10 TAC §255.7
The Office of Rural Community Affairs (Office) adopts amendments
to §255.7, concerning the allocation of Community Development Block Grant
(CDBG) non-entitlement area funds under the Texas Community Development Program
(TCDP).
The amendments establish the standards and procedures by which the Office
and the Texas Department of Agriculture will allocate and distribute 2005
program years funds under the Texas Capital Fund. The amendments are being
adopted to make changes to the application and selection criteria for the
programs available under the Texas Capital Fund.
The amendments to §255.7 are being adopted with one change to the
proposed text as published in the April 1, 2005, issue of the
Texas Register
(30 TexReg 1891). Based on the comments received, the
proposed text in §255.7(i)(2)(A)(ii) has been changed from the proposed
"Score 5 points for letters from 50% or more of the businesses and/or property
owners in the designated Main Street program area. Score 10 points for letters
from 75% of the businesses in the designated Main Street program area." to
"Score 10 points for letters from 75% or more of the businesses and/or property
owners in the proposed Texas Capital Fund project area."
The amendments make changes to the application and selection criteria for
Texas Capital Fund programs.
Comments were received from four persons. Many of the comments were in
favor of the proposed amendments. Those comments supporting the proposed amendments
will not be summarized in the following paragraphs. Responses to the comments
opposing the amendments are from staff of the Texas Department of Agriculture
(TDA).
One commenter was against the proposed amendment to subsection (a)(4),
that would lower the matching funds leverage ratio for the main street program
from 0.2:1 to 0.1:1. TDA believes that the amendment is warranted because
reducing the amount of matching funds will make it easier for small cities
with limited resources to access the main street program and because the leverage
ratio for the downtown revitalization program is also 0.1:1.
One commenter was against the proposed amendment to subsection (a)(9),
that would change the current requirement that only one business can receive
benefit under an infrastructure program or real estate program application
to allow a maximum of three businesses to benefit from an infrastructure program
or real estate program application. The commenter stated: We understand that
the Texas Capital Fund Program previously supported projects with multiple
benefiting businesses, but that after several failed projects, the TCF under
the Texas Department of Economic Development discontinued allowing multiple
businesses to benefit from a single award. We believe that allowing multiple
businesses to benefit will further complicate an already complex project development,
application review, and implementation process and will create additional
liability issues for the applicant locality and the Department. If there is
more than one business with which the locality will be required to subcontract,
the issue shared responsibility for job creation documentation, financial
viability, match injection, and, perhaps, real estate repayment requirements
will become extremely complex. On which company's financial viability will
the financial analysis be based? Our experience has been that, at times, localities
are hesitant to enter into TCF projects with even a single business because
of uneasiness about the repayment liability. In addition, we believe that
the Office of Rural Community Affairs is attempting to address the needs of
smaller businesses by the creation of the Microenterprise Loan Program and
the Small Business Loan Program. These programs will provide funds to assist
businesses with on-site improvements. To address off-site improvements for
smaller businesses, perhaps the TCF could develop a subcategory for sole proprietorship
businesses who employ less than 15 persons. The cost per job for these new
smaller businesses could be higher than the current maximum $25,000 per job.
TDA believes that the amendment should be adopted even though the commenter
is concerned about the additional complexity that allowing three businesses
will create. However, the proposed amendment is permissive and the infrastructure
and real estate program will still allow applications that assist only one
business.
One commenter was against the proposed amendment to subsection (f)(3)(A),
that would change population figures for applicants under the Jobs Impact
scoring criteria to the net of the population after persons in adult or juvenile
correctional institutions, as shown in the 2000 census data, were deducted
from an applicant's 2000 census population. The commenter stated that using
population figures that are the net of people in prisons in most formulas
is unfair. TDA believes that the amendment should be adopted because the change
will help small communities that have a high number of persons in institutions
and these individuals distort the true job impact ratio that is being used
under the scoring criteria.
Two persons submitted comments opposing the proposed amendment to subsection
(i)(2)(A)(ii). TDA agreed with the comments and clause (ii), as described
in the third paragraph of this preamble, will be adopted using the language
suggested by one commenter.
One commenter was against the proposed amendment to subsection (i)(2)(B),
that would increase the score for the Infrastructure Project Plan from 5 points
to 10 points. The commenter stated: We believe that the points for a developed
Infrastructure Project Plan should not be increased from 5 points to 10 points.
We believe that providing a plan to access affected businesses should be developed
as the scope of the project is identified, but that evidence of support from
the community is a more important scoring criteria than documenting a plan
to ensure access to a business. We believe the 2 of the additional 5 points
proposed for this category should be returned to obtaining letters from civic
organizations and the other 3 points shifted to a new category under Subsection
D awarded if the applicant has an adopted central business district or downtown
revitalization plan in place. Most revitalization plans should likely also
include business access plans. TDA believes that the amendment should be adopted
because developing a plan to notify the and prepare the public for a major
infrastructure project is crucial as small businesses and property owners
are most affected by these types of projects. In the interest of small and
property owners and citizens of a community in general, an emphasis on public
notification and planning should be reflected in the grant application process
and review.
One commenter was against the proposed amendment to subsection (i)(2)(C),
that would further define the scoring criteria for receiving points under
the ADA Compliance Goals scoring factor because many downtown areas have already
been made compliant with the Americans with Disabilities Act but need additional
work in other areas. TDA believes that the amendment should be adopted because
many communities need additional work to meet ADA compliance and this is a
priority issue when addressing slum and blight. The applicant can explain
if ADA has already been addressed and the proposed language allows for partial
points if the scoring committee chooses to award them.
