depends on the experience and capability of

the applicant and must be justified based on the number of families to be

assisted. As a guide, the maximum grant amounts for any grant period will be

limited to (See Exhibit H for sample calculations): (Revised 12-12-19,

PN 532.)

(a) An average TA cost equivalent per unit of no more than 15 percent

of the cost of equivalent value of modest homes built in the area.

(Upon request, the County Supervisor will provide the grantee the

average cost of modest homes for the area); or

(Revised 04-24-91, PN 163.)

(b) An average TA cost per equivalent unit that does not exceed the

difference between the equivalent value of modest homes in the area and

the average mortgage of the participating families minus $1,000; or

established by the State Director. The State Director may authorize a

greater TA cost than paragraph (a) or (b) of this section when needed to

accomplish a particular objective, such as requiring the grantee to

serve very low-income families, remote areas, or similar situations; or

(Revision 5)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.407 (Con.)

(d) A negotiated amount for repair and rehabilitation type proposals.

At a minimum, applicants applying for repair and rehabilitation grants

must include information on the proximity of the houses in a project,

the typical needed repairs, and the cost savings between self-help and

contractor rehabilitation and repair. This amount should be reviewed as

an average grant cost savings to the family which is greater than or

equal to the TA per equivalent unit cost. (Revised 12-12-19, PN 532.)

(e) Other limitations announced by Rural Development in an annual

funding policy. (Added 12-12-19, PN 532.)

§ 1944.408 [Reserved] (Revised 07-31-96, PN 264.)

§ 1944.409 Executive Order 12372.

The self-help program is subject to the provision of Executive Order

12372 which requires intergovernmental consultation with State and local

officials. Under Subpart I of Part 1970 (available in any Agency office),

new applicants for the self-help program must submit their Statement of

Activities to the State single point of contact prior to submitting their

preapplication to the Agency. The name of the point of contact is available

from the State Office. (Revised 01-18-12, SPECIAL PN.)

§ 1944.410 Processing preapplications, applications, and completing grant

dockets.

(a) Form SF-424, “Application for Federal Assistance.” Form SF-424 in

an original and one copy must be submitted by the applicant to the

District Director. It will be used to establish communication between

the applicant and RHS, determine the applicant's eligibility, determine

how well the project can compete with similar applications from other

organizations and eliminate any proposals which have little or no chance

for Federal funding before applicants incur significant expenditures for

preparing an application. In addition, the following information will

be attached to and become a part of the preapplication:

(1) Complete information about the applicant's previous experience

and capacity to carry out the objective of the agreement.

(Revision 5)

RD Instruction 1944-I

§ 1944.410(a) (Con.)

(2) If the applicant organization is already formed, a copy of or

an accurate reference to the specific provisions of State law under

which the applicant is organized; a certified copy of the

applicant's Articles of Incorporation and Bylaws or other evidence

of corporate existence; certificate of incorporation for other than

public bodies; evidence of good standing from the State when the

corporation has been in existence 1 year or more; the names and

addresses of the applicant's members, directors, and officers; and,

if another organization is a member of the applicant-organization,

its name, address, and principal business. If the applicant is not

already formed, attach copies of the proposed organizational

documents demonstrating compliance with §1944.404(d) of this

subpart.

(Added 12-12-19, PN 532)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.410(a) (Con.)

(3) A current (no more than 12 months old) dated and signed

financial statement showing the amounts and specific nature of

assets and liabilities together with information on the repayment

schedule and status of any debt owed by the applicant. If the

applicant is being sponsored by another organization, the same type

of financial statement also must be provided by the applicant's

sponsor. The applicant organization’s most recent audit report will

be provided, if available. (Revised 12-12-19, PN 532.)

(4) A narrative statement which includes information about the

amount of the grant funds being requested, area(s) to be served,

need for self-help housing in the area(s), the number of self-help

units proposed to be built, rehabilitated or repaired during the

agreement period, housing conditions of low-income families in the

area and reasons why families need self-help assistance. Evidence

should be provided that the communities support the activity and

that there are low-income families willing to contribute their labor

in order to obtain adequate housing. Evidence of community support

may be letters of support from local officials, individuals and

community organizations. The pre-application may contain

information such as census materials, local planning studies,

surveys, or other readily available information which indicates a

need in the area for housing of the type and cost to be provided by

the proposed self-help TA program.

(5) A plan of how the organization proposes to reach very low-

income families living in houses that are deteriorated, dilapidated,

overcrowded, and/or lack plumbing facilities.

(6) A proposed budget which will be prepared on SF-424A, “Budget

Information (Non-Construction Programs)” will be completed to

address applicable assurances as outlined in 2 CFR 200 as adopted by

USDA through 2 CFR 400. State and local Government will include an

assurance that the grantee shall comply with all applicable Federal

statutes and regulations in effect with respect to the periods for

which it receives grant funding. The State and local governments

shall also comply with 2 CFR 200 as adopted by USDA through part

400. (Revised 12-12-19, PN 532.)

(7) A preliminary survey as to the availability of lots and

projected cost of the sites.

(8) A list of other activities the applicant is engaged in and

expects to continue, and a statement as to other sources of funding

and whether it will have sufficient funds to assure continued

operation of the other activities for at least the period of the

agreement. If multi-funded, its cost allocation plan or indirect

cost rate must be part of the pre-application.

(Revision 2)

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RD Instruction 1944-I

§1944.410(a) (Con.)

(9) Whether assistance under paragraph (d) of this section is

requested and a brief narrative identifying the need, amount of

funds needed, and projected time period.

(10) If a project is planned for five or more housing lots or

units, an Affirmative Fair Marketing Plan is required. The plan

will be in effect until the completion of the project.

(b) Preapplication review.

(1) The District Director, within 30 days of receipt of the

preapplication, Form SF-424, and all other required information and

material will complete a thorough review for completeness, accuracy,

and conformance to program policy and regulations. Incomplete

preapplications will be returned to the applicant for completion.

The applicant should be given the name of the regional technical

assistance contractor. The County Supervisor in the prospective

county will be contacted as to the need for the program in the

proposed area and if the necessary resources are available to the

grantee. This will include a discussion of the number of 502 and

504 units that will need to be committed to the grantee and the

potential work impact on the office during the grant period. If it

is determined that the County Office lacks the resources (either

personnel or funds) to process all loan requests in a timely manner,

the District Director must communicate this need to the State

Director along with a recommended solution. (Lack of resources at

the county level are not grounds to deny a request). After the

District Director has determined that the preapplication is complete

and accurate, the District Director will assemble the material in an

applicant case file and forward it to the State Director. The case

file, as a minimum, must contain the following:

(i) Form SF-424,

(ii) Documentation required in accordance with 7 CFR part

1970, (Revised 04-01-16, SPECIAL PN.)

(iii) Eligibility recommendations, and

(iv) HUD Form 935.2 “Affirmative Fair Housing Marketing Plan

– Single Family Housing”, if applicable.

(Revision 2)

RD Instruction 1944-I

§ 1944.410(b) (Con.)

(2) The State Director may, if needed, submit the organizational

documents with any comments or questions to the Office of General

Counsel (OGC) for a preliminary opinion as to whether the applicant

is or will be a legal organization of the type required by these

regulations and for advice on any other aspects of the

preapplication.

(3) The State Director, if unable to determine eligibility or

qualifications with the advice of the OGC, may submit the

preapplication to the National Office for review. The

preapplication will contain all memoranda from OGC giving the

results of its review. The State Director will identify in the

transmittal memorandum to the National Office the specific problem

and will recommend possible solutions and any information about the

applicant which would be helpful to the National Office in reaching

a decision.

(4) After an eligibility determination has been made, which should

be completed within 30 days unless OGC is involved, the State

Director will:

(i) If the applicant is eligible, contact the National Office

as to the availability of funds or submit the proposal to the

National Office for authorization if the requested amount

exceeds the State Director's approval authority. If funds are

available, the final review officer, either the State Director

or the Assistant Administrator, Housing will issue a letter of

conditions that the applicant must meet and direct the

District Director to issue Form AD-622, “Notice of

Preapplication Review Action.”

(ii) If the applicant is determined not eligible, the State

Director will direct the District Director to issue Form AD-

622.

(1) If the applicant is eligible and after the State Director has

returned the pre-application information and, as appropriate, the

environmental review documentation required in 7 CFR part 1970 to

the Area Office, the Area Director will, within 10 days, prepare

and issue Form AD-622. The original Form AD-622 will be signed and

delivered to the applicant along with the letter of conditions, a

copy to the applicant's case file, a copy to the County Supervisor,

and a copy to the State Director. (Revised 04-01-16, SPECIAL PN.)

(Revision 2)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.410(c) (Con.)

(2) If the applicant is not eligible and after the State Director

has returned the preapplication information, the District Director

will within 5 days notify the applicant on Form AD-622. The

notification will inform the applicant that an appeal of the

decision may be made to the National Appeals Division under 7 CFR

Part 11 and Subpart B of Part 1900 of this chapter.

(3) If the applicant is eligible and no grant or loan funds are

available, the State Director will return the preapplication

information to the District Director who will, within 10 days,

notify the applicant on Form AD-622. The notification will explain

the facts concerning the lack of funding and that Rural Development

will notify them when funding will be available. This is not an

appealable decision.

(d) Self-help technical assistance grant predevelopment agreement. If

the grantee requested predevelopment assistance and the State Director

determines that the applicant lacks the financial resources to meet the

conditions of grant approval, a grant of up to $10,000 and for up to six

months will be made in order for the applicant to provide what is

required by paragraph (e) of this section. Exhibit D of this subpart

will be used for this purpose. Existing grantees proposing to operate

in an area different from the area that they are currently funded to

operate are eligible for this grant. However, this grant is available

only once for a defined area. This grant is available only after the

letter of conditions has been issued. Denial of this assistance is an

appealable decision under 7 CFR Part 11 Subpart B of Part 1900 of this

chapter.

(e) Form SF-424, “Application for Federal Assistance.” The applicant

will submit Form SF-424 in an original and one copy to the District

Director. The application should provide a detailed proposal of its

goals including (see Exhibit G and I for new construction and

rehabilitation type application checklists): (Revised 12-12-19,

PN 532.)

(1) Names, addresses, number in household, and total annual

household income of families who have been contacted by the

applicant and are interested in participating in a self-help housing

project. Community organizations including minority organizations

may be used as a source of names of people interested in self-help

housing.

(2) Proof that the first group of prospective participating

self-help families have qualified for financial assistance.

(Revision 2)

RD Instruction 1944-I

§ 1944.410(e) (Con.)

(3) Evidence that lots are optioned by the prospective

participating self-help families for the first group. Evidence that

lots are available for the remaining groups.

(4) Detailed cost estimates of houses to be built by the mutual

self-help method. Plans and specifications should be submitted with

the cost estimates.

(5) Proposed staffing need, including qualifications, experience,

proposed hiring schedule, and availability of any prospective

employees.

(6) Name, address, and official position of the applicant's

representative or representatives authorized to act for the

applicant and work with Rural Development.

(7) Budget information including a detailed budget for the

Agreement period based upon the needs outlined in the proposal.

SF 424A will be completed to furnish the budget information.

(8) Indirect or direct cost policy and proposed indirect cost rate

developed in accordance with 2 CFR 200 as adopted by USDA through 2

CFR part 400. (Revised 12-12-19, PN 532.)

(9) Personnel procedures and practices that will be established or

are in existence. Forms to be used should be submitted with the

application.

(10) A proposed monthly activities schedule showing the proposed

dates for starting and completing the recruitment, loan processing

and construction phases for each group of participant families.

(11) Other items identified in Exhibits G and I for new

construction and rehabilitation projects. (Added 12-12-19, PN 532.)

§ 1944.411 Conditions for approving a grant.

A grant may be approved for an eligible applicant when the conditions in

the letter of conditions are met and the following conditions are present

(see Exhibit J for a sample letter of conditions): (Revised 12-12-19,

PN 532.)

(a) The applicant has or can hire, or contract directly or indirectly

with, qualified people to carry out its responsibilities in

administering the grant.

(Revision 2)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.411 (Con.)

(b) The applicant has met all of the conditions listed in §1944.410(e)

of this subpart.

requirements of the Departmental Regulations found in 2 CFR 200 as

adopted by USDA through 2 CFR 400. (Revised 12-12-19, PN 532.)

(d) A resolution has been adopted by the board of directors which

authorizes the appropriate officer to execute Exhibit A of this subpart

and Form RD 400-4, “Assurance Agreement.” (Revised 04-24-91, PN 163.)

(e) The grantee has fidelity bonding as covered in 2 CFR 200 as adopted

by USDA through 2 CFR 400 if a nonprofit organization or, if a State or

local government, to the extent required in 2 CFR 200 as adopted by UDSA

through 2 CFR 400. (Revised 12-12-19, PN 532.)

(f) The grantee has agreed by completing SF-424B, “Assurances-Non-

Construction Programs,” that it will establish a recordkeeping system

that is certifiable by a certified public accountant that it adequately

meets the Agreement. (Revised 04-24-91, PN 163.)

(g) The grantee has established an interest-bearing checking account on

which at least two bonded officials will sign all checks issued and

understands that interest earned in excess of $250.00 annually must be

submitted to Rural Development quarterly. (The use of minority

depository institutions is encouraged.) Effective September 10, 2015,

interest earned up to $500 per year may be retained by the grantee for

administrative expense in accordance with 2 CFR §200.305(b)(9). Grantees

must maintain advance payments of Federal awards in interest-bearing

accounts in accordance with 2 CFR §200.305(b)(8) unless the following

apply: (Revised 12-12-19, PN 532.)

(1) The Non-Federal entity receives less than $120,000 in Federal

awards per year. (Added 12-12-19, PN 532.)

(2) The best reasonably available interest-bearing account would

not be expected to earn interest in excess of $500 per year on

Federal cash balances. (Added 12-12-19, PN 532.)

(3) The depository would require an average or minimum balance so

high that it would not be feasible within the expected Federal and

non-Federal cash resources. (Added 12-12-19, PN 532.)

(4) A foreign government or banking system prohibits or precludes

interest bearing accounts. (Added 12-12-19, PN 532.)

(Revision 2)

RD Instruction 1944-I

§ 1944.411 (Con.)

(h) The grantee has developed an agreement to be executed by the grantee

and the self-help participants which clearly sets forth what is expected

of each and has incorporated Exhibit B-2 of this subpart which clearly

shows what work is expected of the participating family.

(i) The grantee is not a debarred or an excluded party. The Treasury’s

Bureau of Fiscal Service Do Not Pay (DNP) portal, or an equivalent system

is used as part of the pre-award verification process and to reduce

improper payments. (Revised 12-12-19, PN 532.)

§ 1944.412 Docket preparation.

When the application and all items required for the complete docket have

been received, the District Director will thoroughly examine it to insure the

application has been properly and accurately prepared and that it includes

the required dates and signatures. The docket items will be assembled and

distributed by the District Director in the following order:

Number

Form Name of Form Total No. Signed by for Agree- Copy for

Number or Document of Copies Applicant ment docket Applicant

SF-424 Application for 3 1 1-0&1C 1-C

Federal Assistance

14A

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RD Instruction 1944-I

§1944.412 (Con.)

AD-622 Notice of Pre-

application Review

Action 2 - 1-C 1-0

RD Request for Obligation

1940-1 of Funds 4 2 3-0&2C 1-C

RD Assurance

400-4 Agreement 2 1 1-0 1-C

HUD Form 935.2,

Affirmative Fair 3 1 1-0&1C 1-C

Housing Marketing

Plan

Certified Copy

Authorizing

Resolution 1 1 1-0 -

Self-Help Technical

Assistance Grant

Agreement (Exhibit A) 2 1 1-0 1-C

Any Personnel Forms

to be used 2 1-0 1-C

Additional items for New Construction (Exhibit G), or Rehabilitation

(Exhibit I) (Added 12-12-19, PN 532.)

