(iv) Restrict in any way access to, or in the enjoyment of any advantage or privilege enjoyed by others in connection with facilities, services, financial aid or other benefits under the program or activity.

(v) Treat an individual differently from others in determining whether the individual satisfies any admission, enrollment, eligibility, membership, or other requirement or condition which individuals must meet in order to be provided any facilities, services or other benefit provided under the program or activity.

(vi) Deny an opportunity to participate in a program or activity as an employee.

(2) A recipient may not utilize criteria or methods of administration which have the effect of subjecting individuals to discrimination on the basis of race, color, national origin, or sex, or have the effect of defeating or substantially impairing accomplishment of the objectives of the program or activity with respect to individuals of a particular race, color, national origin, or sex.

(3) A recipient, in determining the site or location of housing or facilities provided in whole or in part with funds under this part, may not make selections of such site or location which have the effect of excluding individuals from, denying them the benefits of, or subjecting them to discrimination on the ground of race, color, national origin, or sex; or which have the purpose or effect of defeating or substantially impairing the accomplishment of the objectives of the Act and of this section.

(4) (i) In administering a program or activity funded in whole or in part with community development block grant funds regarding which the recipient has previously discriminated against persons on the ground of race, color, national origin or sex, the recipient must take affirmative action to overcome the effects of prior discrimination.

(ii) Even in the absence of such prior discrimination, a recipient in administering a program or activity funded in whole or in part with community development block grant funds should take affirmative action to overcome the effects of conditions which would otherwise result in limiting participation by persons of a particular race, color, national origin or sex. Where previous discriminatory practice or usage tends, on the ground of race, color, national origin or sex, to

exclude individuals from participation in, to deny them the benefits of, or to subject them to discrimination under any program or activity to which this part applies, the recipient has an obligation to take reasonable action to remove or overcome the consequences of the prior discriminatory practice or usage, and to accomplish the purpose of the Act.

(iii) A recipient shall not be prohibited by this part from taking any action eligible under § 570.200 to ameliorate an imbalance in services or faciilties provided to any geographic area or specific group of persons within its jurisdiction, where the purpose of such action is to overcome prior discriminatory practice or usage.

(5) Notwithstanding anything to the contrary in this section, nothing contained herein shall be construed to prohibit any recipient from maintaining or constructing separate living facilities or rest room facilities for the different sexes. Furthermore, selectivity on the basis of sex is not prohibited when institutional or custodial services can properly be performed only by a member of the same sex as the recipients of the services. § 570.602 Relocation and acquisition.

(a) Title II of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (40 U.S.C. 4601), hereafter referred to as the Uniform Act, and the regulations at 24 CFR Part 42 are applicable to all displacement of persons, bsuinesses, nonprofit organizations, and farms occurring as a direct result of any acquisition of real property assisted under this Part.

(b) Title III of the Uniform Act and the regulations at 24 CFR Part 42 are applicable to all acquisition of real property assisted under this part.

(c) The costs of relocation payments and assistance under Title II of the Uniform Act shall be paid from funds provided by this Part and/or such other funds as may be available to the locality from any source.

These procedures set forth the regulations, policies, responsibilities and procedures governing the carrying out of environmental review responsibilities of recipients.

§ 570.604 Historic preservation.

Recipients must take into account the effect of a project on any district, site, building, structure, or object listed on or nominated for listing on the National Register of Historic Places, maintained by the National Park Service of the U.S. Department of the Interior. Recipients should make every effort to eliminate or minimize any adverse effect on a historic property. Activities affecting such properties will be subject to requirements set forth in 570.604(b). Recipients must meet the historic preservation requirements of P.L. 89-665 and the Archeological and Historic Preservation Act of 1974, Pub. L. 93-291 and Executive Order 11593, including the procedures prescribed by the Advisory Council on Historic Preservation in 36 CFR Part 800. § 570.605 Labor standards.

