Section R. 125.192 - Program funds eligible usesRule 192.
(1) Michigan housing and community development program funds may be used for the following activities:(a) Acquisition activities. Acquisition in whole or in part by the recipient, by purchase, long-term lease, donation, or otherwise, of real property, including air rights, water rights, rights-of-way, easements, and other interests therein, for any purpose authorized by the program.(b) Rehabilitation, clearance, and remediation activities. Rehabilitation activities include clearance, demolition, and removal of buildings and improvements, movement of structures to other sites, and remediation of known or suspected environmental contamination for a current or proposed housing development or project located in a downtown area or adjacent neighborhood. Demolition of HUD-assisted or HUD-owned housing units may be undertaken only with the prior approval of HUD.(c) New construction of housing activities or projects located in a downtown area or adjacent neighborhood. Construction of a housing development or projects located in a downtown area or adjacent neighborhood, including housing assisted under federal or state law, through the incurrence of development costs and predevelopment costs.(d) Activities incurring development costs and predevelopment costs.(e) Preservation of existing housing or activities related to the preservation of existing housing.(f) Activities related to community development projects, infrastructure improvements, economic development projects, blight elimination, and community facilities. Activities under this category include acquisition, construction, reconstruction, rehabilitation or installation of community facilities, and infrastructure improvements or other incurrence of development costs or predevelopment costs carried out by the recipient. In undertaking such activities, design features and improvements that promote energy efficiency may be included. Such activities may also include the execution of architectural design features and similar treatments intended to enhance the aesthetic quality of facilities and improvements receiving assistance. Such community facilities include, but are not limited to, shelters for the homeless; shelters for victims of spousal and dating violence; halfway houses for children temporarily separated from their parents or guardians, drug offenders or parolees; group homes for persons with disabilities; and temporary housing for disaster victims.(g) Activities incurring insurance costs related to any purpose authorized by the Michigan housing and community development program.(h) Activities involving operating, replacement, and other reserves related to any purpose authorized by the Michigan housing and community development program.(i) Activities providing down payment and other direct homeownership assistance to low, very low, or extremely low-income households.(j) Activities providing security deposit assistance to low, very low, or extremely low-income households.(k) Activities providing foreclosure prevention or foreclosure assistance to low, very low, or extremely low-income households.(l) Activities related to individual development accounts established under the individual or family development account program act, 2006 PA 513, MCL 206.901 to 206.911.(m) Activities related to ending homelessness.(n) The provision of assistance either through the recipient directly or through public and private organizations, agencies, and other subrecipients, including nonprofit and for-profit subrecipients, to facilitate economic development projects or activities that support housing development that does the following: (i) Provides financial support for the establishment, stabilization, and expansion of business enterprises.(ii) Provides technical assistance, advice, and business support services to owners of business enterprises and persons developing business enterprises.(iii) Provides general support, including, but not limited to, peer support programs, counseling, childcare, transportation, and other similar services, to owners of business enterprises and persons developing business enterprises.(iv) Assistance under this subrule may also include training, technical assistance, or other support services to increase the capacity of the recipient or subrecipient to carry out the activities under this subrule.(o) Assistance activities provided to public or nonprofit entities, including municipalities and land bank fast track authorities organized under the land bank fast track act, 2003 PA 258, MCL 124.751 to 124.774, to increase the capacity of such entities to carry out program eligible housing development, neighborhood revitalization, or economic development activities.(p) Predatory lending prevention or relief.(q) Any other housing and community development fund or program activities authorized under the authority's act.(2) Ineligible applicants include the following: (a) An applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest, either failed to submit or is now delinquent in providing an explanation, evidence of corrective action or a payment of disallowed costs or fees as a result of a program funding monitoring review.(b) An applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest, is currently delinquent on any loan payments or any fees due and payable to the authority.(c) An applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest, has been or is barred, debarred, suspended, or terminated from procurement in a state or federal program or listed in the list of parties excluded from federal procurement or non-procurement programs or has otherwise been debarred by HUD or the authority.(d) Any individual acting as an owner, member, principal, officer, manager, or key employee of the applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest, has been convicted of a state or federal felony crime involving fraud, bribery, theft, misrepresentation of material fact, misappropriation of funds, or other similar criminal offenses within 15 years preceding the application deadline.(e) An applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest, at the time of application submission is subject to any of the following: (i) Enforcement or disciplinary action under state or federal securities law or by the National Association of Securities Dealers (NASD).(iii) An enforcement proceeding with any governmental entity.(f) An applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest has open or unresolved, or both, audit issues with HUD or the authority related to this program or other programs administered by HUD or the authority.(g) A submitted application is incomplete; lacks required supporting documentation; or is so unclear or disjointed that, in the discretion of the authority, it cannot reasonably be reviewed to determine whether it meets program criteria. If an application is determined to be ineligible pursuant to this rule, the application will be terminated. To the extent that the authority staff was able to complete a limited application review, specific reasons for the authority's determination of ineligibility must be included in the termination letter to the applicant.(h) An applicant, recipient, or an entity in which the applicant or recipient has or had a controlling interest, has an ownership interest, or exercises control of 1 or more rental housing properties in this state is subject to a regulatory agreement or tax credit regulatory agreement with the authority and is in material noncompliance with the regulatory agreement or tax credit regulatory agreement.(i) Any application that includes financial participation by a person who, during the 5-year period preceding the date of the bid or award, has been convicted of violating a federal law in connection with a contract awarded by the federal government for relief, recovery, or reconstruction efforts as a result of any disaster occurring after January 1, 2000, or was assessed a federal civil or administrative penalty in relation to such a contract.(j) Applications for proposals which cause or result in the permanent displacement of low-income, very low-income, or extremely low-income households. Low-income, very low-income, or extremely low-income households that may be temporarily displaced by the rehabilitation of affordable housing may be eligible for compensation of moving and relocation expenses. If a recipient violates the dislocation provisions of this subrule, that recipient shall repay program money and the landlord or developer must pay the affected parties' costs and all moving expenses.Mich. Admin. Code R. 125.192
2008 AACS; 2009 AACS; 2023 MR 6, Eff. 3/21/2023