BEP Guidelines Released 080325.pdf

INTERIM GUIDELINES – ISSUED 8/3/25

SUBJECT TO CHANGE AND UPDATES

State Land Bank Authority

Blight Elimination Program

Interim Guidelines

FY2023 – 2026

Issue Date: August 3, 2025

Subject to change and updates as needed.

Synopsis

The State Land Bank Authority (SLBA) received two appropriations for addressing blight conditions statewide in fiscal year 2023 through the end of calendar year 2026. The first source of funds is State general fund dollars and totaled $21.55M. The second source of funds is federal Fiscal Recovery Funds (FRF) dollars and totaling $75M.

The SLBA staff developed parameters for awarding grant funds relative to their enabling legislation and source of funds in an ongoing focus to eliminate blight statewide while returning property to productive use.

Table of Contents Program Overview

Enabling Legislation

Definitions:

Eligibility Requirements

Eligible Applicants and Award Parameters

Timeline

Eligible Activities

Demolition activities

Stabilization activities

Rehabilitation activities

Match or gap funding for environmental remediation

Project administration

Determination of Property Eligibility

Acquisition Price

Uniform Relocation Act

Lien Requirements

Sale Proceeds

Income from Rent or Lease of Property (Rounds 3 and 4 only)

Subawards

Procurement Requirements

• Micro-purchases

• Small Purchases

• Formal Procurement methods

Insurance Requirements

Davis-Bacon Act/Prevailing Wage Requirement

Elliott Larsen Civil Rights Act

Grantee Risk Assessment

Disbursement of Grant Funds

Reporting Requirements

Personally Identifiable Information Protections

Monitoring

Audit Requirements

Records Retention

CAPGEMS

Grant Close Out Procedure

Appendix 1 - Administration Expenditure Self Certification Sample Form

Appendix 2: Davis Bacon/Prevailing Wage Form

Appendix 3: Quarterly Reporting Tool

Appendix 4: Annual Reporting Tool

Program Overview The Blight Elimination Program (Program) is a state and federally funded initiative conducted in 4 rounds of awards between October 2022 and December 2026. The Program will invest in disproportionately impacted communities around the state which will attract more investment at the neighborhood level leading directly to the Department of Labor and Economic Opportunity’s (LEO) goal of Building Strong Communities and, eventually, to increasing labor force and household income growth. Specific eligible activities are demolition or stabilization of public or privately-owned structures as well as environmental remediation or rehabilitation of publicly owned structures. Rehabilitation as an eligible activity only applies to the federal funds (Rounds 3 and 4).

Enabling Legislation Round 1 & 2 Round 3 & 4 State Appropriation PA 166 of 2022, Section

1094f. (2) through (6) PA 1 of 2023, Section 301

Source of funds State dollars Federal dollars Related Regulations 31 CFR Part 35

Final Rule-Coronavirus State and Local Fiscal Recovery Funds (SLFRF), as amended

2 CFR Part 200 Uniform Guidance

**Note: the term ‘grantee’ will be used throughout these guidelines, although Round 3 and 4 recipients are in fact a ‘subrecipient’ as defined in SLFRF.

Definitions:

“Blight” is defined as one of the following:

1. The property has been declared a public nuisance in accordance with a local housing, building, plumbing, fire, or other related code or ordinance; OR

2. The property has had utilities, plumbing, heating, or sewerage disconnected, destroyed, removed, or rendered ineffective for a period of 1 year or more, rendering the property unfit for its intended use; OR

3. The property is tax-reverted and owned by this state, a county, or a municipality.

"Eligible Properties" is defined as one of the following:

1. Any property owned or under the control of a land bank fast track authority under the land bank fast track act, 2003 PA 258, MCL 124.751 to 124.774; OR

2. Any vacant residential, commercial, or industrial property that is blighted.

"Rural County" means a county with a population of 50,000 or less, according to the most recent decennial census.

"State Land Bank Municipal Partnership" or “SLBMP” means a partnership between the state land bank authority and a municipality that includes a land banking agreement for the given municipality where the state manages a portfolio of parcels for that municipality.

Eligibility Requirements For Rounds 1 and 2 of the Blight Elimination Program (state general funds), the State of Michigan legislature earmarked a total of $21.55M for competitive blight elimination grants. The same legislation provided a guarantee for local land banks, as well as Rural Counties, to receive a minimum allocation of $200,000 each. Additionally, 5% was required to be distributed to each of the ten (10) Prosperity Regions as identified by the Michigan Economic Development Corporation

(MEDC).

For Rounds 3 and 4 of the Blight Elimination Program (federal funds), the State of Michigan legislature earmarked $2.5M to each of the 10 land banks and/or SLBMP with the largest inventory numbers and $500,000 to each of the remaining county land banks (Round 3).

Additionally, up to $30,500,000 is available for a statewide competitive grant program open to all land banks, as well as municipalities or counties not served by a county land banks (Round 4).

Specific eligible activities are demolition or stabilization of public or privately-owned structures as well as environmental remediation or rehabilitation of publicly owned structures.

Rehabilitation as an eligible activity only applies to the federal funds (Rounds 3 and 4). All funds in Rounds 3 and 4 must be expended by September 30, 2026, by the grantees. This allows adequate time for SLBA to prepare its final reports. Grantees may receive up to 8% of the total activity cost of each project for their administration expenses directly related to the eligible grant activities.