One commenter was against the proposed amendment to subsection (i)(2)(F),
that would eliminate the Community Development Potential scoring factor and
create a new Community Size scoring factor. The commenter requested that consideration
be given to lowering the proposed 10 points for this factor because other
scoring criteria already favor smaller communities and 10 points is too large
of a percentage of the total available points to be based solely on population.
TDA believes that the amendment should be adopted because smaller communities
often have fewer resources and greater needs than their larger counterparts.
One commenter was against the proposed amendment to subsection (i)(2)(G),
that would eliminate the Local Main Street program training scoring factor
and create a new Main Street Program Participation scoring factor. The commenter
stated: We are opposed to this new scoring category because it unfairly penalizes
newer Main Street communities. We know of one instance where a community pursued
Main Street designation with the specific intent of immediately applying for
TCF Main Street funds. This aggressive, newly designated city will be penalized
while less aggressive older Main Street cities will be given these points.
In fact, this scoring practice will mean that Main Street cities 10 or more
years in the program will receive maximum points on every application while
it will take newer Main Street cities 10 years to earn the full 5 points.
If the intent of the program is to "spread the wealth," perhaps these 5 points
should be redirected to an "previously funded" category similar to that used
in the TCF Infrastructure/Real Estate and TCF Downtown Revitalization programs
where points are awarded to applicants who have not received a TCF award for
at least two years. Since TCF rules do not allow applicants to apply for TCF-Main
Street funds while they still have an open project, the "previously funded"
period could extend for two prior cycles or four years. TDA believes that
the amendment should be adopted because the purpose of this category is to
provide an incentive for and reward to communities that commit significant
financial and community resources to the revitalization of their commercial
historic district over a number of years.
One commenter was against the proposed amendment that would create a new
subparagraph (H) under subsection (i)(2), that would award points under a
scoring factor created to encourage local attendance at Main Street grant
training workshops. The commenter stated: We are opposed to this new scoring
category because it places an onerous burden on smaller communities who rarely
have travel budgets, and because any travel costs incurred to attend grant
application training is not a reimbursable expense. In addition, unless there
are numerous training sessions scheduled close to the application deadline,
cities who decide to apply in the last month before the deadline will always
be penalized under this category. If the intent of the program is to ensure
the applicant locality understands the TCF-Main Street program, we believe
it would be a better use of travel funds to require grant recipients to attend
an implementation workshop. TDA believes that the amendment should be adopted
because the TDA will continue to coordinate Texas Capital Fund training with
training that is already required for Main Street managers as a part of their
letter of agreement. By conducting training with at least two required events
throughout the year, it will ensure that obtaining these points will not be
a burden. It supports a high standard for the program by requiring that TDA
provide the best training possible to produce the best grant applications
further ensuring the best use of these grant funds.
One commenter was against the proposed amendment to subsection (i)(2)(J),
that would change the existing language to better define the criteria to receive
points for sidewalk or ADA compliance activities under the downtown revitalization
program. The commenter states: The program needs to allow communities to make
their own self determination as to what sort of public improvements are needed
to jump start the revitalization of their downtown. I have worked with many
communities over the past thirty years and I have conducted nearly fifty central
business planning studies. During our analysis of downtowns, we found that
the key to jump starting reinvestment is to provide those public facilities
that are needed to encourage private reinvestment. I have found that communities
are in the best position to determine what is needed to jump start revitalization.
At the present time, the DRP program emphasizes sidewalk improvements as the
predominant remedy for revitalization. I believe a great disservice is being
done because it leads many communities to believe that sidewalks are the only
solution. On the contrary, the solution can come in any of the following public
activities such as: sidewalks, parking lots, enhanced water and sewer services,
sponsoring community events, clearance and demolition, drainage improvements,
landscaping, lighting, and public common areas. For these reasons, DRP program
should allow communities the greatest flexibility to make their own self determination
as to how to solve their local problems. TDA believes that the amendment should
be adopted to continue the emphasis on sidewalks and ADA compliance based
on the historically large percentage of main street improvements program funds
that have been used to address these activities. The downtown revitalization
program does not prohibit other uses, but rather provides points in the scoring
system for sidewalks and ADA activities. In many small towns, sidewalks are
seen as a primary first step towards revitalization.
The amendments are adopted under §487.052 of the Government
Code, which provides the Office of Rural Community Affairs with the authority
to adopt rules implementing its statutory responsibilities.
The Texas Administrative Code, Title 10, Part 6, Chapter 255, is affected
by the adoption of the amendments to §255.7.
§255.7.Texas Capital Fund.
(a)
General Provisions. This fund covers projects which will
result in either an increase in new, permanent employment within a community
or retention of existing permanent employment. Under the main street improvements
and downtown revitalization programs, projects must qualify to meet the national
program objective of aiding in the prevention or elimination of slum or blighted
areas.
(1)
For an activity that creates/retains jobs, the city/county
and business must document that at least 51% of the jobs are or will be held
by low and moderate income persons. For purposes of determining whether a
job is or will be held by a low or moderate income person or not, the following
options are available.
(A)
The business must survey all persons filling a created/retained
job. Persons filling a created job should be surveyed at the time of employment.
Persons holding a retained job should be surveyed prior to application submission.