All laborers and mechanics employed by contractors or subcontractors on construction work assisted under this Part shall be paid wages at rates not less than those prevailing on similar construction in the locality as determined by the Secretary of Labor in accordance with the Davis-Bacon Act, as amended (40 U.S.C. 276a-276a-5), and shall receive overtime compensation in accordance with and subject to the provisions of the Contract Work Hours and Safety Standards Act (40 U.S.C. 327-332), and the contractors and subcontractors shall comply with all regulations issued pursuant to these Acts and with other applicable Federal laws and regulations pertaining to labor standards. This section shall apply to the rehabilitation of residential property only if such property is designed for residential use of eight or more families. The Secretary of Labor has, with respect to the labor standards specified in this section, the authority and functions set forth in Reorganization Plan Number 14 of 1950 (5 U.S.C. 133z-15) and section 2 of the Act of June 13, 1934, as amended (40 U.S.C. 276c).

§ 570.606 Architectural Barriers Act of 1968.

The Architectural Barriers Act of 1968, 42 U.S.C. 4151 is applicable to assistance

§ 570.607 Activities for which other Federal funds must be sought.

A recipient may use community development funds for the provision of public services as described in § 570.200(a) (8) for activities (other than those previously approved under the model cities program and described in § 570.200(b)); or for flood or drainage facilities as described in § 570.200 (a) (2), provided that:

(a) The recipient has applied or inquired in writing to the Federal agency or agencies which conduct a program or programs most likely to meet the needs for which community development funds are being considered, or of the State or local agency or agencies, if any, which customarily receive funds from such programs and administer them within the recipient's jurisdiction.

(b) The recipient has received (1) a written statement of rejection from such Federal, State or local agency; (2) a written statement that funds cannot be made available for at least 90 days after the request; or (3) no response from the Federal, State or local agency within a 90 day period from the date of application or inquiry; and

(c) The recipient has notified HUD of the results of the application or inquiry.

§ 570.608 Hatch Act.

Neither the Community Program nor the funds provided therefor, nor the personnel employed in the administration of the program shall be in any way or to any extent engaged in the conduct of political activities in contravention of Chapter 15 of Title 5, United States Code.

§ 570.609 National Flood Insurance Pro

gram.

The provisions of the Flood Disaster Protection Act of 1973 (Pub. L. 93-234) and the regulations thereunder (24 CFR Chapter X, Subpart B) apply to assistance under this part.

§ 570.610 Clean Air Act and Federal

Water Pollution Control Act.

The recipient must comply with the provisions of the Clean Air Act, as amended (42 U.S.C. 1857 et seq.), and the Federal Water Pollution Control Act, as amended (33 U.S.C. 1251 et seq.), and the regulations thereunder (40 CFR Part 15).

Subpart H-Loan Guarantees

§ 570.700 Eligible applicants.

Units of general local government, which are eligible for grant assistance as specified in Subpart B, may apply for loan assistance under this subpart. Applications may also be made by public agencies designated by such units of general local government if the unit of general local government certifies that it does not have the legal capacity to carry out the activities for which the loan assistance is being made available and/or to accept the loan assistance. § 570.701 Application requirements.

(a) Timing of submission of loan application. Applications for loan guarantees must be submitted at the time of submission of an application for grant funds as specified in Subparts D and E.

(b) Submission requirements. Applications for loan guarantees must be made in the form prescribed by HUD. Units of general local government will be required to furnish full faith and credit pledges, or pledges of revenues approved by HUD, pursuant to § 570.702 (c).

of

(a) Eligible costs. Guarantees loans may be made to cover the costs for acquisition or assembly of real property and the related expenses of interest, demolition, relocation, and site improvements, as identified and approved in the grant application.

(b) Prohibition on loans to benefit private individuals or corporations. No guarantee shall be issued in behalf of any agency designed to benefit, in or by the flotation of any issue, a private individual or corporation.