O=Original

C=Copy

_____________________________________________________________________________

§1944.413 Grant approval.

(a) Approval of grant. Within 30 days of the grantee meeting the

conditions of §1944.411 of this subpart or, if applicable, signing

Exhibit D, the approving official will:

(1) Execute and distribute Form RD 1940-1 in accordance with the

Forms Manual Insert (FMI).

(2) After the Finance Office acknowledges that funds are obligated,

request an initial advance of funds on Form RD 440-57,

“Acknowledgment of Obligated Funds/Check Request,” in accordance

with the FMI. The amount of this request should cover the

applicant's needs for the remainder of the month in which the grant

is closed plus the next month. Subsequent advances will cover only

a one-month period.

(b) Cancellation of an approved grant. An approved grant may be

canceled before closing if the applicant is no longer eligible, the

(Revision 1)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.413(b) (Con.)

proposal is no longer feasible, or the applicant requests cancellation.

Cancellation will be accomplished as follows:

(1) The District Director will prepare Form RD 1940-10,

“Cancellation of U.S. Treasury Check and/or Obligation,” according

to the FMI and send it to the State Director with the reasons for

cancellation. If the State Director approves the request, Form RD

1940-10 will be returned to the District Office for processing in

accordance with the FMI.

(2) The District Director will notify the applicant of the

cancellation and the right to appeal under 7 CFR Part 11 and Subpart

B of Part 1900 of this chapter. If the applicant requested the

cancellation, no appeal rights are provided, but the applicant will

still be notified of the cancellation.

has been developed, the approving official will state the reason on the

original Form RD 1940-1, or in a memorandum to the District Director.

The District Director will notify the applicant in writing of the

disapproval and the reason for disapproval. Also, the notification will

inform the applicant of its appeal rights under 7 CFR Part 11 Subpart B

of Part 1900 of this chapter.

_____________________________________________________________

§1944.414 [Reserved]

§1944.415 Grant approval and other approving authorities.

(a) The State Director is authorized to approve or disapprove TA grants

under this subpart. For a grant in excess of $300,000, or in the case

of a grant amendment when the amount of the grant plus any unexpended

funds from a previous grant will exceed $400,000, prior written consent

of the National Office is required. In such cases, the docket, along

with the State Director's recommendations, must be submitted to the

National Office for review.

(1) Once funds have been obligated, the National Office will issue

a letter to the State Director confirming the obligation and

outlining any additional closing conditions. The Letter of

Conditions (LOC) will include all conditions to grant closing and

issue it with the grant agreement, as applicable. This final LOC is

part of the grant docket and no funds may be released to the grantee

before the grant agreement is fully executed. Once the grant is

closed, a copy of the fully executed grant agreement and LOC are

also provided to the T&MA Contractor. (Added 12-12-19, PN 532.)

(Revision 1)

RD Instruction 1944-I

§ 1944.415(a) (Con.)

(2) Congressional notification is accomplished through the Rural

Development Office of External Affairs (OEA) procedures to announce

grant awards. (Added 12-12-19, PN 532.)

(b) The State Director may approve a grant not to exceed $10,000 to an

eligible organization under §1944.410(d) of this subpart. The grant

must be limited to 6 months and funds must be used for the development

of the final application, family recruitment, and related activities as

explained in §1944.410(e) of this subpart. The amount of this grant

will not be included in figuring TA cost per units.

16A

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RD Instruction 1944-I

§ 1944.415 (Con.)

Administrator of Rural Development, Rural Housing Service. (Revised

12-12-19, PN 532.)

(d) Monthly expenditures of the grantee will normally be approved by

the District Director unless:

(1) The grantee operates in only one county, in which case the

authority may be delegated to the County Supervisor.

(2) The grantee operates in more than one Rural Development

District, in which case the State Director will designate the

approving official.

(3) The grantee operates in more than one State Director's

jurisdiction, in which case the Administrator will designate the

approving official.

(4) The expenditure is under contract authority, in which case the

Contracting Official Representative will approve the monthly

expenditure.

§ 1944.416 Grant closing.

The grant is closed on the date the Agreement is executed as defined in

§1944.403(a) by the applicant and the Government. Funds may not be advanced

prior to the signing of the Agreement. The District Director or Assistant

District Director are authorized to execute the Agreement for Rural

Development. Person(s) authorized by resolution may sign for the applicant.

§ 1944.417 Servicing actions after grant closing.

Rural Development has a responsibility to help the grantee be successful

and help the grantee avoid cases of fraud and abuse. Servicing actions also

include correlating activities between the grantee and Rural Development to

the benefit of the participating families. The amount of servicing actions

needed will vary in accordance with the experience of the grantee, but as a

minimum the following actions are required:

(a) Monthly, the grantee will provide the District Director with a

request for additional funds on Form SF-270, “Request for Advance or

Reimbursement.” This request need only show the amount of funds used

during the previous month, amount of unspent funds, projected need for

the next 30 days, and written justification if the request exceeds the

projected need for the next 30 days. This request must be in the

District Director's office fifteen days prior to the beginning of the

month. Upon receipt of the grantee's request, the District Director

will:

(Revision 2)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.417(a) (Con.)

(1) If the request appears to be in order, process Form RD 440-57

so that delivery of the check will be possible on the first of the

next month. Grant disbursements are based upon an approved draw

schedule taking into account, but not based exclusively on the

Equivalent Units (EU’s) produced as well as other factors such as

power tool and equipment needs, audit requirements, and training.

With the request, the grantee may submit a copy of a current working

budget and sample draw request form found in Exhibit L. (Revised

12-12-19) PN 532.)

(2) If the request does not appear to be in order, immediately

contact the grantee to resolve the problem. After the contact:

(i) if the explanation is acceptable, process Form RD 440-57

so delivery may be possible by the first of the next month, or

(ii) if the explanation is not acceptable, immediately notify

the grantee and request the amount of funds that appear

reasonable for the next 30 days on Form RD 440-57, so that

delivery may be possible by the first of the next month.

Unapproved funds that are later approved will be added to the

next month's request.

(b) Quarterly, the grantee will submit Exhibit B of this subpart in an

original and three copies to the County Supervisor on or before January

15, April 15, July 15, and October 15 which will verify its progress

toward meeting the objectives stated in the Agreement and the

application. The County Supervisor will immediately complete the County

Office review part and forward the report to the District Office. After

Exhibit B is received in the District Office, a meeting should be

scheduled between the grantee, District Director, and the County

Supervisor since this is an opportune time for both the grantee and

Rural Development to review progress to date and make necessary

adjustments for the future. This meeting is required if the grantee was

previously identified as a problem grantee or will be identified as a

problem grantee at this time. Regardless of whether a meeting will be

held, the following will be done (Note: Conducting this meeting

virtually is permitted. The grantee, Rural Development staff

administering the TA grant, processing Section 502 loans / Section 504

loans and grants, and the T&MA Contractor should participate in

meetings): (Revised 12-12-19) PN 532.)

(1) Exhibit B and other information will be evaluated to determine

progress made to date. The District Director will comment on

Exhibit B as to whether the grantee is ahead or behind schedule in

each of the following areas (Note: an automated process for Exhibit

B may be used so long as it captures the same data.): (Revised

12-12-19) PN 532.)

(i) Assisting the projected number of families.

(Revision 2)

RD Instruction 1944-I

§ 1944.417(b)(1) (Con.)

(ii) Serving very low-income applicants. Is the grantee

reaching a minimum of very low-income families as required in

Exhibit A, Attachment 2 to Subpart L of Part 1940 of this

chapter (available in any Rural Development office).

18A

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RD Instruction 1944-I

§ 1944.417(b)(1) (Con.)

(iii) Equivalent units (EUs). Is the number of EUs completed

representative of lapse in time of the grant? For example, if

25 percent of the grant period has elapsed, are 25 percent of

the number of EUs completed?

(iv) Labor contributions by the family. Are the families

working together and are they completing the labor tasks as

established on Exhibit B-2?

(2) The District Director will submit Exhibit B to the State

Director who will evaluate the quarterly report along with the

District Director's comments. If the State Director determines the

grantee is progressing satisfactorily, the State Director will sign

and forward Exhibit B to the National Office. However, if the State

Director determines the grantee is not performing as expected, the

State Director will notify the grantee that it has been classified a

“High Risk” grantee. The notice will specify the deficiencies and

inform the grantee of proposed remedies for non-compliance.

Performance issues include any problem that will affect or is

affecting the grantee’s ability to meet the five grant goals with

consideration for issues that may be caused by Rural Development

delays. See Exhibit M for a sample “High Risk” designation letter.

(Revised 12-12-19) PN 532.)

The notice will advise the grantee that Rural Development is

available to assist and provide the name and address of an

organization that is under contract with Rural Development to assist

them. The State Director will forward a copy of Exhibit B, District

Directors comments, and the reasons for classifying them as “High

Risk” to the National Office, Single Family Housing, Special

Programs Branch. When the period of time provided for corrective

action has expired, an assessment will be made of the progress by

the grantee toward correcting the situation. If the State Director

determines:

(i) The situation has been corrected or reasonable progress

has been made toward correcting the situation, the “High Risk”

status will be lifted and the grantee so notified. See

Exhibit N for sample “High Risk” removal letter. (Revised

12-12-19, PN 532.)

(ii) The situation has not been corrected but it is

correctable if additional time is granted, an extension will

be issued.

(iii) The situation has not been corrected and it is unlikely

to be corrected if given additional time, the grant will be

terminated under §1944.426(b)(1) of this subpart. Termination

of a grant should only begin with concurrence from the

National Office, Single Family Housing, Special Programs

Branch. (Revised 12-12-19) PN 532.)

§1944.418 [Reserved]

(Revision 1)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.419 Final grantee evaluation.

Near the end of the grant period but prior to the last month, an

evaluation of the grantee will be conducted by Rural Development. The State

Director may use Rural Development employees or an organization under

contract to Rural Development to provide the evaluation. The evaluation is

to determine how successful the grantee was in meeting goals and objectives

as defined in the agreement, application, this regulation, and any

amendments. Failure to obtain at least an acceptable grant rating could

jeopardize future grant awards. (Revised 12-12-19) PN 532.)

(a) This is a quantitative evaluation of the grantee to determine if it

met its goals in:

(1) Assisting the projected number of families in obtaining

adequate housing.

(2) Meeting the goal of assisting very low-income families.

(3) Meeting the family labor requirement in §1944.411(h) and

Exhibit B-2 of this subpart. For rehabilitation use Exhibit K-2.

(Revised 12-12-19) PN 532.)

(4) Keeping costs within the guides set in §1944.407.

(5) Meeting other objectives in the Agreement.

(b) The evaluation is a narrative addressed to the State Director with

a copy to the National Office, Single Family Housing Processing

Division. It will be in 3 parts, namely; findings, recommendations, and

an overall rating. The rating will be either unacceptable, acceptable,

or outstanding, as follows (see Exhibit O for a sample final evaluation

letter): (Revised 12-12-19) PN 532.)

(1) Outstanding if the grantee met or exceeded all of the goals in

paragraph (a) of this section.

(2) Acceptable if the grantee met or exceeded all of the goals as

defined in paragraph (a) except two.

(3) Unacceptable if the grantee failed to obtain an acceptable

rating.

(Revision 1)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.419 (Con.)

be mailed to the grantee. The grantee may request a review of the

evaluation with the District Director. This review is for clarification

of the material and to dispute the findings if they are known to be

wrong. The rating is not open for discussion except to the extent it

can be proven that the findings do not support the rating. If this is

the case, the District Director will file an amendment to the State

Director. A copy of this letter should also be forwarded to the National

Office, Single Family Housing, Special Programs Branch and the T&MA

Contractor. (Revised 12-12-19) PN 532.)

20A

(Added 12-12-19, PN 532)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.420 Extension or revision of the grant agreement.

The State Director may authorize the District Director to execute on

behalf of the Government, Exhibit C of this subpart, at any time during the

grant period provided:

(a) The extension period is for no more than one year from the final

date of the existing Agreement.

(b) The need for the extension is clearly justified,

complete justification, and

(d) The grantee is within the guidelines in §1944.407 of this subpart

or the State Director determines that the best interest of the

Government will be served by the extension

(e)Requests for extensions or revisions should be made by the grantee in

writing prior to the expiration of the grant. Grantee should include

any pertinent documents such as a revised budget, implementation

schedule and current status report utilizing Exhibit B for new

construction or Exhibit K for rehabilitation. The T&MA Contractor

should also review the request and provide a recommendation to Rural

Development. Rural Development will review the request and if approved

issue Exhibit C, “Amendment to Self-Help Technical Assistance Grant

Agreement” along with an amended letter of conditions, as needed. State

Directors may not approve extensions beyond one year. Time extensions

beyond one year may be approved with National Office concurrence.

Grantees should be monitored closely after an extension or other

modification to ensure compliance and to prevent further delays. (Added

12-12-19, PN 532.)

§1944.421 Refunding of an existing grantee.

Grantees wishing to continue with self-help efforts after the end of the

current grant plus any extensions should file Form SF-424, in accordance with

§1944.410(e). It is recommended that it be filed at least 6 months before

the end of the current grant period. Funds from the existing grant may be

used to meet the conditions of a new grant to serve the same or redefined

geographic area. If the grantee is targeting a different geographic area, a

new preapplication must be submitted in accordance with §1944.410 and the

grantee may apply for a predevelopment grant in accordance with §1944.410(d).

In addition to meeting the conditions of an applicant as defined in §1944.411

of this subpart, the grantee must also have received or will receive an

acceptable rating on its current grant unless an exception is granted by the

State Director. The State Director may grant an exception to the rating if

it is determined that the reasons causing the previous unacceptable rating

have been removed or will be removed with the approval of this grant.

(Revision 2)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§1944.422 Audit and other report requirements.

The grantee must submit an audit to the appropriate Rural Development

District Office annually (or biennially if a State or local government with

authority to do a less frequent audit requests it) and the earlier of 30

calendar days after receipt of the auditor's report or nine months after the

end of the grantee's audit period. The audit, conducted by the grantee's

auditors, is to be performed in accordance with Generally Accepted Government

Auditing Standards (GAGAS), using the publication “Standards for Audit of

Governmental Organizations, Programs, Activities and Functions” developed by

the Comptroller General of the United States in 1981, and any subsequent

revisions. In addition, the audits are also to be performed in accordance

with 2 CFR part 200 as adopted by USDA through 2 CFR part 400 and Rural

Development requirements as specified in this subpart. Audits of the

borrower loan funds will be required. The number of borrower accounts

audited will be determined by the auditor. In incidences where it is

difficult to determine the appropriate number of accounts to be audited,

auditors should be authorized by the State Director to audit the lesser of 10

loans or 10 percent of total loans. Audits of the borrower funds do not

necessarily need to be tested in the same manner as the organizational audit.

Agreed Upon Procedures (AUPs) may be developed and used for the Section 502

or 504 loan funds in custodial accounts. At a minimum, an AUP engagement

will include a review of the draw requests to ensure charges listed can be

traced back to source documents and a reconciliation of the financial

institution’s account record. (Revised 12-12-19) PN 532.)

(a) Nonprofit organizations and others. If determined necessary, these

organizations are to be audited in accordance with Rural Development

requirements in accordance with 2 CFR part 200 as adopted by USDA

through 2 CFR part 400. These requirements also apply to public

hospitals, public colleges, and universities if they are excluded from

the audit requirements of paragraph (b) of this section. (Revised

12-12-19) PN 532.)

(1) An audit conducted by the grantee's auditor shall be supplied

to the Rural Development District Director as soon as possible but

in no case later than ninety (90) days following the period covered

by the grant agreement.

(2) Auditors shall promptly notify United States Department of

Agriculture's Office of the Inspector General Regional Inspector

General and the Rural Development District Office, in writing, of

any indication of fraud, abuse, or illegal acts in grantees use of

grant funds or in the handling of borrower’s accounts.

