Federal Disaster Recovery Funding:

Federal Disaster Recvery Funding: Minimizing Radblcks t Maximize Resurces CONSUMER CONFIDENCE SK COLLABORATION BUSINESS RETENTION TRENDS CAPITAL PLANNING GLOBAL RAPID RESPONSE RESTORATION COLLABORATION LEADERSHIP ENTREPRENEURSH PARTNERSHIPS GREEN MANAGEMENT WORKFORCE WEALTH RESOURCES STAKEHOLDERS UNEMPLOYMENT DIVERSIFICATION REGIONALISM FORESIGHT BRANDING LEVERAGE CREATIVITY STRATEGIC VISION GROWTH TALENT REDEVELOPMENT JOBS SITE SELECTION PRIVATE SECTOR ECONOMIC TRANSFORMATION COMMUNITY POLICY INNOVATION ENCY MARKETING MITIGATION COMMUNICATION SUSTAINABILITY BUSINESS CONTINUITY PARTNERSHIPS PRIVATE SECTOR COMMERCIALIZATION PR REDEVELOPMENT INNOVATION JOBS CRI IEDC Research Reprt // June 2013

Internatinal Ecnmic Develpment Cuncil (IEDC) develpment prfessin with 4,300+ members and a netwrk f 25,000+ ecnmic develpment prfessinals and allies. Frm public t private, rural t urban, and lcal t internatinal, experience. Thrugh a range f services that include cnferences, training curses, webinars, publicatins, research and technical assistance effrts, IEDC strives t prvide cutting-edge expertise t the ecnmic develpment cmmunity and its stakehlders. Primary Authrs Editrs Carrie Mulcaire, Directr, Federal Grants and Technical Assistance Brian Overingtn, Senir Assciate, Ecnmic Develpment Tye Libby, Special Prjects and Research Assciate Swati Ghsh, Directr, Research and Technical Assistance Elizabeth Thrstensen, Vice President, Knwledge Management and Ecnmic Develpment Practice Acknwledgements This research prject was accmplished thrugh the U.S. Ecnmic Develpment Administratin (EDA)'s Ecnmic Adjustment Assistance Prject N. 08-79-04593. The statements, findings, cnclusins, recmmendatins, and ther data in this reprt are slely thse f IEDC and d nt necessarily reflect the views f the U.S. Ecnmic Develpment Administratin. This reprt is part f a larger cmpendium f research and technical assistance prduced by IEDC and funded by the afrementined U.S. Ecnmic Develpment Administratin (EDA) grant, which fcuses n lng-term ecnmic recvery f disaster-impacted Gulf Cast cmmunities in sutheast Texas and Luisiana. IEDC greatly appreciates input and assistance received frm its members and stakehlders wh participated in research and interviews fr this reprt, and wuld like t acknwledge thse wh cntributed greatly t the cntent f this reprt. Cpyright 2012 Internatinal Ecnmic Develpment Cuncil 2

Table f Cntents Sectin I Intrductin... 7 Overview... 8 Federal Apprach t Recvery... 9 Presidential Disaster Declaratin... 9 Natinal Disaster Recvery Framewrk... 9 Federal Agencies and Prgrams fr Ecnmic Recvery... 11 U.S. Department f Husing and Urban Develpment... 11 U.S. Ecnmic Develpment Administratin... 12 U.S. Small Business Administratin... 13 U.S. Emplyment and Training Administratin... 13 U.S. Department f Agriculture Rural Develpment... 13 U.S. Treasury Department... 14 Overview f Federal Requirements... 15 Definitins f Federal Requirements... 15 Definitins f Waivers... 16 Issues Impacting Federal Supprt fr Ecnmic Recvery... 18 Lack f Knwledge f Federal Prgrams... 18 Different Reprting Requirements fr Grant Cmpliance... 18 Interpreting Requirements between Levels f Gvernment... 19 Funding Match Requirements: Asking T Much frm Impacted Cmmunities?... 19 Timeliness in Interpreting Federal Requirements... 19 Sectin II General Guidelines fr Requesting Waivers... 20 Making a Case t Justify a Waiver... 21 Knw Federal Agency Objectives... 21 Review Previus Waivers... 22 Present Unique Cmmunity Recvery Needs in Waiver Requests... 23 Cmmunicate with Federal and State Officials Early and Often... 25 Establish a Lcal Ecnmic Recvery Team... 25 Identify Lead Organizatins... 26 Engage State Agency Recvery Leaders... 26 Cmmunicate Frequently with State and Federal Agencies... 28 Fllwing thrugh with Agency Officials... 30 Persevering... 30 Dcument All Cmmunicatin and Waiver Apprvals... 30 Pushing thrugh Majr Regulatry Barriers... 31 Preparatins fr the Next Disaster... 31 Sectin III Guidelines fr Waiving Requirements by Federal Agency... 32 U.S. Department f Husing and Urban Develpment... 33 CDBG-DR Overview... 33 Requirements That Cannt Be Waived... 34 -DR Prgram... 36 Identify and Cmmunicate with Agencies Authrized t Request Waivers... 38 Learn Abut Requirements and Waivers Needed in a Cmmunity... 40 Demnstrate Need fr Waivers and Hw Requirements Negatively Impact a Cmmunity 40 Retain Experienced Legal Persnnel t Review Regulatins... 41 3

... 42 Overview f Disaster Recvery Assistance... 42 Requirements That Cannt Be Waived... 43 Allwable Waivers f EDA Disaster Assistance Requirements... 43 Wrking Effectively with EDA n Federal Requirements... 43 U.S. Small Business Administratin... 46 Overview f SBA Disaster Lans... 46 Requirements That Cannt Be Waived... 46 Allwable Waivers f SBA Disaster Lan Requirements... 47 Waiver-Related Recmmendatins fr SBA Disaster Lans...48... 49 Overview f Natinal Emergency Grants (NEGs) fr Disaster... 49... 50 State Actin Is Necessary t Extend Six Mnth Limitatin... 50 U.S. Department f Agriculture Rural Develpment... 51... 51... 51 Allwable Waivers f USDA Rural Develpment Requirements... 52 Cnclusin... 53 4

Executive Summary The increased frequency and magnitude f majr disasters in the U.S. in recent years has caused the federal gvernment t be mre invlved in disaster recvery assistance. In 2011 and 2012, the U.S. experienced 25 majr natural disasters, each accunting fr at least a billin dllars in damage. Eleven f these billin-dllar disasters caused a cmbined $110 billin in damage in 2012, making it the secnd cstliest year after 2005 (Hurricane Katrina). Even the mst resilient lcal cmmunities and states struck by these disasters require massive amunts f federal gvernment assistance fr their recvery effrts. This reprt is intended t help guide lcal and state ecnmic recvery stakehlders including ecnmic develpment rganizatins, lcal and state gvernment agencies, chambers f cmmerce, ecnmic develpment districts and ther recvery fficials arund sme f the radblcks t using federal funds fr ecnmic recvery purpses. The reprt shares hw federal requirements can smetime hinder the recvery prcess and prvides insights abut the prcess f requesting waivers f these requirements. Many f the recmmendatins are based n input frm ecnmic recvery practitiners and federal fficials interviewed fr this research. Lcal cmmunities can use this infrmatin t help maximize the speed and efficiency f their ecnmic recvery effrts after a disaster. This reprt is divided in three sectins. The first sectin intrduces the subject and prvides an verview f the federal apprach t recvery, including presidentiallydeclared disasters and the Natinal Disaster Recvery Framewrk (NDRF). It als utlines sme f the federal prgrams assciated with ecnmic recvery and highlights majr challenges t meeting federal requirements. Disaster-impacted cmmunities that are familiar with the mst cmmn barriers t meeting federal requirements will be in a better psitin t cnfrnt challenges alng the rad t recvery. The secnd sectin prvides general guidelines fr states and disaster-impacted cmmunities fr requesting waivers f funding requirements frm federal gvernment agencies. These include: Identifying a lead rganizatin at the lcal level fr representing the ecnmic recvery interests f an impacted cmmunity; Cmmunicating early and ften with federal fficials abut federal requirements; Reviewing successful waivers f ther disaster-impacted states; Presenting unique recvery needs alngside ther cmpelling infrmatin t justify waiver requests; and Prmting frequent engagement between impacted cmmunities and the state agencies that serve as crdinatrs f disaster recvery activities. The final sectin prvides infrmatin n waivers assciated with the majr federal agencies that fund pst-disaster ecnmic recvery effrts. This includes the U.S. Department f Husing and Urban Develpment (HUD), the U.S. Ecnmic Develpment Administratin (EDA), the U.S. Small Business Administratin (SBA), the U.S. Department f Agriculture (USDA). 5

It als highlights the mst cmmnly requested waivers by federal agency and prvides agency specific recmmendatins fr justifying waiver requests. Readers f this reprt shuld nte that its cntent shuld be seen as a snapsht, and that federal pst-disaster funding prgrams and plicies evlve. IEDC encurages readers t peridically check www.iedcnline.rg/web-pages/resurces-publicatins/ disaster-preparedness-and-recvery/ cntent and recmmendatins and fr additinal resurces t help navigate federal funding prcesses and requirements fr ecnmic recvery effrts. 6

Sectin I Intrductin 7

Overview When majr disasters strike, cmmunities are seldm prepared t deal with the cmplex challenges assciated with the ecnmic recvery prcess that fllws. Catastrphes ften require massive capital infusins and assistance beynd what an individual cmmunity r state can prvide. Part f the disaster recvery prcess will almst certainly invlve the federal gvernment and its surces f financial assistance. Yet, many ecnmic develpment rganizatins (EDOs) are nt well-versed in the prcess f btaining and maximizing federal funding assistance until they are cnfrnted with having t request these funds fr the first time. This reprt is intended t infrm disaster-impacted cmmunities and their EDOs abut issues that arise with the use f federal funds fr ecnmic recvery, hw federal requirements can smetimes hinder the ecnmic recvery prcess, and t share insights n the prcess fr requesting waivers f federal requirements that pse significant barriers fr lcal cmmunities. Fr the purpses f this reprt, ecnmic recvery is defined as the recvery effrts f lcal businesses and the lcal ecnmy, and des nt cver the immediate respnse effrts fcused n life-saving and prperty-saving activities. 1 Cmmunities face many cmplex challenges when trying t meet statutry and regulatry requirements f federal funds fr disaster recvery. Amng the mst significant are labr and wage requirements, lcal r state matching funds, envirnmental reviews, incme level requirements, and the requirement that individuals, businesses, and ther entities d nt receive duplicative assistance frm different federal agencies (i.e. duplicatin f benefits). Sme federal requirements can be waived, but federal agencies require an ften lengthy justificatin prcess in which applicants must prvide detailed and frmally dcumented explanatins fr why exceptins t these requirements shuld be made. Based n myriad interviews with lcal ecnmic recvery practitiners, federal prgram fficers, state fficials, and cngressinal staff, this reprt highlights reasns that federal requirement waivers are smetimes necessary and prvides insight n hw disaster-impacted cmmunities can mve frward thrugh a waiver request prcess. While this reprt ffers guidance fr navigating the smetimes challenging prcess f requesting waivers, it is nt intended t ffer an exhaustive review f all federal prgrams that fund disaster recvery assistance. 1 While sme cmmunities may include husing as part f their ecnmic recvery effrts and husing is a critical cmpnent f cmmunity rebuilding after a disaster, this reprt des nt cver the tpic f husing assistance. 8

Federal Apprach t Recvery Presidential Disaster Declaratin This reprt fcuses exclusively n presidentially-declared disasters. Presidentiallydeclared disaster areas are regins r states fr which the President f the United States has issued a majr disaster declaratin that authrizes the federal gvernment t prvide pst-disaster assistance. The declaratin begins with the submissin f a written request fr federal assistance by a state gvernr t the president. 2 The advantage f a presidential declaratin is that it creates an pprtunity fr cmmunities t access a substantial amunt f federal assistance prgrams, resurces, and funding t accelerate respnse and recvery initiatives. The Natinal Respnse Framewrk (NRF) and the Natinal Disaster Recvery Framewr the federal framewrk fr disaster respnse and disaster recvery, including making existing federal pst-disaster functins wrk mre effectively tgether. Where the NRF is largely cncerned with shrt-term respnse, the NDRF cvers lng-term recvery effrts, including the vast majrity f ecnmic recvery functins. Disasterimpacted cmmunities shuld develp a brad understanding f the NDRF, as it helps t infrm state and lcal fficials abut the federal recvery prcess and prgrams that may be available t impacted cmmunities. The fllwing sectin highlights the purpse and resurces f the NDRF. Natinal Disaster Recvery Framewrk The Natinal Disaster Recvery Framewrk (NDRF) prvides guidance n hw federal gvernment agencies crdinate disaster recvery assistance with ne anther and with state, tribal, and lcal gvernments with the gal f assisting disaster-impacted cmmunities with recvery effrts. The NDRF recgnizes that lcal, state, and tribal gvernments bear the chief respnsibility fr cmmunity recvery effrts, but that federal resurces are necessary t supplement the lcal recvery needs. rvide a cmprehensive rganizing structure fr disaster recvery that all levels f gvernment can fllw. The nngvernmental partners t align resurces and wrk tgether t supprt recvery 3 cre principles that are reflected in six recvery supprt functins (RSFs) (Primary crdinating agencies are in parentheses). 2 3 This prcess is set frth in the Rbert T. Staffrd Disaster Relief and Emergency Act, 42 U.S.C. 5121-5206 (Staffrd Act) Natinal Disaster Recvery Framewrk - Frequently Asked Questins. Federal Emergency Management Agency (FEMA) website. Available at www.fema.gv/natinal-disaster-recvery-framewrk-frequently-asked-questins, June 10, 2013. 9