In Rounds 3 and 4, there are three tracks of eligibility to ensure investment is made to disproportionately impacted areas or individuals:

a) Enumerated: Eliminate blight county-wide in the 67 counties where the median household income is less than the 3 person 300% FPG. The data points are from 2021, as that is the latest year for which income data is available from the Census. This can be through demolition, stabilization, environmental remediation, or rehabilitation; the removal of blight fulfills the obligation requirements.

Those counties are:

Alcona, Alger, Alpena, Antrim, Arenac, Baraga, Bay, Berrien, Branch, Calhoun, Cass, Charlevoix, Cheboygan, Chippewa, Clare, Crawford, Delta, Dickinson, Emmet, Genesee, Gladwin, Gogebic, Gratiot, Hillsdale, Houghton, Huron, Ingham, Ionia, Iosco, Iron, Isabella, Jackson, Kalamazoo, Kalkaska, Keweenaw, Lake, Lenawee, Luce, Mackinac, Manistee, Marquette, Mason, Mecosta, Menominee, Missaukee, Montcalm, Montmorency, Muskegon, Newaygo, Oceana, Ogema, Ontonagon, Osceola, Oscoda, Otsego, Presque Isle, Roscommon, Saginaw, Sanilac, Schoolcraft, Shiawassee, St. Clair, St. Joseph, Tuscola, Van Buren, Wayne and Wexford.

b) Enumerated: Eliminate blight in Qualified Census Tract (QCT) areas in the 16 counties where the median household income in greater than the 3 person 300% FPG. This can be through demolition, stabilization, environmental remediation, or rehabilitation. Four of the 16 counties do not contain any QCTs, Barry, Benzie, Leelanau, and Livingston, and must only utilize the eligibility requirements in c) below.

Those 16 counties are:

Allegan, Barry, Benzie, Clinton, Eaton, Grand Traverse, Kent, Lapeer, Leelanau, Livingston, Macomb, Midland, Monroe, Oakland, Ottawa and Washtenaw.

c) Designating Other Impacted Classes through Expanded Presumptive Eligibility (SLFRF permits funds to be used, among other uses, to combat the public health and negative economic impacts (PH-NEI) of the pandemic.): Eliminate blight in non-QCT areas of counties in the 16 counties where the median household income in greater than the 3 person 300% FPG. This can be through renovation of a house that is then sold to a low-to-moderate (LMI) household at 80% AMI or less OR rented to a LMI household at 65% AMI or less – both must have an affordability period of 20 years maintained through a legal instrument. So long as that occurs, the entire amount (acquisition/renovation) will be counted toward the obligation deadline regardless of sales proceeds created when selling the house to a LMI household.

Eligible Applicants and Award Parameters Round # Eligible Applicants Award Parameters

1 *County and City Land Banks *Local units of government when there is no local land bank

*5% of program funds are allocated to each Prosperity Region *$200,000 guaranteed to county or city land banks for eligible activities *$200,000 guaranteed to rural counties, as defined

2 *County and City Land Banks *County or local units of government not served by a county land bank

3 *County and City Land Banks and

SLBMP

*10 largest land banks or SLBMP will receive a grant of up to $2.5M for eligible activities *Remaining land banks will receive a grant of up to $500,000 for eligible activities *Activities must be designed to address a documented economic harm to a beneficiary or class of beneficiaries resulting from or exacerbated by the COVID-19 public health emergency and must be reasonably proportional to the extent and type of harm experienced

4 *County and City Land Banks *County or local units of government not served by a county land bank

*$30,500,000 competitive grant program for eligible activities *Activities must be designed to address a documented economic harm to a beneficiary or class of beneficiaries resulting from or exacerbated by the COVID-19 public health emergency and must be reasonably proportional to the extend and type of harm experienced

Applicants for grant funds must be in good standing with the State of Michigan and the SLBA.

This includes, but is not limited to:

• Land Banks must be in compliance with their Intergovernmental Agreement with the SLBA.

This includes regular meetings as defined in their bylaws and the annual filing of a report with the SLBA.

• Local units of Government (LUG) must not be in arrears on payments of the Eligible Tax Reverted Property Specific Tax on properties sold in their jurisdiction by the SLBA.

Timeline

Eligible Activities Round # Eligible Activities 1 *Demolition of vacant residential, commercial, or industrial property that is Blighted, Eligible Property *Stabilization of vacant residential, commercial, or industrial property that is Blighted, Eligible Property and identified for future rehabilitation *Gap funding for Environmental Remediation need to comply with EGLE and limited site preparation costs on publicly owned residential, commercial, or industrial Blighted, Eligible Property *Project Administration fee capped at 8% of grant award

3 *Demolition of vacant residential, commercial, or industrial property that is Blighted, Eligible Property *Stabilization of vacant residential, commercial, or industrial property that is Blighted, Eligible Property and identified for future rehabilitation *Gap funding for Environmental Remediation need to comply with EGLE and limited site preparation costs on publicly owned residential, commercial, or industrial Blighted, Eligible Property. ~~NOTE: ARP funds cannot be used as match to other federal funds.~~ *Rehabilitation of vacant residential, commercial, or industrial publicly owned structure that is Blighted, Eligible Property *Project Administration fee capped at 8% of grant award *Must occur within the geographic limits defined by 35 CFR Part 35 or income eligible limits for rehabilitation outside a QTC *Response/activity must be in line with the impact to those presumed to be ‘impacted’ or ‘disproportionately impacted’

Demolition activities include costs directly related to demolition of a structure, including, but are not necessarily limited to: title work related to acquisition; due care plans; acquisition;

disconnect fees; permit fees; asbestos and hazardous materials survey; abatement of hazardous materials; abatement clearance air monitoring and/or visual inspection; the replacement of damaged sidewalks or re-curbing at the street; and/or restoration of the site including topsoil, seeding and mulching.

