(f) "Community Development Program" means the annual program of projects and activities to be carried out by the applicant with funds provided under this Part and other resources, as described in Subpart D.

(g) "Discretionary grant" means a grant made from the Secretary's fund, from the transition and categorical program settlement fund, from the urban development action grant fund, or from the general purpose funds for metropolitan and nonmetropolitan areas as described more fully in § 570.104 (a), (b), (e), (c)(1), and (c)(2), respectively.

(h) "Entitlement amount" means the amount to be received by a unit of general local government consisting of its basic grant amount and/or holdharmless grant under § 570.102 and § 570.103.

(i) "Extent of housing overcrowding" means the number of housing units with 1.01 or more persons per room based on data compiled and published by the United States Bureau of the Census for 1970.

(j) "Extent of poverty" means the number of persons whose incomes are below the poverty level based on data compiled and published by the United States Bureau of the Census for 1970 and the latest reports of the Office of Management and Budget. For the purposes of this Part, the Secretary has determined that it is neither feasible nor appropriate to make adjustments at this time in the computations of "extent of poverty" for regional or area variations in income and cost of living.

(k) "Hold-Harmless amount" means the amount which represents the average past level of funds received by a unit of general local government under the consolidated programs cited in § 570.1(b) and under section 312 of the Housing Act of 1964 and which is used to determine the amount of the Hold-Harmless grant.

(1) "Hold-Harmless grant" means that amount of funds which a unit of general local government is entitled to receive in excess of its basic grant amount under § 570.103.

(m) "HUD" means the Department of Housing and Urban Development.

(n) "Identifiable segment of the total group of lower-income persons in the community" means female-headed households, and members of a minority group which includes Negroes, Spanish-Americans, Orientals, American Indians and other groups normally identified by race, color, or national origin.

(o) "Low and moderate income families" or "lower income families" means families whose incomes do not exceed 80 percent of the median family income of the metropolitan area, or in the case of families residing in nonmetropolitan areas, of all non-metropolitar areas of the State. (In determining the income eligibility of individual low- and moderate-income or lowerincome families to receive assistance through direct benefit activities under the block grant program, applicant may use the applicable income limits published by HUD for lower-income housing assistance under Section 8 of the United States Housing Act of 1937 (42 U.S.C. 1437f).)

(p) "Low- and moderate-income persons" or "lower-income persons" means members of families whose incomes are within the income limits of lower-income families as defined in § 570.3(0). This term may, where appropriate, also include unrelated individuals, as defined by the U.S. Census Bureau, whose incomes do not exceed 80 percent of the median income of all unrelated individuals residing in the metropolitan area, or in the case of unrelated individuals residing in nonmetropolitan areas, of all nonmetropolitan areas of the State.

(q) "Metropolitan area" means a standard metropolitan statistical area, as established by the Office of Management and Budget.

(r) "Metropolitan city" means (1) a city, within a metropolitan area, which is a central city of such area, as defined and used by the Office of Management and Budget, or (2) any other city, within a metropolitan area, which has a population of fifty thousand or more. Any city which has been classified as a metropolitan city because it has a population of at least fifty thousand will continue to be so classified until the next ensuing de

cennial census indicates that the population of such city is below fifty thousand.

(s) "Population" means the total resident population based on data compiled and published by the United States Bureau of the Census for 1970, which has been upgraded by the Bureau to reflect the changes resulting from Boundary and Annexation Survey, new incorporations, and consolidations of governments, pursuant

to § 570.100, and which reflects changes resulting from the Bureau's latest population determination through its estimating technique using natural changes (birth and death) and net migration, and is referable to the same point or period in time.

(t) "Secretary" means the Secretary of Housing and Urban Development.

(u) "State" means any State of the United States, or any instrumentality thereof approved by the Governor; and the Commonwealth of Puerto Rico.