1. Cmmunity Planning and Capacity Building (Federal Emergency Management Agency (FEMA)) 2. Ecnmic 3. Health and Scial Services (Department f Health and Human Services (HHS)) 4. Husing (Department f Husing and Urban Develpment (HUD)) 5. Infrastructure Systems (United States Army Crps f Engineers (CORPS)) 6. Natural and Cultural Resurces (Department f the Interir (DOI)) (EDA)) In additin t pst-disaster recvery, the NDRF als seeks t establish leadership rles, respnsibilities, crdinatin, and guide recvery planning between all levels f gvernment befre a disaster ccurs. The majrity f federal agencies are legally bligated t initially crdinate with a then determine which state agency will manage disaster recvery funds fr specific (CDBG-DR)). 10

Federal Agencies and Prgrams fr Ecnmic Recvery The fllwing sectin prvides a list f cmmnly used federal funding surces fr pst-disaster ecnmic recvery. While this list is nt exhaustive, it highlights many f the mst imprtant federal agencies and prgrams respnsible fr prviding federal ecnmic recvery resurces. Ecnmic develpment prfessinals are encuraged t use the infrmatin in this sectin as a starting pint n which t build a mre cmprehensive knwledge base abut federal ecnmic recvery funding mechanisms. U.S. Department f Husing Cmmunity Develpment Blck Grants fr Disaster Recvery Develpment (CPD) administers the Grant fr Disaster Recvery (CDBG-DR) prgram. This prgram has served as the majr surce f recvery funds fr mst presidentially-declared disasters ver the past 25 years. In additin t helping supplement ther federal disaster recvery funding resurces such as the (SBA) Disaster Lan prgram, CDBG- - impacted areas and prvide cmmunities with vital seed funding t begin the recvery prcess. 4 CDBG-DR funds can nly be used fr - relief, lng-term recvery, and the restratin f infrastructure, husing, and Federal Recvery Assistance U.S. Department f Husing and Urban Develpment Cmmunity Develpment Blck Grants fr Disaster Recvery U.S. Small Business Administratin Disaster Recvery Lans Hme/Persnal Prperty Lan Business Physical Disaster Lan Ecnmic Injury Disaster Lan U.S. Ecnmic Develpment Administratin Strategic Planning and Technical Assistance Infrastructure Design and Develpment Capital fr Alternative Financing U.S. Emplyment and Training Administratin Natinal Emergency Grants (NEGs) Disaster U.S. Department f Agriculture Rural Develpment Rural Business Enterprise Grants Rural Business Opprtunity Grants Intermediary Relending Prgram Rural Ecnmic Develpment Lans and Grants Cmmunity Facilities Lans and Grants Water and Waste Direct Lans Business and Industry Guaranteed Lan Prgram Bimass Crp Assistance Prgram Birefinery Assistance Prgram Bienergy Prgram fr Advanced Bifuels Rural Energy fr America Prgram Bimass Research and Develpment Initiative 4 CDBG Disaster Recvery Assistance. U.S. Department f Husing and Urban Develpment (HUD) website. Accessed at: http://prtal.hud.gv/hudprtal/hud?src=/prgram_ffices/cmm_planning/cmmunitydevelpment/prgrams/drsi 11

5 It is wrth nting that there is n set frmula r prcess fr dcumenting hw a prject is related the afrementined criteria. A grantee in discussins with a federal prgram fficer has sme discretin in determining what type f dcumentatin is sufficient. When submitting an applicatin, grantees must als demnstrate that a prject r prgram (1) addresses a disaster-related impact fr a cunty in a presidentially-declared disaster area; (2) is a legitimate CDBG-eligible 6 and mderate incme (LMI); (2) aiding the preventin r eliminatin f slums r blight; r (3) meeting ther urgent cmmunity develpment needs due t an immediate threat f cmmunity health and welfare. 7 In interviews with ecnmic develpment prfessinals that have used CDBG-DR grants after a disaster, the mst frequently cited cncerns are difficulties with meeting ne f the three natinal bjectives, particularly the LMI requirement, and the significant amunt f cmpliance paperwrk that the prgram requires. U.S. Department f Cmmer Ecnmic Develpment Administratin develpment assistance t lcal gvernments fr lng-term cmmunity ecnmic 8 EDA ffers this assistance directly t impacted cmmunities in the frm f grants fr strategic planning, infrastructure, capital fr alternative financing (i.e. revlving lan funds), ecnmic develpment and redevelpment prjects, and funding fr disaster recvery crdinatrs. EDA reginal ffices wrk directly with lcal cmmunities thrugh an established netwrk f ecnmic develpment districts (EDDs). The full list f eligible EDA grant recipients includes: (1) states and plitical subdivisins f states (i.e., twns and cunties); (2) public r private nnprfit assciatins; (3) ecnmic develpment districts (r reginal planning agencies); (4) institutins f higher educatin; (5) tribal gvernments; and (6) applicants lcated in, r applying n behalf f, a cunty that received a majr disaster declaratin. While EDA is a smaller surce f disaster recvery funding cmpared t prgrams like -DR, IEDC interviewees nted that EDA grants were mre flexible surces f ecnmic recvery funding because f the cmparatively mre limited amunt f federal requirements and ease f grant cmpliance. 5 6 7 8 Ibid. Guide t Natinal Objectives and Eligible Activities fr State CDBG Prgrams. U.S. Department f Husing and Urban Develpment Website. http://prtal.hud.gv/hudprtal/hud?src=/prgram_ffices/cmm_planning/cmmunitydevelpment/library/stateguid e http://prtal.hud.gv/hudprtal/hud?src=/prgram_ffices/cmm_planning/cmmunitydevelpment/prgrams/drsi Disaster Recvery. U.S. Ecnmic Develpment Administratin website. Accessed at: www.eda.gv/disasterrecvery.htm 12

U.S. Small Business Admin The U.S. Small Business Administratin (SBA) ffers disaster recvery assistance in the frm f Disaster Lans fr businesses and mst private nnprfit rganizatins. These lans are ffered t disaster-impacted businesses f all sizes fr repairing r replacing real estate, persnal prperty, equipment, and business assets damaged in a disaster. SBA Disaster Lans prvide lw-interest, lng-term lans fr physical and ecnmic damage caused by a presidentially-declared disaster thrugh the SBA Office f Disaster Assistance. fr disaster-impacted businesses. These lans help businesses with regular and necessary financial bligatins that they cannt t meet because f disaster impacts. disaster recvery perid and are available fr businesses and business wners wh cannt cver the full csts f their wn recvery withut financial assistance frm gvernment surces. 9 and Training (NEGs) fr Disaster that assist dislcated wrkers, and the cmmunities in which they live and wrk, 10 The NEG prgram funds ne f fur eligible layff events: (1) a single cmpany layff f 50 r mre wrkers; (2) multiple cmpany layffs, where 50 r mre wrkers frm each cmpany are dislcated; (3) industry-wide layffs; r (4) layffs affecting an entire cmmunity (Cmmunity Impact), where there are multiple small dislcatins (50 wrkers r less frm each cmpany). 11 The Disaster NEG prgram prvides funding specifically fr the creatin f temprary emplyment t assist directly with disaster cleanup activities fr the first six mnths frm the date the grant is awarded. A state can include a cmpnent fr emplymentrelated services in its fully dcumented plan r mdificatin request. Disaster NEGs are nly available t state gvernments and require that FEMA has declared a disaster area eligible fr public assistance. U.S. Department f A Rural Develpment Disaster Assistance USDA Rural Develpment ffers federal funding resurces fr pst-disaster cmmunity ecnmic recvery purpses that fall within three categries f business prgrams: (1) revlving lan funds and technical assistance; (2) cmmercial lending; and (3) energy prvide financing and technical assistance fr setting up revlving lan fund prgrams, wrking capital lans, real estate, financing prgrams, ecnmic develpment planning, business develpment, real estate feasibility analyses, cnstructin, capital imprvement, and machinery r equipment purchases. USDA Rural Develpment als 9 10 11 As determined by SBA. Emplyment and Training Administratin. Accessed at: www.dleta.gv/neg/dislcatin.cfm. Ibid. 13

prvides guaranteed lans generating r maintaining emplyment. US fcus n renewable energy, energy efficiency, bimass, birefinery, and bienergy prjects. U.S. Cmmunity Develpment Financial Institutins (CDFI) Fund The purpse f the U.S. Treasury Depart int Cmmunity Develpment Financial Institutins (CDFIs), which serve lwerincme cmmunities that lack sufficient access t affrdable financial services. The CDFI Fund ffers tw funding ptins t CDFIs: Technical Assistance awards and Financial Assistance awards. 12 These financial institutins wrk tward the fllwing bjectives: 13 Prmting ecnmic develpment, jb creatin, and develp businesses and cmmercial real estate; Prmting hme wnership and affrdable husing develpment; and Prviding financial services fr cmmunity develpment (e.g., financial literacy prgrams, alternatives t predatry lending, and basic banking services). After a disaster, CDFIs can ffer crucial alternative financing and technical assistance t lcal small businesses. CDFIs have becme increasingly imprtant cntributrs t the ecnmic recvery prcess, as their financial terms generally ffer greater flexibility t suit small business needs. Fllwing Hurricane Sandy, lcal CDFIs were disaster-impacted businesses. This alternative financing surce was critical fr quickly getting funds t small businesses while these businesses waited fr traditinal surces f disaster financing such as insurance settlements. 14 12 www.cdfifund.gv/what_we_d/prgrams_id.asp?prgramid=3 13 Ibid. 14 CDFIs and Hurricane Sandy A Key Partner in Disaster Recvery Effrts January 31, 2013. Accessed at: http://fundcnsulting.wrdpress.cm/2013/01/31/cdfis-and-hurricane-sandy-a-key-partner-in-disasterrecvery-effrts/ 14

Overview f Federal Requirements Federal requirements ensure the financial integrity f public tax dllars. Under nrmal, nn-disaster cnditins, these requirements set perfrmance and cmpliance standards fr state and lcal recipients f federal funds. Yet, these requirements d nt ften reflect the realities f pst-disaster envirnments. Disasters can strike with little r n warning, and damages t cmmunities and states can ttal billins f dllars. Disasters ften frce lcal cmmunities and states t face dramatic scial, humanitarian, and ecnmic cnsequences in an extremely shrt perid f time, and ty t recver frm catastrphic damages. Speed majr disaster. Accrding t industry experts, apprximately 25 t 40 percent f impacted small businesses never repen r are likely t clse within tw years f an event. Every day a business remains clsed spells lst revenue fr bth the individual business and the cmmunity. Mrever, businesses ften depend n lcal suppliers and custmer bases that are als likely t have been impacted. It is vital that cmmunity ecnmy recvery effrts mve quickly and with full crdinatin amng cmmunity lcal, state and federal recvery fficials. As partners in the disaster recvery prcess, the federal gvernment has put frth great effrt t streamline and accelerate the ecnmic recvery prcess fr cmmunities and states. Certain federal requirements can, hwever, impede r halt recvery assistance effrts and slw recvery prcesses fr mnths r years. In interviews with IEDC, ne state-level disaster recvery fficial characterized many f fficial urged ther disaster-impacted cmmunities t carefully scrutinize the regulatins f federal recvery prgrams and cnsider requesting waivers f any and Fllwing a disaster, funding delays carry huge pprtunity csts, as lcal businesses that cannt quickly access vital funds ften face grim survival prspects. In this cntext, the value f waivers is clear. Lcal cmmunities that are able t temprarily repeal certain federal funding requirements can accelerate the prcess f getting necessary funds t the businesses and rganizatins that desperately need them. Definitins f Federal Requirements T better understand what federal requirements may r may nt be waived, it is imprtant t nte the distinctin between statutry requirements and regulatry requirements. Federal requirements are created when the U.S Cngress enacts legislatin that defines federal statutes that gvern U.S. gvernment agencies and assciated prgrams. These statutes are then cdified in what is knwn as the U.S. Cde. These statutry requirements are cnsidered fficial federal law and can nly be changed r waived by subsequent acts f Cngress. After Cngress creates federal statutes, federal agencies then interpret these statutes t develp specific agency regulatins and rules fr their funding prgrams. These resulting regulatins are published in the Cde f Federal Regulatins (CFR) and can -disaster) regulatins under which federal 15