Stabilization activities may include but are not limited to: title work related to acquisition;

acquisition (Rounds 3 and 4 only); debris removal that stabilizes the property; exterior security materials to deter trespassing and vandalism; and interior and exterior repairs needed to protect against further deterioration and meet local exterior property maintenance requirements. Any activity undertaken must contribute to the structures continued integrity. Activities may not include items typically associated with rehabilitation of a structure not contributing to the continued integrity of the structure.

Rehabilitation activities (Rounds 3 and 4 only) include costs directly related to rehabilitation of a structure, including, but are not necessarily limited to: title work related to acquisition;

acquisition; appraisal for completed purchases; title work; closing fees; due care plans; permit fees; utility expenses and site maintenance from acquisition to sale; property insurance; lead paint, asbestos and hazardous material surveys; abatement of asbestos containing materials, hazardous materials and lead paint; abatement clearance air monitoring and/or visual inspection;

repairs to structure including, but not limited to, roofs, siding, drywall, kitchen and bath updates, floor covering, painting, structural repairs, electrical, plumbing, heating, the replacement of damaged sidewalks, well and septic upgrades/replacement/closure as required by local codes;

and/or reasonable landscaping of the site. The scope of the rehabilitation must be reasonable. To determine that, a proforma must be completed for each address. The property MUST be 100% publicly owned.

Rehabilitation expenses must be reasonable with the goal of eliminating blight by returning the property to habitable standards.

Match or gap funding for environmental remediation provides partial funding on remediation projects that need to comply with the Michigan Department of Environment, Great Lakes and Energy (EGLE) standards. Included in that remediation effort may be limited site preparation costs to remove other predevelopment hurdles. The property MUST be 100% publicly owned.

Projects using only BEP funds are not eligible. The preparation of Phase I, II and/or BEA as the only activity is not an eligible project.

Projects that utilize funding under ARP may not use the dollars to match other federal funds.

Project administration of up to 8% of the grant award is allowed. In Rounds 3 and 4, grantees should be prepared to justify with accurate, detailed records that the expenses are directly related to eligible activities on approved projects. Grantees may utilize the sample Self-certification of Administrative Expense form in Appendix 1 or similar to document employee time. Other types of documentation may include, but not be limited to: payments to third party administrators of the grant funds; electronic payroll detail; travel expenses; etc.

Determination of Property Eligibility Rounds 1, 2 and 4 projects will be solicited through a Request for Proposals (RFP) process. In that process, property eligibility will be determined according to the legislative definitions (see page 3) with supporting documentation, as well as any other criteria required by the source of the funds.

Round 3 grantees will have an initial grant agreement issued and each project must be reviewed against the following required criteria before the grantee may expend any grant funds. Failure to have written preapproval of the project from the SLBA will result in the project not being reimbursed.

*Proof of Blight

*Eligibility of the proposed activity undertaken

*Budget of the proposed activity

*Site Control/ownership

*Eligible disproportionately impacted area or class

Acquisition Price Acquisition reimbursement amounts can be no more than fair market value (FMV) as determined by a third-party appraisal, two (2) times State Equalized Value (SEV), or the auction price of the property if grantee participates in the auction. It is acceptable for other non-ARP funds to be used to fund acquisition costs above the allowable reimbursement amount set forth here.

Uniform Relocation Act In cases where grantees are acquiring property from a private owner for a project in Rounds 3 and/or 4 through donation or purchase, the grantee must be mindful of the provisions of the Uniform Relocation Assistance and Real Property Acquisition Act of 1970 (42 USC 4601), as amended. It is recommended that a document be executed during the closing process that indicates the seller is selling the property voluntarily, as well as delivery of the document titled “When a Public Agency Acquires Your Property”. This document can be found at:

https://www.hud.gov/sites/dfiles/CPD/documents/BROCHURE-acq-2-05.pdf.

Indiana Office of Community and Rural Affairs has some sample documents here:

https://www.in.gov/ocra/cdbg/cdbg-handbook-and-forms/. Scroll down to “Acquisition and Relocation” Forms 7-10 to see examples.

Lien Requirements In Rounds 1 and 2, all privately owned properties will be required to have a lien placed on the title of the property for a period of 7 years. Owners must sign a Note and Notice of Lien prior to the commencement of the approved eligible activity. This will mitigate the risk of private individuals or companies from being unduly enriched through the grant program. The lien will be for the amount of the activity performed on the property and will be in favor of the State Land Bank Authority.

https://www.hud.gov/sites/dfiles/CPD/documents/BROCHURE-acq-2-05.pdf https://www.in.gov/ocra/cdbg/cdbg-handbook-and-forms/

In cases where local units of government have obtained a court order allowing demolition to occur and a lien (tax or administrative) placed on the property in the name of the LUG, this type of lien will supersede the requirement that the lien be in favor of the SLBA.