This determination is based on the family's size and previous 12 month income
and is normally documented on the Family Income/Size Certification form, which
is filled out, dated and signed by employees; or
(B)
The person(s) employed by the business for created/retained
jobs may be presumed to be a low or moderate income person if the person resides
within a census tract or block numbering area that either is part of a Federally-designated
Empowerment Zone or Enterprise Community or the person(s) reside in a census
tract or block numbering area that meets the following criteria:
(i)
The census tract or block numbering area has a poverty
rate of at least 20% as determined by the most recently available decennial
census information;
(ii)
The census tract or block numbering area does not include
any portion of a central business district, as this term is used in the most
recent Census of Retail Trade, unless the tract has a poverty rate of at least
30% as determined by the most recently available decennial census information;
and
(iii)
The census tract or block numbering area shows evidence
of pervasive poverty and general distress by meeting at least one of the following
standards:
(I)
All block groups in the census tract have poverty rates
of at least 20%; or
(II)
The specific activity being undertaken is located in a
block group that has a poverty rate of at least 20%; or
(III)
Has at least 70% of its residents who are low- and moderate-income
persons; or
(IV)
The assisted business is located within a census tract
or block numbering area that meets the requirements of this subparagraph,
and the job under consideration is to be located within that census tract
or block numbering area.
(2)
If the project is designed to aid in the prevention or
elimination of slum or blighted areas, then it must meet the area slum or
blight or spot slum or blight criteria and threshold requirements outlined
in the separate main street or downtown revitalization program applications.
(3)
A firm financial commitment from all funding sources.
(4)
The leverage ratio between all funding sources to the Texas
Capital Fund (TCF) request may not be less than 1:1 for awards of $750,000
or less; and 4:1 for awards of $750,000 to $1,000,000. The main street and
downtown revitalization programs require a minimum 0.1:1 match.
(5)
In order for an applicant to be eligible, the cost per
job calculation must not exceed $25,000 for awards of $750,000 or less; $10,000
for awards of $750,001 to $1,000,000; and $5,000 for awards of $1,000,001
to $1,500,000. These requirements do not apply to the main street program
or the downtown revitalization program.
(6)
No financial assistance will be provided to projects involved
in the relocation of any industrial or commercial plant, facility or operation,
from one state to another state, if the relocation is likely to result in
a significant loss of employment in the labor market area from which the relocation
occurs. No assistance will be provided for projects intended to facilitate
the relocation of any industrial or commercial plant, facility or operation
from one unit of general local government within Texas to another unit of
general local government within Texas unless a 10% net gain of jobs will occur
and one of the following requirements has been met prior to submitting an
application for consideration under this section:
(A)
Business to relocate with approval of current locality.
Local government must provide written documentation within the application,
verifying the chief elected official (mayor or judge) of the unit of local
government from which the business is relocating supports and approves the
relocation proposal. A written agreement between the two local governments
involved in the business relocation is preferred.
(B)
Local government notification with no response. Local government
must provide written documentation that a letter has been mailed (by registered
mail) to the local government from which the business is relocating, notifying
it of the relocation. The local government, upon receipt of the notification,
then has 30 days to object to the relocation, in writing, to the TDA before
the TCF application can be considered. A written objection to a relocation
from a local government will prevent the application from being considered.
(7)
The TDA will not consider any application for funding which
will result in the provision of assistance for an economic development project
where the applicant and one or more other cities or counties are competing
to provide economic development project funds to that project.
(8)
The TDA will not consider any application for funding in
which the business or principals to be assisted thereunder, or a business
that shares common principals has filed under the Federal Bankruptcy Code,
and the matter is in the process of being adjudicated or in which such business
has been adjudicated bankrupt. On a case by case basis, extenuating circumstances
will be evaluated.
(9)
The TDA may consider applications in the real estate and
infrastructure improvement programs that provide funding to benefit a maximum
of three (3) businesses.
(10)
The TDA will consider a project proposed by a city that
is in the city's corporate limits or its extraterritorial jurisdiction, and
will consider a project proposed by a county that is in the unincorporated
area of the county. Counties may not sponsor an application for a business
located in a city, if that business is currently participating in a TCF project
with that city. TDA may consider providing funding for an economic development
project proposed by a city that is outside the city's corporate limits or
extraterritorial jurisdiction, but within the county or contiguous counties
(not to exceed five (5) miles beyond the city's extra-territorial jurisdiction
that the city is located in and will consider a project proposed by a county
that is within an incorporated city, if the applicant demonstrates that the
project is appropriate to meet its needs, if the applicant has the legal authority
to engage in such a project and if at least fifty-one percent (51%) of the
principal beneficiaries reside within the applicant's jurisdiction.
(11)
A TCF contractor must satisfactorily close out a contract
in support of a specific business, downtown revitalization project, or main
street project in order to be eligible to receive additional funds under the
TCF for the same business, downtown project, or main street city. The contractor
is eligible for an additional TCF award in support of a specific business,
provided that the prerequisite program income choice has been selected, if
the assisted business is not in the designated main street or downtown business
district geographic area and the assisted business will create or retain jobs
to meet the national program objective.
(12)
The TDA will not consider or accept an application for
funding from a community, in support of a business project that is currently
receiving TCF assistance through that same community.
(13)
The minimum and maximum award amount that may be requested/awarded
for a project funded under the TCF infrastructure or real estate development
programs, regardless of whether the application is submitted by a single applicant
or jointly by two or more eligible jurisdictions is addressed here. Award
amounts are directly related to the number of jobs to be created/retained
and the level of matching funds in a project. Projects that will result in
a significantly increased level of jobs created/retained and a significant
increase in the matching capital expenditures may be eligible for a higher
award amount, commonly referred to as jumbo awards. TCF monies are not specifically
reserved for projects that could receive the increased maximum award amount,
however, jumbo awards may not exceed $2 million in total awards during the
program year. Additionally, no more than $1 million in jumbo awards will be
approved in any round. The maximum amount for a jumbo award is $1 million
and the minimum award amount is $750,100. The maximum amount for a normal
award is $750,000 and the minimum award amount is $50,000. These amounts are
the maximum funding levels. The program can fund only the actual, allowable,
and reasonable costs of the proposed project, and may not exceed these amounts.