agencies perate prgrams and disburse federal funds. Federal agencies generally have brader discretin t mdify r waive these regulatry requirements. By cmparisn, after a disaster strikes and the U.S. President has issued a federal disaster declaratin, Cngress can then authrize supplemental disaster-related legislatin that adjusts the requirements f a federal (e supplemental legislatin specifies alternative requirements fr these prgrams and effectively creates a disaster recvery versin f a -DR). A significant amunt f disaster assistance funding cmes thrugh these emergency supplemental apprpriatins, which are mre funding apprpriatins g beynd the regular agency budgets authrized in annual apprpriatin bills and may als be subject t additinal federal requirements. Definitins f Waivers strict regulatry cmpliance upn a finding f gd cause, subject t statutry limitatins and waiver nt t certain federal regulatins cdified in the Cde f Federal Regulatins (CFR). 15 A federal agency may chse t waive a regulatry requirement but in mst cases an alternative requirement will be specified. Fr example, under nrmal circumstances EDA may require cmmunities t prvide a 50 Cmmnly Requested Waivers U.S. Dept. f Husing and Urban Develpment CDBG Actin Plan Requirement Annual Perfrmance Review Reprting Requirement Citizen Participatin Requirement Expanded Distributin and Direct Actin Cnsistency with Cnslidated Plan Requirement Overall Benefit t Lw-t-Mderate (LMI) Persns General Administratin Limitatin/Cap Use f Sub-Recipients Prgram Incme Requirements Eligibility Husing Related Buildings fr General Cnduct f Gvernment Jb Relcatin/Anti-Pirating Requirements Standard Certificatins Requirements Applicatin Requirements fr Allcatins Under Supplemental Apprpriatins Act U.S. Ecnmic Develpment Administratin Matching Share Requirements and Investment Rates Cmprehensive Ecnmic Develpment Strategy (CEDS) Requirement EDA Prcedures in Disaster Areas U.S. Small Business Administratin Timeline Requirement fr SBA Lan Increase Maximum Amunt Requirement fr Physical Disaster and Ecnmic Injury Business Lans Federal Debt Cllectin Requirement U.S. Emplyment and Training Administratin 6-mnth Limit n Emplyment fr Disaster NEG Participants U.S. Department f Agriculture Rural Develpment Rural Area Definitin Requirement Limitatin n Grant Amunts Matching Funds Requirement fr Cmmunity Facilities Prgram Requirements fr Renewable Energy Systems/Energy Efficiency Imprvements Requirements fr Value-Added Prducer Grants 15 U.S. Department f Husing and Urban Develpment Office f Public and Indian Husing. Prcessing Requests fr Regulatry Waivers. Available at: www.prrac.rg/pdf/expanding_chice_appendix_a_guidance_n_reg_waiver.pdf 16

percent lcal funding match t receive an EDA grant award. Hwever, EDA may waive this requirement and nly impse a 20 percent funding match requirement. It is imprtant t nte that sme federal agencies may nt explicitly refer t remving waive requirements, prgram fficers at these agencies may repeal a particular requirement withut necessarily explaining t a grantee it has been fficially waived. It shuld als be nted that sme federal agency headquarters and reginal ffices may have mre flexible interpretatins f sme statutry and regulatry requirements listed in federal legislatin. 17

Issues Impacting Federal Supprt fr Ecnmic Recvery Different cmmunities face many cmmn challenges using federal funding fr ecnmic recvery purpses. Based n interviews with lcal- and state-level recvery practitiners, sme f the mst frequently cited challenges that hinder swift and efficient use f federal funding include: Lack f knwledge abut federal prgrams fr disaster recvery Different perfrmance, cmpliance and reprting requirements f varius federal agencies and prgrams Variatin and ambiguity f statutry and regulatry requirement interpretatins acrss lcal, state, and federal fficials Onerus requirements such as federal funding matches Timeliness in clarifying and interpreting federal requirements, which can substantially delay disbursement f funds Lack f Knwledge f Federal Prgrams One f the mst bvius challenges fr cmmunities seeking t btain federal waivers is a sheer lack f knwledge abut the varius federal prgrams available. It is critical t build an understanding f the varius federal disaster recvery prgrams ideally befre a disaster strikes s that cmmunities are better prepared t navigate the applicatin and waiver request prcess. Eligibility requirements can vary widely acrss different federal prgrams and can be cnfusing fr cmmunities withut prir experience. Different Reprting Requirements fr Grant Cmpliance Requirements can vary significantly acrss different federal agencies and funding prgrams. Different federal agency requirements are impsed t encurage grantees t achieve specific bjectives and prgram utcmes. Fr example, interpretatins f envirnmental requirements fr HUD-funded prjects can vary significantly frm the envirnmental requirements that the U.S. Army Crp f Engineers impses n the same pst-disaster redevelpment prject. In interviews with IEDC, an fficial invlved in the ecnmic recvery effrts f the state f Mississippi referenced an example f a HUD envirnmental regulatin that disallws any HUD-funded prject t be within a mile f any abve-grund explsive r flammable strage tanks f 100 gallns r mre. The issue became a significant barrier t addressing the urgent need fr rental prperty cnstructin and recnstructin, as the area in which HUD-funded disaster recvery prjects were t take place was ppulated with prpane tanks used fr residential hme and water heating. 18

Interpreting Requirements between Levels f Gvernment While this paper fcuses n federal requirements, it is imprtant t understand that each state als has legal requirements that gvern and impact the ecnmic recvery prcess. The federal gvernment generally takes these state requirements int accunt by nting in varius federal legislatin that all actins related t federal disaster and ecnmic recvery funds must cmply with state laws as well. Yet, federal legislatin and state legislatin may nt always align. One example mentined by recvery ff cmparatively mre restrictive definitin and interpretatin f husing regulatins than federal requirements. This led t cnfusin and delays in administering federal funding fr husing-related recvery effrts in the state. Funding Match Requirements: Asking T Much frm Impacted Cmmunities? Disaster fficials ften nte the challenge that impacted cmmunities encunter when trying t meet federal matching requirements fr disaster recvery prjects. On ne hand, many federal funding prgrams require that all ther financial resurces be exhausted prir t awarding federal funds. On the ther hand, ther federal disaster recvery funding prgrams require a disaster-impacted cmmunity t generate a -share requirement). Disaster recvery practitiners nted in interviews that lcal disaster-impacted cmmunities are ften cash-strapped after suffering a disaster and have extremely limited capacities t generate funding fr a match-share requirement. They expressed sme degree f exasperatin that disaster-impacted cmmunities are asked t simultaneusly meet tw cmpeting requirements (i.e. exhaust all funding while generating match-share funds) in rder t access critical surces f federal funding. Timeliness in Interpreting Federal Requirements Anther cmmn cncern amng experienced cmmunity disaster recvery prfessinals is the speed with which federal disaster recvery funding prgrams are able t disburse funding t disaster-impacted cmmunities. There are many factrs that affect the timeliness f disbursing federal disaster recvery funding, mst f which are beynd the scpe f this reprt. Hwever, it is sufficient t say that the mre prepared a disaster-impacted cmmunity is with regard t understanding the prcess f applying fr waivers f funding requirements, the mre likely the chances that federal disaster recvery funds will be disbursed mre quickly. 19

Sectin II General Guidelines fr Requesting Waivers 20

Federal agencies ften differ with regard t the specific requirements fr states and lcal cmmunities using federal disaster recvery funds. Still, there are general principles that states and disaster-impacted cmmunities can fllw when requesting waivers f funding requirements frm federal gvernment agencies. The fllwing sectin prvides guidance n applying fr waivers and highlights ways cmmunities have successfully btained thse waivers. Making a Case t Justify a Waiver The ability t btain a waiver depends partly n the type f waiver requested and hw well a disaster-impacted cmmunity can justify the need t alter a requirement in rder t meet unique lcal recvery needs. As a first step, it is recmmended that the grant applicant cnduct sme research t increase awareness f bth federal agency funding prgrams and the requirements that restrict the use f funds theref. This plays an imprtant part in making a case fr waiving specific requirements r btaining alternative requirements that allw grant recipients maximum flexibility fr respnding t a cmmu Knw Federal Agency Objectives T better justify the need t temprarily repeal federal requirements f specific federal agencies, cmmunities shuld be well infrmed f the investment pririties and bjectives f the prgrams these agencies use t prvide disaster recvery assistance. Reviewing these bjectives and pririties will shed light n what these federal agencies lk fr when evaluating funding applicatins and waiver requests. Mst federal prgrams used fr pstdisaster ecnmic recvery are prgrams that were nt specifically created r designed t address pstdisaster situatins. This is reflected in the requirements that restrict funding uses in ways that may appear t impede the ecnmic recvery prcess. Additinally, sme federal prgrams used fr disaster recvery funding are nt fcused exclusively n ecnmic develpment r ecnmic recvery. Understanding the gals, mtivatins and the brad restrictins under which these federal agencies perate can prvide cmmunities insight n hw t negtiate particular requirement waivers. Objectives f EDA Ecnmic Adjustment Assistance (EAA) (Disaster Recvery Supplemental Versin) EAA ffers flexible tls t develp reginally based lng-term ecnmic develpment strategies in respnse t majr federally declared disasters. EDA encurages applicatins based n lng-term, reginally riented and cllabrative ecnmic develpment strategies t fster ecnmic grwth and resilience. Federal Funding Opprtunities (FFO) and Ntices f Funding Availability (NOFA) are gd starting pints fr identifying imprtant investment pririties and bjectives f federal funding prgrams. IEDC interviews with an EDA prgram fficer revealed the hw prpsed prjects directly link t jb creatin and private-sectr investment gals that are explicitly stated requirements in FFOs. 21

It is recmmended that applicants carefully review all dcuments relevant t a federal be better prepared t justify exceptins t any requirements that may becme achieved this by asking a capable staff member t dedicate three full days exclusively t cmbing thrugh the Cde f Federal Regulatins and identifying all applicable requirements f the federal agency prviding recvery funds t the cmmunity. This prved t be wisely invested time, as the lcal agency was able t accelerate the recvery prcess by being able t better cmmunicate with federal agency fficials abut certain federal requirements and by better understanding which requirements culd be waived. Review Previus Waivers Cmmunities shuld review and research successful waivers frm previus disaster recvery effrts t get a sense f the variety f available waivers f each federal agency. While sme specific federal prgram requirements authrized in supplemental disaster legislatin may change ver the years, the majrity f a federal requirements remain the same frm year t year. Federal Register ntices will cntain infrmatin n any new r alternate requirements. Reviewing these waiver requests als prvides insight int the prcess and hw justificatins were presented t a specific federal agency. Sme cmmunities have had t pineer new requests fr specific waivers, but there is ample precedent fr the mst cmmn waivers. Gleaning insights n hw ther cmmunities were able t justify certain waivers will enhance a c justify its wn waivers. While it is imprtant t review examples f successful waiver requests f ther cmmunities, ne federal prgram fficer cautined that a cmmunity needs t make a unique case fr why and hw a federal requirement All waiver requirements fr federally-funded, presidentially-declared disasters are required t be published in the Federal Register, which serves as a gd starting pint fr waiver research (see www.federalregister.gv). Sme federal agencies list previus waiver requests n their websites. Fr example, waivers fr HUD funding regarding Hurricane Katrina can be accessed at www.hud.gv/ffices/cpd/library/katrina. websites. State f Vermnt CDBG Disaster Recvery Waiver Requests http://accd.vermnt.gv/sites/accd/files/dcuments/strngcmmunities/cd/ vcdp/waiver%20request%20frm%20feb%206%202012.pdf State f Luisiana (Divisin f Administratin, Disaster Recvery Unit) Disaster Recvery Waivers Frm Plan t Implementatin: Lessns Learned http://prtal.hud.gv/hudprtal/dcuments/huddc?id=doc_22564.pdf 22

T underscre the imprtance f precedent as applied t waiving federal requirements n recvery funding, in recent negtiatins f HUD CDBG-DR funding - percent f the mst cmmnly requested regulatry waivers. While this is nt a frmal precedent fr future HUD CDBG-DR funding, this highlights that the federal gvernment recgnizes the imprtance f waivers t ecnmic recvery. Present Unique Cmmunity Recvery Needs in Waiver Requests When applying fr waivers r alternative requirements, federal agencies will be lking fr an impacted cmmunity t justify waiver requests with cmpelling infrmatin n al fficial cmmented that federal grant recipients shuld nt expect a federal agency t waive all f a. Rather, lcal cmmunity leadership must make effrts t educate federal prgram fficers n hw -disaster circumstances necessitate the use f specific waivers. Where pssible, it is recmmended that cmpelling data be prvided t reinfrce and strengthen arguments fr waiver justificatins. Actin Plan fr 2012 HUD CDBG-DR funding prvides advice t impacted cmmunities n hw t justify waiver requests fr specific requirements (see t the right). The appendix als includes sample language that cmmunities can use as a basic starting pint when justifying their wn waiver applicatins. Sample excerpts are prvided belw t illustrate the type f basic infrmatin cntained in waiver requests, including descriptins f hw a waiver will impact recvery effrts, references t precedent f previus waiver use, and applicable data. Fr all waiver requests, it is highly recmmended that lcal cmmunities include language that reflects lcal cnditins and challenges in their applicatins. Sample Waiver Justificatin Prcess (Vermnt HUD CDBG-DR example) Research and review sample waiver justificatins using examples prvided fr reference Mdify sample justificatins t address recvery needs Cmplete a justificatin fr each requested waiver Prvide citatins and integrate relevant data (if pssible) Understand the scpe f each waiver (i.e., whether it applies t lcal cmmunities, states, r bth) 23