Round 1 and 2 waiver guidelines for liens on the title of a property will be announced at a future date.

In Rounds 3 and 4, the lien requirements will be as follows:

• All privately owned properties will be required to have a lien placed on the title of the property for a period of 7 years. Owners must sign a Note and Notice of Lien prior to the commencement of the approved eligible activity.

• In cases where local units of government have obtained a court order allowing demolition to occur and a lien (tax or administrative) placed on the property in the name of the LUG, this type of lien will supersede the requirement that the lien be in the name of the SLBA.

Funds collected from this local lien would need to be repaid to the SLBA under the terms of Sale Proceeds outlined below.

• No waivers of the liens can be granted for properties funded under Rounds 3 and 4.

• If rehabilitation is the eligible activity and the eligibility criteria is based on up to 80% AMI, an affordability period of 20 years must be maintained on the property through a legal instrument.

Sale Proceeds For properties funded under Rounds 3 and 4 and subsequently sold, there is no ‘program income’ which is commonly defined as funds that can be reused by the grantee for similar, eligible activities. Rather, all sale proceeds in excess of what the grantee has invested in the project from other sources (on a ratio basis) must be returned to the SLBA provided they exceed the de minimis level of $5,000. A sale worksheet and instructions for approval of the disposition of a property is available in CAPGEMS Get Help for calculation of sale proceed disbursement.

Return of sale proceeds does decrease your obligated amount of grant funds and allows you to re-obligate those dollars on a new activity/project; provided the deadline to do so has not passed.

All sale worksheets must be reviewed by the SLBA prior to any sale on or before December 31, 2031.

Further guidance on sales can be found in the document titled “Guidelines for the Sale/Disposition of Round 3 and 4 Funded Properties” or review the “Instructions for Sale/Disposition of Property” memo issued July 22, 2025.

Income from Rent or Lease of Property (Rounds 3 and 4 only) Should a grantee retain ownership of a property and engage in the rent or lease of any portion of that property, this does create a probable ‘program income’ situation. However, current guidance provided by U.S. Treasury is limited in addressing how it relates to the Blight Elimination Program.

Interpretation of the requirements would default to Uniform Guidance rules.

Under 2 CFR § 200.307, program income earned under a federal award must be used for allowable costs in accordance with the terms and conditions of the award. Specifically:

“Program income includes but is not limited to income from fees for services performed, the use or rental of real or personal property acquired under federal awards, the sale of commodities or items fabricated under a federal award, license fees and royalties on patents and copyrights, and interest on loans made with federal award funds.”

“To the extent that the federal awarding agency does not specify otherwise, program income must be deducted from total allowable costs to determine the net allowable costs.”

However, the U.S. Treasury has not issued specific guidance on the treatment or reporting of program income generated after the SLFRF performance period ends on December 31, 2026.

Recommendation:

In light of the above, and until further federal guidance is issued, SLBA recommends consideration of the following:

1. Establish a Capital Reserve Fund: Retain all program income generated by the Round3/4 Blight Elimination Program project in a dedicated capital reserve fund through December 31, 2031. These funds cannot be co-mingled with funds from any other source.

2. Allowable Use of Funds: Restrict the use of these funds to allowable activities under SLFRF, such as the maintenance and operation of the property that generated the income.

The grantee should recognize that payment of funds into this Capital Reserve fund should not be considered by the grantee as an expenditure but instead as a method of accounting for rents collected and expenditures that are goods received, or services rendered.

3. Recordkeeping: Maintain detailed records of all program income and expenditures from this fund in accordance with SLFRF Guidance which requires retention of records for five years after the end of the performance period.

4. Federal Reporting: Continue to monitor Treasury updates and consult with the Stimulus PMO team regarding whether this income must be included in additional close-out reporting requirements.

This approach provides a conservative and compliant path forward that protects both the recipient agency and grantees from potential future audit findings or recoupment actions.

Subawards In Rounds 1 and 2, grantees are able to make subawards to local municipalities with written consent of the SLBA. Grantees, in general, will be encouraged to avoid subawards to individuals or other non-governmental entities as the public transparency is lost. In all subawards, procurement measures outlined in these Guidelines must be followed. The grantee retains the responsibility of monitoring and ensuring compliance with all Program requirements. All subawards must be pre-approved in writing by the SLBA, as well as the subaward documents.

The SLBA does not assume responsibility for the contractual relationship between the Grantee and any LUG they subaward to.

In Rounds 3 and 4, grantees may make subawards to a LUG, but the grantee retains the responsibility of monitoring and ensuring compliance with all federally related regulations. All subawards must be pre-approved in writing by the SLBA, as well as the subaward documents.

The SLBA does not assume responsibility for the contractual relationship between the grantee and any LUG they subaward to. Subawards to private individuals, companies, developers, or non-profit organizations are strictly prohibited.

Procurement Requirements In Rounds 1 and 2, grantees must follow their locally established procurement requirements. If a local land bank does not have written procurement requirements, they must follow their home County’s procurement processes and requirements. If a LUG does not have written procurement procedures, they must procure contractors competitively and in a public-facing manner.

