Report To The Utah Legislature - A Performance Audit Of The Division Of Housing And Community Development - 2012 Page 27
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33customary notification and citizen participation requirements in the
interest of expediting the use of the NSP funds. None of the other 13
states that received $19.6 million issued a similar RFP.
Utah’s NSP1 Use Complied with Federal
Requirement to Use Funds Quickly
Even with the RFP process, HCD was able to put the majority of
the NSP1 funds to use faster than any other state in the nation. This
speed of use complies with the federal emphasis on using the NSP1
money quickly. HCD awarded the contract to UCAH in August
2009; by June 2010, UCAH had loaned 96 percent of the money. As
of June 2011, Utah had the largest percentage of money used of any
state.
Federal regulations repeatedly discuss “moving forward rapidly” or
“expediting” the use of NSP1 funds. Specifically, the regulations state,
One of the most critical NSP provisions is . . . that any
grantee receiving a grant ‘shall, not later than 18 months
after the receipt of such amounts, use such amounts to
purchase and redevelop abandoned and foreclosed
homes and residential properties.’
Instead of slowing down the use of these monies, the RFP process and
partnership with UCAH seems to have accomplished the federal
government’s goal of expediting use of these funds.
In addition to using the funds quickly, HCD, through UCAH, has
chosen to loan the NSP1 money instead of granting it. Doing so will
enable HCD to recycle the funds and use them for the foreseeable
future. This is fairly unique among the states receiving $19.6 million.
Of the 13 we contacted, only 3 others distributed the money on a loan
basis.
The two other main concerns expressed with the NSP1 set up were
that UCAH is predominantly using land-banking, and that they give
preferential treatment to properties owned by the private company
34 percent of Utah’s
donating administrative costs. We found that neither of these
NSP1 funds were used
concerns appear to be true. A federal Office of Housing and Urban
for land-banking.
Development (HUD) report identifies that 34 percent of Utah’s
NSP1 monies have been used for land-banking, a practice discussed in
Office of the Utah Legislative Auditor General
17
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