Sample Waiver Requests: Excerpt HUD CDBG-DR Actin Plan WAIVER REQUEST Waive requirement t distribute all funds t lcal gvernments. Replace with permissin fr the state t carry ut activities directly. JUSTIFICATION As the 2011 disaster affected a large prtin f the state, a state agency is best able t rchestrate a crdinated and streamlined disaster respnse by carrying ut activities directly, it can distribute assistance via ne r mre prgrams t applicants lcated in cmmunities acrss the entire state. Furthermre, the State f Vermnt believes that in using statutry language similar t that used fr prir CDBG supplemental apprpriatins, Cngress signaled its intent that the state grantees under this apprpriatin als be able t carry ut activities directly. WAIVER REQUEST Waive prvisins necessary t allw: Hmewnership assistance t persns whse incmes are up t 120 percent f median incme (supprts mixed incme husing), New cnstructin f husing, and Dwn payment assistance fr up t 100 percent f a dwn payment. JUSTIFICATION The bradening f Sectin 105(a)(24) f the 1974 Act, and a waiver f Sectin 105(a) is necessary fllwing the 2011 disasters in which large numbers f affrdable husing units have been damaged r destryed. As a result f the 2011 disaster, the State f were damaged r cmpletely destryed. These mdificatins will allw the State t implement husing recvery prgrams t reach a brader range f husehlds frm an incme perspective that were severely impacted frm Trpical Strm Irene. Fr additinal infrmatin, resurces, and examples f sample waiver requests, visit http://accd.vermnt.gv/strng_cmmunities/pprtunities/funding/cdbgdr. 24

Cmmunicate with Federal and State Officials Early and Often In a pst-disaster envirnment, cmmunicatin lines may be severely damaged at a time when they are mst needed. While lcal cmmunities have relatinships and ften cmmunicate with their state cunterparts, the added layer f the federal nd recvery adds a certain level f cmplexity t pst-disaster situatins. -declared disaster. One exceptin is the U.S. Ecnmic Develpment Administratin (EDA), which has reginal ffices that can cmmunicate directly with the impacted cmmunities. Fr majr disasters that have impacted multiple states, such as Hurricanes Katrina and Sandy, the prcess f identifying respnse and recvery needs and determining the amunt f recvery funding t prvide t impacted states can be particularly challenging and smetimes highly plitical. The lead state-level rganizatins that crdinate and negtiate this prcess with different federal agencies must represent the needs f disaster-impacted cmmunities t FEMA and the varius federal departments and agencies invlved in the recvery prcess. While the NDRF is helping t imprve the ways by which federal, state, and lcal gvernments cmmunicate with ne anther and with ther recvery stakehlders, the prcess is still very cmplicated. An impacted cmmunity needs t actively cmmunicate with bth state and federal fficials at an early stage t describe and emph business and ecnmic recvery needs. This shuld include discussins n the surces f federal funding t best assist thse recvery effrts, including requirements that restrict the use f such funds. Impacted cmmunities need t clearly understand their capacity t meet thse requirements early in the prcess, as there is a shrt windw f pprtunity fr initial requests f waivers r alternative requirements. Requests may als need t be made repeatedly during the applicatin prcess fr federal funds. Cmmunicatin plays a vital rle in this prcess. Belw are sme recmmended actins t facilitate ptimal cmmunicatin. Establish a Lcal Ecnmic Recvery Team After a disaster strikes, it is cmmn fr a cmmunity t establish an Ecnmic Recvery Team, which is generally cmprised f leaders frm lcal ecnmic develpment rganizatins, chambers f cmmerce, gvernment, and prminent business leaders. Part f the rle f this team is t cmmunicate with lcal gvernments and respective cunterparts at the state and federal level abut their specific ecnmic recvery needs. In many cmmunities, the lcal EDO r chamber is invlved in utilizing federal dllars fr ecnmic recvery initiatives but is nt always invlved in the riginal applicatin prcess with federal agencies. It is in the best interest f the Ecnmic Recvery Team t fully understand the federal requirements attached t utilizing specific funds and t infrm lcal gvernments f particular waivers that are needed t ensure full grant cmpliance and the greatest amunt f flexibility when using funds. 25

Identify Lead Organizatins It is imprtant t identify the lead rganizatins respnsible fr cmmunicating and crdinating majr recvery initiatives. It is suggested that these lead rganizatins als be invlved in the applicatin and waiver request prcess fr federal ecnmic recvery funding. The timeline fr applying fr federal funds varies by federal agency. -DR assistance, fr example, requires that an actin plan be submitted within 45 days f the HUD als requires that waiver requests be submitted prir t submissin f an actin plan. EDA requires the waivers r alternative requirements be included in the grant applicatin, and reviews these applicatins n a quarterly basis. If additinal funds have been apprpriated t EDA in a disaster supplemental, there may be a certain time windw (smetimes six t nine mnths) t apply fr these funds. Early and frequent cmmunicatin between the lead rganizatin and the EDA reginal ffice staff is suggested. One EDA reginal ffice suggested the disaster-impacted cmmunity reach ut t their ffice as early as tw weeks fllwing the disaster t discuss cmmunity impacts and critical recvery prjects and initiatives. Engage State Agency Recvery Leaders Example Lead Recvery Organizatins Federal Federal Agencies Agency Headquarters Reginal Agency Offices r Divisins State State Gvernr r State Gvernment Agencies Recvery Agencies r Authrities Redevelpment Agencies r Authrities State Departments f Cmmerce Lcal / Reginal Chambers f Cmmerce Reginal Cuncils f Gvernment Lcal r Reginal Planning Cuncils Ecnmic Develpment Districts (EDDs) Municipal Ecnmic Develpment Organizatins Cunty Ecnmic Develpment Organizatins In the early stages fllwing a presidentially-declared disaster, a state gvernr will determine the lead state-level rganizatins t serve as the primary agencies fr crdinating and implementing disaster recvery initiatives. Sme gvernrs have established a separate authrity t manage these federal funds, such as the Luisiana Recvery Authrity (LRA) fllwing Hurricane Katrina. Thse invlved in ecnmic recvery at the lcal level, shuld becme intimately knwledgeable abut this lead agency, including their capacity and resurces. The state agency may r may nt be astute at the ecnmic recvery issues and needs that cmmnly arise fllwing a majr disaster. 26

Frequent and effective cmmunicatin with this state agency is critical ver the lng prcess f recvery. State agency representatives can serve as valuable cnduits f infrmatin that will aid disaster-impacted cmmunities. They play a rle in negtiating federal waivers r alternatives with the apprpriate federal agencies. Additinally, state agencies als may have their wn set f requirements in additin t the federal requirements, which will add a layer f cmplexity that might drastically affect the use f thse funds. It is imprtant fr lcal cmmunities t keep an pen line f cmmunicatin with the apprpriate state agency representative that has the authrity t help remve red tape and serve as an advcate fr thse impacted cmmunities. Waiver Requests fr the Greater Hustn Regin After Hurricane Ike in 2008, the Hustn-Galvestn regin required waivers f certain HUD CDBG-DR requirements in rder t speed the rebuilding f husing and the use f funds fr ecnmic recvery purpses. Lcal cmmunity and ecnmic recvery leaders in Greater Hustn were left ut f the applicatin prcess between the Texas Department f Rural Affairs, the lead state agency fr CDBG-DR funds (nw defunct), additinal layer f cmplexity. Because the state agency did nt fully cnsider many f lcalities had a very difficult time meeting federal requirements. By 2011, mst f the cunties still had nt utilized the vast majrity f CDBG-DR funding. When talking with a lcal fficial abut the lessns learned frm Hurricane Ike, they prvided the fllwing advice. 1) Lcal and reginal gvernment shuld infrm themselves f the types f waivers their impacted cmmunity needs. 2) These fficials shuld seek t educate apprpriate state fficials and cngressinal staff abut the need fr waivers f federal requirements n disaster recvery funding. 3) Cmmunities need t prepare examples that reveal the impacts that certain requirements will have n their lcal cmmunities s that state and federal fficials can easily understand the value f the waiver. As nted in this paper, the State f Vermnt, fllwing Hurricane Irene in 2011, prepared their state actin plan fr HUD funds t include a suggested prcess fr cmmunities making waiver requests and prvided sample language fr varius waivers. This type f guidance prvides the critical leadership and supprt that disaster-impacted cmmunities need frm their state gvernments. State f Mississippi CDBG-DR prgram wuld be the Mississippi Develpment Authrity (MDA). MDA was respnsible fr administering $5,058,185,000 in HUD CDBG-DR funding t 27

cmmunities acrss the state. 16 MDA develped a streamlined methd fr determining prjects t fund in each disaster-impacted cmmunity. MDA asked each disasterimpacted cmmunity t send priritized lists f lcal prject requests, with the agreement that MDA wuld wrk clsely with HUD n behalf f each cmmunity t qualify prjects and request any specific waivers that wuld be needed. In rder t set realistic expectatins and manage the prcess, MDA als requested that each cmmunity assess and priritize prject suggestins at the lcal level based n which prjects the lcal cmmunity believed were the mst imprtant. The purpse f highlighting these examples is t illustrate that state-level lead rganizatins f ecnmic recvery prcesses vary in type and capabilities depending n the nature, scpe, and scale f a disaster. As nted previusly in this reprt, shrtly after a presidential disaster declaratin (fllwing a request frm the gvernr), the rganizatins fr wrking with different federal agencies invlved in the ecnmic recvery effrt. The brader lessn is that each state will determine the entity that is best suited fr administering certain federal disaster recvery funding prgrams, and that disasterimpacted cmmunities need t identify as quickly as pssible which state-level lead rganizatins can best negtiate the apprpriate waivers with the varius federal agencies invlved in the ecnmic recvery prcess. Thugh it is presumed that these state-level lead rganizatins will have effective knwledge and negtiatin skills t wrk with federal agencies in the waiver request prcess, it is nt enugh fr individual disaster-impacted cmmunities t simply sit back and wait fr the state make decisins abut waiver requests n behalf f the cmmunity. Cmmunicate Frequently with State and Federal Agencies The prcess fr requesting waivers f federal funding requirements demands frequent cmmunicatin between lcal gvernment and bth state and federal fficials. Lcal cmmunities shuld expect t initiate cmmunicatin with apprpriate state agency fficials early and ften, as the prcess fr negtiating waiver requests can mve rather quickly fllwing a presidential disaster declaratin. Accrding t fficials interviewed fr this reprt, it is nt nly critical t regularly cmmunicate with the apprpriate state and federal fficials but t als dcument all cmmunicatin and decisin making n waiver requests. C-Lcating Agencies in Luisiana Fllwing Hurricane Katrina After Hurricane Katrina wrught havc n the many cmmunities in and arund ecnmic develpment agency (JEDCO) alng with many ther lcal agencies was ffered temprary space at Luisiana Ecnmic Develpment (LED) in Batn Ruge. This c-lcatin f lcal and state rganizatins enabled early and frequent cmmunicatin between grant manager and grant recipient. Thse lcal agencies perating ut f the LED were ften mre infrmed f the federal grant requirements and cmpliance issues, and were able t make better use f thse funds fr ecnmic recvery purpses.. 16 by Hurricanes. HUD Archives: News Releases. HUD N. 06-011. January 25, 2006. Accessed at: http://archives.hud.gv/news/2006/pr06-011.cfm 28

Hwever, each federal agency r department varies in the type f cmmunicatin they want t receive frm ptential grantees. The U.S. Ecnmic Develpment Administratin (EDA) has six reginal ffices (Atlanta, Austin, Chicag, Denver, Philadelphia, and Seattle) that wrk directly with lcal and reginal gvernments n ecnmic recvery effrts. An EDA grant manager shared that EDA encurages cmmunity leaders in disaster-impacted areas t visit their reginal ffice fllwing a majr event t discuss their funding needs. EDA values these face-t-face meetings with grantees, as they prvide an pprtunity t better explain federal requirements and address ptential barriers in utilizing the funds. In IEDC interviews, lcal recvery fficials als nted the challenge presented by nt being able t directly cmmunicate with sme federal agencies r departments n waiver requests, and they expressed a desire fr imprved rganizatinal structures t facilitate that cmmunicatin. Fr example, nly 15 percent f the HUD CDBG-DR grantees are lcal gvernments in which lcal fficials wrk directly with HUD field ffices. Fr the remaining 85 percent f HUD CDBG-DR grantees, the appinted state agency is respnsible fr distributing and administering funds as well as making thse waiver requests. The ability f the state agency t understand hw the funding requirements might impact the lcal level depends in part n pen cmmunicatin lines between state and lcal agencies and whether state agency resurces have been exhausted due t the disaster. 29