In Rounds 3 and 4, grantees must follow either the procurement standards outlined in the Uniform Guidance 2 CFR 200.320, or a more restrictive procurement standard for their organization. In a nutshell, Uniform Guidance provides for:

• Micro-purchases - The acquisition of supplies or services where the aggregate dollar amount of which does not exceed the micro-purchase threshold which is generally $10,000 (see 48 CFR Part 2, subpart 2.1), may be awarded without soliciting competitive price or rate quotations if the grantee considers the price to be reasonable based on research, experience, purchase history or other information and documents it files accordingly.

• Small Purchases - The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold which is $250,000 (see 48 CFR Part 2, subpart 2.1). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the grantee.

• Formal Procurement methods - When the value of the procurement for property or services under this grant award exceeds the Small Purchases threshold, formal procurement methods are required. Normal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with § 200.319 or paragraph (c) of this section. The following formal methods of procurement are used for procurement of property or services above the simplified acquisition threshold or a value below the simplified acquisition threshold the grantee determines to be appropriate:

o Sealed bids - bids are publicly solicited and a firm fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price.

o Proposals - either a fixed price or cost-reimbursement type contract is awarded.

Proposals are generally used when conditions are not appropriate for the use of sealed bids.

All vendors and contractors must be verified for the following, as appropriate. Grantee must retain a copy of their verifications collected.

• Federal Debarment (all contractors): www.sam.gov

• Licensed in the State of Michigan o Asbestos Inspector - Asbestos Home Page (state.mi.us) o Abatement Worker and/or Supervisor - Asbestos Home Page (state.mi.us) o Abatement Contractors - Asbestos Home Page (state.mi.us) http://www.sam.gov/ https://asbestosprogram.apps.lara.state.mi.us/ https://asbestosprogram.apps.lara.state.mi.us/ https://asbestosprogram.apps.lara.state.mi.us/ o Lead Paint Inspector - https://www.michigan.gov/mileadsafe/lead-services/hire-lead-professional o Lead Paint Worker and/or Supervisor -https://www.michigan.gov/mileadsafe/lead-services/hire-lead-professional o Residential Builder or Maintenance and Alterations Contractor - Accela Citizen Access o Electrical, HVAC or Plumbing - Accela Citizen Access o Well Driller - https://www.michigan.gov/-

/media/Project/Websites/egle/Documents/Programs/DWEHD/Water-Well- Construction/Registered-Water-Well-Contractors- List.pdf?rev=db3747c23b704295a6d16c8470f92802 o Others which may not be listed but require licensure in the State of Michigan or local county registration or licensure.

Insurance Requirements Grantees must require contractors to hold Builder’s Risk insurance on all properties engaged in a rehabilitation activity. Once the property is insurable, grantee must obtain, and provide to SLBA as soon as it is obtained, proof of insurance on the property against fire, theft, vandalism, and acts of nature. This insurance should be of a sufficient amount to ensure replacement should the structure be a total loss. This is required by Uniform Guidance 2 CFR 200.310.

Properties engaged in demolition, stabilization and environmental remediation are assumed to be un-insurable by traditional companies, so the grantee will be considered ‘self-insured’ on these properties. Additional grant funds cannot be used to repair any damages to improvements already funded by the grant.

For all projects, contractors must carry and provide proof of insurance for Automobile, Commercial General Liability and Worker’s Compensation, for the duration of their contract with the grantee.

Davis-Bacon Act/Prevailing Wage Requirement Rounds 1 and 2 are not funded with federal funds and prevailing wage does not apply.

Rounds 3 and 4 are funded with federal funds therefore Davis-Bacon rules apply. Further, since all grant agreements under the SLBA total over $10M, rehabilitation and stabilization must utilize prevailing wage. Demolition may be required to use Davis-Bacon rules – see below.

Under Davis-Bacon, all prime construction contracts in excess of $2,000 awarded by the grantees must include a provision for compliance with the Davis–Bacon Act (40 U.S.C. §§ 3141–3144, and 3146–3148) as supplemented by Department of Labor regulations (29 CFR Part 5, “Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction”).

Further, the August, 2023, revision of the Davis-Bacon Act regulations states:

“…the Department has understood the Davis-Bacon labor standards to cover demolition and removal under certain circumstances. First, demolition and removal activities are covered by Davis-Bacon labor standards when such activities in and of themselves constitute construction, alteration, or repair of a https://www.michigan.gov/mileadsafe/lead-services/hire-lead-professional https://www.michigan.gov/mileadsafe/lead-services/hire-lead-professional https://www.michigan.gov/mileadsafe/lead-services/hire-lead-professional https://aca-prod.accela.com/LARA/GeneralProperty/PropertyLookUp.aspx?isLicensee=Y&TabName=APO https://aca-prod.accela.com/LARA/GeneralProperty/PropertyLookUp.aspx?isLicensee=Y&TabName=APO https://aca-prod.accela.com/LARA/GeneralProperty/PropertyLookUp.aspx?isLicensee=Y&TabName=APO https://www.michigan.gov/-/media/Project/Websites/egle/Documents/Programs/DWEHD/Water-Well-Construction/Registered-Water-Well-Contractors-List.pdf?rev=db3747c23b704295a6d16c8470f92802 https://www.michigan.gov/-/media/Project/Websites/egle/Documents/Programs/DWEHD/Water-Well-Construction/Registered-Water-Well-Contractors-List.pdf?rev=db3747c23b704295a6d16c8470f92802 https://www.michigan.gov/-/media/Project/Websites/egle/Documents/Programs/DWEHD/Water-Well-Construction/Registered-Water-Well-Contractors-List.pdf?rev=db3747c23b704295a6d16c8470f92802 https://www.michigan.gov/-/media/Project/Websites/egle/Documents/Programs/DWEHD/Water-Well-Construction/Registered-Water-Well-Contractors-List.pdf?rev=db3747c23b704295a6d16c8470f92802 public building or work…. Second, the Department has consistently maintained that if future construction that will be subject to the Davis-Bacon labor standards is contemplated at the location where the demolition occurs—either because the demolition is part of a contract for such construction or because such construction is contemplated as part of a future contract, then the demolition of the previously existing structure is considered part of the construction of the subsequent building or work and therefore within the scope of the Davis-Bacon labor standards.”