(3) Nonprofit organizations that receive less than $25,000 a year

in Federal financial assistance need not be audited.

(Revision 2)

RD Instruction 1944-I

§ 1944.422 (Con.)

(b) State and local governments and Indian tribes. These organizations

are to be audited in accordance with this subpart and 2 CFR 200 as

adopted by USDA through 2 CFR part 400. The grantee will forward

completed audits to the appropriate Federal cognizant agency and a copy

to the Rural Development District Director. “Cognizant agency” for

audits is defined at 2 CFR 200.18 as the Federal agency designated to

carry out the responsibilities described in §200.513 Responsibilities,

paragraph (a). The cognizant agency for audit is not necessarily the

same as the cognizant agency for indirect costs. A list of cognizant

agencies for audit may be found at the FAC Web site. Within USDA, the

OIG shall fulfill cognizant agency responsibilities. Smaller grantees

not assigned a cognizant agency by OMB should contact the Federal agency

that provided the most funds. When USDA is designated as the cognizant

agency or when it has been determined by the borrower that Rural

Development provided the major portion of Federal financial assistance,

the State Director will contact the appropriate USDA OIG Regional

Inspector General. Rural Development and the borrower shall coordinate

all proposed audit plans with the appropriate USDA OIG. (Revised

12-12-19, PN 532.)

22A

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(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.422 (Con.)

(1) State and local governments and Indian tribes that receive

$25,000 or more a year in Federal financial assistance shall have an

audit made in accordance with 2 CFR part 200 as adopted by USDA

through 2 CFR 400. (Revised 12-12-19) PN 532.)

(2) State and local and Indian tribes that receive less than

$25,000 a year in Federal financial assistance shall be exempt from

2 CFR part 200 as adopted by USDA through 2 CFR part 400. (Revised

12-12-19, PN 532.)

(3) Public hospitals and public colleges and universities may be

excluded by the State Director from OMB Circular A-128 audit

requirements. If such entities are excluded, audits shall be made

in accordance with paragraph (a) of this section.

§ 1944.423 Loan packaging and 502 RH application submittal.

A grantee is required to assist 502 RH applicants in submitting their

application for an RH loan. Loan packaging will be performed in accordance

with 7 CFR part 3550; therefore, it is important that the grantee be trained

at an early date in the packaging of RH loans. Typically, this training

should take place before the first applications are submitted to the County

Office and before the grant is closed. A grantee should become very

knowledgeable of Rural Development's eligibility requirements but must

understand that only Rural Development can approve or deny an applicant

assistance. Grantee must work cooperatively with Rural Development in the

502 loan approval process and must work within the regulations for the 502

program and recognize Rural Development's ultimate decision making authority

to approve or deny loans. However, the grantee may ask for clarification

that may be helpful in working with future applicants. Grant funds may not

be used to pay any expense in connection with an appeal that the applicant

may file or pursue.

(a) Grantee packaging for a Rehabilitation type project, at a minimum,

must include the following items: (Added 12-12-19, PN 532.)

(1) Final Purchase and Sale Agreement – with any amendments (n/a

for Owner Occupied Rehab),

(2) Inspection Report – qualified inspector as described above,

(3) Work Order List – with a description of materials,

(Revision 3)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.423(a) (Con.)

(4) Development Plan Cost Breakdown – include

development/construction costs; purchase price and closing costs as

applicable,

(5) Projected Cost Savings – utilizing one of the allowed methods

described below and,

(6) Estimated Construction Period – including average labor

requirements for the participants.

(b) This docket will be submitted to the local RD office if Agency

funding will be used. If funding other than 502/504 will be utilized,

grantees will need to report quarterly on the items outlined in Exhibit

K but do not need to submit an entire project docket to the Agency.

While rehab projects do not need to be approved individually, be

reminded that the rehab program goal at grant completion is to have an

average cost savings that is equal to or greater than the TA cost.

(Added 12-12-19, PN 532.)

Section 504 Loan/ Grant programs. (Added 12-12-19, PN 532.)

§ 1944.424 Dwelling construction and standards.

All construction will be performed in accordance with Subpart A of Part

1924 of this chapter. The planned work must meet the building requirements

of 7 CFR part 3550 and meet the Development Standards as defined in subpart A

of part 1924 of this chapter and in any local codes. Sites and site

developments must conform to the requirements of subpart C of part 1924 of

this chapter. The following applies to rehabilitations type construction

projects:

(a) It is the responsibility of the Section 523 Mutual Self-Help

applicant/grantee to provide adequate documentation to support the

proposal for rehab projects. When a home has been identified for rehab,

the grantee will need to assess the project’s feasibility. Rehab

projects may be on scattered sites and the construction supervisor

travel cost, as well as oversight requirements for each task, should be

accounted for in a grantee’s feasibility analysis. Grantees should

consider all organizational costs associated with undertaking the

project and compare it to the maximum allowable TA amount before

proceeding. (Added 12-12-19, PN 532.)

(Revision 3)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.424 (Con.)

(b) The grantee must also determine if an identified home is suited for

the program. Extreme consideration should be given to any hazardous

materials, lead, mold and asbestos identified during the inspection.

The scope of work for any project must, at a minimum, ensure that

construction meets the standards in RD Instruction 1924-A and local

codes for Acquisition Rehab; while Owner Occupied Rehab projects will

typically need to meet Agency decent, safe, and sanitary requirements

and local codes, if applicable. For this reason, a whole house

inspection from a state-licensed inspector that addresses all items in

Handbook HB-1-3550, paragraph 5.7 (A), is required for Acquisition

projects (Added 12-12-19, PN 532.)

inspection from the grantee’s qualified staff. State offices will

determine the qualification of the grantee’s staff and may require a

third-party inspection on a case by case basis. Based on the

inspector’s findings, the grantee will prepare the project application

docket described above. (Added 12-12-19, PN 532.)

(d) The grantee will be responsible for ensuring the bidding process

for subcontracted work provides the best value to the program

participants. The best value to the participant may be documented by

comparable contractor bids, use of cost estimating software when costs

appear realistic for the area, and/or the grantees certification that no

better value is known based on their knowledge of the area. (Added

12-12-19, PN 532.)

(e) State offices must approve a grantee’s performance of any

subcontracted labor arrangements. In order for a grantee to serve as a

subcontractor on a rehab project they must be licensed (if required by

State law), demonstrate that they are able to provide the best value to

the program participant as described above; and also have an accounting

system that will ensure the 523 grant is not charged for subcontracted

work which is a cost to the program participant’s loan/grant. (Added

12-12-19, PN 532.)

24A

(Added 12-12-19, PN 532)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.425 Handling and accounting for borrower loan funds.

Grantees will be required to administer borrower loan funds during the

construction phases. The extent of their involvement will depend on the

experience of the grantee and the amount of authority delegated to them by

the District Director in accordance with § 1924.6(c) of Subpart A of Part

1924 of this chapter. Training should include Rural Development's non-

discrimination policies in receiving applications. At a minimum, the

following requirements must be met: (Revised 12-12-19, PN 532.)

(a) The grantee should have successfully completed at least one grant

cycle. (Added 12-12-19, PN 532.)

(b) The grantee has a record-keeping system which shows that the cost

of the materials and services were allocated to each borrower’s account

in relation to the actual material and service used by each borrower.

When requesting funds from the 502 borrower accounts, the grantee should

provide RD with clear documentation of the expenditures due. This

should include a coversheet detailing the current charges due from the

borrower as well as copies of corresponding invoices. The coversheet

should be signed by both the grantee and the participating family before

it is submitted to the RD for processing. (Added 12-12-19, PN 532.)

Self-Help group with funds exceeding $250,000 at any time must have

acceptable collateral pledged with the Federal Reserve Bank in an amount

not less than the excess as outlined in RD Instruction 1902-A §1902.7.

To avoid this situation, the field office should monitor the custodial

account as draws are requested. It is advantageous to make smaller

draws on the borrower’s accounts, more frequently, as funds are needed.

(Added 12-12-19, PN 532.)

(d) A letter from the self-help grantee’s auditor or T&MA Contractor

indicating that the proposed method for bill-paying provides a means for

an adequate audit trail. (Added 12-12-19, PN 532.)

§ 1944.426 Grant closeout.

(a) Grant purposes completed. Promptly after the date of completion,

grant closeout actions will be taken to allow the orderly discontinuance

of grantee activity.

24B

(Added 12-12-19, PN 532)

RD Instruction 1944-I

§ 1944.426(a) (Con.)

(1) The grantee will immediately refund to Rural Development any

balance of grant funds advanced that are not committed for the

payment of authorized expenses. The unused grant funds will be

remitted on Form RD 451-2, “Schedule of Remittances” in

accordance with the form’s manual insert. (Revised 10-28-03,

SPECIAL PN.)

(2) The grantee will furnish Form SF-269A, “Financial Status

Report (short form)” to Rural Development within 90 days after

the date of completion of the grant. All other financial,

performance, and other reports required as a condition of the

grant also will be completed.

(3) After the grant closeout, Rural Development retains the

right to recover any disallowed costs which are discovered as a

result of the final audit. 7 CFR part 3550 will be used by Rural

Development to recover any unauthorized expenditures. (Revised

01-23-03, SPECIAL PN.)

(4) The grantee will provide Rural Development an audit

conforming to those requirements established in this part,

including audits of self-help borrower accounts.

(5) Upon request from the recipient, any allowable reimbursable

cost not covered by previous payments shall be promptly paid by

Rural Development.

24C

(Added 12-12-19, PN 532)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.426 (Con.)

(b) Grant purposes not completed.

(1) Notification of termination. The State Director will promptly

notify the grantee and the National Office in writing of the

termination action including the specific reasons for the decision

and the effective date of the termination. The notification to the

grantee will specify that if the grantee believes the reason for the

proposed termination can be resolved, the grantee should, within 15

calendar days of the date of this notification, contact the State

Director in writing requesting a meeting for further consideration.

The meeting will be an informal proceeding at which the grantee will

be given the opportunity to provide whatever additional information

it believes should be considered in reaching a decision concerning

the case. The grantee may have an attorney or any other person

present at the meeting if desired. Within 7 calendar days of the

meeting, the State Director will determine what action to take.

(i) If the State Director determines that termination is not

necessary, the grantee will be informed by letter along with

the District Director.

(ii) If the State Director determines that termination of the

grant is appropriate, he/she will promptly inform the grantee

by the use of Exhibit B-3 of 7 CFR Part 11 and Subpart B of

Part 1900 of this chapter.

(2) National Office review.

(i) Upon receipt of a request from a grantee that the

decision of the State Director be reconsidered, the National

Office will make a preliminary decision concerning the

continued funding of the grantee during the appeal period.

Written notification of the decision will be given to the

State Director and grantee.

(ii) The National Office will then obtain a comprehensive

report on the matter from the State Office. This information

will be considered together with any additional information

that may be provided by the grantee.

terms of the agreement, the District Director will promptly report the

facts to the State Director. The State Director will consider

termination or suspension of the grant usually only after a Grantee has

been classified as “high risk” in accordance with §1944.417(b)(2)

(Revision 1)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

§ 1944.426 (Con.)

of this subpart. When the State Director determines that the grantee

has a reasonable potential to correct deficiencies the grant may be

suspended. The State Director will request written authorization from

the National Office to suspend a grantee. The suspension will adhere to

2 CFR part 200 as adopted by UDA through 2 CFR 400. The grantee will be

notified of the grant suspension in writing by the State Director. The

State Director will also promptly inform the grantee of its rights to

appeal the decision by use of Exhibit B-3 of 7 CFR Part 11 and Subpart B

of Part 1900 of this chapter. (Revised 12-12-19, PN 532.)

(d) Grant Termination. The State Director may terminate the grant

agreement whenever Rural Development determines that the grantee has

failed to comply with terms of the Agreement. The reasons for

termination may include, but are not limited to, such problems as listed

in paragraph (e)(3)(i) of Exhibit A of this subpart. The State Director

may also withhold further disbursement of grant funds and prohibit the

grantee from incurring additional obligations of grant funds with

written approval of the National Office. Rural Development will allow

all necessary and proper costs which grantee could not reasonably avoid.

(1) Termination for cause. The grant agreement may be terminated

in whole, or in part, at any time before date of completion,

whenever Rural Development determines that the grantee has failed to

comply with terms of the Agreement. The State Director will notify

the grantee in writing giving the reasons for the action and inform

the grantee of its rights of appeal by use of Exhibit B-3 of 7 CFR

Part 11 and Subpart B of Part 1900 of this chapter.

(2) Termination for convenience. Rural Development or the grantee

may terminate the grant in whole, or in part, when both parties

agree that the continuation of the grant would not produce

beneficial results. The two parties will agree in writing to the

termination conditions including the effective date. No notice of

rights of appeal will be issued by Rural Development.

§ 1944.427 Grantee self-evaluation.

Annually or more often, the board of directors will evaluate their own

self-help program. Exhibit E of this subpart is provided for that purpose.

It is also recommended that they review their personnel policy, any audits

that may have been conducted and other reports to determine if they need to

make adjustments in order to prevent fraud and abuse, and meet the goals in

the current grant agreement.

(Revision 1)

RD Instruction 1944-I

§§ 1944.428 - 1944.449 [Reserved]

§ 1944.450 OMB Control Number

The reporting and recordkeeping requirements contained in this regulation

have been approved by the Office of Management and Budget and have been

assigned OMB control number 0575-0043. Public reporting burden for this

collection of information is estimated to vary from 10 minutes to 18 hours

per response, with an average of 1.17 hours per response including time for

reviewing instructions, searching existing data sources, gathering and

maintaining the data needed, and completing and reviewing the collection of

information. Send comments regarding this burden estimate or any other

aspect of this collection of information, including suggestions for reducing

this burden, to Department of Agriculture, Clearance Officer, OIRM, Room 404-

W, Washington, D.C. 20250; and to the Office Management and Budget, Paperwork

Reduction Project (OMB# 0575-0043), Washington, D.C. 20503.

Attachments: Exhibits A, B, B-1, B-2, B-3, C, D, E, F, G, H, I, J, K, L, M,

N, O & P.

oOo

(Revision 1)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit A

SELF-HELP TECHNICAL ASSISTANCE GRANT AGREEMENT

THIS GRANT AGREEMENT dated _________________, 19___, is between _________

_________________________________________________________________________

a nonprofit corporation (“Grantee”), organized and operating under

_________________________________________________________________________

(authorizing State statute)

and the United States of America acting through Rural Development, Department

of Agriculture.

In consideration of financial assistance in the amount of $______________

(called “Grant Funds”) to be made available by Rural Development to Grantee

under Section 523 (b) (1)(A) of the Housing Act of 1949 to be used in

(specify area to be served) ___________________________________ for the

purpose of providing a program of technical and supervisory assistance which

will aid low-income families in carrying out mutual self-help housing

efforts. Grantee will provide such a program in accordance with the terms of

this Agreement and Rural Development regulations.

Definitions:

“Date of Completion” means the date when all work under a grant is completed

or the date in the TA Grant Agreement, or any supplement or amendment

thereto, on which Federal assistance ends.

“Disallowed costs” are those charges to a grant which the Rural Development

determines cannot be authorized.

“Grant Closeout” is the process by which the grant operation is concluded at

the expiration of the grant period or following a decision to terminate the

grant.

“Termination” of a grant means the cancellation of Federal assistance, in

whole or in part, under a grant at any time prior to the date of completion.

Terms of agreement:

(a) This Agreement shall terminate ______________ years from this date

unless extended or sooner terminated under paragraphs (e) and (f) of

this Agreement.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit A

Page 2

(b) Grantee shall carry out the self-help housing activity described in

the application docket which is attached to and made a part of this

Agreement. Grantee will be bound by the conditions set forth in the

docket, 7 CFR Part 1944, Subpart I, and the further conditions set forth

in this Agreement. If any of the conditions in the docket are

inconsistent with those in the Agreement or Subpart I of Part 1944, the

latter will govern. A waiver of any condition must be in writing and

must be signed by an authorized representative of Rural Development.

specified in Rural Development regulations and in the application docket

approved by Rural Development including the approved budget. Any uses

not provided for in the approved budget must be approved in writing by

Rural Development in advance.