All projects awarded under the TCF program are subject to final negotiation
between TDA and the applicant regarding the final award amount, but at no
time will the award exceed the amount originally requested in the application.
(14)
TDA will allocate the available funds for the year, less
$600,000 for the main street program, and $600,000 for the downtown revitalization
program, as follows:
(A)
First round. 30% of the annual allocation plus any deobligated
and program income funds available, as of the application due date.
(B)
Second round. 40% of the remaining allocation plus any
deobligated and program income funds available, as of the application due
date.
(C)
Third round. 50% of the remaining allocation plus any deobligated
and program income funds available, as of the application due date. If only
three application rounds are scheduled, all remaining funds will be allocated
to the final round.
(D)
Fourth round. Any remaining allocation plus any deobligated
and program income funds available, as of the application due date.
(E)
The downtown revitalization program projects may not exceed
$600,000 in total awards, unless there are unused funds remaining in the Texas
Capital Fund real estate and infrastructure programs as of January 1st. If
such funds are available, up to an additional $600,000 may be used for downtown
revitalization program projects.
(b)
Overview. This fund is distributed to eligible units of
general local government for eligible activities in the following program
areas:
(1)
The infrastructure program. The infrastructure program
provides funds for eligible activities such as the construction or improvement
of water/wastewater facilities, public roads, natural gas-line main, electric-power
services, and railroad spurs.
(2)
The real estate program. The real estate program provides
funds to purchase, construct, or rehabilitate real estate that is wholly or
partially owned by the community and leased to a specific benefitting business
(either a for-profit entity or a non-profit entity).
(3)
The main street program. The main street improvements program
provides public improvements in support of Texas main street program designated
municipalities.
(4)
The downtown revitalization program. The downtown revitalization
program provides public improvements to a city's historic main business district.
(c)
Application Dates. The TCF (except for the main street
program and the downtown revitalization program) is available up to four times
during the year, on a competitive basis, to eligible applicants statewide.
Applications for the main street program and the downtown revitalization program
are accepted annually. Applications will not be accepted after 5:00 pm on
the final day of submission. The application deadline dates are included in
the program guidelines.
(d)
Repayment Requirements. TCF awards for real estate improvements
and private infrastructure require repayment. Infrastructure payments and
real estate lease payments are intended to be paid by the benefiting business
to the applicant/contractor and constitute program income. The repayment is
structured as follows:
(1)
Real estate improvements. These improvements are intended
to be owned by the applicant and leased to the business. Real estate improvements
require full repayment. At a minimum, the lease agreement with the business
must be for a minimum three year period or until the TCF contract between
the applicant and TDA has been satisfactorily closed (whichever is longer).
A minimum monthly lease payment will be required to be collected from the
original business and any subsequent business which occupies the real estate
funded by the TCF, which equates to the principal funded by the TCF divided
over a maximum 20 year period (240 months), or until the entire principal
has been recaptured. The repayment term is determined by TDA and may not be
for the maximum of 20 years for smaller award amounts. There is no interest
expense associated with an award. Payments begin the first day of the third
month following the construction completion date or acquisition date. Payments
received 15 calendar days or more late will be assessed a late charge/fee
of 5% of the payment amount. After the contract between the applicant and
the Department is satisfactorily closed, the applicant will be responsible
for continuing to collect the minimum lease payments only if a business (any
business) occupies the real estate. The lease agreement may contain a purchase
option, if the option is effective after a minimum five year ownership requirement
and if the purchase price equals (at a minimum) the remaining principal amount
originally funded by the TCF which has not been recaptured.
(2)
Infrastructure improvements.
(A)
Private Infrastructure is infrastructure that will be located
on the business's site or on adjacent and/or contiguous property, to the site,
that is owned by the business, principals, or related entities. All funds
for private infrastructure improvements require full repayment. Terms for
repayment will be interest free, with repayment not to exceed 20 years and
are intended to be repaid by the business through a repayment agreement. Payments
begin the first day of the third month following the construction completion
date. Payments received 15 calendar days or more late will be assessed a late
charge/fee of 5% of the payment amount.
(B)
Public Infrastructure is infrastructure located on public
property or right-of-ways and easements granted by entities unrelated to the
business or its owners and not included or identified as private infrastructure.
All funds for public infrastructure do not require repayment.
(C)
Rail improvements on private property require full repayment.
Terms for repayment will be no interest, with repayment not to exceed 20 years
and are intended to be repaid by the business through a repayment agreement.
Payments begin the first day of the third month following the construction
completion date. Payments received 15 calendar days or more late will be assessed
a late charge/fee of 5% of the payment amount.
(e)
Application process for the infrastructure and real estate
programs. The TDA will only accept applications during the months identified
in the program guidelines. Applications are reviewed after they have been
competitively scored. Staff makes recommendation for award to the TDA Commissioner.
The TDA Commissioner makes the final decision. The application and selection
procedures consist of the following steps:
(1)
Each applicant must submit a complete application to TDA's
Rural Economic Development Division. No changes to the application will be
allowed after the application deadline date, unless they are a result of TDA
staff recommendations. Any change that occurs will only be considered through
the amendment/modification process after the contract is signed.
(2)
Upon receipt of applications, TDA staff reviews scores
for validity and ranks them in descending order.