“the Department proposed to clarify that demolition work is covered under Davis- Bacon in any of three circumstances: (1) Where the demolition and/or removal activities themselves constitute construction, alteration, and/or repair of an existing public building or work; (2) where subsequent construction covered in whole or in part by Davis-Bacon labor standards is planned or contemplated at the site of the demolition or removal, either as part of the same contract or as part of a future contract; or (3) where otherwise required by statute.”

“While a determination of whether demolition is performed in contemplation of a future construction project is a fact-specific question, the proposed rule also included a nonexclusive list of factors that can inform this determination, including the existence of engineering or architectural plans or surveys; the allocation of, or an application for, Federal funds; contract negotiations or bid solicitations; the stated intent of the relevant government officials; the disposition of the site after demolition (e.g., whether it is to be sealed and abandoned or left in a state that is prepared for future construction); and other factors. Based on these guidelines, Davis-Bacon coverage may apply, for example, to the removal and disposal of contaminated soil in preparation for construction of a building, or the demolition of a parking lot to prepare the site for a future public park. In contrast, Davis-Bacon likely would not apply to the demolition of an abandoned, dilapidated, or condemned building to eliminate it as a public hazard, to reduce likelihood of squatters or trespassers, or to make the land more desirable for sale to private parties for purely private construction. (emphasis added)”

This proposed language was accepted in whole as 29 CFR Part 5, §5.2

In accordance with the statute, contractors must be required to pay wages to laborers and mechanics at a rate not less than the prevailing wages specified in a wage determination made by the US Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. The grantee must place a copy of the current prevailing wage determination issued by the US Department of Labor in each solicitation. The decision to award a contract or subcontract must be conditioned upon the acceptance of the wage determination.

Wage determinations include both direct wages and indirect benefits given to the employee. Any difference between the minimum fringe benefit amount per hour detailed in the wage determination and what a contractor pays per hour for fringe benefits must be made up to the worker by adding that difference to their hourly wage.

For contracts where Davis-Bacon applies, grantees are required to collect self-certification documents from their contractor(s) and their subcontractors for every week that contractor(s) spends on eligible activity. Grantee will be required to submit one sample wage and benefits statement with each quarterly report. All documentation must be retained per the Record Retention Schedule noted in these Guidelines.

Effective August 3, 2025, all grantees are advised to use this link to access Federal prevailing wage: https://sam.gov/search/?index=dbra&page=1&pageSize=25&sort=-modifiedDate

Utilize either the Residential or, if it is a commercial project, the Building selection to identify the federal prevailing wage for your project. If it is a Residential project and there are missing classifications, you may use a combination of Residential and Commercial to incorporate the missing classifications. Any missing classifications would also require engaging in a process to request those rates. Please see the Job Aid in CAPGEMS Get Help for detailed instructions.

Grantees should retain copies of the prevailing wages used for each project. Appendix 2 has links to the Prevailing Wage Certification form and instructions.

Elliott Larsen Civil Rights Act All grantees shall not discriminate against any employee or applicant for employment, to be employed in the performance of the grant agreement, with respect to his or her hire, tenure, terms, conditions, or privileges of employment, or any matter directly or indirectly related to employment, because of his or her race, religion, color, national origin, age, sex, height, weight, marital status, or physical or mental disability that is unrelated to the individual’s ability to perform the duties of a particular job or position. This same requirement applies to procured contractors and their subcontractors.

Grantee Risk Assessment In Rounds 1 and 2, respondents to the Request for Proposals have the option to self-identify capacity and experience issues and request the SLBA to assist with the funded activities. The assistance will be provided by SLBA staff at the level indicated by the requesting respondent/grantee.

In Rounds 3 and 4, respondent/grantee will perform a self-assessment using a provided scoring tool designed to identify risks of non-compliance in the potential grantee pool. The SLBA staff will review and score the responses provided by the grantees and may include other variables such as past grant performance.

For Rounds 3 and 4, SLBA will engage the services of a compliance consultant to assist grantees in meeting State and Federal requirements. All grantees whose score indicates they would significantly benefit from additional assistance to fully comply with all grant requirements shall be required to work with a compliance consultant procured and funded by SLBA. The compliance consultant will review grantees grant administration process throughout the funding period including, but not limited to:

• Create standardized reports, forms, checklists, toolkits, and/or templates for SLBA and its grantees’ use.

• Develop documentation standards and guidelines to demonstrate compliance.

https://sam.gov/search/?index=dbra&page=1&pageSize=25&sort=-modifiedDate

• Develop guidance for cost categorization determinations based on programmatic, governmental accounting requirements, and/or Uniform Guidance.