(d) If Grantee is a private nonprofit corporation, expenses charged for

travel or per diem will not exceed the rates paid Rural Development

employees for similar expenses. If Grantee is a public body, the rates

will be those that are allowable under the customary practice in the

government of which Grantee is a part; if none are customary, the Rural

Development rates will be the maximum allowed.

(e) Grant closeout and termination procedures will be as follows:

(1) Promptly after the date of completion or a decision to

terminate a grant, grant closeout actions are to be taken to allow

the orderly discontinuation of Grantee activity.

(i) Grantee shall immediately refund to Rural Development any

uncommitted balance of grant funds.

(ii) Grantee will furnish to Rural Development within 90 days

after the date of completion of the grant a “Financial Status

Report”, Form SF-269A. All financial, performance, and other

reports required as a condition of the grant will also be

completed.

(iii) Grantee shall account for any property acquired with

technical assistance (TA) grant funds, or otherwise received

from Rural Development.

(iv) After the grant closeout, Rural Development retains the

right to recover any disallowed costs which may be discovered

as a result of any audit.

RD Instruction 1944-I

Exhibit A

Paragraph (e) Con.

Page 3

(2) When there is reasonable evidence that Grantee has failed to

comply with the terms of this Agreement, the State Director may

determine Grantee as “high risk”. A “high risk” Grantee will be

supervised to the extent necessary to protect the Government's

interest and to help Grantee overcome the deficiencies.

(3) Grant termination will be based on the following:

(i) Termination for cause. This grant may be terminated in

whole, or in part, 90 days after a Grantee has been classified

as “high risk” if the State Director determines that Grantee

has failed to correct previous deficiencies and is unlikely to

correct such items if additional time is allowed. The reasons

for termination may include, but are not limited to, such

problems as:

(A) Actual TA costs significantly exceeding the amount

stipulated in the proposal.

(B) The number of homes being built is significantly less

than proposed construction or is not on schedule.

self-help program.

(D) Failure of Grantee to only use grant funds for

authorized purposes.

(E) Failure of Grantee to submit adequate and timely

reports of its operation.

(F) Failure of Grantee to require families to work

together in groups by the mutual self-help method in the

case of new construction.

(G) Serious or repetitive violation of any of the

provisions of any laws administered by Rural Development

or any regulation issued under those laws.

(H) Violation of any nondiscrimination or equal

opportunity requirement administered by Rural Development

in connection with any Rural Development programs.

(I) Failure to establish an accounting system acceptable

to Rural Development.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit A

Page 4

(J) Failure to serve very low-income families.

(K) Failure to recruit families from substandard housing.

(ii) Termination for convenience. Rural Development or

Grantee may terminate the grant in whole, or in part, when

both parties agree that the continuation of the project would

not produce beneficial results commensurate with the further

expenditure of funds. The two parties shall agree upon the

termination conditions, including the effective date and, in

case of partial termination, the portion to be terminated.

(4) To terminate a grant for cause, Rural Development shall

promptly notify Grantee in writing of the determination and the

reasons for and the effective date of the whole or partial

termination. Grantee will be advised of its appeal rights under 7

CFR Part 11 and 1900, Subpart B.

(f) An extension of this grant agreement may be approved by Rural

Development provided in its opinion, the extension is justified and

there is a likelihood that the grantee can accomplish the goals set out

and approved in the application docket during the period of the

extension.

(g) Grant funds may not be used to pay obligations incurred before the

date of this Agreement. Grantee will not obligate grant funds after the

grant termination or completion date.

(h) As requested and in the manner specified by Rural Development, the

grantee must make quarterly reports, Exhibit C of this subpart (on 1/15,

4/15, 7/15 and 10/15 of each year), and a financial status report at the

end of the grant period, and permit on-site inspections of program

progress by Rural Development representatives. Rural Development may

require progress reports more frequently if it deems necessary. Grantee

must also comply with the audit requirements found in ½1944.422 of

Subpart I of 7 CFR Part 1944, if applicable. Grantee will maintain

records and accounts, including property, personnel and financial

records, to assure a proper accounting of all grant funds. These

records will be made available to Rural Development for auditing

purposes and will be retained by grantee for three years after the

termination or completion of this grant.

(i) Acquisition and disposal of personal, equipment and supplies should

comply with Subpart R of 7 CFR Part 3015 and Subpart C of 7 CFR Part

3016.

RD Instruction 1944-I

Exhibit A

Page 5

(Revision 1)

(j) Results of the program assisted by grant funds may be published by

Grantee without prior review by Rural Development, provided that such

publications acknowledge the support provided by funds pursuant to the

provisions of Title V of the Housing Act of 1949, 42 U.S.C. 1471, et

seq., and that five copies of each such publication are furnished to the

local representative of Rural Development.

(k) Grantee certifies that no person or organization has been employed

or retained to solicit or secure this grant for a commission,

percentage, brokerage, or contingent fee.

(l) Grantee shall comply with all civil rights laws and the Rural

Development regulations implementing these laws.

(m) In all hiring or employment made possible by or resulting from this

grant, Grantee: (1) will not discriminate against any employee or

applicant for employment because of race, religion, color, sex, marital

status, national origin, age, or mental or physical handicap, and (2)

will take affirmative action to insure that applicants are employed, and

that employees are treated during employment without regard to their

race, religion, color, sex, marital status, national origin, or mental

or physical handicap. This requirement shall apply to, but not be

limited to, the following: Employment, upgrading, demotion, or

transfer; recruitment or recruitment advertising; layoff or termination;

rates of pay or other forms of compensation; and selection for training,

including apprenticeship. In the event Grantee signs a contract which

would be covered by any Executive Order, law, or regulation prohibiting

discrimination, Grantee shall include in the contract the “Equal

Employment Clause” as specified by Rural Development.

(n) It is understood and agreed by Grantee that any assistance granted

under this Agreement will be administered subject to the limitations of

Title V of the Housing Act of 1949 as amended, 42 USC 1471 et seq., and

related regulations, and that rights granted to Rural Development in

this Agreement or elsewhere may be exercised by it in its sole

discretion to carry out the purposes of the assistance, and protect

Rural Development's financial interest.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit A

Page 6

(Revision 1)

(o) Grantee will maintain a code or standards of conduct which will

govern the performance of its officers, employees, or agents. Grantee's

officers, employees, or agents will neither solicit nor accept

gratuities, favors, or anything of monetary value from suppliers,

contractors, or others doing business with the grantee. To the extent

permissible by State or local law, rules, or regulations such standards

will provide for penalties, sanctions, or other disciplinary actions to

be taken for violations of such standards.

(p) Grantee shall not hire or permit to be hired any person in a staff

position or as a participant if that person or a member of that person's

immediate household is employed in an administrative capacity by the

organization, unless waived by the State Director. (For the purpose of

this section, the term “household” means all persons sharing the same

dwelling, whether related or not).

(q) Grantee's board members or employees shall not directly or

indirectly participate, for financial gain, in any transactions

involving the organization or the participating families. This includes

activities such as selling real estate, building material, supplies, and

services.

(r) Grantee will retain all financial records, supporting documents,

statistical records, and other records pertinent to this agreement for 3

years, and affirms that it is fully aware of the provisions of the

Administrative Remedies for False Claims and Statements Act, 31 USC

3801, et seq.

By_____________________ By______________________

(Signature) (Signature)

______________________ ___________________________

(Title) (Title)

GRANTEE RURAL DEVELOPMENT

oOo

RD Instruction 1944-I

Exhibit B

Evaluation Report of Self-Help Technical Assistance (TA) Grants

Evaluation for Quarter Ending: _____________(1)_______, 19 ____________

1. a. Name of Grantee: ____________________(2)________________________

b. Address: ____________________________(3)________________________

c. Area the grant serves: ______________(4)________________________

2. Date of Agreement:_________________(5)________Time Extended___(6)___

3. a. Equivalent unit increase during quarter: ______(7)______

First Month

______(8)____ _

Second Month

______(9)______

Third Month

b. Cumulative total number of Equivalent Units ______(10)_________

since beginning of grant: Total to Date

4. a. Method of Construction:

Stick built ________%, Panelized ________%, Combined _______%

b. Number of bedrooms per house built this grant period:

__________2BR, ___________3BR, 4BR ___________

c. Household size this Quarter:

1 person _________, 2 persons _________, 3 persons __________

4 persons _________, 5 persons _________

d. Number of houses under construction this grant period, but started

during previous grant period: __________________

5. a. Number of houses proposed under this grant: _______(11)______

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit B

Page 2

b. Number of houses completed under this grant: _______(12)______

c. Number of houses currently under construction: _______(13)______

d. Number of families in pre construction: _______(14)______

e. Number of Construction Supervisors: _______(15)______

f. Number of TA employees: _______(16)______

6. a. Average time needed to construct a single house: ______(17)______

b. Number of months between submission of self-

help borrower's docket and approval/rejection: _____(18)______

c. Number and percentage of loan docket rejections

during reporting period: ______(19)______

7. a. Did any of the following adversely affect the Grantee's ability

to accomplish program objectives?

YES NO

TA Staff Turnover _____________ _______________

Rural Development Staff Turnover _____________ _______________

Bad Weather _____________ _______________

Loan Processing Delays _____________ _______________

Site Acquisition and Development _____________ _______________

Unavailable Loan/Grant Funds _____________ _______________

Lack of Participants _____________ _______________

Communication between Rural Development/ _________ _______________

Grantee

8. Attach information concerning number of families contacted, number who

have indicated a willingness to be a participating family, number of

mutual self-help groups organized, progress on any construction

started, and any problems relating to the operation of this grant.

RD Instruction 1944-I

Exhibit B

Page 3

I certify that the statements made above are true to the best of my

knowledge and belief.

________(20)_________ _________(21)_________ ________(22)_______

(Date) (Title) (Signature)

GRANTEE

COUNTY OFFICE REVIEW

I have reviewed the above information which I have found to be substantially

correct. Must be completed by County Office.

Comment: Must be completed (23)

Average appraisal value of units financed this

Quarter: __________________

Average amount loan per unit financed this Quarter: _______________

________(24)____________ ___________(25)________

(Date) County Supervisor

DISTRICT OFFICE REVIEW

Comment: Must be completed (26)

_______(27)__________ _________(28)___________

Date District Director

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit B

Page 4

STATE OFFICE REVIEW

Comments: Must be completed (29)

________(30)___________ _____________(31)____________

Date State Office Representative

oOo

RD Instruction 1944-I

Exhibit B-1

Page 1

Instructions for Preparation of

Evaluation Report of Self-Help Technical Assistance Grants

Exhibit B will be used by all Technical Assistance (TA) Grantees

obtaining self-help TA grants. This attachment provides the grantee and

Rural Development a uniform method of reporting the performance progress of

self-help projects. The TA Grantee will prepare an original and 4 copies of

the attachment. The TA Grantee will sign the original and 3 copies and

forward it to the local Rural Development County Office. The TA Grantee will

keep the unsigned copy for its records.

The evaluation report will be completed in accordance with the

following:

1. Enter the date the quarter ends either March 31, June 30,

September 30, or December 31 and the year.

2. Enter the full name of the TA Grantee organization.

3. Enter the complete mailing address of the TA Grantee

organization.

4. Enter the area served by the grant.

5. Enter the date of the initial self-help TA grant agreement.

6. Enter the time of any extension self-help TA grant agreement(s).

7. Insert the number of equivalent units (EU) completed the

first/second/third month of the quarter using steps 1, 2, and

3 of Exhibit B-3.

8. Insert the number of EU's completed the second month of the

quarter by using steps 1, 2, and 3 of Exhibit B-3.

9. Insert the number of EU's completed the third month of the

quarter by using steps 1, 2, and 3 of Exhibit B-3.

10. Add items (7), (8), and (9) to the total from the previous

quarterly report to obtain the cumulative total number of EU's.

This total is the cumulative total number of EU's for the

project.

11. Enter the number of houses planned in the TA Grantee proposal(s).

12. Enter the number of houses completed and occupied since the

beginning of the grant.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit B-1

Page 2

13. Enter the number of houses that are under construction at the end

of this quarter.

14. Enter the number of families in the pre-construction phase.

15. Enter the total number of construction supervisor(s) paid with TA

grant funds.

16. Enter the number of employees paid with TA grant funds including

those listed in item 15.

17. Insert the average elapsed time needed per house from excavation

to final inspection by Rural Development to complete construction of

a house. If no self-help homes have been completed by this grantee,

use other projects or your best estimate as a guide.

18. Enter the number of months it takes on average to approve or

reject a borrower's docket once it's submitted.

19. Enter number and percent of dockets submitted and rejected this

quarter.

20. Enter date of Exhibit submittal.

21. Insert title of the Grantee or authorized representative.

22. Signature of Grantee or authorized representative.

23. County Supervisor must answer questions concerning market value

and loan amount and also should insert comments concerning

progress of construction, success of the project and any problems

that the organization may have.

24. Insert date of County Supervisor's review.

25. Signature of County Supervisor.

26. District Director representative should insert his/her comments

concerning items listed in §1944.417(b)(1) of 1944-I.

27. Insert date of District Director review.

28. Signature of District Director or representative.

29. Insert State Office comments.

30. Insert date of State Office review.

31. Signature of State Office representative.

RD Instruction 1944-I

Exhibit B-2

BREAKDOWN OF CONSTRUCTION DEVELOPMENT FOR

DETERMINING PERCENTAGE CONSTRUCTION COMPLETED

With With With

Slab on Crawl Base-

Grade % Space % ment %

1. Excavation 3 5 6

The removal of earth to allow the construction of a foundation or

basement.

2. Footing, Foundations, columns 8 8 11

Footing: Construction of the spreading course or courses at the base

or bottom of a foundation wall, pier, or column.

Foundation: Construction of the supporting portion of a structure

below the first floor construction, or below grade, including

footing.

3. Floor slab or framing 6 4 4

The floor slab consist of concrete, usually reinforced, poured over

gravel and a vapor barrier with perimeter insulation to prevent heat

loss.

4. Subflooring 0 1 1

The installation of materials used for flooring that is laid directly

on the joist and serving the purpose of a floor during construction

prior installation of the finish floor.

5. Wall framing sheathing 7 7 6

The construction process of putting together and erecting the

skeleton parts of a building's walls (the rough lumber work) and, for

the exterior walls, covering with sheathing (plywood, waferboard,

oriented strand board or lumber) and insulating board to close up the

side walls prior to the installation of finish materials on the

surface.

6. Roof and ceiling framing, sheathing 6 6 5

The process, or method, of putting the parts of a roof, such as

truss, rafters, ridge and plates in position. Ceiling joist support

the overhead interior lining of a room. Roof sheathing is any sheet

material, such as plywood or particleboard, connected to the roof

rafters or truss to act as a base for sheathing felt, shingles or

other roof covers.

7. Roofing 5 5 4

The installation of a material that acts as a roof covering, making

it impervious to the weather, such as shingles over sheathing felt,

tile, or slate.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit B-2

Page 2

8. Siding, exterior trim, porches 7 7 6

The installation of lumber, panel products or other materials

intended for use as the exterior wall covering including all trim.

9. Windows and exterior doors 9 9 8

The installation of all exterior windows and doors. This includes

securely fastening windows and doors plumb and level, square and true

and adjusting sash, screens and hardware for smooth and proper

operation.

10. Plumbing - roughed in 3 2 3

Subject to local codes and regulations the installation of all parts

of the plumbing system which must be completed prior to the

installation of plumbing fixtures or appliances. This includes

drain, waste, and vent piping, water supply, and the necessary built-

in fixture supports.