(3)
TDA staff will review the applications for eligibility
and completeness in descending order based on the scoring. The applicant will
be given 10 business days to rectify all deficiencies. An application containing
an excessive number of deficiencies, or deficiencies of a material nature
will be determined incomplete and returned. In the event staff determines
that an application contains activities that are ineligible for funding, the
application will be restructured or returned to the applicant. An application
resubmitted for future funding cycles will be competing with those applications
submitted for that cycle. No preferential placement will be given an application
previously submitted and not funded.
(4)
TDA staff then conducts a review of each complete application
to make threshold determinations with respect to:
(A)
The financial feasibility of the business to be assisted
based on a credit analysis;
(B)
The strength of commitments from all other public and/or
private investments identified in the application;
(C)
Whether the use of TCF is appropriate to carry out the
project proposed in the application;
(D)
Whether efforts have been made to maximize other financial
resources;
(E)
Whether there is evidence that the permanent jobs created
or retained will primarily benefit low-and-moderate income persons; and
(F)
The ability of the applicant to operate or maintain any
public facility, improvements, or services funded with TCDP funds.
(5)
Upon TDA staff determination that an application supports
a feasible and eligible project, staff normally will schedule a visit to the
applicant jurisdiction to discuss the project and program rules with the chief
elected official (or designee), business representative(s), and to visit the
project site.
(6)
TDA staff prepares a project report with recommendations
(for approval or denial) to TDA's Commissioner.
(7)
The TDA Commissioner reviews the recommendation and announces
the final decision.
(8)
TDA staff works with the recipient to execute the contract
agreement. While the contract award must be based on the information provided
in the application, TDA staff may negotiate some elements of the final contract
agreement with the recipient.
(9)
The contract is drafted and then reviewed by management
and legal prior to two copies being mailed to award recipient. Upon receipt,
the award recipient has 30 days to review and execute both copies. Once returned
to TDA, the contract will be fully executed by the TDA Commissioner and then
a single copy is returned to contractor.
(f)
Scoring criteria for the infrastructure and real estate
programs. There is a minimum 25-point threshold requirement. Applications
will be reviewed for feasibility in descending order based on the scoring
criteria. There are a total of 100 points possible.
(1)
In the event of a tie score and insufficient funds to approve
all applications, the following tie breaker criteria will be used.
(A)
The tying applications are ranked from lowest to highest
based on poverty rate stated on the score sheet. Thus, preference is given
to the applicant with the higher poverty rate.
(B)
If a tie still exists after applying the first criteria
then applications are ranked from lowest to highest based on unemployment
rate stated on the score sheet. Thus, preference is then given to the applicant
with the higher unemployment rate.
(2)
Community Need (maximum 60 points). Measures the economic
distress of the applicant community.
(A)
Unemployment (maximum 10 points). Five points awarded if
the applicant's unemployment rate (for cities, the most recently available
quarterly city rate will be used; for counties, the most recently available
quarterly county or census tract rate, for where the business site is located,
whichever is higher, will be used) is higher than the state rate, indicating
that the community is economically below the state average. Ten points awarded
if the applicant's most recently available quarterly unemployment rate is
1.5% over the state rate.
(B)
Poverty (maximum 15 points). Awarded if the applicant's
most recently available annual county poverty rate, as provided in Appendix
A of the Application, is higher than the annual state rate, indicating that
the community is economically below the state average. Applicants will score
5 points if their rate meets or exceeds the state average; score 10 points
if this figure exceeds the state average by at least 15%; and score 15 points
if this figure exceeds the state average by at least 25%.
(C)
Enterprise/Empowerment/Defense Zone (maximum 5 points).
A project located in a state designated enterprise zone, federal enterprise
community, federal empowerment zone, or defense zone receives these five points.
(D)
Previous Contracts (Maximum 10 points). Award 5 points
if the community has been awarded one contract in the current calendar year
or preceding 2 calendar years. Award 10 points if the community has been awarded
zero contracts in the current calendar year or the preceding 2 calendar years.
(E)
Community Population (maximum 10 points). Points are awarded
to applying cities with populations of 5,050 or less and counties with a total
population of 35,000 or less, using 2000 census data. For cities: score 5
points if the city is located in a county with a population of 35,000 or less;
and score 5 additional points if the population of the city is less than 5,050.
For counties: score 5 points if the county population is less than 35,000
and score 5 additional points if the county population is less than 15,350.
Community population figures are net of the population held in adult or juvenile
correctional institutions, as shown by the 2000 census data.
(F)
Community Income (maximum 10 points). Ten points awarded
to communities that have a low and moderate income level for a 4 person household
that is in the bottom 90% of all county level 4 person low and moderate income
levels, as provided in Appendix D of the application.
(3)
Jobs (maximum 20 points).
(A)
Job Impact (maximum 10 points). Awarded by taking the business'
total job commitment, created and retained, and dividing by applicant's 2000
unadjusted population. This equals the job impact ratio. Score 5 points if
this figure exceeds the median job impact ratio for prior years; and score
10 points if this figure exceeds 200% of the ratio. County applicants should
deduct the 2000 census population amounts for all incorporated cities, except
in the case where the county is sponsoring an application for a business that
is or will be located in an incorporated city. In this case the city's population
would be used, rather than the county's. Community population figures are
net of the population held in adult or juvenile correctional institutions,
as shown in the 2000 census data.
(B)
Cost per Job (maximum 10 points). Awarded by dividing the
amount of TCF monies requested (including administration) by the number of
full-time job equivalents to be created and/or retained. Points are then awarded
in accordance with the following scale:
(i)
Below $15,000--10 points.
