HUD OIG report 2017 may offer a hint of a solution to the SBA Loan Declined still showing as DOB

image

HUD OIG published its recommendations and HUD made its comments. But still today we are seeing thousands of low income families penalized for duplication of disaster recovery benefits that they did not receive and did not want to take.

By Murray Wennerlund published 7-18-2018 updated 7-18-2018 4 min. 33 seconds read viewed 1.2K times. Download PDF


OPINION:

When government officials came together in search of a recovery program to help Americans after a disaster they came up with several programs. Over the years since that time many changes have been made and more restrictions put into place. 

Most all of the restrictions are needed. It's of my opinion even more need to be added, restrictions that denial future funding based on past funding fraud or mismanagement. 

You can even take a percentage of the amount of money that the state was awarded and deduct that amount from all future grants until the mistakes are no longer repeated. 

For restrictions we clearly want to focus on HUD national objectives. Simple 3 points to cover. 

HUD National Objectives Categories and Subcategories

  • Activities Benefiting Low/Moderate Income Persons
    • L/M Income Area Benefit
    • L/M Income Limited Clientele
    • L/M Income Housing
    • L/M Income Jobs
  • Prevention / Elimination of Slums or Blight
    • Addressing Slums or Blight on an Area Basis
    • Addressing Slums or Blight on a Spot Basis
    • Addressing Slums or Blight in an Urban Renewal Area
  • Urgent Needs

HUD Responded very rational to the HUD OIG Report. 
With comments identifying the issue with the SBA loans by individuals that declined the SBA loan we can see they are clear with their objective.

HUD Comments regarding OIG Report:
Comment 2: The OIG is correct that CPD did not publish the guidance concerning households that declined SBA loans and the award of CDBG-DR assistance as part of the Departmental clearance process. CPD notes that HUD's Directives Handbook 000.2, REV-3 provides that the Assistant Secretaries must ensure compliance with the Handbook, but it also states that the Secretary or Deputy Secretary may exempt an individual HUD Principal from compliance with the Handbook. The guidance was issued to address pressing questions about the eligibility of recovering homeowners and businesses to receive CDBG-DR assistance. While it is unclear whether the Secretary at the time provided a written exemption from the Departmental clearance process for this purpose, the Secretary was briefed on the guidance when it was being developed and was supportive of its publication.

Comment 2: Although the document did not go through the Departmental Clearance process, the guidance was developed in consultation with HUD's Office of General Counsel and the Hurricane Sandy Task Force, established pursuant to Executive Order. CPD also coordinated with the SBA prior to publishing the guidance.

Comment 3: CPD disagrees that the July 25th guidance contradicts its previous guidance included in a Notice published in the Federal Register on November 16, 2011, (76 FR 71040). The Federal Register Notice provided instruction to CDBG-DR grantees on how to prevent the duplication of benefits. In describing the federal government's disaster recovery programs and delivery sequence, the Notice states that SBA loans are among the government's primary and standard forms of disaster assistance, and that CDBG-DR funds should not be used to pay down SBA loans. Because CDBGDR funds are provided through supplemental Congressional appropriations, the funds are intended to supplement rather than supplant SBA assistance. The July 25th guidance clarified the Federal Register Notice by addressing the circumstances under which CDBG-DR grantees could assist households who applied for, but declined, SBA assistance, and the manner in which this can be done.

Comment 4: The November 16, 2011, Federal Register Notice and the July 25th guidance are entirely consistent. A homeowner's decision to decline SBA assistance and a grantee's subsequent award of CDBG-DR funds to that household does not result in CDBG-DR funds supplanting SBA funds. All CDBG-DR grantees must identify the amount and purpose of any disaster recovery funds that a household has received or is expected to receive and determine whether those funds are available. Once a homeowner formally declines an SBA loan, the SBA funds are not available to the homeowner, and the duplication of benefits prohibition in section 312 of the Stafford Act (42 U.S.C. 5155) is not implicated. Therefore, CPD determined at the time that CDBG-DR assistance that is subsequently provided to the homeowner would not supplant the SBA loan that was declined.