11. Sewage disposal 1 1 1

Subject to local codes and regulations the construction and

installation of a wastewater disposal system consisting of a house

sewer, a pretreatment unit (e.g., septic tank, individual package

treatment plant), an acceptable absorption system (subsurface

absorption field, seepage pit, or subsurface absorption bed). The

system shall be designed to receive all sanitary sewage (bathroom,

kitchen and laundry) from the dwelling, but not footing or roof

drainage. It shall be designed so that gases generated anywhere in

the system can easily flow back to the building sewer stack.

12. Heating - roughed in 1 1 1

Subject to local codes and regulations the installation of ducts

and/or piping and the necessary supports to minimize the cutting of

walls and joist. This rough in is done before finish wall and floor

installed.

13. Electrical - roughed in 2 2 2

Subject to local codes and regulations the installation of conduit or

cable and the location of switch, light, and outlet boxes with wires

ready to connect. This roughing-in work is done before the dry wall

finish is applied, and before the insulation is placed in the walls

and ceiling.

14. Insulation 2 2 2

The installation of any material used in walls, floors, and ceilings

to prevent heat transmission as required by RD Instruction 1924-A,

Exhibit D of 7 CFR of Part 1924, Subpart A.

RD Instruction 1944-I

Exhibit B-2

Page 3

15. Dry wall 8 8 7

Dry walling is covering the interior walls using sheets of gypsum

board and taped joints.

16. Basement or porch floor, steps 1 1 6

The construction of basement or porch floors and steps whether wood

or concrete.

17. Heating - finished 3 3 3

Subject to local codes and regulations the installation of registers,

grilles and thermostats.

18. Flooring covering 6 6 5

The installation of the “finish flooring” (the material used as the

final wearing surface that is applied to a floor). Floor covering

include numerous flooring materials such as wood materials, vinyl,

linoleum, cork, plastic, carpet and other materials in tile or sheet

form.

19. Interior carpentry, trim, doors 6 6 5

Installing visible interior finish work (molding and/or trim),

including covering joints around window and door openings. The

installation of an interior door including frames and trim.

20. Cabinets and counter tops 1 1 1

Securing cabinets and counter tops (usually requiring only fastening

to the wall or floor) that are plumb and level, square and true.

21. Interior painting 4 4 3

Cleaning and preparation of all interior surfaces and applying paint

in strict accordance with the paint manufacturer's instructions.

22. Exterior painting 1 1 1

Cleaning and preparation of all exterior surfaces and applying paint

in strict accordance with the paint manufacturer's instructions.

23. Plumbing - complete fixtures 4 4 3

Subject to local codes and regulations the installation of a receptor

or device which requires both a water supply connection and a

discharge to the drainage system, such as water closets, lavatories,

bathtubs or sinks. Also, the installation of an energized household

appliance with plumbing connections, such as a clothes washer, water

heater, dishwasher or garbage grinder.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit B-2

Page 4

24. Electrical - complete fixtures 1 1 1

Subject to local codes and regulations the installation of the

fixtures, the switches, and switch plates. This is usually done

after the dry wall finish is applied.

25. Finish hardware 1 1 1

The installation of all the visible, functional hardware in a house

that has a finish appearance, including such features as hinges,

locks, catches, pulls, knobs, and clothes hooks.

26. Gutters and downspouts 1 1 1

The installation of a shallow channel of wood, metal, or PVC

(gutters) positioned just below and following along the eaves of the

house for the purpose of collecting and diverting water from a roof

to a vertical pipe (downspouts) used to carry rainwater from the roof

to the ground by way of a splash block or into a drainage system.

27. Grading, paving, landscaping 3 3 3

Landscaping includes final grading, planting of shrubs and trees, and

seeding or sodding of lawn areas. Final grading includes the best

available routing of runoff water to assure that house and adjacent

homes will not be endangered by the path of water runoff. The minimum

slope should be 6” in 10' or 5% from the foundation of the home.

Paving includes both driveways and walks.

______________________________

100% 100% 100%

RD Instruction 1944-I

Exhibit B-3

Pre-Construction and Construction Phase Breakdown

I. General. This Exhibit will be used by Rural Development and the Grantee

in determining Grantee performance as required in §1944.417(b) of this

subpart.

II. Determining technical assistance (TA) cost per unit.

A. Equivalent units are used to measure progress at any time during the

period of the grant. It is necessary because self-help grantees have

several groups of families in various stages of progress during the

period of the grant. The following formula has been developed to

provide a more accurate method of determining progress.

FORMULA

PHASE BREAKDOWN VALUE OF EACH PHASE CUMULATIVE

(%) (%)

Pre-Construction

Phase I 10 10

Phase II 10 10

Construction

Phase III 80 21-100

B. Using the Description of Phase Breakdown as a guide, the project

staff selects the total percentage pertinent to the stage the self-help

group is in and multiplies that percentage by the number of families

(units) in the group. The result is the equivalent number of units

completed. No credit may be given for Phase I, if the application is

rejected. When this computation has been completed for each group that

falls within Phases I - III, the total number of equivalent units is

divided into the total grant funds expended to that date. The result is

the TA cost per unit at that stage of the program's progress.

C. The definition of pre-construction and construction phases described

are follows:

PRE-CONSTRUCTION

Phase I: Hold community meetings; conduct interviews; obtain house

plans; prepare cost estimates; begin search for land; submit family

applications to the lender; lender runs credit check; applications.

Lender either approves or rejects.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit B-3

Page 2

Phase II: Organize an association of Section 502 Rural Housing eligible

families; association conducts weekly meetings at which required lender

forms are discussed and completed; house plans and land sites are

selected; outside speakers explain and discuss taxes, insurance, how to

keep a checking account how interest is computed, home maintenance,

decorating, and landscaping; etc.; completed loan dockets for each

family are submitted to the lender. Family loan dockets are reviewed

and recommendations made as to the loan amounts requested; the lender

reviews family loan dockets; preliminary title search of each proposed

building site is begun; requests loan check from Finance Office; when

check arrives, final title search is made, loan closed, checking

accounts opened, and construction begun.

Construction: The grantee will utilize Exhibit B-2 which outlines 27

construction tasks to determine the percentage of completed construction

activities.

D. The computation of equivalent units and TA costs will be computed as

follows:

Exhibit C will be used for recording the following information and

construction in this example which starts January 1.

Step 1

Both the grantee and Rural Development review the Rural Development loan

application records to determine the percentage of completion for each

family in the pre-construction phase of the program. These are Phases I

- III. Total these percentages to find the number of “equivalent units”

(EUs) completed at that date during pre-construction. For example, if

there are eight families in Group #2 and all have completed the 20

percent phase of preconstruction, then there would be 1.6 EUs in the

pre-construction phase of the program as of that date. Each phase must

be completed before it is considered in the calculation.

Step 2

Refer to the records of construction progress for families in the

construction Phase III. As of that date, the director totals the

percentage of completion figures for each family as followings:

Askew: .45

Whited: .40

Martinez: .40

Gonzalez: .38

RD Instruction 1944-I

Exhibit B-3

Page 3

Sherry: .34

Duran: .33

Johnson: .13

Harvey: .31

2.92 EUs

Total production in the construction phase is therefore 2.92 EUs as of

that date.

Step 3

Add the pre-construction and construction subtotals together:

Pre-construction 1.60

Construction 2.92

Total EUs 4.52

This provides the total EUs of production during the first three months

of operation. Steps 1, 2, and 3 will be used to complete items 7, 8 and

9 of Exhibit B of this subpart.

III. Preparation:

Compile Exhibit B of this subpart in an original and four copies. The

exhibit will be signed by the TA Grantee. Submit the original and three

copies of the exhibit quarterly to Rural Development County Office on or

before January 15, April 15, July 15, and October 15, of each year for the

quarters ending March 31, June 30, September 30, and December 31 of each

year. The District Director will keep the original and forward two copies to

the State Office. The State Office will forward one copy to the National

Office. The State Office will prepare information concerning TA grants

closed within 30 days of the end of a quarter on the next quarterly report.

oOo

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit C

Amendment

Self-Help Technical Assistance Grant Agreement

This Agreement dated,_________________ 19_______between__________________

_________________________________________________________________________

a nonprofit corporation (“Grantee”), organized and operating under

____________________________________ and the United States of America

(authorizing State Statute)

acting through the Rural Development, Department of Agriculture (“Rural

Development”), amends the “Self-Help Technical Assistance Grant Agreement”

between the parties dated _________________ 19________, (“Agreement”).

The Agreement is amended by providing additional financial assistance in the

amount of ________________to be made available by Rural Development to

Grantee pursuant to Section 523 of Title V of the Housing Act of 1949 for the

purpose of assisting in providing a program of technical and supervisory

assistance which will aid low-income families in carrying out mutual self-

help housing efforts; or

The Agreement is amended by changing the completion date specified in

covenant 1 from _____________to ___________ and by making the following

attachments to this amendment: (List and identify proposal and any other

documents pertinent to the grant.)

Agreed to this____________day of ___________19________.

______________________

(Name of Grantee)

By____________________

(Signature)

______________________

(Title)

UNITED STATES OF AMERICA

By_____________________

(Signature)

_______________________

(Title)

RURAL DEVELOPMENT

oOo

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit D

SELF-HELP TECHNICAL ASSISTANCE GRANT PREDEVELOPMENT AGREEMENT

THIS GRANT PREDEVELOPMENT AGREEMENT dated, _____________________________

19 ___, is between _____________________________________________________

a nonprofit corporation (“Grantee”), organized and operating under

________________________________________________________________________

(authorizing State statute)

and the United States of America acting through the Rural Development,

Department of Agriculture.

In consideration of financial assistance in the amount of $______________

(“Grant Funds”) to be made available by Rural Development to Grantee under

Section 523 (b)(1)(A) of the Housing Act of 1949 to be used in (specify area

to be served) _____________________________________ for the purpose of

developing a program of technical and supervisory assistance which will aid

low-income families in carrying out mutual self-help housing efforts, Grantee

will provide such a program in accordance with the terms of this Agreement

and Rural Development regulations.

Grant funds will be used for authorized purposes as contained in §1944.410(d)

of 7 CFR Part 1944, Subpart I, as necessary, to develop a complete program

for a self-help TA grant. This will include recruitment, screening, loan

packaging and related activities for prospective self-help participants.

Agreed to this ____________________________ day of _____________________

19 _____.

(Name of Grantee)

By_____________________

(Signature)

______________________ (Title)

UNITED STATES OF AMERICA

By_____________________

(Signature)

_______________________

(Title)

RURAL DEVELOPMENT

oOo

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit E

Page 1

(Revision 1)

GUIDANCE

FOR RECIPIENTS OF

SELF-HELP TECHNICAL ASSISTANCE GRANTS

(SECTION 523 OF HOUSING ACT OF 1949)

7 CFR Part 1944, Subpart I provides the specific details of this grant

program. The following is a list of some functions of the grant recipients

taken from this subpart. With the list are questions we request to be

answered by the recipients to reduce the potential for fraud, waste,

unauthorized use or mismanagement of these grant funds. We suggest the Board

of Directors answer these questions every six months by conducting their own

review. Paid staff should not be permitted to complete this evaluation.

A. Family Labor Contribution

1. Does your organization maintain a list of each Yes No

family and a running total of hours worked (when

and on what activity)?

2. Are there records of discussions with participating Yes No

families counseling them when the family contribution

is falling behind?

3. Are there obstacles which prevent the family from Yes No

performing the required tasks?

B. Use of Grant Funds

1. Were grant funds used to pay salaries or other Yes No

expenses of personnel not directly associated with

this grant?

2. Were grant funds used to pay for construction Yes No

work for participating families?

3. Were all purchases or rentals (item and cost) Yes No

of office equipment authorized?

4. Are all office expenses authorized by 7 CFR Part 1944, Yes No

Subpart I?

5. Was a record of long distance telephone calls Yes No

maintained and was that log and telephone checked?

6. Was all travel and mileage incurred for official Yes No

business and properly authorized in advance?

7. Were mileage and per diem rates within authorized Yes No

levels?

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit E

Page 2

(Revision 1)

8. Were participating families charged for use of Yes No

tools?

9. Were grant funds expended to train grant personnel? Yes No

10. Was training appropriate for the individual trainee? Yes No

11. Were any technical or consultant services obtained Yes No

for participating families?

12. Were the provided technical or consultant services Yes No

appropriate in type and cost?

C. Financial Responsibilities

1. Does each invoice paid by the grant recipient match Yes No

the purchase order?

2. Does each invoice paid by the borrower and Rural Yes No

Development match the purchase order?

3. Were purchases made from the appropriate vendors? Yes No

4. Are the invoices and itemized statements totaled Yes No

for materials purchased for individual families?

5. Is there a record of deposits and withdrawals to Yes No

account for all loan funds?

6. Are checks from grant funds signed by the Board Yes No

Treasurer and Executive Director?

7. Are grant funds deposited in an interest bearing Yes No

account?

8. Are checks from loan funds prepared by the grant Yes No

recipient for the borrower's and lender's signature?

9. Are checks from loan funds accompanied by accurate Yes No

invoices?

10. Are any borrower loan funds including interest, Yes No

deposited in grantee accounts?

11. Are checks from loan funds submitted to Rural Yes No

Development more often than once every 30 days?

12. Is the reconciliation of bank statements for both Yes No

grant and loan funds completed on a monthly basis?

RD Instruction 1944-I

Exhibit E

Page 3

13. If the person who issues the checks also reconciles Yes No

them, does the Executive Director review this activity?

14. Are materials purchased in bulk approved by the Yes No

Executive Director?

15. Was the amount of materials determined by both the Yes No

Executive Director and construction staff?

16. Were any participating families consulted about the Yes No

purchase of materials?

17. Were savings accomplished by the bulk purchase method? Yes No

18. Did the Executive Director review the purchase Yes No

order and the ultimate use of the materials?

19. Are materials covered by insurance when stored by Yes No

grantee?

D. Reporting

1. Are “Requests for Advance or Reimbursement” made Yes No

once monthly to the Rural Development District Office?

2. Has the grant recipient engaged a certified public Yes No

Accountant (CPA) or CPA firm to review their

operations on a regular basis: (Annually is preferable

but every two years and at the end or the grant period

are requirements)?

3. Are the quarterly evaluation reports submitted on Yes No

time to the County Supervisor?

What, if any, problems exist that need to be corrected for effective

management of the grant project?

____________ _____________________________

Date President, Board of Directors

(Period covered by report______________)

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit E

Page 4

ANSWER KEY

The following answers should help your organization in assessing its

vulnerability to fraud, waste, and abuse. You should take actions to correct

practices that now generate an answer different from the key.

Question Answer

A. 1 yes

A. 2 yes

A. 3 yes

B. 1 no

B. 2 no

B. 3 yes

B. 4 yes

B. 5 yes

B. 6 yes

B. 7 yes

B. 8 no

B. 9 yes

B. 10 yes

B. 11 yes

B. 12 yes

C. 1 yes

C. 2 yes

C. 3 yes

C. 4 yes

C. 5 yes

C. 6 yes

C. 7 no

C. 8 yes

C. 9 yes

C. 10 no

C. 11 no

C. 12 yes

C. 13 yes

C. 14 yes

C. 15 yes

C. 16 yes

C. 17 yes

C. 18 yes

C. 19 yes

D. 1 yes

D. 2 yes

D. 3 yes

oOo

RD Instruction 1944-I

Exhibit F

Page 1

Site Option Loan to Technical Assistance

Grantees

I. Objectives. The objective of a Site Option (SO) loan under Section

523(b)(1)(B) of Title V of the Housing Act of 1949 is to enable technical

assistance (TA) grantees to establish revolving fund accounts to obtain

options on land needed to make sites available to families that will build

their own homes by the self-help method. An SO loan will be considered only

when sites cannot be made available by other means including a regular Rural

Housing Site (RHS) loan.