(ii)
Below $20,000--5 points.
(4)
Business Emphasis (maximum 20 points).
(A)
Manufacturers (max 10 points). Awarded if the Business'
primary Standard Industrial Classification (SIC) code number starts with 20-39
or if their primary North American Industrial Classification System (NAICS)
code number starts with 31-33. This is based on the SIC number reported on
the Business' Texas Workforce Commission (TWC) Quarterly Contribution Report,
Form C-3 or their IRS business tax return, or other documentation from the
Texas Workforce Commission. Foreign businesses that have not had an SIC/NAICS
code number assigned to them by either the TWC or IRS may submit alternative
documentation to support manufacturing as their primary business activity
to be eligible for these points.
(B)
Small businesses (maximum 5 Points). Awarded if the Business
employs no more than 50 employees for all locations both in and out of state.
This number is determined by the business and any related entities, such as
parent companies, subsidiaries and common ownership. Common ownership is considered
51% or more of the same owners.
(C)
HUB--Historically Underutilized Business (maximum 5 Points).
Awarded if a business is certified by the state Texas Building and Procurement
Commission (TBPC) as a Historically Underutilized Business (HUB). Provide
a copy of TBPC's certification in the application.
(g)
Equity requirement by the business. All businesses are
required to make financial contributions to the proposed project. A cash injection
of a minimum of 2.5% of the total project cost is required. Total equity participation
must be no less than 10% of the total project cost. This equity participation
may be in the form of cash and/or net equity value in fixed assets utilized
within the proposed project. A minimum of a 33% equity injection (of the total
projects costs) in the form of cash and/or net equity value in fixed assets
is required, if the business has been operating for less than three years
and is accessing the R/E program. TDA staff will consider a business to have
been operating for at least three years if:
(1)
The business or principals have been operating for at least
three years with comparable product lines or services;
(2)
The parent company (100% ownership of the business) has
been operating for at least three years with comparable product lines or services;
or
(3)
An individual or partnership (100% ownership of the business)
has been in existence/operation for at least three years with comparable product
lines or services.
(h)
Application process for the main street program. The application
and selection procedures consist of the following steps:
(1)
Each applicant must submit two complete applications to
Texas Historical Commission (THC). No changes to the application are allowed
after the application deadline date, unless they are a result of TDA staff
recommendations. Any change that occurs will only be considered through the
amendment/modification process after the contract is signed.
(2)
Upon receipt of the applications, THC evaluates applications
based on the scoring criteria and ranks them in descending order.
(3)
TDA staff will then review the four highest ranking applications
for eligibility and completeness in descending order based on the scoring.
In the event the staff determines the application contains activities that
are ineligible for funding, the application will be restructured or considered
ineligible. The applicant will be notified of any deficiencies and given 10
business days to rectify all deficiencies. An application containing an excessive
number of deficiencies, or deficiencies of a material nature (e.g., lack of
financial commitments) may be declined. In any event a determination is made
that an application contains activities that are ineligible for funding, the
application will be restructured or declined and the application materials
will be retained by TDA. An application resubmitted for future funding cycles
will be competing with those applications submitted for that cycle. No preferential
placement will be given an application previously submitted and not funded.
(4)
TDA staff then conducts a review of each complete application
to make threshold determinations with respect to:
(A)
The project feasibility;
(B)
The strength of commitments from all other public and/or
private investments identified in the application;
(C)
Whether the use of TCF is appropriate to carry out the
project proposed in the application;
(D)
Whether efforts have been made to maximize other financial
resources; and
(E)
The ability of the applicant to operate or maintain any
public facility, improvements, or services funded with TCF funds.
(5)
Upon TDA staff determination that an application supports
a feasible and eligible project, an on-site visit to the four highest scoring
applicants may be conducted by TDA staff to discuss the project and program
rules with the chief elected official, as applicable, or their designee and
to visit the Main Street area.
(6)
TDA staff prepares a project report and makes a recommendation
for approval or denial to TDA's Commissioner or the Commissioner's designee
for the final decision.
(7)
The Commissioner reviews the recommendation and, if approved,
an award letter is sent to the applicant's chief elected official.
(8)
The contract is drafted and then reviewed by management
and legal prior to two copies being mailed to award recipient. Upon receipt,
award recipient has 30 days to review and execute both copies. Once returned
to TDA, the contract will be fully executed by the Commissioner or the Commissioner's
designee and then a single copy is returned to contractor.
(i)
Scoring criteria for the main street program. There is
a minimum 25-point threshold requirement. Applications will be reviewed for
feasibility and placed in descending order based on the scoring criteria.
There is a total of 100 points possible.
(1)
In the event of a tie score, the following tie breaker
criteria will be used.
(A)
The tying applications are ranked from lowest to highest
based on the applicant's most recently available annual county poverty rate,
as provided in Appendix A of the application. Thus, preference is given to
the applicant with the higher poverty rate.
(B)
If a tie still exists after applying the first criteria,
then applications are ranked from lowest to highest based on the most recently
available, quarterly, city unemployment rate provided by the Texas Workforce
Commission. Thus, preference is then given to the applicant with the higher
unemployment rate.
(2)
Project Feasibility (maximum 70 points). Measures the applicant's
potential for a successful project. Each applicant must submit detailed and
complete support documentation for each category. Compliance with the ten
criteria for Main Street Recognition is required. First year Main Street Cities
must receive prior approval from THC to apply and must submit the Main Street
Criteria for Recognition Survey with the TCF application. The criteria include
the following:
(A)
Broad-based public support for the proposed project--(10
points). Show letters of support from the following:
(i)
one (1) letter from the County Historical Commission (A
letter of support from the County Historical Commission is required to receive
any points in this category.)