(v) "Unit of general local government" means any city, county, town, township, parish, village, or other general purpose political subdivision of a State; Guam, the Virgin Islands, and American Samoa, or a general purpose political subdivision thereof; a combination of such political subdivisions recognized by the Secretary; the District of Columbia; and the Trust Territory of the Pacific Islands. Such term also includes a State or a local public body or agency (as defined in section 711 of the Housing and Urban Development Act of 1970), a community association, or other entity, which is approved by the Secretary for the purpose of providing public facilities or services to a new community as part of a program meeting the eligibility standards of section 712 of the Housing and Urban Development Act of 1970 or Title IV of the Housing and Urban Development Act of 1968.

(w) "Urban county" means any county within a metropolitan area which, pursuant to § 570.105, is authorized under State law to undertake essential community and housing assistance activities in its unincorporated areas, if any, which are not units of general local government, and (1) has

a combined population of two hundred thousand or more (excluding the population of metropolitan cities and Indian tribes therein) in such unincorporated areas and in its included units of general local government (i) in which it has authority to undertake essential community development and housing assistance activities and which do not elect to have their population excluded or (ii) with which it has entered into cooperation agreements to undertake or to assist in the undertaking of essential community development and housing assistance activities, or (2) has a population in excess of one hundred thousand, a population density of five thousand persons per square mile, and contains within its boundaries no incorporated places as defined by the United States Bureau of the Census.

(x) "Age of housing" means the number of existing year-round housing units constructed in 1939 or earlier, based on data compiled by the United States Bureau of the Census and referable to the same point or period of time.

(y) "Extent of growth lag" means the number of persons who would have been residents in a metropolitan city or urban county, in excess of the current population of such metropolitan city or urban county, if such metropolitan city or urban county had a population growth rate, between 1960 and the date of the most recent population count referable to the same point of period in time, equal to the population growth rate for such period of all metropolitan cities.

(z) "Indian tribe" means any Indian tribe, band, group, and nation, including Alaska Indians, Aleuts, and Eskimos, and any Alaska Native Village, of the United States, which is considered an eligible recipient under the Indian Self-Determination and Education Assistance Act (Pub. L. 93-638) or under the State and Local Fiscal Assistance Act of 1972 (Pub. L. 92-512).

(aa) "Urban development action grant" (UDAG) means a grant made from those funds specifically appropriated under § 570.104(f) for the support of severely distressed cities and urban counties, to help alleviate physical and

economic deterioration through reclamation and through revitalization of communities, where such cities and urban counties require increased public and private assistance in addition to assistance otherwise made available under this title and other Federal assistance.

(bb) "Low-income persons" means members of families whose incomes do not exceed 50 percent of the median family income of the metropolitan area, or in the case of families residing in nonmetropolitan areas, of all nonmetropolitan areas of the State. This term may, where appropriate, also include unrelated individuals, as defined by the U.S. Census Bureau, whose incomes do not exceed 50 percent of the median income of all unrelated individuals residing in the metropolitan area, or in the case of unrelated individuals residing in nonmetropolitan areas, of all nonmetropolitan areas of the State.

§ 570.4 Waivers.

The Secretary may waive any requirement of this part not required by law whenever it is determined that undue hardship will result from applying the requirement and where application of the requirement would adversely affect the purposes of the Act.

Subpart B-Allocation and Distribution of Funds

AUTHORITY: Title I, Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.); Title I, Housing and Community Development Act of 1977 (Pub. L. 95128); and sec. 7(d), Department of Housing and Urban Development Act (42 U.S.C. 3535(d)).

SOURCE: 43 FR 4385, Feb. 1, 1978, unless otherwise noted.

§ 570.100 General.

(a) This subpart describes the policies and procedures governing the determination of entitlement for eligible units of general local government to receive grants, the entitlement amounts, and the allocation of appropriated funds among the several distribution categories provided under Title

I of the Housing and Community Development Act of 1974, as amended.