II. Eligibility requirements. To be eligible for an SO loan, the applicant

must be a TA grantee that is currently operating in a satisfactory manner

under a TA grant agreement. If the SO loan applicant has applied for TA

funds but is not already a TA grantee and it appears that the TA grant will

be made, the SO loan may be approved but not closed until the TA grant is

closed.

III. Loan purposes. Loans may be made only as necessary to enable eligible

applicants to establish revolving accounts with which to obtain options on

land that will be needed as building sites by self-help families

participating in the TA self-help housing program. Loans will not be made to

pay the full purchase price of land but only for the minimum amounts

necessary to obtain an option from the seller. The option should be for as

long as necessary but in no case should the option be for less than 90 days.

IV. Limitations.

(A) If the amount of an SO loan will exceed $10,000, the prior consent

of the National Office shall be obtained before approval.

(B) The amount of the SO loan should not exceed 15 percent of the

purchase price of the land expected to be under option at any one time,

unless a higher percent is authorized by the State Director when other

land is not available or the particular area requires more down payment

than elsewhere or similar circumstances exist.

without modification in all cases for obtaining options under this

subpart.

(D) The limitations of §1822.266(b)(1) and (2) of Subpart F of Part

1822 of this chapter (RD Instruction 444.8, paragraphs VI B(1) and (2))

concerning land purchase will apply to options purchased under this

subpart.

V. Rates and terms.

(A) Interest. Loans will be made at an interest rate of 3 percent.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit F

Page 2

(B) Repayment period. Each SO loan will be repaid in one installment

which will include the entire principal balance and accrued interest.

The maximum repayment period for each SO loan will be the applicant's

remaining TA grant funding period.

(1) A shorter repayment period will be established if SO funds will

not be needed for the entire TA grant funding period.

(2) If a regular RHS loan is to be processed, the SO loan should be

scheduled for repayment when RHS loan funds will be available to

purchase the land and repay the amount of SO funds advanced on the

option, unless SO loan funds will still be needed to purchase other

options. Under no circumstances, however, will the repayment period

exceed the applicant's remaining TA grant funding period.

VI. Processing application.

(A) Form of application: The application for assistance will be in the

form of a letter to the Rural Development County Supervisor having

jurisdiction over the area of the proposed site to be optioned. The

letter will be signed by the applicant or its authorized representative

and contain, as a minimum, the following information:

(1) A copy of the proposed option that shows a legal description of

the land, option price, purchase price, and terms of the option. If

more than one site is to be purchased, a schedule of the proposed

options should be included.

(2) Information to verify that a regular RHS loan cannot be

processed in time to secure the option.

(3) Proposed method repayment of the SO loan.

(4) Resolution from the applicant's governing body authorizing the

application for an SO loan from Rural Development.

(B) Responsibility of the County Supervisor. Upon receipt of an SO

loan application, the County Supervisor will:

(1) Determine whether the applicant is eligible. If the applicant

is not eligible, or the loan cannot be made for other reasons, the

application may be rejected by the County Supervisor with the

concurrence of the District Director. The reasons for the rejection

should be clearly stated and provided, in writing to the applicant.

The applicant will have the right to have the decision reviewed

following the procedure established in 7 CFR Part 11 and

RD Instruction 1944-I

Exhibit F

Page 3

(Revision 1)

Subpart B of Part 1900 of this chapter.

(2) Review and verify the accuracy of the information provided.

(3) Make an inspection and a memorandum appraisal of each proposed

site “as is.” The appraisal will include a narrative statement as

to whether the site has been recently sold, verify that the seller

is the owner of the property, and indicate whether the purchase

price is acceptable based on the selling price of similar properties

in the area.

(4) Indicate whether or not it appears that, considering the

location and cost of development, adequate building sites can be

provided at reasonable costs.

(5) If the option is for a tract of land on which 5 or more sites

are proposed, the County Supervisor will forward to the District

Director with recommendations as defined in § 1924.119 of Subpart C

of Part 1924 of this chapter.

(6) If approval is recommended, prepare and have the applicant

execute Form RD 1940-1, “Request for Obligation of Funds,” for the

amount needed. Copies of the form will be distributed as provided

in the Forms Manual Insert (FMI).

(7) Forward the SO loan application and the applicant's TA

application or TA docket to the State Director. The submission will

include the appraisal report and the County Supervisor's comments

and recommendations.

VII. Loan approval authority and State Office actions. The State Director

is authorized to approve SO loans developed in accordance with this Exhibit.

The approval or disapproval of the loan will be handled in the same manner as

provided in § 1822.272 of Subpart F of Part 1822 of this chapter (RD

Instruction 444.8, paragraph XII). SO loans will be established in Automated

Multiple Housing Accounting System (AMAS) using Form RD 3560-51, “Multiple

Family Housing Obligation Fund Analysis”. The Issue loan/Grant checks

transaction will be used to request a check for SO loans. (Revised 02-24-05,

SPECIAL PN.)

VIII. Loan closing.

(A) General. Loan closing instructions will be provided by the Office

of the General Counsel (OGC) to assure that the Promissory Note is

properly completed and executed. The County Supervisor may then close

the loan.

(11-15-90) SPECIAL PN

RD Instruction 1944-I

Exhibit F

Page 4

(Revision 1)

(B) Security for the loan. The loan will be secured by a Promissory

Note properly executed by the grantee using Form RD 1940-16, “Promissory

Note.” A lien on the optioned real estate will not be taken.

(1) The “kind of loan” block on the note will read “SO loan.”

(2) The note will be modified to show that the only installment on

the loan will be the final installment.

is executed and the loan check delivered to the grantee.

IX. Establishment of SO loan revolving account.

(A) Supervised bank accounts will not be used for SO loans.

(B) Grantee will deposit SO loan funds in a depository institution of

its choice. The use of minority institutions is encouraged. Such funds

will remain separate from any other account of the grantee and shall be

established as an SO revolving account.

of purchasing land options and must be signed by at least two authorized

officials of the grantee who have been properly bonded in accordance

with § 1944.411(e) and (g) of this subpart.

(D) Grantees will not expend funds for any options until the site and

the option form have been reviewed and approved by the County

Supervisor.

(1) SO funds will not be left unused in the revolving account in

excess of 60 days.

(2) If the funds are not used for the intended purpose within the

60 days specified above, the unused portion will be refunded on the

account.

(E) When funds become available for repayment of the SO loan, such

funds will be deposited in the revolving account for the purchase of

additional site options if needed. If such funds are not needed to

purchase more options, they will be applied on the SO loan.

X. Source of funds.

SO loans will be funded from the self-help housing land development

fund.

oOo

RD Instruction 1944-I

Exhibit G

Page 1

(Added 12-12-19, PN 532)

APPLICATION PROCESSING CHECKLIST - NEW CONSTRUCTION

Description of Documents

Form/

Instruction

Number

Tab

Position

Date

Received/Comments

(1) Application for

Federal Assistance Non-

Construction Programs

Including

Intergovernmental Review

Response (as available)

Form SF-424

1944.410(e)

(2) Waiting List of

Participants

1944.410(e)(1)

(3) Proof that the

participants in the

first group have

qualified for assistance

1944.410(e)(2)

(4) Lot options for

first group

1944.410(e)(3)

(5) Evidence of lot

availability for

remaining groups

1944.410(e)(3)

(6) House plans,

specifications and

detailed cost estimates

1944.410(e)(4)

(7) Staffing needs and

hiring schedule

1944.410(e)(5)

(8) Authorized

representative of

applicant

1944.410(e)(6)

(9) Budget Information –

Non-Construction

Programs

Form SF-424A &

Budget Narrative

1944.410(e)(7)

(10) Indirect or direct

cost policy and proposed

indirect cost rate

1944.410(e)(8)

(11) Monthly activities

schedule

1944.410(e) (10)

(12) Personnel

practices and procedures

1944.410(e)(9)

(13) Authorizing

resolution

1944.411(d)

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit G

Page 2

(Added 12-12-19, PN 532)

Description of Documents

Form/

Instruction

Number

Tab

Position

Date

Received/Comments

(14) Assurance Agreement

Form RD 400-4

1944.411(d)

(15) Fidelity Bond

Coverage

1944.411(e)

(16) Evidence of interest-

bearing

checking account and

a statement o

f interest

repayment (as applicable)

1944.411(g)

(17) Group and/or

Participation Agreem

ent

including Exhibit B

-2 of

1944-I

1944.411(h)

(18) Request for Obligation

of Funds

Form RD 1940-l

1944.412

(19) Self-Help Technical

Assistance Grant Agreemen

Exhibit A of

1944-I

1944.412

(20) Certification Regarding

Drug

- Free Workplace

Form AD-1049

RD Inst. 1940-

M, §1940.606

(b)(2)

(21) Certification Regarding

Debarments, Suspension, and

other Responsibility Matters

Form AD-1047

RD Inst.

1940-M,§

1940.606(b)(1)

(22) Certification Regarding

Lobbying

Exhibit A-1 of

RD Inst. 1940-

and §1940.810

(23) Statement of Compliance

with 2 CFR 200 Part 400 &

416 if a State or Local

government; or Part 400 &

415 if a non-profit

1944.411(c)

(24) Assurances – Non-

Const

ruction Programs

Form SF-424B

1944.411(f)

(25) Rural Development’s

Recomm

endation

*Do Not Pay (Checked at

submission and again prior

to closing)

1944.410(b)

1940-M

§1940.606(b)

RD Instruction 1944-I

Exhibit G

Page 3

(Added 12-12-19, PN 532)

Description of Documents

Form/

Instruction

Number

Tab

Position

Date

Received/Comments

(26) T&MA Contractor’s

Review and Recommendation

Required Under

National

Office T&MA

Contractor

(27) National Office Review

1944.415(a)

(28)_Narrative Statement

(a) Amount of request

(b) Areas served

proposed

(d)

Housing conditions of

low-income families

(e) Need for self-help

housing

(f)

Evidence of Community

Support

1944.410(a)(4)

(29) Current Financial

Statements for Applicant and

any Sponsor

1944.410(a)(3)

(30) Outreach Plan for very

ow- Income

1944.410(a)(5)

(31) HUD Affirmative Fair

Hou

sing Marketing Plan

(AFHM)

HUD Form 935.2

1944.410

(a)(10)

(32) Determination of TA

Grant Amount

1944.407

(33) Intergovernmental

Review Submittal

1944.409

(34) Civil Rights Impact

Analysi

s Certification

Form RD

2006-38

2006-P,

§2006.754(b)

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit G

Page 4

(Added 12-12-19, PN 532)

Description of Documents

Form/ Instruction

Number

Tab

Position

Date

Received/Comments

(35) Compliance Review

(Pre-award)

Form RD 400-8 RD

Inst.1901-E,

§1901.204(a) &

§1901.204 (c)(3)

(36) OGC Review (if

necessary)

§1944.410(b)(2)

(37) Previous Experience §1944.410(a)(1)

(38) Organizational

Documents

(a) Reference to

State Law

(b) Certified copies

of Articles of

Incorporation and

Bylaws, or other

evidence of corporate

existence

incorporation for other

than public bodies

(d) Evidence of Good

Standing from the State

(e) Names and

addresses of Board of

Directors, officers and

members (plus principal

business of any member

that is an

organization)

(f) Evidence of

nonprofit status

§1944.410(a)(2)

§1944.404(d)(1-4)

Applicants and existing Self-Help grantees applying for a new grant should

submit their applications in an original & one copy containing the above

applicable items to the Technical and Management Assistance (T&MA)

Contractor for review. The T&MA Contractor will make a recommendation &

submit the package to the State Office within 15 calendar days. Within

thirty (30) days of the agency’s receipt of the application, the designated

official will review the application for completeness, accuracy &

conformance to program policy and regulations. The designated official

should then make a recommendation & forward along with a copy of the

grantee’s package to the National Office.

oOo

RD Instruction 1944-I

Exhibit H

Page 1

(Added 12-12-19, PN 532)

SAMPLE TECHNICAL ASSISTANCE CALCULATIONS

Requested Grant Amount = $500,000 ($23,810 X 21 = $500,010)

Method A Method B

Equivalent Value of modest Average mortgage of participating

homes built in area: $160,000 families $134,000 minus $1,000

Number of homes built under

the grant proposal: 21

Max allowed TA cost per

House ($160,000 X 15%): $24,000

Requested TA per house: $23,810

Actual Percentage of

equivalent value: 14.88%

(TA cost equivalent per unit

of no more than 15% of modest

home built in the area)

------------------------------------------------------------------------

Calculation A Calculation B

Grant amount: $500,000 Average Mortgage of families

No. of homes built: ÷ 21 $134,000

Requested TA amount $23,810*

Equivalent Value of modest

home built in area: ÷$160,000

Percent of equivalent value = 14.88%

------------------------------------------------------------------------

Equivalent Value of modest Equivalent Value of modest

home built in area: $160,000 home built in area:

15% of Equivalent Value x 15% $160,000

Maximum allowed TA cost: $24,000 -$134,000 (Average Mortgage)

$ 26,000

-$ 1,000

$ 25,000 (Difference*)

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit H

Page 2

(Added 12-12-19, PN 532)

*The requested TA amount of $23,810 does not exceed the difference ($25,000)

between the Equivalent Value of a modest home built in the area and the

Average Mortgage of participating families, minus $1,000.

oOo

RD Instruction 1944-I

Exhibit I

Page 1

(Added 12-12-19, PN 532)

REHABILITATION PROGRAMS

APPLICATION/RE-APPLICATION/AMENDMENT CHECKLIST

Description of

Documents

Comment

Form/

Instruction

Number

Tab

Position

Date

Received/

Comments

(1) Application for

Federal Assistance Non-

Construction Programs

Including Inter-

governmental Review

submittal, if

applicable

N/A- For Grant

Amendment

Form SF-424

§1944.410(e)

(2) Waiting List of

Participants

In Addition to

Name, Contact, &

demographic info-

Include Property

Address(es) if

Identified,

Anticipated Loan

Amount and Source

of Funding

§1944.410(e)

(1)

(3) Proof that

approximately 10% of

the participants have

qualified for

assistance

RD HB Letter 16

or 3

Party

Funding Source

Approval Document

§1944.410(e)

(2)

(4) Lot options for

first group

N/A- See Waiting

List

§1944.410(e)

(3)

(5) Evidence of lot

availability for

remaining groups

Provide Listing

of Identified

Potential Program

Homes for Sale in

Service Area

§1944.410(e)

(3)

(6) House plans,

specifications and

detailed cost estimates

Describe How the

Home Inspection,

Work Order List,

Cost Estimating,

and Contractor

Selection Process

will be Completed

and Documented.