(ii)
Score 10 points for letters from 75% or more of the businesses
and/or property owners in the proposed Texas Capital Fund project area.
(B)
Infrastructure Project Plan--(10 points). Show the city's
plan for dealing with an infrastructure project. Develop a plan for access
to local business during the infrastructure project. Provide public notification
to support the project.
(C)
ADA Compliance Goals--(10 points). Does the project address
ADA accessibility issues. How will ADA issues be addressed in the project.
If project does not address ADA compliance issues, is the Main Street District
in compliance with Federal ADA standards. If the project does not address
ADA compliance, no points will be awarded for this category. Partial points
may be awarded depending upon the degree in which the project addresses ADA
compliance issues.
(D)
Historic Preservation Ethic and Preservation Impact--Main
Street's Role--(10 points). Preservation is a major component of the Texas
Historical Commission's Main Street program. Officially designated cities
are eligible for the Texas Capital Fund grant based on their inclusion in
the Texas Main Street program. Points will be awarded if the applicant has
successfully addressed the criteria as follows: if the applicant successfully
addressed the issue of enhancing historic assets and/or historic preservation
goals, up to 5 points may be awarded. If the applicant has demonstrated that
they have a current historic preservation ordinance, up to 3 points may be
awarded based upon the content of the ordinance. Up to 2 points may be awarded
for historic preservation-related programs or incentives. The THC mission
is "To protect and preserve the state's historic and prehistoric resources
for the use, education, enjoyment and economic benefit of present and future
generations." Therefore, in the interest of accomplishing our mission, please
answer the following:
(i)
Describe how the proposed Texas Capital Fund project enhances
your historic assets or historic preservation goals.
(ii)
Does the city have a current historic preservation ordinance?
(iii)
Does the city have any historic preservation related
programs or incentives?
(iv)
List any building demolitions within your Main Street
project area during the past five years. If you had any building demolitions
in the past five years, what was the age of the buildings that were demolished?
(E)
State Enterprise Zone and Economic Development Consideration--(10
points) Four points will be awarded if the city has a nominated or active
Enterprise Zone project. Three points will be awarded if the city has the
economic development sales tax (4A, 4B or both). Three points may be awarded
for other viable economic development programs the city offers in order to
further realize its full economic development potential. Please document any
other economic development programs and strategies that your city is engaged
in.
(F)
Community Size--(10 points). Score 5 points if the population
of the city is 12,000 or less; score additional 5 points if the population
is less than 4,000, using 2000 census data. City population figures are net
of the population held in adult or juvenile correctional institutions, as
shown by the 2000 census data.
(G)
Main Street Program Participation--(5 points). Points are
awarded on the applicant's continuous participation in the Main Street program
as follows: For every two years of continuous participation in the Main Street
program, the applicant will be awarded 1 point. Points will only be awarded
for every two consecutive years and will not be broken into half points for
increments other than two-year increments. If a city leaves the Main Street
program and then returns at a later date, "continuous participation" will
be calculated from the date that they returned to the program. Applicants
will receive the maximum amount of points if they have participated in the
program for 10 continuous years.
(H)
Texas Capital Fund Grant Training--(5 points). Has a city
representative attended a Texas Capital Fund Main Street Improvements grant
training workshop? At least one training workshop is held prior to each application
deadline. List the date attended and the location. If the city is retaining
a paid consultant to prepare the application, a city representative will still
be required to attend training in order to receive the points in the category.
(3)
Applicant (maximum 30 points). There are three applicant
scoring categories each worth 5 to 10 points.
(A)
Minority Hiring (maximum 10 points). Measures applicant's
hiring practices. Percentage of minorities presently employed by the applicant
divided by the percentage of minority residents within the local community.
Score 10 points if the applicant's minority employment rate is equal to or
greater than the applicant's community minority rate.
(B)
Leverage (maximum 10 points). A 10% cash match is required
for the grant. Additional points will be given for additional matching funds.
10% additional match equals 5 points. 20% additional match equals 10 points.
The additional match can be cash and in-kind.
(C)
Main Street Standing (maximum 10 points). If the Main Street
program received National Recognition the prior year, 10 points will be awarded.
(j)
Threshold criteria for the main street program. In order
for its application to be considered, an applicant must meet the requirements
of either paragraph (1) or (2) and paragraph (3) of this subsection.
(1)
The national objective of aiding in the prevention or elimination
of slum or blight on a spot basis. To show how this objective will be met,
the applicant must:
(A)
document that the project qualifies as slum or blighted
on a spot basis under local law; and
(B)
describe the specific condition of blight or physical decay
that is to be treated.
(2)
Area slums/blight objective. Document the boundaries of
the area designated as a slum or blighted, document the conditions which qualified
it under the definition in §255.1(a)(14) of this title (relating to General
Provisions), and the way in which the assisted activity addressed one or more
of the conditions which qualified the area as slum or blighted.
(3)
Main street designation. The applicant must be designated
by the THC as a Main Street City prior to submitting a TCF application for
main street improvements and must remain a participating city for the duration
of the award/contract.
(k)
Application process for the downtown revitalization program.
The TDA will only accept applications during the months identified in the
program guidelines. Applications are reviewed after they have been competitively
scored. Staff makes recommendation for award to TDA Commissioner or the Commissioner's
designee. TDA Commissioner makes the final decision. The application and selection
procedures consist of the following steps:
(1)
Each applicant must submit a complete application to TDA's
Rural Economic Development Division. No changes to the application will be
allowed after the application deadline date, unless they are a result of TDA
staff recommendations. Any change that occurs will only be considered through
the amendment/modification process after the contract is signed.