Fllwing thrugh with Agency Officials Persevering A number f interviewed ecnmic recvery practitiners pinted t their persistence as ne f the main reasns they were able t acquire a waiver r alternative requirement and achieve greater flexibility n hw they culd use federal funds. They presented strng arguments as t hw a specific federal requirement wuld impse an undue burden n their disaster-impacted cmmunities r states. They als requested additinal infrmatin t help them refine their interpretatins f these requirements and enhance their arguments fr waiving these requirements. Lcal and state fficials als wrked t garner supprt frm high-level plitical figures. When representatives t help ensure bureaucratic bstacles were minimized. Attitude was anther determining factr fr successfully btaining greater flexibility in federal requirements. A state disaster recvery fficial said they apprached each waiver request pragmatically and explred ways t best secure federal apprval. This included questins abut what wuld be the mst cmpelling infrmatin t prvide t federal authrities t persuade them that a requirement shuld nt apply t their The fficial cmmented that federal agencies may themselves be the best surce f infrmatin and assistance fr finding answers t these questins and ultimately reslving waiver request issues. By appraching each agency fr 29 f its 33 waiver requests. Requesting Extensins When Waivers Expire Persistence is particularly imprtant when requesting an extensin fr expiring federal waivers. Federal agencies prvide the majrity f federal requirement waivers fr a defined perid f time; hwever, it is cmmn fr delays t ccur in the implementatin f cmmunity and ecnmic recvery prjects after a disaster. If the waiver expires, the cmmunity must reapply fr the requirement waiver, which includes prviding justificatin t the federal agency. Lcal cnditins might have changed since the riginal waiver justificatin, thereby making it mre difficult t make the apprpriate argument. Still, a case needs t be made as t why waiving the federal requirement is still necessary fr the success f the recvery prject. Dcument All Cmmunicatin and Waiver Apprvals A number f ecnmic recvery practitiners emphasized the imprtance f supprting all waiver requests with apprpriate data and descriptive infrmatin. Cmmunities shuld seek ut advice frm state and federal fficials t better understand what type f infrmatin needs t be dcumented in rder t make an effective argument. If a state and federal agency verbally apprves a federal waiver, cmmunities shuld make sure t fllw up and cnfirm this in writing. Many ecnmic recvery prjects take years t cmplete and staff is likely t experience turnver. It will be imprtant t prvide this dcumentatin in future audits and cmpliance reviews in rder t cmply with federal regulatins and requirements. 30

Pushing thrugh Majr Regulatry Barriers Many disaster-impacted cmmunities are unprepared fr the vlume f cmmunicatin required t justify and negtiate waiver requests with state and federal fficials. In IEDC interviews, lcal recvery fficials nted an incredibly lng and frustrating prcess in sme cases. One state gvernment fficial shared that mnths until they culd clarify with HUD an envirnmental requirement related t the restrictin f the number f abve-grund kersene tanks within a ne-mile radius f intended prjects. The state pursued the remval f this federal requirement and succeeded in their effrt. While cmplying with numerus federal regulatins can be daunting t disasterimpacted cmmunities, there is n substitute fr persevering and utilizing apprpriate state resurces t minimize regulatry bstacles. In the event that a state agency des nt prvide the needed supprt r pses additinal cnstraints, impacted cmmunities need t find apprpriate supprt fr waiver requests at the reginal r natinal level. Impacted cmmunities need t educate key state fficials n the utcmes f nt pursuing specific waiver requests and hw the inability t secure a waiver will impede r halt the develpment f majr recvery prjects. It is imprtant t articulate expectatins and the need fr state supprt in rder t successfully btain requests frm apprpriate federal agencies. Preparatins fr the Next Disaster Often lcal and state ecnmic develpment rganizatins (EDOs) are nt invlved in lcal and state emergency preparedness effrts, which makes theme further unprepared fr the ecnmic recvery wrk after a disaster strikes. It is extremely valuable fr a state r reginal rganizatin t cnsider prducing a disaster recvery guide t assist lcal cmmunities in the event f a majr emergency. This guide shuld list the resurces and respnsibilities f varius stakehlder grups in all aspects f recvery, including ecnmic recvery. The publicatin wuld als discuss the federal funding surces fr recvery, federal requirements attached t thse surces, and the ptential waiver requests that culd be made. 31

Sectin III Guidelines fr Waiving Requirements by Federal Agency 32

The fllwing sectin prvides infrmatin n the majr federal agencies and prgrams that ffer federal funding fr pst-disaster ecnmic recvery effrts. Each sub-sectin prvides details n a particular federal agency, majr funding prgrams administered by each agency fr disaster recvery purpses, and details n the mst cmmnly requested waivers f specific agency federal requirements. U.S. Department f Husing and Urban Develpment CDBG-DR Overview Develpment (CPD) administers Cmmunity Develpment Blck Grant Prgram fr Disaster Recvery (CDBG- DR) create jbs, expand emplyment fr lw- t mderate-incme persns, and develp safe and affrdable husing. Apprpriatins laws dictate that CDBG- DR grant funding must be used fr expenses assciated with disaster relief and lng-term recvery, infrastructure restratin, husing, and ecnmic revitalizatin. Grant activities must meet (1) benefit lw and mderate incme (LMI) persns, (2) prevent r eliminate slums r blight, r (3) meet an urgent need. A CDBG-DR grantee must demnstrate ties between its funding-related activities and a disaster. A grantee must als dcument hw each activity addresses disaster-related impacts and rehabilitates r restres husing, infrastructure, r the ecnmy. It is wrth nting that there is n set frmula r prcess fr dcumenting the relatinship between CDBG-DR grantee activities and hw they address a disaster, and CDBG-DR funding recipients have sme flexibility t determine the mst apprpriate frm f dcumentatin. Hw CDBG-DR Wrks Cngress: Apprpriates Recvery Funds HUD: (a) Cntacts Grantees (b) Discusses Recvery Plan (c) Identifies Necessary Waivers HUD: Publishes Waivers and Alt. Requirements (in Federal Register Ntices) Grantee: Applies / HUD: Issues Grant State/Lcal Gvernment: Manages Prgrams (funds may be sub-granted and prjects subcntracted) Grantee: Selects Activities Grantee: Submits Actin Plan (every activity eligible and meets natinal bjective) Grantee: Devises Management Prcedures (includes internal auditing and mnitring prcedures) Grantee: Funds Drawn frm U.S. Treasury Credit Line HUD: Mnitrs Cmpliance with Actin Plan and Rules 33

Accrding t a Gulf Cast Ecnmic Develpment District presentatin (GCEDD), CDBG-DR grants can be used t (amng ther activities): 1. Fund the cnstructin, repair, r rehabilitatin f damaged businesses and cmmercial structures t return them t their riginal pre-strm state if certain cnditins are met; 2. Make repairs t an industrial park r cmmercial area that experienced damage; and 3. Assist a business that clsed r relcated t anther state due t a disaster that wishes t return t the jurisdictin. Accrding t the GCEDD presentatins, lcal gvernments cannt apply fr funds t build speculative industrial parks r cmmercial areas, and prspective businesses r tenants need t be identified befre a funding applicatin is submitted. Requirements That Cannt Be Waived It is imprtant fr cmmunities t knw which federal requirements cannt be BG-DR funding. The rules that gvern the activities f CPD funding are divided int three categries: (1) cngressinally-authrized laws (statutry requirements), (2) HUDcreated regulatins t achieve the result f the law (regulatry requirements), and (3) plicy memranda which are created t address specific instances. The fllwing CDBG-DR funding requirements cannt be waived by HUD. Securing a waiver fr any f these requirements requires Cngressinal actin. 17 Nn-Discriminatin Requirement Fair Husing Act (FHA) Fair and Prevailing Wages Requirement Fair Labr Standards Act (FLSA) and Davis-Bacn Act (DBA) Envirnmental Review Requirement Natinal Envirnmental Plicy Act (NEPA) Public Ntice f Funding Availability Requirement HUD CDBG-DR Requirements That Cannt Be Waived (per apprpriatin laws) may waive, r specify alternative requirements fr, any prvisin f any statute r regulatin that the Secretary administers in cnnectin with the bligatin by the Secretary r the use by the recipient f these funds r guarantees (except fr requirements related t fair husing, nn-discriminatin, labr standards, and the envirnment) 17 CDBG Disaster Recvery Overview. U.S. Department f Husing and Urban Develpment, Office f Cmmunity Planning and Develpment. Accessed at: http://prtal.hud.gv/hudprtal/dcuments/huddc?id=cdbg_dr_overview.pdf. 34

Nn-Discriminatin Prvisin Fair Husing Act (FHA) The federal Fair Husing Act prhibits discriminatin based n race, clr, religin, natinal rigin, sex, familial status, r disability. 18 Fair and Prevailing Wages Fair Labr Standards Act (FLSA) and Davis-Bacn Act (DBA) Federal legislatin requires that any prjects r activities that invlve federal funds, including disaster-related funding, must cmply with federal wage and labr standards utlined in the Fair Labr Standards Act (FLSA) and three legislative acts requiring prevailing wages, including the Davis-Bacn Act. FLSA establishes minimum wages amng a multitude f wage and labr related requirements. 19 The Davis-Bacn Act requires prevailing wages be paid fr cnstructin wrk, including mechanics and labrers. 20 Anther prevailing wage requirement relates t maintenance activities (including nn-rutine maintenance), which cvers labrers, mechanics, technicians, technical engineers, draftsmen, and architects wrking in public husing develpments. 21 The final prevailing wage legislatin, the Service Cntract Act, requires prevailing wages be paid t maintenance and ther service cntracts fr direct HUD cntracts. 22 In IEDC interviews, several ecnmic recvery practitiners nted that, fr recnstructin prjects, the prevailing wage requirement is particularly difficult t meet. One lcal fficial cmmented that meeting this requirement can result in an estimated 30 percent additinal csts fr a cnstructin prject. Anther fficial n funding recnstructin prjects. Envirnmental Review Natinal Envirnmental Plicy Act (NEPA) The Natinal Envirnmental Plicy Act requires envirnmental reviews and envirnmental assessments fr many types f federally-funded disaster recvery prjects and activities. While the details f these envirnmental reviews and assessments are beynd the scpe f this reprt, it is sufficient t say that these prcesses are generally cmplex, time-cnsuming, and in many cases difficult t interpret. In interviews with IEDC, sme gvernment fficials invlved in recvery initiatives nted cncern regarding the timeliness f the cmpliance prcess fr NEPA requirements, descri 18 Fair Husing Mnth Vide 2013. Accessed at: www.yutube.cm/watch?feature=player_embedded&v=9k2w_e30hvi 19 Fact Sheet #72 Emplyment + Wages Under Federal Law During Natural Disasters + Recvery. U.S. Department f Labr (DOL) Wage + Hur Divisin (WHD). May 2010. Accessed at <www.dl.gv/whd/regs/cmpliance/whdfs72english.htm>. 20 Davis-Bacn Act wage requirements apply t HUD prgrams via statutry prvisins f the Davis-Bacn Act (nly fr 21 direct HUD cntracts). HUD-determined wage rates apply t Public, Indian, and Hawaiian husing activities in accrdance with the U.S. Husing Act f 1937 (as amended) and the Native American Husing Assistance and Self-determinatin Act f 1996 (as amended). 22 Service Cntract Act wage requirements are applicable by statutry prvisins f the Service Cntract Act (nly fr direct HUD cntracts). 35

examples f varying requirements fr NEPA cmpliance acrss different federal agencies, including HUD, the Crps f Engineers, EPA, and EDA. While NEPA regulatins are universal acrss all federal agencies, each agency may have a different interpretatin f these requirements, which can lead t cnfusin at the lcal and state levels. As an example, a state agency discussed a majr infrastructure redevelpment that was being funded by tw federal agencies, HUD and the Crps f Engineers. The agency had t prepare tw separate envirnmental assessments fr the same prject in rder t meet all f the envirnmental requirements fr each agency. The state agency emphasized the need t streamline the NEPA cmpliance prcess, timing, and interpretatin f envirnmental requirements as a critical pririty area fr the federal gvernment. Fr mre specifics n the statutry laws, regulatins, and plicy memranda gverning CDBG-DR funding, visit http://prtal.hud.gv/hudprtal/hud?src=/ prgram_ffices/cmm_planning/cmmunitydevelpment/rulesandregs. Public Ntice f Funding Availability Federal law dictates that a Ntice f Funding Availability must be peridically published in the Federal Register with infrmatin n available funding amunts, funding criteria, where funding applicatins can be btained and submitted, and applicatin submissin timelines. Allwable Waivers fr s CDBG-DR Prgram The fllwing is a list f cmmnly requested waivers fr the CDBG-DR prgram. It is imprtant t nte that this is nt an exhaustive list f all waivers r alternative requirements fr CDBG-DR. Instead, these are the waivers that are cnsidered the mst relevant fr pst-disaster ecnmic recvery activities. These waivers apply nly t CDBG-DR grants and nt t funds authrized under the nrmal CDBG prgram. Alternative Requirements fr CDBG Actin Plan This waiver specifies alternative requirements fr a disaster recvery-specific actin plan that substitute fr the standard CDBG actin plan requirements. The streamlined actin plan fr disaster recvery allws funding recipients t implement ecnmic recvery prgrams mre efficiently and swiftly while still cmplying with statutry requirements. Annual Perfrmance Review Reprting Requirement This waiver repeals nrmal CDBG annual perfrmance reprting requirements and specifies the alternative requirement that grantees must submit quarterly reprts using the Disaster Recvery Grant Reprting (DRGR) system. Overall Benefit t Lw-t-Mderate (LMI) Persns Under the nrmal state CDBG prgram grantees must use 70 percent f CDBG funds t benefit peple f lw- t mderate-incme. This waiver adjusts the verall LMI benefit threshld t allw a state t use 50 percent f CDBG-DR funding t benefit peple f lw- t mderate-incme, with the ther 50 percent used fr activities addressing preventin r eliminatin f slum r blight. 36