• Maximize federal reimbursement by ensuring SLBA, and its grantees, are able to identify and capture allowable expenditures.

• Provide guidance on best practices for tracking and documenting expenditures.

• Develop financial and programmatic tracking mechanisms.

• Provide programmatic and policy advice on federal programs.

• Develop processes and documentation requirements around grantees’ risk assessment, monitoring and management, including training materials for grantees use on funding and programmatic requirements.

• Review proposed contracts and purchasing documentation for compliance with programmatic rules, Uniform Guidance, and governmental accounting standards.

• Assist with standardizing SLBA program files.

• Streamline the reporting process to ensure continued compliance and implement post-award procedures.

Additionally, grantees awarded funds for demolition in all Rounds are required to attend a training session with experienced SLBA staff on the requirements for a successful demolition. Grantees awarded funds for rehabilitation in Round 3 and/or 4 are required to attend training sessions with experienced SLBA staff on the requirements for a successful rehabilitation project.

Disbursement of Grant Funds All grants will be on a reimbursement basis at the conclusion of the funded activity(ies). Should a grantee have insufficient funds to fully fund a project in its entirety before being reimbursed, grantee may request a milestone-based reimbursement schedule, which shall be developed in conjunction with SLBA’s Grant Manager.

Once all activities/project are completed, the grantee will submit all activity related documents as outlined in their respective grant agreements, as amended, along with their Request for Payment form provided with their grant agreement. Submissions are to be sent to the Grant Manager listed on their grant agreement.

1) Reimbursement package comes in.

2) Grant Manager, or their designee, reviews for completeness.

3) Any missing documentation is requested by the Grant Manager, or their designee.

4) Once all documentation is provided and approved, SLBA will submit to LEO Finance for processing.

5) Funds will be sent via Electronic Funds Transfer (EFT) to the account listed on grantee’s documentation.

Grantees should plan to receive funds 30-45 days from successful submission, although care is taken to process as soon as possible.

Reporting Requirements Rounds 1 and 2 grantees have no ongoing reporting requirements. All required final documentation is to be submitted at the time of final reimbursement.

Rounds 3 and 4 grantees will be required to file quarterly and annual reports. Through CAPGEMS, SLBA will provide a template reporting guide to capture the required data. Failure to provide reports for Rounds 3 and 4 will result in up to a $500 penalty per occurrence. Quarterly report forms are in Appendix 3 and Annual report forms are in Appendix 4 for reference only – the data will be submitted through CAPGEMS.

Quarterly Report Dates:

Year Calendar Quarter

Program Year/Quarter

Period Covered Due Date to SLBA

2023 3 2024 / 1 July 1 – September 30 Reports Waived 2023 4 2024 / 2 October 1 – December 31 Reports Waived 2024 1 2024 / 3 January 1 – March 31 Reports Waived 2024 2 2024 / 4 April 1 – June 30 July 10 2024 3 2025 / 1 July 1 – September 30 October 10 2024 4 2025 / 2 October 1 – December 31 January 10 2025 1 2025 / 3 January 1 – March 31 April 10 2025 2 2025 / 4 April 1 – June 30 July 10 2025 3 2026 / 1 July 1 – September 30 October 10 2025 4 2026 / 2 October 1 – December 31 January 10 2026 1 2026 / 3 January 1 – March 31 April 10 2026 2 2026 / 4 April 1 – June 30 July 10 2026 3 2027 / 1 July 1 – September 30 October 10 2026 4 2027 / 2 October 1 – December 31 January 10

Annual Report Dates:

Report Period Covered Due Date to SLBA 1 July 1, 2023 – June 30, 2024 July 10, 2024 2 July 1, 2024 – June 31, 2025 July 10, 2025 3 July 1, 2025 – June 31, 2026 July 10, 2026 4 April 1, 2023 – December 31, 2026 January 10, 2027

Final Annual Reports will be may be made available sooner than the end of the fourth quarter for grantees filing final reports in earlier quarters. This ends the grantee’s reporting requirement.

However, records must be kept according to the Record Retention Schedule noted in these Guidelines.

Personally Identifiable Information Protections OMB defines “Personally Identifiable Information” (PII) as information that can be used to distinguish or trace an individual’s identity, either alone or when combined with other personal or identifying information that is linked or linkable to a specific individual. “Sensitive Information” is considered any unclassified information whose loss, misuse, or unauthorized access to or modification of could adversely affect the interest or the conduct of federal programs or the privacy to which individuals are entitled under the Privacy Act.

Grantees have a responsibility to protect any and all PII that comes into their possession related to this grant program. All grantees must ensure the privacy of all PII obtained from participants in an eligible blight elimination project and to protect such information from unauthorized disclosure.

Grantees must ensure that PII used during their grant has been obtained in conformity with applicable federal and state laws and policies governing the confidentiality of information. All PII transmitted via e-mail or stored on external drives must be encrypted. All PII stored onsite must be kept safe from unauthorized individuals at all times and must be managed with appropriate information technology (IT) services. Accessing, processing, and storing of PII data on personally owned equipment at off-site locations (e.g. employee’s home, and non-grantee managed IT services, e.g. Yahoo mail, Gmail, etc.) is strictly prohibited. All parties who will have access to sensitive/confidential/proprietary/private data must be advised of the confidential nature of the information, the safeguards with which they must comply to protect the information, and that they may be liable to civil and criminal sanctions for improper disclosure. Access to any PII obtained through the grant must be restricted to only those employees of the grant recipient who need it in their official capacity to perform duties in connection with the scope of work in the grant agreement. All PII data must be processed in a manner that will protect the confidentiality of the records/documents and is designed to prevent unauthorized persons from retrieving such records by computer, remote terminal, or any other means.