(2)
Upon receipt of applications, TDA staff reviews scores
for validity and ranks them in descending order.
(3)
TDA staff will review the applications for eligibility
and completeness in descending order based on the scoring. The applicant will
be given 10 business days to rectify all deficiencies. An application containing
an excessive number of deficiencies, or deficiencies of a material nature
will be determined incomplete and returned. In the event staff determines
that an application contains activities that are ineligible for funding, the
application will be restructured or returned to the applicant. An application
resubmitted for future funding cycles will be competing with those applications
submitted for that cycle. No preferential placement will be given an application
previously submitted and not funded.
(4)
TDA staff then conducts a review of each complete application
to make threshold determinations with respect to:
(A)
The strength of commitments from all other public and/or
private investments identified in the application;
(B)
Whether the use of TCF is appropriate to carry out the
project proposed in the application;
(C)
Whether efforts have been made to maximize other financial
resources; and
(D)
The ability of the applicant to operate or maintain any
public facility, improvements, or services funded with TCF funds.
(l)
Scoring criteria for downtown revitalization program. There
are a total of 100 points.
(1)
In the event of a tie score and insufficient funds to approve
all applications, the following tie breaker criteria will be used.
(A)
The tying applications are ranked from lowest to highest
based on applicant's most recently available annual county poverty rate, as
provided in Appendix A of the application. Thus, preference is given to the
applicant with the higher poverty rate.
(B)
If a tie still exists after applying the first criteria
then applications are ranked from lowest to highest based on the most recently
available, quarterly, city unemployment rate provided by the Texas Workforce
Commission. Thus, preference is then given to the applicant with the higher
unemployment rate.
(2)
Maximum 100 points.
(A)
Unemployment (maximum 10 points). Five points awarded if
the applicant's unemployment rate (for cities, the most recently available
quarterly city rate will be used) is higher than the state rate, indicating
that the city is economically below the state average. Ten points awarded
if the applicant's most recently available quarterly unemployment rate is
1.5% over the state rate.
(B)
Poverty (maximum 15 points). Awarded if the applicant's
most recently available annual county poverty rate, as provided in Appendix
A of the Application, is higher than the annual state rate, indicating that
the community is economically below the state average. Applicants will score
5 points if their rate meets or exceeds the state average; score 10 points
if this figure exceeds the state average by at least 15%; and score 15 points
if this figure exceeds the state average by at least 25%.
(C)
Enterprise/Empowerment/Defense Zone (maximum 5 points).
A project located in a state designated enterprise zone, federal enterprise
community, federal empowerment zone, or defense zone receives these five points.
(D)
Previous Contracts (Maximum 10 points). Award 5 points
if the community has been awarded one contract in the current calendar year
or preceding 2 calendar years. Award 10 points if the community has been awarded
zero contracts in the current calendar year or the preceding 2 calendar years.
(E)
Community Population (maximum 10 points). Points are awarded
to applying cities with populations of 5,050 or less, using 2000 census data.
Score 5 points if the city is located in a county with a population of 35,000
or less; and score 5 additional points if the population of the city is less
than 5,050. Community population figures are net of the population held in
adult or juvenile correctional institutions, as shown by the 2000 census data.
(F)
Community Income (maximum 10 points). Ten points awarded
to communities that have a low and moderate income level for a 4 person household
that is in the bottom 90% of all county level 4 person low and moderate income
levels, as provided in Appendix D of the application.
(G)
Leverage (maximum 10 points). A 10% cash match is required
for the grant. Additional points will be given for additional matching funds.
10% additional match equals 5 points. 20% additional match equals 10 points.
The additional match can be cash and in-kind.
(H)
Minority Hiring (maximum 10 points). Measures applicant's
hiring practices. Award 5 points if the city's minority employment rate is
equal to or greater than the community minority percentages rate. Award 10
points if the city's minority employment rate is equal to or greater than
125% of the community minority percentage rate or in cities where the minority
population is 80% or greater, the applicant must employ 95% minorities.
(I)
Commercial Support (maximum 10 points) Award 5 points for
letters from 50% or more of the businesses in the Downtown Revitalization
area. Award 10 points for letters from 75% of the businesses in the Downtown
Revitalization area.
(J)
Sidewalks and ADA Compliance (10 points). Points awarded
if a minimum of 70% of the requested funds will be used for sidewalk and/or
ADA compliance activities.
(m)
Threshold criteria for the downtown revitalization program.
In order for its application to be considered, an applicant must meet the
requirements of either paragraph (1) or (2) of this subsection.
(1)
The national objective of aiding in the prevention or elimination
of Slum or Blight on a spot basis. To show how this objective will be met,
the applicant must:
(A)
document that the project qualifies as slum or blighted
on a spot basis under local law; and
(B)
describe the specific condition of blight or physical decay
that is to be treated.
(2)
Area slums/blight objective. Document the boundaries of
the area designated as a slum or blighted, document the conditions which qualified
it under the definition in §255.1(a)(14) of this title (relating to General
Provisions), and the way in which the assisted activity addressed one or more
of the conditions which qualified the area as slum or blighted.
This agency hereby certifies that the adoption has been
reviewed by legal counsel and found to be a valid exercise of the agency's
legal authority.
Filed with the Office of
the Secretary of State on June 6, 2005.
TRD-200502294
Charles S. Stone
Executive Director
Office of Rural Community Affairs
Effective date: June 26, 2005
Proposal publication date: April 1, 2005
For further information, please call: (512) 936-6710