Requirement fr Citizen Participatin This waiver remves the requirement fr public hearings (at state, entitlement, r lcal gvernment level) t disseminate infrmatin and cllect citizen seven days) fr public cmment and nging access t infrmatin n the use f CDBG-DR funds. Expanded Distributin and Direct Actin This waiver remves the requirement that states must distribute HUD funds t lcal gvernments, thereby allwing states t directly carry ut CDBG-DR funded disaster recvery activities. Cnsistency with Cnslidated Plan Requirement This waiver remves the nrmal CDBG restrictin requiring t be cnsistent with its HUD-apprved cnslidated plan the primary strategic planning dcument HUD requires fr nrmal CDBG frmula funding. The waiver f this requirement allws CDBG grantees mre time and flexibility t undertake activities that are nt cnsistent with its cnslidated plan until the grantee is able t update the pririties f the plan. General Administratin Limitatin/Cap This waiver remves the dllar-fr-dllar state funding match requirement fr administratin csts (abve $100,000). Use f Sub-Recipients States using the Expanded Distributin and Direct Actin waiver must fllw the alternative CDBG entitlement rules and requirements specified in the disaster-specific Federal Register Ntice when using sub recipients. Prgram Incme Requirements Waives certain standard CDBG incme requirements and specifies alternative CDBG-DR prgram incme requirements that are cnsidered mre flexible. Eligibility Husing Related This waiver remves certain requirements t allw (a) hmewnership assistance t husehlds with up t 120 percent f an area (b) up t 100 percent f dwn payment assistance, and (c) new husing cnstructin. 23 Buildings fr General Cnduct f Gvernment This waiver remves certain requirements t permit CDBG-DR funding recipients t pay fr recnstructin r rehabilitatin f therwise ineligible public buildings. Jb Relcatin/Anti-Pirating Requirements This waiver remves jb relcatin restrictins t let grantees assist businesses that perated in a disaster-declared area prir t a disaster that mved in rder t cntinue business peratins frm a disaster-impacted area t a 23 benefit natinal bjective. lw/mderate-incme persn 37

different state r labr market in the same state. 24 This waiver is cnsidered necessary in sme instances t allw a grantee affected by majr disaster t rebuild its emplyment base. Standard Certificatins Requirements This waiver remves the standard CDBG certificatins requirement and substitutes alternative certificatins tailred t CDBG DR grants. Applicatin Requirements fr Allcatins Under Supplemental Apprpriatins Act This waiver remves, r ffers alternative requirements, t streamline the prens. The fllwing sectin prvides guidance t lcal ecnmic recvery stakehlders, ecnmic develpment rganizatins (EDOs) and chambers f cmmerce, fr interacting with lcal and state gvernment agencies wrking directly with HUD n CDBG-DR funding. Identify and Cmmunicate with Agencies Authrized t Request Waivers While cmmunity recvery is indeed a lcal issue, state and federal rganizatins certainly play critical rles in helping disaster-impacted cmmunities recver. These rles include requesting apprpriate levels f federal funding and making sure thse fun which may include remving nerus requirements. HUD generally wrks with a centralized authrity (mstly at the state level) t manage CDBG-BR funds fr disaster recvery. As discu -DR while 15 percent is granted directly t lcal areas (mstly entitlement cmmunities). This same state r lcal gvernment agency will be respnsible fr submitting a disaster recvery actin plan. HUD must review a frmal actin plan fr cmmunity recvery in rder t better understand the intended path twards recvery and ensure federal dllars are cmmitted and will be apprpriately spent. This actin plan describes recvery needs, strategies, anticipated uses f recvery funds, eligible activities, and the case fr remving r altering federal requirements assciated with nitude and the gegraphic cverage f damage, these appinted state agencies will wrk directly with HUD field ffices n their use f CDBG-DR funding. Given the chatic envirnment that ften fllws a majr disaster, lcal recvery stakehlders shuld early n seek t identify the individual(s) at the state agency wh are respnsible fr making waiver requests n behalf f impacted cmmunities. While state agencies will reach ut t garner lcal input n recvery needs and an actin plan, lcal cmmunities shuld nt rely exclusively n these cmmunicatin effrts. Lcal cmmunities shuld actively reach ut t apprpriate state fficials t ensure 24 Nrmal CDBG requirements bar grantees frm assisting businesses in relcating frm ne labr market area t anther if the result is significant jb lss in the labr market frm which a business mved. This restrictin, hwever, may pse significant barriers t cmmunities seeking t reestablish/rebuild displaced emplyment bases fllwing a disaster. 38

their interests and recvery needs are represented during the negtiatin prcess fr HUD CDBG-DR funding and waiver requests. The prcess fr creating an actin plan can mve quickly. HUD determines CDBG-DR funding grantees within 45 t 60 days fllwing a disaster. Additinal funding resurces may be added at a later date. The apprpriate state agency will need t submit its initial disaster recvery actin plan within 90 days f HUD publishing its ntice f CDBG-DR funding in the Federal Register (see figure -DR Funding t the right fr an illustratin f the HUD CDBG-DR funding prcess). The state agency begins discussing the pssibility f remving r altering federal requirements with federal fficials befre the actin plan is submitted, and waiver requests are included in a final befre a plan is submitted. Als, minr r majr amendments f an actin plan can be made when deemed necessary. Given the cmplexity f federal requirements fr CDBG-DR funding, it is imprtant t maintain pen lines f cmmunicatin with many f the different state and federal fficials invlved in the funding prcess. One HUD fficial recmmended frequent cmmunicatin between impacted cmmunities and their state and federal cunterparts t clarify and reslve issues f grant cmpliance, including identifying any pssible wrkarunds fr requirements that cannt be waived. Grand Frks, ND prvides an illustratin f hw frequent cmmunicatin between lcal and federal fficials can help t quickly reslve regulatry bstacles and increase flexibility f CDBG-DR dllars fr recvery activities. In the Great Fld f 1997, the city f Grand Frks including majr parts f the dwntwn and surrunding areas experienced extreme flding. Grand Frks was an existing CDBG entitlement cmmunity, which allwed it t develp its wn actin plan and wrk directly with HUD field staff n recvery effrts. HUD staff members were temprarily hused - lcatin greatly enhanced cmmunicatin between federal and lcal fficials, particularly with regard t navigating the funding prcess and cmplying with federal requirements. Due t their clse prximity, HUD staff members were cnstantly advising the city f cmpliance issues, and as a result, the city indicated it had significantly fewer issues during its grant cmpliance and mnitring effrts. 39

Learn Abut Requirements and Waivers Needed in a Cmmunity Once a cmmunity knws which federal agencies can prvide funding fr its recvery needs, it is critical t understand any requirements assciated with a specific federal reprt serves as a starting pint t highlight a number f federal requirements that can be altered r waived, impacted cmmunities and states will need t cnduct further research specific t their needs. As discussed abve, HUD requires that disaster recvery actin plans include requested waivers. Belw are several examples f state CDBG-DR actin plans frm previus disasters. These dcuments utline hw CDBG-DR funds are channeled int separate recvery prgrams, describe eligible activities, and cntain waiver requests frm each state. Mst actin plans include a sectin detailing the federal requirements that grantees believe they need t have waived r altered alngside justificatins fr waiver requests. The actin plan frm the State f Vermnt prvides a lnger list f waivers including suggested language fr justifying waivers. State f Vermnt CDGB Disaster Recvery Actin Plan, 2012 (Hurricane Irene) http://accd.vermnt.gv/sites/accd/files/dcuments/strngcmmunities/cd/vcdp/actin% 20Plan%20fr%20Disaster%20Recvery%202012%20_%20FinalJG.pdf State f Iwa Actin Plan #1: Utilizing Supplemental CDBG Disaster Recvery Funding frm the Supplemental Apprpriatins Act (Public Law 110-252), 2008 (Hurricane Ike) http://www.iwaecnmicdevelpment.cm/userdcs/dcuments/ieda/actinplan1.pdf State f Texas Actin Plan fr CDBG Disaster Recvery Grantees under the Department f Defense Apprpriatins Act, 2006 (Hurricane Katrina) http://archives.hud.gv/news/2006/pr06-054.pdf Impacted states and cmmunities shuld review these actin plans when cnsidering future waiver requests. States and cmmunities shuld lk fr waivers that have precedent and review sample waiver request language t better understand what type f infrmatin HUD fficials expect t see frm cmmunities in their wn waiver requests. This can help cmmunities create strnger justificatins fr future waiver requests. Demnstrate Need fr Waivers and Hw Requirements Negatively Impact a Cmmunity One HUD fficial nted that many cmmunities ask why their federal agency cannt autmatically waive all requirements in the case f a majr disaster. The respnse is that the federal agency cannt easily alter its missin and the plicy gals that it is trying t achieve thrugh its prgram requirements. If ne f these plicies and its requirements pses a significant impediment t funding recvery prjects in disasterimpacted cmmunities, then it is reasnable fr the federal department r agency t cnsider altering r eliminating the requirement (if it has authrity t d s). In this case, a grantee shuld thrughly explain the unique lcal cnditins in impacted cmmunities and why certain regulatins may hinder the recvery prcess. This justificatin helps supprt fficial waiver requests. 40

In rder t make a cmpelling case fr using waivers, an impacted cmmunity needs t have a deep understanding f hw the cmmunity was impacted with regard t prperty damage and infrastructure, hw mney frm insurance claims might cver sme f the csts f rebuilding effrts, and hw federal funds might be used t address funding gaps. CDBG-DR has been a majr surce f recvery funding fr the last tw decades; yet, there are a significant number f federal requirements, many f which have been highlighted in this paper, that limit its flexibility as a funding surce. It is imprtant t understand hw meeting certain federal requirements might negatively impact the ability f lcal cmmunities t use disaster recvery funds fr recvery prgrams and prjects. Lcal and state fficials tend t have a better understanding f limitatins that may hinder fulfillment f these requirements. This infrmatin shuld be articulated by the appinted state r lcal gvernment agency t help persuade HUD t grant any relevant waivers. As an example, Mississippi Develpment Authrity (MDA), the appinted state agency fr disaster recvery fllwing Hurricane Katrina, made a request t remve a requirement that restricts CDBG-DR funds frm being used in the recnstructin f public buildings. The hurricane destryed mst public buildings in many castal cmmunities. Since the state desperately needed CDBG-DR funds t help fund the redevelpment f these public facilities, MDA successfully used this infrmatin as justificatin fr their waiver request t remve the funding restrictin. Retain Experienced Legal Persnnel t Review Regulatins After a majr disaster, states and lcal cmmunities may be respnsible fr managing hundreds f millins, if nt billins, f dllars in CDBG-DR funding. In such cases, the state r lcal agency managing these recvery funds has a fiduciary respnsibility t ensure that taxpayer dllars are spent in cmpliance with the law. As nted abve, the federal regulatins cncerning CDBG-DR funds are cmplex. Fr example, a recent Federal Register ntice regarding CDBG-DR funding fr Hurricane Sandy-impacted cmmunities cntained 16 pages f infrmatin n applicable laws and regulatins. 25 In additin t studying such ntices, a state r lcal gvernment agency shuld als cmplete its wn review f federal regulatins assciated with CDBG-DR while paying particular attentin t ptential prblematic areas in terms f grant administratin and cmpliance. In an IEDC interview, ne state disaster recvery fficial suggested that impacted states shuld seek the cunsel f an experienced auditr r capable attrney t help interpret the cmplex legal issues and federal regulatins assciated with HUD CDBG- DR funding. When administering several millins r even billins f dllars in federal funds, seeking cunsel frm auditrs and attrneys n applicable CDBG-DR funding regulatins helps better prepare the state and its affected cmmunities fr securing necessary waivers and funding. 25 Federal Register Ntice. Vlume 78. N. 43. March 5, 2013. Accessed at: http://prtal.hud.gv/hudprtal/dcuments/huddc?id=cdbg-fr_sandy_ntice.pdf 41