(c) Security requirements. No guarantee or commitment to guarantee shall be made unless:

(1) The Secretary has reserved and withheld, from the applicant's entitlement or discretionary amount for the applicable program year, for the purpose of paying the guaranteed obligations (in

cluding interest), an amount which is at least equal to 110 percent of the difference between the cost of land acquisition and related expenses and the estimated disposition proceeds, which amount may subsequently be increased by the Secretary to the extent he determines such increase is necessary or appropriate because of any unanticipated, major reduction in such estimated disposition proceeds;

(2) The unit of general local government pledges its full faith and credit or revenues approved by the Secretary for the repayment of any amounts required to be paid by the United States pursuant to its guarantee as is equal to the difference between the principal amount of the guaranteed loan and interest thereon and the amount to be reserved and withheld under the preceding paragraph. If revenues are pledged, the applicant must submit evidence to the satisfaction of the Secretary that: (1) There is a reasonable expectation that the revenues will be available; and (ii) the revenues are unencumbered by any superior claim under the pledge; and

(3) The unit of general local government pledges the proceeds of any grants to which it may become eligible under this for the repayment of any amounts which are required to be paid by the United States pursuant to its guarantee, and which are not otherwise fully repaid when due pursuant to paragraphs (c) (1) and (2) of this section. § 570.703 Federal guarantee.

The full faith and credit of the United States is pledged to the payment of all guarantees made under this section. Any such guarantee made by the Secretary shall be conclusive evidence of the eligibility of the obligations for such guarantee with respect to principal and interest, and validity of any such guarantee so made shall be incontestable in the hands of a holder of the guaranteed obligations.

programs (NDP) pursuant to Title I of the Housing Act of 1949, as amended to the programs undertaken pursuant to this Part.

§ 570.801 Projects which can be completed without additional capital

grants.

(a) Urban renewal and NDP projects which can be completed without additional capital grants may continue to completion under the existing contracts executed under Title I of the Housing Act of 1949, as amended.

(b) At the request of the local public agency (LPA) carrying out the project, with the approval of the governing body of the unit of general local government in which the project is located, the Secretary may approve a financial settlement of the project if a surplus of capital grant funds will result after full repayment of temporary loan indebtedness. The form of the request for financial settlement will be prescribed by the Secretary. Financial settlements so requested shall be made at the discretion of the Secretary.

(1) Disbursement and use of surplus funds. Surplus grant funds remaining after financial settlement will be made available to the unit of general local government for use in accordance with the provisions of this Part.

(i) Entitlement recipients. Entitlement recipients may use surplus funds for activities previously approved in their application as specified in Subpart D. If activities not previously approved are to be undertaken with surplus funds, the recipient may either follow the amendment policy as specified in § 570.305, or it may include the proposed use of surplus funds in the first application for entitlement funds which is submitted after financial settlement. If the unit of general local government wishes to stage the use of surplus urban renewal funds over a period of years, it may request the Secretary to make the funds available on a schedule specified by the unit of general local government. In this event, the application or amendment must include only the surplus funds to be used in the program year covered by the application. The use of remaining surplus funds will be governed by subsequent years' applications. Amounts not identified in the application or amendment will be obligated to the recipient by contract and reserved until the use

of funds is included in an approved application.

(ii) Non-Entitlement communities. Surplus funds resulting from a financial settlement under this section will be made available to a unit of general local government which receives no entitlement amount under Subpart B upon approval of an application as specified in Subpart E, Applications and Criteria for Discretionary Grants.

(2) Release from contractual obligations under Title I of the Housing Act of 1949. Prior to financial settlement of the project, the Secretary will negotiate with the LPA the requirements which must be met for completion of the project under the contract executed under Title I of the Housing Act of 1949, as amended, in accordance with § 570.803.

§ 570.802

Projects which cannot be completed without additional capital grants.

(a) Use of funds by locality. Units of general local government may use funds made available under this Part to complete projects funded under Title I of the Housing Act of 1949, as amended, as specifically authorized by § 570.200(a) (10).