§1944.410(e)

(4)

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit I

Page 2

(Added 12-12-19, PN 532)

Description of

Documents

Comment

Form/

Instruction

Number

Tab

Position

Date

Received/

Comments

(7) Staffing needs and

hiring

schedule

N/A- Grant

Amendment Unless

Changed from

Original

Application

§1944.410(e)(5)

(8) Authorized

representative of

applicant

N/A- Grant

Amendment

§1944.410(e)(6)

(9) Budget Information

– Non-Construction

Programs

Not Required in

No-Cost Amendment

Requests

Form SF-424A &

Budget Narrative

1944.410(e)(7)

(10) Indirect or

direct cost policy and

proposed indirect cost

rate approval

N/A- Grant

Amendment Unless

Changed from

Original

Application

1944.410(e)(8)

(11) Monthly

activities schedule

Should be Updated

with all Amendment

Requests

1944.410(e)(10)

(12) Personnel

practices and

procedures

N/A- Grant

Amendment

1944.410(e)(9)

(13) Authorizing

resolution

Should be Received

for Amendment

Requests

1944.411(d)

(14) Assurance

Agreement

N/A- Grant

Amendment

Form RD 400-4

1944.411(d)

(15) Fidelity Bond

Coverage

N/A- Grant

Amendment

1944.411(e)

(16) Evidence of

interest-bearing

checking account and a

statement of interest

repayment

N/A- Grant

Amendment

1944.411(g)

(17) Group and/or

Participation

Agreement including

Exhibit B-2 of 1944-I

Describe how labor

hours will be

tracked and how

cost savings to

the family is

being calculated;

Exhibit B-2 not

applicable

1944.411(h)

RD Instruction 1944-I

Exhibit I

Page 3

(Added 12-12-19, PN 532)

Description of

Documents

Comment

Form/

Instruction

Number

Tab

Position

Date

Received

Comments

(18) Request for

Obligation of Funds

Only if Amendments

Request is For-

Cost

Form RD 1940-l

1944.412

(19) Self-Help

Technical Assistance

Grant Agreement

Amendment to Self-

Help Technical

Assistance Grant

Agreement

Exhibit A of

1944-I

§1944.412

(20) Certification

Regarding Drug-Free

Workplace

N/A- Grant

Amendment

Form AD-1049

RD Inst. 1940-M,

§1940.606(b)(2)

(21) Certification

Regarding Debarments,

Suspension, and other

Responsibility

Matters

N/A- Grant

Amendment

Form AD-1047

RD Inst.1940-M,

§1940.606(b)(1)

(22) Certification

Regarding Lobbying

N/A- Grant

Amendment

Exhibit A-1 of

RD Inst. 1940-Q

and §1940.810

(23) Statement of

Compliance

with 2 CFR 200 Part

400 & 416 if a State

or Local government;

or Part 400 & 415 if

a non-profit

N/A- Grant

Amendment

§1944.411(c)

(24) Assurances – Non

Construction Programs

N/A- Grant

Amendment

Form SF-424B

§1944.411(f)

(25) Area Director

Recommendation

*DNP Portal

Verification (Checked

at submission and

again prior to

closing)*

Always required

1944.410(b)

1940-M

§1940.606(b)

(26) T&MA Contractor

Review and

Recommendation

Always required

Required Under

National

Office T&MA

Contractor

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit I

Page 4

(Added 12-12-19, PN 532)

Description of Documents

Comment

Form/

Instruction

Number

Tab

Position

Date

Received/

Comments

(27) National Office

Review (if over $300,000

or if amount of new

grant plus unexpended

funds from previous

grant total $400,000)

All For-Cost

Amendments

are Funded at

the National

Office

§1944.415(a)

In addition to the above information, existing grantees submitting an

application for a new grant should also provide the following information as

part of a complete application. If this information was already provided in the

pre-application of a new grantee, they will not be required to duplicate this

information:

(28) Narrative Statement

(a) Amount of request

(b) Areas served

purposed

(d) Housing conditions

of low income

Families.

(e) Need for self-help

housing

(f) Evidence of

Community support

Rehab

Narrative

Statements

Should Also

Include

1. Rehab

Policies and

Procedures

2. Min/Max

rehab $ per

home

3. Relocation

Policy, if any

§1944.410(a)(4)

(29) Current Financial

Statements for Applicant

and any Sponsor

Updated

Financial

Statements as

applicable for

Amended

Request

§1944.410(a)(3)

(30) Outreach Plan for

very low-Income

N/A- Grant

Amendment

§1944.410(a)(5)

(31) HUD Affirmative

Fair Housing Marketing

Plan (AFHMP)

N/A- Grant

Amendment

HUD Form 935.2

§1944.410(a)

(10)

(32) Determination of TA

Grant Amount

Include the

Projected

Average Cost

Savings for

Families

§1944.407

(33) Intergovernmental

Review Submittal, if

applicable

N/A- Grant

Amendment

§1944.409

RD Instruction 1944-I

Exhibit I

Page 5

(Added 12-12-19, PN 532)

Description of Documents

Comment

Form/

Instruction

Number

Tab

Position

Date

Received/

Comments

(34) Civil Rights Impact

Analysis Certification

N/A- Grant

Amendment

Form RD 2006-38

2006-P,

§2006.754(b)

(35) Compliance Review

(Pre-award)

N/A- Grant

Amendment

Form RD 400-8

RD Inst.1901-E,

§1901.204(a) and

1901.204(c)(3)

(36) OGC Review (if

necessary)

N/A- Grant

Amendment

1944.410(b)(2)

(37) Previous Experience

N/A- Grant

Amendment

1944.410(a)(1)

(38) Organizational

Documents

(a)Reference to State

Law

(b)Certified copies of

Bylaws and Articles of

Incorporation, or other

evidence of corporate

existence

(c)Certificate of

incorporation for other

than public bodies

(d)Evidence of Good

Standing from t

he State

(e)Names and addresses

of Board of Directors,

officers and members

(plus principal business

of any member that is an

organization)

(f) Evidence of

nonprofit status

N/A- Grant

Amendment

1944.410(a)(2)

1944.404(d)(1-4)

Applicants and existing Self-Help grantees applying for a new grant should submit their

applications in an original and one copy containing the above applicable items to the

Technical and Management Assistance (T&MA) Contractor for review. The T&MA Contractor will

make a recommendation and submit the package to the State Office within 15 calendar days.

Within thirty (30) days of receipt of the application, the designated official will review

the application for completeness, accuracy and conformance to program policy and

regulations. The designated official should then make a recommendation and forward along

with a copy of the grantee’s package to the State Director. The State Office will issue a

Letter of Conditions to the Grantee subject to: (1) review of the application package by

the National Office, if applicable and (2) subject to submission of any additional items

not included with the application.

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit J

Page 1

(Added 12-12-19, PN 532)

LETTER OF CONDITIONS – APPLICATION REVIEW

Grantee Name and Address

Re: Self-Help Technical Assistance Grant {AMOUNT}

Dear {CONTACT PERSON}:

A review has been made of the items submitted in connection with your

application for a Section 523 Mutual Self-Help grant to your organization.

Based on your submittal of items required listed under 7 CFR 1944.410(e)(1)

through (10), your application package is determined complete and grant

approval can be considered.

This letter establishes conditions which must be understood and agreed to

before your grant is approved. The amount of this grant is based upon the

construction of {PROPOSED NUMBER OF HOUSES TO BE BUILT} houses. Please

provide the following information to Rural Development within 30 days so that

your grant can be approved. The items are as follows:

1. A signed statement from the Board of Directors stating the applicant has

or can hire, or contract directly or indirectly with qualified people to

carry out its responsibilities in administering the grant.

2. Provide a copy of the resolution adopted by (The Board of Directors or

other Governing Body if public body) authorizing the appropriate official

to execute Exhibit A, “Self-Help Technical Assistance Grant Agreement” of

7 CFR Part 1944, subpart I and Form RD 400-4, “Assurance Agreement”.

3. Provide a completed SF-424B, “Assurances Non-Construction Programs,”

agreeing to establish a recordkeeping system that a certified public

accountant will certify as meeting the requirements of the Grant

Agreement.

4. By grant closing, {UNLESS EXEMPTED BY 2 CFR 200 §200.305(b)(8)} you must

establish an interest-bearing checking account on which two or more bonded

employees will sign checks. Any interest earned in excess of $500

annually must be submitted to Rural Development quarterly. (The use of

minority depository institutions is encouraged.)

5. Provide a copy of the agreement which will be signed by you and the self-

help participants setting forth exactly what is expected of each and

incorporates Exhibit B-2 of 7 CFR Part 1944, subpart I, clearly showing

what labor tasks are required by the participating families.

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit J

Page 2

(Added 12-12-19, PN 532)

6. Certify on Exhibit A of 1940-Q and §1940.810 (certification regarding

lobbying) that you comply with the provisions therein.

7. Certify by signing Form AD-1049, “Certification Regarding Drug-Free

Workplace” and Form AD-1047, “Certification Regarding Debarment,

Suspension, and Other Responsibility Matters – Primary Covered

Transactions” that you will comply with the provisions of 2 CFR Part 200,

Parts 400 and 416 if a State or Local government; or Part 400 and 415 if a

non-profit. Provide a copy of the statement given all employees in

accordance with Appendix C of Part 400. All persons/entities doing

business with you must sign Form AD-1048, “Certification Regarding

Debarment, Suspension, Ineligibility, and Voluntary Exclusion – Lower Tier

Covered Transactions”.

8. You are encouraged to utilize the Technical and Management Assistance

Regional Contractor ({INSERT NAME AND ADDRESS}) for any needed technical

assistance in complying with these requirements.

9. {ADD ANY ADDITIONAL REQUIREMENTS}

[Note: If the grant will be closed ‘subject to’ any item(s) the final LOC

should begin with the following language instead of the above.]

A review has been made of the items submitted in connection with your

application for a Section 523 Mutual Self-Help grant to your organization.

Based on your submittal of items required listed under 7 CFR 1944.410(e)(1)

through (10), your application package is determined complete and the amount

of this grant is based upon the construction of {PROPOSED NUMBER OF HOUSES TO

BE BUILT} has been approved.

This letter establishes conditions which must be understood and agreed to in

conjunction with the grant requirements outlined in 1944-I Exhibit A ‘Self-

Help Technical Assistance Grant Agreement.’ This grant is being closed

subject to the following conditions which, if not met, may result in the

denial of grant draw request and potential termination of the grant:

1. {LIST CONDITIONS WITH TIMEFRAMES FOR COMPLETION.}

If you have any questions concerning these conditions, please contact Rural

Development for assistance at {SERVICING OFFICE TELEPHONE NUMBER}.

Sincerely,

Rural Development Authorized Official

Attachments

cc: Appropriate T&MA Contractor

Appropriate Rural Development Offices

RD Instruction 1944-I

Exhibit K

Page 1

(Added 12-12-19, PN 532)

Evaluation Report of Rehabilitation Self-Help Technical Assistance (TA) Grants

Evaluation for Quarter Ending ____ (1) ______, 20__

1. a. Name of Grantee: _________ (2) _________________________

b. Address: ___________ (3) _______________

c. Area the grant serves: _______ (4) ____________

d. TA Employees (number of and positions held): ____ (5) __________________

____________________________________________________________________________

2. Date of Agreement: _______ (6) _________ Time Extended _____ (7) _________

3. a. Equivalent unit increase during quarter:

_________________________________ (8) _______________________________________

First Month

_________________________________ (9) ______________________________________

Second Month

_________________________________ (10) ______________________________________

Third Month

b. Cumulative total number of Equivalent Units since beginning of grant:

______________________________ (11) ____________________________________

4. a. Method of Rehabilitation: Acquisition_(12)_, Owner Occupied _(13)__,

b. Average construction investment this quarter:

_________________ (14) ______________________________________________________

b1. Average construction investment for the grant cycle:

_________________(15)________________________________________________________

c. Average cost savings to participant this quarter:

_________________(16)________________________________________________________

c1. Average cost savings to participants for the grant cycle:

___________(17)______________________________________________________________

5.a. Number of houses/EU completed in this grant cycle:

__________(18)_________________________________________________________________

b. Number of houses/EU under rehab this grant cycle, but started during

previous grant:

_________________(19)__________________________________________________________

c. Number of houses/EU currently under rehab:

___________(20)________________________________________________________________

d. Number of families in pre-rehab phase:

___________(21)________________________________________________________________

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit K

Page 2

(Added 12-12-19, PN 532)

6.a. Average time needed to complete rehab project:

___________(22)___________________________________________________________

b. Length of time between submission of Rehab borrower’s docket and

approval/rejection and/or list third party funding sources being utilized:

_________(23)___________________________________________________________

c. Number and percentage of loan docket rejections during reporting period:

_________(24)___________________________________________________________

7. Did any of the following adversely affect the Grantee's ability to

accomplish program objectives (attach narrative as needed)? (25)

YES

TA Staff Turnover

RD Staff Turnover

Bad Weather

Loan Processing Delays

Rehab Home Acquisition and Development

Unavailable Loan/Grant Funds

Lack of Participants

Communication between RD/Grantee

8. Attach information concerning individual projects as follows: (26)

(1) The participating families name, address, income level, and funding source

with total loan/grant amount; (2) The rehab work completed with constructing

investment amount; (3) Cost savings to family with explanation of method used.

I certify that the statements made above are true to the best of my knowledge

and belief.

________(27)______________ ___________(28)___________

(Title) (Date)

____________(29)______________________

(Grantee Signature)

RD Instruction 1944-I

Exhibit K

Page 3

(Added 12-12-19, PN 532)

B. Area Office Review, as applicable- I have reviewed the above information

which I have found to be substantially correct.

Comments:__________________(30)________________________________________________

_______________________________________________________________________________

______________(31)________________ __________(32)__________________

(Area Office Representative Signature) (Date)

C. State Office Review, as applicable-I have reviewed the above information

which I have found to be substantially correct.

Comments:______________________________(33)____________________________________

_______________________________________________________________________________

____________(34)_____________________ ______ (35)__________________

(State Office Representative Signature) (Date)

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit K-1

Page 1

(Added 12-12-19, PN 532)

Instructions for Preparation of

Evaluation Report of Self-Help Rehabilitation Technical Assistance Grants

Exhibit K will be used by all Technical Assistance (TA) Grantees obtaining

self-help TA grants. This attachment provides the grantee and Rural

Development a uniform method of reporting the performance progress of self-

help projects. The TA Grantee will prepare an original and copies of the

attachment for the quarterly meeting. The TA Grantee will sign the original

and forward it to the local Rural Development Office. The TA Grantee will keep

the unsigned copy for its records.

The evaluation report will be completed in accordance with the following:

1. Enter the date the quarter ends or the year.

2. Enter the full name of the TA Grantee organization.

3. Enter the complete mailing address of the TA Grantee organization.

4. Enter the area served by the grant.

5. Enter the position titles of all employees being paid by the TA grant and

the percentage of their wages being paid or the originations indirect

cost rate.

6. Enter the date of the initial self-help TA grant agreement.

7. Enter the time of any extension self-help TA grant agreement(s).

8. Insert the number of equivalent units (EU) completed the

first/second/third month of the quarter using steps 1, 2, and

3 of Exhibit K-2.

9. Insert the number of EU's completed the second month of the quarter by

using steps 1, 2, and 3 of Exhibit K-2.

10. Insert the number of EU's completed the third month of the quarter by

using steps 1, 2, and 3 of Exhibit K-2.

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit K-1

Page 2

(Added 12-12-19, PN 532)

11. Add items (7), (8), and (9) to the total from the previous quarterly

report to obtain the cumulative total number of EU's. This total is the

cumulative total number of EU's for the project.

12. Enter the number of Acquisition Rehab projects in the Grantee

proposal(s).

13. Enter the number of Owner-Occupied Rehab projects in the Grantee

proposal(s).

For numbers 14 through 17, if both Acquisition and Owner-Occupied Rehab types

were completed a separate number for each program should be given.

14. Enter the average of all construction cost for rehab projects in the

quarter.

15. Enter the average construction investment for the grant cycle to-date.

16. Enter the average cost savings to participants during the quarter by

following the methods found in Exhibit K-2.

17. Enter the average cost savings to participants for the grant cycle to-

date.

18. Enter the total number of houses/EU’s completed to-date towards the grant

goal(s).

19. Enter the total number of homes/EU’s started in a previous grant cycle

but completing in the current, if any.

20. Enter the number of homes currently under rehab.

21. Enter the total number of families currently in the pre-rehab phase as

described in Exhibit K-2.

22. Insert the average elapsed time needed per house from loan closing

to final inspection by Rural Development to complete rehab of a house. If

no self-help homes have been completed by this grantee, use other

projects or your best estimate as a guide.

23. Enter the number of days it takes on average to approve or reject a

borrower's docket once it's submitted to Rural Development and/or list

alternate funding sources being used.

RD Instruction 1944-I

Exhibit K-1

Page 3

(Added 12-12-19, PN 532)

24. Enter number and percent of dockets submitted and rejected this quarter.

25. In the chart provided indicate if each item adversely affected grant

performance in during the quarter in review my marking yes or no. A

narrative may accompany the report to provide additional details on

specific situations.