U.S. Ecnmic Develpment Administratin (EDA) Overview f Disaster Recvery Assistance Ecnmic Develpment Administratin (EDA) is a federal agency that wrks t generate and retain emplyment and stimulate new cmmercial and industrial activity primarily in ecnmically distressed cmmunities. At its discretin, the U.S. Cngress can apprpriate supplemental funding t EDA in rder t assist disasterimpacted areas in lng-term ecnmic recvery activities. EDA can als ffer ecnmic recvery assistance t disaster-impacted cmmunities thrugh its nrmal funding apprpriatins. In cntrast t HUD, whse CDBG-DR prgram is designed fr disaster recvery assistance, EDA uses its existing prgrams t fund disaster recvery prjects. EDAfunded activities typically fall within ne f the fllwing three categries. Strategic Planning: The agency can ffer technical assistance and financing fr prjects that help create r imprve ecnmic develpment plans after a disaster, via funding fr disaster recvery plans and fr disaster recvery crdinatrs. Infrastructure Develpment: EDA can prvide grant funding fr building new infrastructure (e.g., research facilities, business incubatrs, technlgy parks, and essential utilities) t prmte ecnmic develpment that attracts r Ecnmic Adjustment Assistance Purpse intended t help address the ecnmic i.e. thse that have incurred harmful ecnmic impacts frm natural disasters (amng ther reasns). Objective These grants are meant t imprve the ability f a distressed cmmunity t becme ecnmically cmpetitive and are intended t stimulate private investment in target areas. Pririties cmpetitiveness, natinal strategic pririties, envirnmentally-sustainable develpment, cllabrative reginal innvatin, public/ private partnerships, and ecnmically distressed/underserved cmmunities. Restrictins Must be in areas that satisfy at least ne ecnmic distress criterin Investments need t be cnsistent with an EDA-apprved CEDS r equivalent reginal strategic ecnmic develpment plan Must have required lcal match share s Recipients must award cntracts accrding t apprpriate prcurement plicy + ensure Davis-Bacn wage rates are paid by cntractrs Indirect csts nt allwed retains jbs in a regin. Capital fr Alternative Financing: prgram allws gvernments and nnprfits t establish an RLF t assist recvery thrugh sub-market-rate lans t businesses. 42

EDA strngly encurages ptential applicants fr financial assistance t cntact the nearest EDA reginal ffice t initiate a dialgue abut qualifying prjects and the applicatin prcess. Requirements That Cannt Be Waived One EDA requirement that is difficult t waive is dcumenting a nexus between a prject and a disaster. This is particularly imprtant fr a disaster supplemental apprpriatin, as it is ne f the main reasns why an applicant wuld be eligible t receive funds. EDA grant managers will carefully evaluate this particular explanatin in an applicatin. This means that EDA funding applicants must prvide a strng shwing hw - disaster ecnmic recvery, mitigatin, r resiliency effrts. The same requirements referenced in the previus HUD sectin nn-discriminatin, fair and prevailing wages, envirnmental reviews, and public ntices f funding availability als apply t EDA grant funding and cannt be waived. Allwable Waivers f EDA Disaster Assistance Requirements Cmprehensive Ecnmic Develpment Strategy (CEDS) Requirement EDA can waive the CEDS requirements fr Ecnmic Adjustment prjects in 26 Matching Share Requirements and Investment Rates and investment rates fr the mst distressed cunty (r similar plitical unit) in a disaster impacted cmmunity/regin. EDA reserves the discretin t award grants under supplemental apprpriatins fr natural disasters at investment rates f up t 100 percent. 27 EDA Prcedures in Disaster Areas This waiver remves nn-statutry administrative/prcedural cnditins fr EDA investment assistance awards if these cnditins cannt be met by an eligible applicant n accunt f a disaster. 28 Wrking Effectively with EDA n Federal Requirements The fllwing sectin prvides guidance t lcal ecnmic recvery stakehlders, ecnmic develpment rganizatins (EDOs) and chambers f cmmerce, fr interacting with reginal ffices f the U.S. Ecnmic Develpment Administratin (EDA). 26 dcuments. 27 Office f Management and Budget (OMB) Circular A-133. 28 Defined under the Public Wrks and Ecnmic Develpment Act (PWEDA) f 1965 43

Frequent Cmmunicatin with Reginal Office Staff While HUD and USDA wrk primarily at the state-level t address disaster recvery, EDA wrks directly with lcal and reginal ecnmic recvery entities. EDA-eligible applicants include cities (r plitical subdivisins f a state), public r private nnprfit rganizatins acting in cperatin with a plitical subdivisin f a state, higher educatin institutins, Native American Tribes, r nnprfit rganizatins invlved in training r research and develpment activities. EDA encurages applicants t cmmunicate directly with a designated Ecnmic Develpment Representative (EDR) at the apprpriate EDA reginal ffice prir t submitting funding applicatins. The purpse f this cmmunicatin is t learn abut EDA investment pprtunities and the applicatin prcess, discuss r refine a prpsed -specific r general federal requirements. It is recmmended that applicants review annuncement prir t cmmunicating with EDA reginal staff. These federal ntices are published at www.grants.gv and www.eda.gv/ff.htm. An FFO prvides additinal details n criteria used t evaluate prjects, utlines investment pririties, and includes specific requirements frm the agency r the disaster supplemental legislatin itself. An imprtant benefit f E ffices is that staff members will likely be mre familiar with the needs f particular regins and will therefre be able t prvide mre detailed advice as t whether a prject in a specific cmmunity reginal staff can help guide a cmmunity thrugh the applicatin prcess and prvide valuable feedback during an applicatin review. It is imprtant that cmmunities initiate cnversatins directly with reginal staff in rder t receive guidance n acceptable requirement waivers r alternate requirements. EDA Reginal Offices Atlanta Alabama Flrida Gergia Kentucky Mississippi Nrth Carlina Suth Carlina Tennessee Austin Arkansas Luisiana New Mexic Oklahma Texas Chicag Illinis Indiana Michigan Minnesta Ohi Wiscnsin Denver Clrad Iwa Kansas Missuri Mntana Nrth Dakta Nebraska Suth Dakta Utah Wyming Philadelphia Cnnecticut Delaware District f Clumbia Maine Maryland Massachusetts New Hampshire New Jersey New Yrk Pennsylvania Rhde Island Vermnt Virginia West Virginia Puert Ric Virgin Islands Seattle Alaska Arizna Califrnia Hawaii Idah Nevada Oregn Washingtn American Sama Nrthern Mariana Islands Guam Federated States f Micrnesia Rep. f Marshall Islands Rep. f Palau In rder t qualify fr EDA funding, the agency requires applicants t perate in an area that has develped a Cmprehensive Ecnmic Develpment Strategy (CEDS) r a CEDSpresents reginal gals and is supprted by bth the public and private sectrs. A CEDS dcument is an imprtant agency requirement, which is reviewed befre a 44

prject is cnsidered fr funding. This allws EDA staff t review whether a prject aligns with investment pririties utlined in a CEDS. In additin t a CEDS, applicants are encuraged t btain letters f supprt fr disaster recvery prjects t shw reginal supprt fr a prject frm cmmunity and reginal stakehlders. can be waived in an established Ecnmic Develpment District and CEDS shuld ask the apprpriate EDA reginal ffice if a CEDS requirement has been waived r if a waiver can be requested. Alternatively, a cmmunity can usually substitute a different type f ecnmic develpment strategy fr a lcal area in rder t fulfill a CEDS requirement. Obtaining a Lwer Lcal Share Requirement -EDA funds in the frm f either cash r in-kind cntributins. Accrding t EDA regulatins, this matc 29 In nn-disaster situatins, EDA requires a 50 percent lcal match, unless the applicant jurisdictin can meet specific criteria that lwers the lcal match belw 50 percent. In the event f a presidentially-declared disaster, an alternative requirement with a lcal match lwer than 50 percent can be btained if apprpriate justificatin can be prvided. Fr disaster supplemental apprpriatins, EDA may, at its discretin, increase a grant award at an investment rate f up t 100 percent. EDA will als cnsider a different match rate fr entities that have exhausted their effective taxing and brrwing capacity. In August 2012, IEDC and the Natinal Assciatin f Develpment Organizatins (NADO) cnvened a grup f ecnmic recvery practitiners and federal gvernment fficials frm acrss the cuntry t discuss varius disaster recvery tpics, including best practices fr meeting requirements fr federally funded prjects. Wrkshp practitiners shared that a cmmunity is mre likely t btain a waiver f a lcal match share requirement if the prpsed EDA funding cmes frm a Cngressinally apprved disaster supplemental apprpriatin. It was als nted that btaining alternative requirements, such as an 80/20 percent federal-lcal match share funding rati, is typically easier t achieve than btaining a 100 percent investment rate frm EDA. 29 13 CFR Ch. III (1 1 11 Editin), Chapter 3: Ecnmic Develpment Administratin, Department f Cmmerce, http://www.eda.gv/pdf/edas_regs-13_cfr_chapter_iii.pdf, 06/13/2013 45

U.S. Small Business Administratin Overview f SBA Disaster Lans -disaster financial help via lng-term, lw-interest lans t renters, hmewners, and businesses. SBA disaster lans are the main type f federal recvery assistance fr rebuilding and repairing nn-farm business lsses assciated with a disaster. Disaster lans are the nly type f assistance SBA ffers fr which businesses f all sizes are eligible. Disaster-impacted businesses are eligible fr SBA financial assistance in the frm f business lans t repair r replace disaster-damaged business prperty, including machinery, equipment, supplies, inventries, and real estate. Other eligible grups include private nnprfits (e.g., churches, charities, Ecnmic Injury Disaster Lans are wrking capital lans prvided t disasterimpacted businesses t help with regular and necessary financial bligatins that these businesses may be unable t meet because f disaster impacts. Ecnmic Injury Disaster Lans are meant t help businesses thrugh a disaster recvery perid and are available nly t thse businesses and wners wh are nt able t cver the csts f their wn recvery via nn-gvernmental financial resurces. 30 SBA disaster lans are intended t help repair r restre prperties t their predisaster frm and cannt be used fr expanding r upgrading businesses unless these actins are required t meet lcal building cde standards. SBA requires that a business submit a cmpleted lan applicatin and a signed and dated IRS frm 8821. The IRS frm 8821 authrizes permissin fr the U.S. Internal Revenue Service (IRS) t prvide infrmatin frm tax returns t SBA. SBA als requires current financial infrmatin in the frm f persnal financial statements, prfit/lss statements, balance sheets, and lists f debts t prcess applicatins. SBA typically tries t make lan decisins within eighteen days. SBA has cllateral requirements fr the physical-lss lans f greater than $14,000 and all ecnmic injury disaster lans f greater than $5,000. SBA will ften require real estate cllateral (either first r secnd mrtgage) ver any frm f ther cllateral such as machinery and equipment. Requirements That Cannt Be Waived The cre federal requirements related t nn-discriminatin, fair and prevailing wages, envirnmental reviews, and public ntices f funding availability apply t SBA lans and cannt be waived. 30 As determined by SBA. 46

Allwable Waivers f SBA Disaster Lan Requirements Timeline Requirement fr SBA Physical Disaster/Ecnmic Injury Lan Increase Administratr fr Disaster Assistance (AA/DA) may waive the requirement that a brrwer must request a lan increase n later than tw years after SBA apprval f a physical disaster/ecnmic injury lan. Maximum Amunt Requirement fr Physical Disaster and Ecnmic Injury Business Lans e SBA can pt t waive the $1,500,000 lan limitatin n disaster business lans (including bth physical disaster and ecnmic-injury lans). SBA defines disaster area that (a) emplyed at least 10 percent f the entire wrkfrce in a cmmuting area f gegraphically identifiable cmmunity (n larger than a cunty), prvided that the cmmuting area des nt extend mre than 50 miles frm such a cmmunity, r (b) emplyed 5 percent f the wrk frce in an industry within a disaster area (If the business is in a nn-manufacturing industry, it must have had at least 50 emplyees in the disaster area. If the business is in a manufacturing industry, it must have emplyed mre than 150 emplyees in the disaster area), r (c) emplyed 250 r mre emplyees in a disaster area. SBA cnsiders waiving the $1,500,000 lan limit nly if (a) a f ging ut f business as result f a disaster and a lan f greater than $1,500,000 is necessary t repen r keep pen the damaged lcatins t avid large-scale unemplyment in the disaster area, and (b) a brrwer has used all reasnably available funds frm his/her business, its affiliates and principal wners (defined as having an wnership interest f 20 percent r mre) and all available credit elsewhere t alleviate physical damage and ecnmic injury. Waiver f Federal Debt Cllectin Requirement fr Disaster Assistance (r a designee) may waive the requirement that a debtr wning prperty subject t a judgment lien fr debt wed t the federal gvernment cannt apply r receive SBA physical and ecnmic injury disaster lans. 31 31 A judgment lien is a curt ruling giving a creditr the right t take pssessin f a debtr's real prperty if the debtr fails t fulfill his r her cntractual bligatins. A judgment lien may be made against an individual r business and allws the creditr t access the debtr's business, persnal prperty and real estate, amng ther assets, t pay the judgment. 47