Clara and Murray street clean up after debris pickup

Comment | Suggestion | Feedback

Mortgage Relief Program for Homeowners Impacted by COVID-19

Homeowner Mortgage Assistance, a U.S. Taxpayer funded program designed to assist individuals and families impacted financially by the COVID-19 pandemic that are at risk of mortgage loan default and have a federally secured mortgage.

by Murray Wennerlund published 1/13/2022 updated 1-14-2022 10 min. 32 seconds read

Continue Reading


Low Income Small Business owners with real property and unmet needs can use HUD Economic Revitalization grants

Small Businesses that own real property, are low income, filed a disaster claim with FEMA, filed an application with SBA that was denied could be eligible for HUD CDBG-DR grants managed by your state agency for Unmet Economic Revitalization Needs.

by Murray Wennerlund published 12/20/2021 updated 12-22-2021 2 min. 5 seconds read

Continue Reading


HUD CDBG-DR Grants funded by Public Law 117-43 from the 117 Congress

Federal Taxpayer funded disaster recovery grant funds have been allocated to major and severe disasters declared in 2020 and 2021. H.R.5305 - Extending Government Funding and Delivering Emergency Assistance Act is allocating

by Murray Wennerlund published 10/31/2021 updated 11-6-2021 3 min. 22 seconds read

Continue Reading


Homeowner Assistance Fund Program that applies to ALL States and US Territories.

Mortgage Assistance will be managed by the same departments as the current Rental assistance. Expect the same results, slow disbursements and eligibility requirements that may not offer any financial assistance or funding coverage.

by Murray Wennerlund published 8/9/2021 2 min. 12 seconds read

Continue Reading


Eligible Homeowners to receive financial assistance from state managed federally funded programs.

Financial hardship means a material reduction in income or material increase in living expenses associated with any federally declared disaster and in this article we will use the coronavirus pandemic as our current federally declared disaster.

by Murray Wennerlund published 8/9/2021 updated 8-10-2021 13 min. 22 seconds read

Continue Reading


HUD Area Median Income Tables

U.S. Department of Housing and Urban Development HUD Area Median Income Tables

by Murray Wennerlund published 8/3/2021 2 min. 58 seconds read

Continue Reading


HUD CDBG-DR Base Flood Elevation (BFE), two (2) feet above the Advisory Base Flood Elevation (ABFE)

When you work with your municipality and they say your elevation has to be Base Flood Elevation BFE they are quoting FEMA policy. FEMA offers a 25/75 cost share for elevation. Your municipality has to tell you BFE plus 2 feet to use other federal funds.

by Murray Wennerlund published 5/13/2021 updated 1-10-2022 1 min. 43 seconds read

Continue Reading


American Rescue Plan Act of 2021 SEC. 3201. EMERGENCY RENTAL ASSISTANCE.

I have clipped the sections of rental assistance that will match your states housing assistance agencies. Your state will have a HUD program which will process your claim. If you were unemployed for the year 2020 you will qualify in nearly all cases.

by Murray Wennerlund published 3/28/2021 updated 1-11-2022 2 min. 3 seconds read

Continue Reading


V.C.2. FUNDS FOR SAME PURPOSE, DIFFERENT ALLOWABLE USE. HUD Guidance June 2019 explained to benefit homeowners

When HUD published updated duplication of benefits policy most states didnt pass the information on to those that the new guidance would assist. In Louisiana the state only addressed issues it was required to address and all others simply ignored.

by Murray Wennerlund published 11/13/2020 3 min. 56 seconds read

Continue Reading


Landlords with non paying renters because of unemployment.

Multifamily rental units occupied by non paying renters of no fault of their own for the COVID-19 job loss they are experiencing. I am researching the option to assist landlords with mortgages based on number of units at fair market rates.

by Murray Wennerlund published 9/20/2020 1 min. 7 seconds read

Continue Reading