26. If not already submitted to Rural Development reports should be submitted

with the supporting documentation listed.

27. Insert title of the Grantee or authorized representative.

28. Enter date of submittal.

29. Signature of Grantee or authorized representative.

30. Area Offices should insert comments concerning loan/grant packages,

progress of rehab, success of the project and any problems that the

organization may have.

31. Signature of Area Office Representative.

32. Insert date of Area Office Representative review.

33. A State Office representative should insert his/her comments.

34. Signature of State Office representative.

35. Insert date of State Office review.

oOo

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit K-2

Page 1

(Added 12-12-19, PN 532)

Equivalent Unit Tracking and Family Cost Savings

The process for completing rehab projects is different to that of mutual self-

help new construction projects. For this reason, EU’s for rehab will be

tracked as follows:

Acquisition Rehab

o Property acquisition-

identifying & assessing feasibility of potential homes .2 EU

o Application-

Closing/Inspections & Scope of Work/Pre-Construction Activities .2 EU

o Rehab Construction/Subcontractor & Inspection Coordination .4 EU

o End of Construction-

Punch List/Construction Completed/Loan Conversion

.2 EU

1.0 EU

Owner Rehab

o Application Closing-

Inspections & Scope of Work/Pre-Construction Activities .2 EU

o Rehab Construction/Subcontractor & Inspection Coordination .4 EU

o End of Construction-

Punch List/Construction Completed/Loan Conversion .4 EU

1.0 EU

Program participants should realize an adequate cost savings, as defined above,

from family labor participation in order for a project to be undertaken by the

grantee. As with the ‘sweat equity’ in the mutual self-help program which

varies greatly from project to project, area to area, and from grantee to

grantee, it is anticipated that the cost savings received in rehab projects

will see similar variances. Cost savings is ideally realized through the

amount of work the participant will be contributing but may be calculated

utilizing an approved method such as those described below.

Methods for establishing the estimated cost savings for a participating family

may also vary but must be well supported and may include one of the following

methods:

1. Contractor Cost Saving: this method should be considered first and

requires comparing a contractor bid or cost estimating software amount

for work to be completed to the total cost under the Self-Help Method.

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit K-2

Page 2

(Added 12-12-19, PN 532)

Example-Job Summary: Remove/replace 20 sq. shingles; reframe part of

roof; remove replace 1600 sq. ft. of siding; remove/replace two doors;

remove carpet in bathroom and replace with vinyl flooring.

Cost Estimator $16,500

Self-Help Cost -$5,700

Cost Savings = $10,800

2. Appraised Value: this method takes the cost to purchase and compares is

to the as-improved appraised value to determine an equity model similar

to that used in self-help new construction.

Example-Appraisal Value Comparison:

As-Improved Value $160,000

Loan Amount -$150,000

Cost Savings = $10,000

3. Hourly Rate of Labor Contribution: this method would include

establishing a typical hourly rate for the job task and multiplying it by

the hours contributed by the participant. The ‘National Cost Estimator’,

‘HomeWyse.com’, or other comparable software may be used to establish the

task labor hours.

Example- Job Summary:

Remove/replace 20 sq. shingles - $300 x 6 hrs = $1,800

Reframe part of roof - $350 x 6 hrs = $2,200

Remove/replace 1600 sq ft of siding - $500 x 10 hrs = $5,000

Remove/replace carpet w/vinyl in bathroom- $300 x 4 hrs = $1,200

Cost Savings $10,200

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit L

Page 1

(Added 12-12-19, PN 532)

ELECTRONIC FUNDS TRANSFER

AUTOMATED CLEARINGHOUSE SYSTEMS

(EFT/ACH) DRAW REQUEST

Date:

Borrower Name:

Borrower Case #:

Fund Code/Loan #

9 Digit Routing Number:

Account #:

Type of Account (checking or savings):

Name of Financial Institution:

Bank Contact and Telephone #:

Undisbursed Amount: $

Amount of Payment: $

Remaining undisbursed funds (after this request): $

Agency Use: Authorized by: ____ Date: ____

Entered by: _______ Date:

oOo

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit M

Page 1

(Added 12-12-19, PN 532)

{DATE}

{GRANTEE NAME}

Attn: Executive Director

{ADDRESS}

RE: Section 523 Technical Assistance Grant

High Risk Status Determination

Dear Executive Director:

In accordance with RD Instruction 1944-I, § 1944.417, Section 523 Technical

Assistance (TA) grantees are responsible to report quarterly on their progress

in all areas related to grant performance. Based on performance, the quarterly

report and information from the Technical & Management Assistance (T&MA)

Contractor, a determination is made by the agency whether the grant is

progressing favorably. In the event the grantee does not appear to be

performing acceptably, a determination of “high risk” is made which identifies

the areas in need of improvement.

Agency officials has been monitoring your grant performance and has recommended

that a determination of high-risk status be issued. This letter serves as

notification that the grantee has been determined high risk for the following

reasons:

1. Assisting the projected number of families.

• The grant proposes completion of {#} homes.

• As of the quarter ending {DATE}, {PERCENT} of the grant period has

elapsed; however, {#} homes, representing {PERCENT} of the proposal

are complete.

2. Serving very low-income families.

• The program goal to serve very low-income families as a priority

with at least 40 percent of the available funds.

• As of the {DATE} quarterly report, the grantee is serving {PERCENT}

very low-income families.

3. Equivalent unit (EU) Production.

• With {PERCENT} of the grant period elapsed, only {#} EU’s have been

completed. This represents {PERCENT} of the proposed goal.

• Without a significant increase in Equivalent Unit Production,

neither the EU, nor the number of homes completed goal will be met.

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit M

Page 2

(Added 12-12-19, PN 532)

4. Technical Assistance (TA) cost.

• The proposed TA cost for the grant is {$}.

• As of the quarter ending {DATE}, the actual TA cost is {$}.

• Unless the EU’s increase to meet grant goals, it does not appear

that the TA cost goal will be met.

5. Labor contributions by the family.

• The grantee does appear to be meeting this goal with the homes

currently in construction.

Contact the following offices for assistance with corrective actions:

RD State Office

RD Area Office

T&MA Contractor

{ADDRESS}

{PHONE}

Corrective actions may include but are not limited to training for packagers

and construction supervisors, assistance with developing and implementing

marketing plans to assist very low-income households, revisions to the

production schedule/grant period, etc. There are many opportunities for

assistance in areas that may help you meet your goals within the grant period.

We encourage you to work closely with your T&MA Contractor to identify

corrective actions.

You are required to submit {INSERT FREQUENCY OF REPORTS TO BE REQUIRED} status

reports to our office, and we will monitor and assess progress. Progress will

be assessed as follows:

a) If the situation has been corrected or reasonable progress has been made

toward correcting the situation, the “high risk” status may be lifted.

b) If the situation has not been corrected and it is unlikely to be

corrected if given additional time, the grant may be terminated under

Rural Development Instruction 1944-I, 1944.426(b)(1).

RD Instruction 1944-I

Exhibit M

Page 3

(Added 12-12-19, PN 532)

Our goal is to assist you remain a successful Section 523 grantee. To that

end, we want to work with you to identify the areas where it does not appear

that goals are being met and implement corrective actions now, so that your

grant goals are reached, and future grants are not jeopardized.

If you have any questions, please contact {INSERT APPROPRIATE RD OFFICIAL AND

PHONE NUMBER}

Sincerely,

{INSERT STATE DIRECTORS NAME}

State Director

cc: {NATIONAL OFFICE, SPECIAL PROGRAMS BRANCH}

{T&MA Contractor}

{OTHER RD OFFICE, AS APPROPRIATE}

{BOARD OF DIRECTORS}

oOo

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit N

Page 1

(Added 12-12-19, PN 532)

{DATE}

{GRANTEE NAME}

Attn: Executive Director

{ADDRESS}

Subject: Section 523 Technical Assistance Grant

High Risk Status Determination

Dear Executive Director:

As you know, a technical assistance grantee “high risk” determination was

effective {INSERT DATE}. Our agency and Technical and Management Assistance

(T&MA) Contractor have been working with you closely to monitor your progress

in meeting grant goals.

Based on a review of the progress you have made and recommendation of the

{Insert as appropriate such as Program Director, Area Director, Self Help

Coordinator} and T&MA Contractor, the high-risk grantee determination is

removed effective today.

Thank you for your efforts to improve performance and address the issues of

concern. We look forward to working with you in the future and providing

additional opportunities for homeownership. If you have any questions, please

contact {NAME} at {INSERT PHONE #}.

Sincerely,

{INSERT STATE DIRECTORS NAME}

State Director

cc: {NATIONAL OFFICE SPECIAL PROGRAMS BRANCH}

{T&MA Contractor}

{OTHER RD OFFICE, AS APPROPRIATE}

{BOARD OF DIRECTORS}

oOo

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit O

Page 1

(Added 12-12-19, PN 532)

{DATE}

{GRANTEE NAME AND ADDRESS}

Dear {NAME}:

This letter is to acknowledge {GRANTEE NAME} completion of 523 Technical

Assistance (TA) Grant requirements in accordance with Rural Development

Instruction 1944-I and 523 TA Agreement (letter of conditions) for the period

of {GRANT START DATE} through {GRANT COMPLETION DATE}.

Performance under this grant agreement is evaluated as follows:

1. {GRANTEE NAME} {DID OR DID NOT} assist the projected number of families

in obtaining adequate housing. There were {#} homes projected, and

{GRANTEE NAME} completed {#} homes during this grant period.

2. {GRANTEE NAME} {DID OR DID NOT} meet the goal of assisting at least 40%

very low-income families. At the end of the grant period, they served

{%} very low-income families.

3. {GRANTEE NAME} {DID OR DID NOT} meet the family labor requirement of at

least 65%.

4. {GRANTEE NAME} {DID OR DID NOT} meet the projected TA cost per EU of {$}.

Actual TA cost per EU at grant close out was only slightly over at {$}.

5. {GRANTEE NAME} {DID OR DID NOT} meet all other objectives under the grant

agreement.

{GRANTEE NAME} receives a rating of “{OUTSTANDING/ACCEPTABLE/NOT ACCEPTABLE}”

since they met {#GOALS MEET} of the above listed goals.

We look forward to working with you on your new 523 grant award and thank you

for your dedication to the self-help program. Please feel free to contact

{OFFICE CONTACT NAME} at {#}, should you have any questions.

Sincerely,

{INSERT STATE DIRECTORS NAME}

State Director

Cc: {NATIONAL OFFICE SPECIAL PROGRAM DIVISION}

{T&MA Contractor}

{OTHER RD OR OFFICE, AS APPROPRIATE}

oOo

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit P

Page 1

(Added 12-12-19, PN 532)

INDIRECT COST RATE NEGOTIATIONS

The cognizant agency for indirect cost negotiation for the United States

Department of Agriculture (USDA) Rural Housing Service, but the servicing

agency for processing indirect cost rate proposals and issuing and extending

indirect cost rate agreements will be the United States Department of the

Interior (DOI).

USDA-Rural Housing Service annually enters into an interagency agreement with

the DOI, Interior Business Center. This agreement provides for DOI to

negotiate, issue, and extend current indirect cost rate/cost allocation plans

on behalf of USDA-Rural Housing Service for Section 523 Mutual Self-Help Grant

Applicants. States should provide this policy to their grant applicants, so

they may work directly with DOI for approval.

Grantees claiming reimbursement of indirect costs on the Section 523 Self-Help

Technical Assistance Grants are required to have current negotiated indirect

cost rate agreements with their federal cognizant agency which may not

necessarily be DOI. For example, if Health and Human Services (HHS) is a

Section 523 Grant applicant’s cognizant agency because they provide the largest

source of funding to the entity, then the applicant will need to provide a copy

of HHS’s rate approval with their grant application.

RESPONSIBILITIES:

Cost Allocation Plans and Indirect Cost Rates

Historically, USDA-RHS has allowed nonprofit organizations and governmental

departments to use a Cost Allocation Plan (CAP) in lieu of an indirect cost

rate. With the release of 2 CFR 200, it has been made evident that an indirect

rate will be more appropriate for the majority of Section 532 Grantees. Under

certain situations, governmental departments or agencies may request to use a

CAP in lieu of an indirect cost rate agreement but this must be requested only

in limited circumstances and be due to the nature of that entity’s federal

award. CAPs used by governmental agencies will be reviewed by DOI on a case-

by-case basis to determine if indirect cost rates can be issued instead.

For nonprofit organizations, the approval of a CAP in lieu of indirect cost

rate will be phased out over the next fiscal period. Starting in FY 2017,

nonprofit organizations will be required to obtain indirect cost rates. In the

extremely rare situation where a Non-Federal entity can appropriately allocate

and charge 100% of their costs directly to their 523 grant and indirect costs

are not claimed, approval from DOI is not necessary; however, DOI may review

proposals of these types on a case-by-case basis to determine if indirect cost

rates can be issued.

(12-12-19) PN 532

RD Instruction 1944-I

Exhibit P

Page 2

(Added 12-12-19, PN 532)

RHS Staff should review specifically line item ‘j. Indirect Charges’ found in

Section B (6) on Standard Form 424-A, ‘Budget Information- Non-Construction

Programs’ to determine if the applicant is proposing to charge indirect costs

to the grant. If the applicant does not show any charge to the grant for

indirect costs, the proposed budget should be reviewed to determine if an

indirect cost rate should be utilized. Regional Technical and Management

Assistance (T&MA) providers should be consulted with to assist the agency in

making the determination as to when an applicant’s cost allocation plan should

be submitted to DOI.

Indirect Cost Rate Negotiation:

For organizations that have previously negotiated indirect cost rate

agreements, it is the responsibility of each grantee to submit a new indirect

cost proposal to their Federal cognizant agency for indirect cost within 6

months after the close of each fiscal year. Any non-federal entity that has a

federally negotiated indirect cost rate may apply for a one-time extension of a

current negotiated indirect cost rate for a period of up to four years. The

extension is subject to the review and approval of the federal cognizant agency

for indirect costs.

Organizations that have not previously established an indirect cost rate with a

Federal agency must submit an initial indirect cost rate proposal immediately

after the organization is advised that a Federal award will be made and in no

event later than three months after the effective date of the Federal award,

unless they elect to charge the de minimis rate of 10% modified total direct

cost (MTDC). Any non-federal entity that has never received a negotiated

indirect cost rate, except for those described in 2 CFR 200 Appendix VII

paragraph (d)(1)(B), may elect to charge a de minimis rate of 10% modified

total direct cost (MTDC) which may be used indefinitely.

Resources and Contacts:

Grantees should be informed that they may request assistance from the

Department of Interior (DOI) in preparing their indirect cost proposals. For

detailed information and guidance on preparation of Indirect Cost Proposals

grantees may visit the DOI web site at

https://www.doi.gov/ibc/services/finance/indirect-cost-services

. Grantees

requesting funding during the period of this agreement should be advised to

prepare and submit proposals to DOI at least 90 days prior to the desired grant

closing date; or provide a copy of its approved indirect cost rate agreement to

Rural Development with their grant application.

RD Instruction 1944-I

Exhibit P

Page 3

(Added 12-12-19, PN 532)

Under the terms of the Interagency Agreement, Rural Development State

Directors, or their designee, will notify the DOI Interior Business Center

regarding grantees that do not have a federally approved indirect cost rate

agreement, or in certain cases, a federally approved cost allocation plan. The

contact information for the DOI, Interior Business Center is:

Doris Jensen, Branch Chief

Email: [email protected]

Phone: 916-930-3829

US Department of the Interior

Interior Business Center

Indirect Cost Services

2180 Harvard Street, Suite 430

Sacramento, CA 95816

FAX: 916-566-7110

ICS Mailbox: [email protected]

oOo

(12-12-19) PN 532