Waiver-Related Recmmendatins fr SBA Disaster Lans SBA Disaster Lans are granted t individual businesses r business wners. They are nt available t lcal gvernments, states, r similar entities. Whereas HUD CDBG-DR waiver requests are submitted as part f an actin plan prir t funds being disbursed, waivers requests related t SBA Disaster Lan requirements are made after a lan has been granted. While, lcal EDOs d nt have a direct rle in making waiver requests fr SBA Disaster Lans, they may still play a rle in cmmunicating t lcal businesses f all sizes Lcal EDOs can als play an educatinal rle by cmmunicating available waivers t lcal businesses that are cnsidering applying fr a disaster lan r lcal businesses that may already have a disaster lan, but are nt aware that sme requirements may be waived. This is particularly true fr lcal businesses that are majr surces f emplyment in a cmmunity as SBA can waive the upward limit f a disaster lan if a lcal business qualifies fr this distinctin. 48

and Training Administratin (ETA) Overview f Natinal Emergency Grants (NEGs) fr Disaster Natinal Emergency Grants (NEGs) frm the Emplyment Training Administratin (ETA) prvide an imprtant surce f emergency funding t temprarily expand capacity fr training and emplyment prgrams at the state and lcal levels. NEGs are ften used t reemply laid-ff wrkers by ffering training t increase ccupatinal skills. The NEG prgram funds ne f fur eligible layff events: 1. A single cmpany layff f 50 r mre wrkers; 2. Multiple cmpany layffs in which 50 r mre wrkers frm each cmpany are dislcated; 3. Industry-wide layffs; r 4. Layffs affecting an entire cmmunity (Cmmunity Impact) with multiple small dislcatins (50 wrkers r less frm each cmpany). Lcal gvernments and ecnmic develpment rganizatins have used NEGs t fund temprary staffing slutins fr varius ecnmic recvery activities. During the aftermath f Hurricane Katrina, JEDCO the ecnmic develpment rganizatin fr Jeffersn Parish, Luisiana used a Natinal Emergency Grant t fund temprary staff at tw f its business recvery centers. 32 Disaster NEG A Disaster NEG is a special NEG that prvides funding t create temprary emplyment t assist with cleanup activities in the event f a disaster. A state can apply fr a Disaster NEG nly in the event that FEMA has declared a disaster area eligible fr public assistance. Thse eligible fr a Disaster NEG differ frm the regular NEG prgram. Disasters NEGs are available t permanently r temprarily dislcated individuals resulting frm a disaster. Disaster NEGs restrict the perid f funding fr clean-up activities t six mnths frm the time the grant is awarded. Unlike standard NEGs, states are always cnsidered t be bth grantee and prgram peratr fr Disaster NEGs. Lcal cmmunities are cnsidered t be cntractrs and service prviders. Fr cases in which a disaster impacts many lcal cmmunities, a between areas. FEMA can authrize public assistance declaratins t cver ther additinal areas. A Disaster NEG grantee can receive additinal funding when needed as lng as there is apprpriate justificatin fr additinal funds. Grant recipients are bligated t present a cmplete a prject perating plan t an ETA reginal ffice fr review within 90 days f receiving a grant r within 60 days f the applicatin apprval. 32 Mulcaire, Carrie. Internatinal Ecnmic Develpment Cuncil (IEDC). Superstrm Sandy Highlights Six Pririties fr Shrt-term Ecnmic Recvery After a Disaster. Accessed at: http://restreyurecnmy.rg/superstrm-sandyhighlights-six-pririties-fr-shrt-term-ecnmic-recvery-after-a-disaster/. 49

Allwable Waivers Prgram Six Mnth Limit n Emplyment fr Disaster NEG Participants The U.S. Secretary f Labr may waive the six mnth time limit fr emplyment related t Disaster Natinal Emergency Grant participants. State Actin Is Necessary t Extend Six Mnth Limitatin At the request f the state, ETA can waive the six-mnth emplyment limitatin fr recipients f state Disaster NEGs. States shuld frmally submit this request in writing t the ETA reginal administratr fr apprval by the U.S. Secretary f Labr. This request needs t include apprpriate justificatin fr why this requirement shuld be waived. Examples f these types f requests and justificatins can be fund n the websites f the Kentucky Office f Emplyment and Training (http://et.ky.gv/waiverneg11182011.pdf) and the Ohi Department f Jb and Family Services (http://jfs.hi.gv/wd/wrkfrceprf/dcs/neg-disaster-waiver- Request-08102012.pdf). 50

U.S. Department f Agriculture Rural Develpment Overview the Rural Husing Service (RHS), the Rural Utilities Service (RUS), and the Rural Business-Cperative Service (RBS) that can assist rural residents, cmmunities and utility systems with an array f grant, lan, and lan guarantee prgrams. USDA Rural Develpment als ffers federal funding resurces fr pstdisaster ecnmic recvery purpses. The mst cmmnly used nn-husing USDA Rural Develpment prgrams fr this purpse fall within three categries. Revlving Lan Funds and Technical Assistance Rural Business Enterprise Grants Rural Business Opprtunity Grants Intermediary Relending Prgram Rural Ecnmic Develpment Lans and Grants Cmmunity Facilities Lans and Grants Water and Waste Direct Lans Cmmercial Lending Prgrams Business and Industry Guaranteed Lan Prgram Renewable Energy/Energy Efficiency Prgrams Bimass Crp Assistance Prgram Birefinery Assistance Prgram Bienergy Prgram fr Advanced Bifuels Rural Energy fr America Prgram (REAP) Bimass Research and Develpment Initiative As with ther federal agencies, requirements related t nn-discriminatin, fair and prevailing wages, envirnmental reviews, and public ntices f funding availability als apply t USDA Rural Develpment disaster assistance and cannt be waived. 51

Allwable Waivers f USDA Rural Develpment Requirements 33 Types f Waivers The mst cmmn waivers authrized by the U.S. Secretary f Agriculture fr USDA Rural Develpment disaster assistance-related prgrams fall int three main categries. Waivers f Limitatins n Ppulatin Requirements Waivers f Limitatins n Incme Requirements Waivers f Limitatins n Cst-Sharing Requirements Specific Waivers Rural Area Definitin Requirement (Any Prgram) The U.S. Secretary f Agriculture can waive the applicatin f the rural area definitin r similar limitatins under any prgram funded thrugh an apprpriatins act and administered by the Rural Develpment Missin Area. Fr example, the secretary may increase the ppulatin limitatin fr rural areas t 50,000 (and t 75,000 fr a limited number f cmmunities). Limitatin f Grant Amunts This waiver allws the U.S. Secretary f Agriculture t make grants r increase grant amunts withut regard t any grant amunt limitatin fr prgrams under the Renewable Energy Systems and Energy Efficiency Imprvements Prgram, Value-Added Prducer Grants Prgram, Rural Cperative Develpment Grant Prgram, and the Cmmunity Facilities Grant Prgram. Matching Funds Requirement fr Cmmunity Facilities Prgram This waiver allws USDA Rural Develpment t waive graduated funding r matching fund requirements fr Cmmunity Facilities Grants in disaster areas. Requirements fr Renewable Energy Systems/Energy Efficiency Imprvements This waiver allws USDA Rural Develpment t create Renewable Energy Systems/Energy Efficiency Imprvements grants and lans in disaster areas with (a) cst share requirements nt t exceed 50 percent, (b) n limitatin f n grant amunts, and (c) inclusin f businesses prcessing un-segregated paper and slid waste. Requirements fr Value-Added Prducer Grants This waiver allws USDA Rural Develpment t create Value-Added Prducer Grants in disaster areas withut matching fund requirements. The waiver decreases the matching fund requirements fr grantees in disaster areas if prpsed prjects are still feasible with a decreased funding match requirement. 33 The list f USDA Rural Develpment waivers referenced here des nt include any waivers assciated with USDA Rural Develpment husing prgrams. 52

Cnclusin With n shrtage f disasters n the hrizn, states and cmmunities shuld develp a deep knwledge f the varius federal funding requirements that need t be met when using federal funds fr pst-disaster recvery effrts. This begins with understanding the federal apprach t disaster recvery, the cre requirements that gvern the use f federal funds, and waivers f any requirements that may be available t impacted cmmunities. Understanding the experiences f ther disasterimpacted cmmunities (e.g., knwing the challenges these cmmunities faced when using federal pst-disaster funds, and knwing which federal requirements these cmmunities were able t waive) greatly helps disaster-stricken cmmunities -disaster recvery funding. There are several steps that impacted cmmunities need t take in rder t achieve all f this. Understand the federal apprach t pst-disaster ecnmic recvery Cmmunities need t understand hw the federal gvernment appraches pst-disaster ecnmic recvery. This requires that cmmunities and states becme knwledgeable abut: The basic prcess by which presidential disaster declaratins are made; and ecnmic recvery resurces thrugh the crdinated respnse f the Natinal Disaster Recvery Framewrk; and, Which federal agencies and funding prgrams are available t cmmunities fr ecnmic recvery effrts. Knw what federal requirements and waivers are After develping a basic knwledge base abut the cre federal agencies and prgrams invlved in pst-disaster ecnmic recvery, cmmunities shuld build upn this by develping a mre cmplete understanding f the requirements that restrict uses f each requirements are universal acrss all federal agencies (and tend t be far mre difficult t waive), while mst requirements are agency-specific and smehw a firm understanding f these requirements, the next step fr cmmunities is t determine which f these requirements can be waived and the prcess fr ding s. federal funding fr ecnmic recvery effrts The best way t determine which federal agency requirements can be waived, is t research and review the ecnmic recvery experiences f ther disasterimpacted cmmunities that been thrugh the prcess. Knwing which federal s funding requirements psed the mst significant radblcks t ther -impacted cmmunities better target their wn resurces and energy t mre efficient and prductive uses. Cmmunities and states shuld deply experienced staff t: 53

Review federal requirements that restrict federal recvery funding; Understand the bjectives f each fe (i.e., knw what each agency tries t accmplish with funds it disburses); Research prir waiver requests frm ther cmmunities r states; and, Gather infrmatin n hw federal prgram regulatins might impact Make a cmpelling case t justify waivers and design a win-win fr all parties Knwing the waivers that ther impacted cmmunities were able t requests and avid exerting significant amunts f energy trying t push fr waivers that are highly unlikely t be granted. Researching and reviewing thse waivers that have ample precedent f being waived in previus pst-disaster situatins helps cmmunities understand what factrs went int a federal. Cmmunities als need t develp creative and cmmunity-specific justificatins when requesting waivers. LMI requirements fr HUD CDBG funds cannt be cmpletely waived. Yet, ne hurricane-impacted cmmunity that sught t maximize the flexibility f HUD CDBG-DR funds was able t justify a waiver t reduce the threshld f CDBG- - t mderate-incme requirement (frm 70 percent t 50 percent) by develping a win-win prpsal fr bth the cmmunity and HUD. CDBG-DR funds were used t develp a lcal university-based facility that serves as bth a technlgy cmmercializatin center fr advancing reginal entrepreneurship and as a wrkfrce and skills training prgram designed t train lw- t mderate-incme individuals impacted by the hurricane. One-half f the facility was designed t meet a unique cmmunity need (i.e., entrepreneurship develpment) and the ther half was designed t meet the CDBG-DR requirement that 50 percent f funds be used t benefit peple f lw- t mderate-incme. Cmmunicate frequently and fllw thrugh with agency fficials The need fr early and frequent cmmunicatin between all levels f gvernment t ensure the recvery unique needs f impacted cmmunities are being met cannt be understated. Many ecnmic recvery effrts fail frm lack f cmmunicatin and crdinatin with recvery fficials, agencies, and decisin makers. Cmmunities must understand that many ecnmic recvery funding decisins are frequently made by state-level fficials that many federal agencies assume will accurately represent the interests f all f the disaster-impacted cmmunities within a state. This pint underscres the imprtance and need fr cmmunities t be in cnstant cmmunicatin with thse state-level agencies that will make decisins that substantially impact an and infrmed cmmunicatin can lcal and state fficials prvide apprpriate justificatin as t why federal requirements need t be altered r waived. 54

Knw the details f the prgrams, prcesses and cmmnly requested waivers f the cre federal agencies that ffer recvery funding Infrmatin is ammunitin in the battle t ensure that a cmmunity is able t fully recver frm disaster, and understanding the nuances f hw each agency ability t access critical federal ecnmic recvery funds. Yet, even if all these steps are fllwed, there is n assurance that the requirements f federal agencies and their recvery funding prgrams will remain static fr future recvery effrts. Federal agencies are cnstantly wrking t imprve delivery f recvery funds and assistance fllwing a disaster, and future adjustments t sme requirements shuld be expected. This reprt shuld be seen as bth a current snapsht and a living dcument, and readers shuld nte that as changes t federal funding prgrams and plicies evlve, IEDC will lk t incrprate new infrmatin t infrm disaster-impacted cmmunities and states n hw t best navigate the pst-disaster federal funding and waiver request prcess. IEDC encurages readers f this reprt t peridically check www.iedcnline.rg/web-pages/resurcespublicatins/disaster-preparedness-and-recvery/ fr updates r amendments t this reprt and fr related resurces n navigating pst-disaster ecnmic recvery funding. 55