Monitoring Grantees will be subject to in-person monitoring as outlined in the Monitoring Plans for Rounds 1 and 2 and for Rounds 3 and 4. The addition of the CAPGEMS online system, is designed to provide SLBA sufficient documentation at time of reimbursement, in general, to determine that the requirements of the funding source have been met. However, to verify that and meet the guidelines of the federal SLFRF program, there will be local monitoring conducted. This will include, but is not limited to, site visits and review of original documentation. Please refer to additional documentation released specific to the BEP Monitoring Plan.

Audit Requirements In general, state, local, and tribal governments and not-for-profit organizations expending at least $750,000 of federal awards in a single fiscal year are required to have a single audit conducted.

All grantees that fall within that threshold will be required to provide copies of their single audits conducted during grant period.

Records Retention Round # Retention Date 1 and 2 Three years after grant agreement end date or final payment, whichever is later 3 and 4 12/31/31

All records, reports and documentation must be retained by all grantees and their vendors. While SLBA has provided CAPGEMS for use in Rounds 3 and 4 where most of the documentation will be uploaded, grantees should not rely on this as meeting their requirement for record retention.

CAPGEMS

For Rounds 3 and 4, the SLBA, in conjunction with our consultant, is providing an online system to provide much of the documentation required for funded projects. The goals of developing this system are:

• To provide long-term storage and access to required eligible activity documentation;

• Assist the grantees in achieving 100% compliance with federal and state requirements;

• Create a tool to enhance the grantee’s quarterly and annual reporting requirements;

• Provide ongoing feedback as project’s progress from beginning to end; and

• Provide a ‘one-stop’ location for future monitoring and reviews by the State of Michigan and/or federal agencies.

Grant Close Out Procedure Round 1 & 2

{To be determined}

Rounds 3 and 4

Once the final reimbursement has been completed, SLBA will schedule a meeting with the Signatory to review any concerns over the process or documentation related to the grant. Upon final review, SLBA will complete the closeout ticket in CAPGEMS which may include a letter of concern or a letter of finding for any deficiencies in the administration of the grant agreement or in execution of the funded activity.

Appendix 1 - Administration Expenditure Self Certification Sample Form

Appendix 2: Davis Bacon/Prevailing Wage Form https://www.dol.gov/sites/dolgov/files/WHD/legacy/files/wh347.pdf

Instructions:

https://www.dol.gov/agencies/whd/forms/wh347 https://www.dol.gov/sites/dolgov/files/WHD/legacy/files/wh347.pdf https://www.dol.gov/agencies/whd/forms/wh347

Appendix 3: Quarterly Reporting Tool This report will be captured through CAPGEMS. Please check for reporting instructions in CAPGEMS.

Grantee Name: SLBA-Issued Grant ID#:

For the period beginning: and ending:

Grantee UEI Number: Grant Amount:

Obligations and Expenditures Current period amount obligated:

$ Current period amount expended:

Cumulative amount obligated: $ Cumulative amount expended: $

Project Status. Report on each funded project’s status each reporting period.

Address/Project Name Census

Tract # Not Started

Completed less than 50%

Completed more than 50%

Completed e.g. 8530 E Colby Rd, Crystal 9706 X

Add additional pages as needed… Sale Proceeds. Report any sale proceeds earned and any expended to cover eligible project costs during this period, if applicable.

Address/Project Name Census

Tract # Date Sold Amount sold for Sale Proceeds e.g. 8530 E Colby Rd, Crystal 9706 2/30/2024 $70,000 $25,000

Subawards. Provide the following information, as applicable, on a separate sheet on any subaward you have made:

• Subrecipient identifying and demographic information (e.g., legal name, UEI number, location)

• Award number (e.g., Award number, Contract number, Loan number)

• Award date, type, amount, and description

• Award payment method (reimbursable or lump sum payment(s))

• For loans, expiration date (date when loan expected to be paid in full)

• Primary place of performance

• Related project name(s)

• Related project identification number(s)

(created by the State)

• Period of performance start date

• Period of performance end date

• Quarterly obligation amount

• Quarterly expenditure amount

• Project(s)

Davis-Bacon/Prevailing Wage Reporting:

Do you certify that all laborers and mechanics employed by contractors and subcontractors in the performance of the project are paid wages at rates not less than those prevailing, as determined by the U.S. Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code (commonly known as the “Davis-Bacon Act”) or the State of Michigan? Yes No

If no, answer the following questions:

• Number of employees of Contractors and Subcontractors working on the project(s):

• Number of employees on the project hired directly:

• Number of employees on the project(s) hired through a third party:

Have you verified that wages and benefits paid to workers on the project(s) are at or above prevailing wage for the worker classifications as determined by US Secretary of Labor or State of Michigan, whichever is higher? Yes No

Do you certify that sufficient records to substantiate labor information will be made…