(b) In determining eligibility for a Basic Grant and in allocating funds under this subpart, current corporate status and geographic boundaries will be considered, in accordance with the following, to the extent such information was certified and available to the U.S. Bureau of the Census 90 days prior to the beginning of such fiscal year, and has been proceesed by Census at the time the allocation of funds is to be made each year:

(1) Incorporation of a community having population of at least 50,000 based on latest national census;

(2) Change in boundaries or annexations resulting in the population of the unit of general local government reaching or exceeding 50,000 based on latest national census count;

(3) All changes in boundaries or annexations that have been accepted at such point in time for use by the Office of Revenue Sharing; and

(4) Designation or redesignation of Standard Metropolitan Statistical Areas by the Office Management and Budget occurring not later than 90 days prior to the beginning of such fiscal year.

(c) The referenced population or national census count to be used in the determination of entitlements shall be the most recent decennial or middecade census; or the most recent updating of such censuses as represented by the Bureau of the Census national population estimates, and shall use the latest geographic base resulting from Boundary and Annexation Surveys, new incorporations, and consolidations of governments available as previously specified.

§ 570.101 Allocation between metropolitan and nonmetropolitan areas.

Eighty percent of the funds appropriated each fiscal year for the purposes of this part, excluding the amounts specified below, will be allocated to metropolitan areas, with the balance of twenty percent allocated to nonmetropolitan areas, for community development block grants in metropolitan and nonmetropolitan areas, re

spectively. Funds to be excluded for this purpose are:

(a) Metropolitan area "set-aside" fund. $50,000,000 for each of fiscal years 1975 and 1976, $200,000,000 fiscal year 1977 (not more than 50 percent of which to be used for holdharmless needs in metropolitan areas), $350,000,000 fiscal year 1978 (not more than 50 percent for hold-harmless needs in metropolitan areas), $265,000,000 for fiscal year 1979 (not more than $25,000,000 for hold-harmless needs in metropolitan areas), and $250,000,000 for fiscal year 1980 (none to be used for hold-harmless needs);

(b) Transition/categorical program settlement fund. $50,000,000 for each of fiscal years 1975 and 1976, and $100,000,000 for each of fiscal years 1977, 1978, 1979, and 1980 to facilitate transition and categorical program settlements, pursuant to Section 103(b) of the Act;

(c) Urban development action grants. Funds authorized and appropriated for making Urban Development Action Grants under Subpart G; and

(d) Secretary's fund. And amount equal to two percent for fiscal years 1975, 1976, and 1977, and three percent for fiscal years 1978, 1979, and 1980 of the total funds authorized and appropriated for each fiscal year that remain after excluding those funds under paragraphs (a), (b), and (c) for that fiscal year.

§ 570.102 Basic grant amounts.

(a) Metropolitan cites. (1) Of the amount allocated to metropolitan areas pursuant to § 570.101, the Secretary will allocate to each metropolitan city an amount of funds which shall be the greater of an amount that bears the same ratio to the allocation for all metropolitan areas as either:

(i) The average of the ratios between:

(A) The population of that metropolitan city and the population of all metropolitan areas;

(B) The extent of poverty in that metropolitan city and the extent of poverty in all metropolitan areas; and

(C) The extent of housing overcrowding by units in that metropolitan

city and the extent of housing overcrowding by units in all metropolitan areas; or

(ii) The average of the ratios between:

(A) The extent of growth lag in that metropolitan city and the extent of growth lag in all metropolitan cities;

(B) The extent of poverty in that metropolitan city and the extent of poverty in all metropolitan areas; and

(C) The age of housing in that metropolitan city and the age of housing in all metropolitan areas.

(2) In determining the average of ratios under paragraph (a)(1)(i) of this section, the ratio involving the extent of poverty shall be counted twice, and each of the other ratios shall be counted once (.50+.25+.25=1.00); and in determining the average of ratios under paragraph (a)(1)(ii), the ratio involving the extent of growth lag shall be counted once, the ratio involving extent of poverty shall be counted one and one-half times, and the ratio involving the age of housing shall be counted two and one-half time (.20+.30+.50=1.00).