(b) HUD review of locality's intended use of funds. The Secretary will review the application submitted pursuant to § 570.303 to determine whether the unit of general local government's use of funds will be sufficient to protect the Federal Government's financial interest in existing urban renewal projects. The Federal Government's financial interest in the existing urban renewal projects shall be determined to be sufficiently protected if the unit of general local government's proposed use of funds will ultimately result in full repayment of outstanding temporary loans plus accrued interest. In the event that full repayment of outstanding temporary loans is proposed to be accomplished over a period of more than three years, the proposed use of funds for payment of interest on outstanding temporary loans until full repayment can be accomplished shall be reviewed. If he determines that the unit of general local government's intended use of funds does not sufficiently protect the Federal Government's financial interest in the existing urban renewal project, the Secretary may, after consultation with the chief executive of the unit of general

local government and the local public agency, deduct up to 20 percent from the unit of general local government's entitlement funds in any fiscal year for application to outstanding temporary loans plus accrued interest.

(c) Deductions at the request of the locality. The Secretary is authorized to make deductions from a unit of general local government's entitlement for repayment of temporary loans plus accrued interest if the local public agency carrying out the project submits to the Secretary a request which is concurred in by the governing body of the unit of general local government.

(d) Release from contractual obligations under Title I of the Housing Act of 1949. Prior to financial settlement of the project, the Secretary will negotiate with the LPA the requirements which must be met for completion of the project under the contract executed under Title I of the Housing Act of 1949, as amended, in accordance with § 570.803.

§ 570.803 Requirements for Completion of Projects Prior to Financial Settlement [Reserved].

Subpart J-Program Management § 570.900 Performance Standards.

Performance standards are the standards against which the Secretary will determine whether the recipient has complied with the specific requirements of this Part. Performance standards are operational program requirements complementing the simplified application review requirements of this part which are designed to provide financial assistance, with maximum certainty and minimum delay, upon which communities can rely in their planning. The Secretary's review of performance against the standards set forth in this section will serve as the basic assurance that grants are being used properly to achieve the objectives of this Part. The Secretary may, either during or after performance, review, monitor, and evaluate the recipient's community development program. The Secretary will use the following standards in determining compliance with this Part of the recipient's performance, including determinations under § 570.911.

(a) Relocation. The recipient has established operating procedures under which:

(1) All displaced persons were provided sufficient information in an assim

ilable form so that they fully understood the reason for their displacement and the relocation rights, payments, and assist ance to which they were entitled;

(2) All displaced persons received formal notice establishing their eligibility for relocation payments;

(3) All displaced families and individuals were provided a reasonable number of referrals to comparable decent, safe, and sanitary housing and were provided assistance in obtaining such housing;

(4) All displaced businesses, organizations, and farm operations were offered assistance in obtaining replacement loca tions;

(5) All displaced persons were provided appropriate advisory services in order to minimize hardships to such persons in adjusting to relocation;

(6) All displaced persons received all the relocation payments to which they were entitled in a prompt manner;

(7) Displacement and relocation activities under the community development program were coordinated with those of other governmental agencies in the community carrying out programs resulting in concurrent displacement; and

(8) A locally developed administrative review process provides full opportunity for displaced persons to obtain reconsideration of determinations as to their eligibility for, or the amount of, a relocation payment made and consideration of complaints regarding the adequacy of replacement housing. The process assures that complaints of displaced persons are handled in a timely and responsive manner, that conflicts are resolved fairly and expeditiously, that the recipient will review determinations upon request, and that an appeal may be made to the HUD Area Office when necessary.

(b) Acquisition. Local acquisition policy complies with Title III of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970.

(c) Equal opportunity. (1) The recipient will be required to document the actions undertaken to assure that no person, on the ground of race, color, national origin, religion, or sex, has been excluded from participation in, denied the benefits of, or otherwise subjected to discrimination under any activity funded under this Part. Such documentation should indicate:

(i) Any methods of administration designed to assure that no person, on the