(3) The Secretary shall determine eligibility of towns or townships to be cities on the basis of information available from the U.S. Bureau of the Census with respect to population level, closeness of settlement, and presence of incorporated places within the boundaries of town or township, and on the basis of information provided by the town or township and its included units of government. In computing amounts for a metropolitan city that is a town or township containing incorporated places, there shall be excluded and such incorporated place which is entitled to receive a hold-harmless grant for that year pursuant to § 570.103 and has not waived such entitlement under § 570.103(e).

(b) Urban counties. (1) Of the amount allocated to metropolitan areas pursuant to § 570.101, the Secretary will allocate to each urban county an amount of funds which shall be the greater of an amount that bears the same ratio to the allocation for all metropolitan areas as either:

(i) The average of the ratios between:

(A) The population of the urban county and the population of all metropolitan areas;

(B) The extent of proverty in that urban county and the extent of poverty in all metropolitan areas; and

(C) The extent of housing overcrowding in the urban county and the extent of housing overcrowding in all metropolitan areas; or

(ii) The average of the ratios between:

(A) The extent of growth lag in that urban county and the extent of growth lag in all metropolitan cities and urban counties;

(B) The extent of poverty in that urban county and the extent of poverty in all metropolitan areas; and

(C) The age of housing in that urban county and the age of housing in all metropolitan areas.

(2) In determining the average of ratios under paragraph (b)(1)(i) of this section, the ratio involving the extent of poverty shall be counted twice, and each of the other ratios will be counted once (.50+.25+.25=1.00); and in determining the average of ratios under paragraph (b)(1)(ii), the ratio involving the extent of growth lag shall be counted once, the ratio involving extent of poverty shall be counted one and one-half times, and the ratio involving the age of housing shall be counted two and one-half times (.20+.30+.50=1.00).

(3) In computing amounts or exclusions with respect to an urban county in any fiscal year there will be excluded any metropolitan city, any other unit of general local government located within the county which is entitled to receive a hold-harmless grant for that fiscal year pursuant to § 570.103 and has not waived such intitlement under § 570.103(e), any other unit of general local government the population of which has been cluded from the county's population as part of the urban county qualification process, pursuant to § 570.105, and any Indian tribes located within the county.

ex

(4) In excluding the population, poverty, housing overcrowding, and age of housing data for units of general local government which are entitled to re

ceive a hold-harmless grant from the computations in this paragraph as required by paragraphs (a)(3) and (b)(3) of this section, the Secretary will exclude only two-thirds of such data for fiscal year 1978 and one-third of such data for fiscal year 1979. In fiscal year 1980 and in subsequent years, no such exclusion is to be made.

(c) Phase-in provision. With respect to funds approved for distribution to a metropolitan city or urban county during fiscal years 1975, 1976 and 1977, the basic grant amount of any such city or county as computed under paragraphs (a) and (b) will be adjusted only for such funds approved for distribution in fiscal years 1975, 1976 and 1977 if the amount so computed for the first year such funds are approved for distribution exceeds the city's or county's hold-harmless amount for that year as determined under § 570.103. The adjustments are made so that:

(1) The amount for the city's or county's first year does not exceed one-third of its full basic grant amount, or its hold-harmless amount, whichever is the greater;

(2) The amount for its second year does not exceed two-thirds of its full basic amount, or its hold-harmless amount, or the amount allowed under Paragraph (c)(1) of this section, whichever is the greatest; and

(3) The amount for its third year does not exceed its full basic grant amount. The full basic grant amount as determined under § 570.102(a) and § 570.102(b) will be allocated to each metropolitan city and each urban county respectively for each of the fiscal years 1978, 1979, and 1980 regardless of their eligibility for or receipt of entitlement in preceding years and without regard to the application of the phase-in provision.

§ 570.103 Hold-harmless grants.

(a) Metropolitan cities and urban counties. Any metropolitan city or urban county having a hold-harmless amount, as calculated under paragraph (c) of this section, in any fiscal year which exceeds its basic grant amount for that year as computed under 570.102 will be entitled to re