RIDGE VIEW COMMONS - CONSTRUCTION LOAN

v'nct or n¢ mss..... u can sore yo. Nouwe• RD( w , cos.+e co....cs.o•ge- A D De NDUM r 'TO Cdki5I WalOIJ COA772�9� 1" � — i 54904 US DEPARTMENT OF HOUSING AND U. etAN DEVELOPMENT WASHINGTON, D.C. 20410 -0000 i - 5 1925 11EMORAHDUM ' •,11 Hou �•' -' g + (HDG) Program Grantees FROM: Si • 4:? .. r Bartolome , • puty Assistant Secretary for Multifamily Housing Programs, HM SUBJECT: I'G Program Policies: Construction /Drawdown Period The purpose of this memorandum is to clarify Housing Development Grant (HDG) program policy and procedures relating to Grantee accountability and HDG funds drawdown during the period after all conditions precedent to drawdown have been met and prior to project closeout. This period will generally coin- cide with the project construction phase. A separate memorandum detailing cost certification and project closeout procedures will follow at a later date. Basic HDG requirements for the construction /drawdown period are covered by regulation at 24 CFR Part 850 from 850.55 through 850.77; Articles IX, X, and XI and Exhibits A through E of the HDG Grant Agreement, and Handbook 1900.27 Letter of Credit Procedures - Treasury Financial Communication System. The policies and proce ures described here augment the instructions in the documents referenced above. I. Documentation Required for Drawdowns to Pay Construction Costs. All Grantee HDG disbursement requests shall be based on vouchers or invoices submitted by the Owner or its representative and certified by the architect, construction manager or other certifying official acceptable to the Grantee. All contractor submissions of monthly requisitions shall be on AIA Forms 702 and 703 (samples attached as Exhibit 1). Evidence of soft Costs may be in the form of bills for services performed or, to the case of a financial institution's fee, a letter certifying payment due In accordance with a contractual obligation. The documentation described above will enable the Grantee to meet the standards of Section 10.01 of the Grant Agreement. In particular, the following must be satisfied: a) The standards for timing and amount of cash withdrawals established in Treasury Circular 1075 and HUD Handbook 1900.27. The HUD Depart - aentwide standard of three days for maximum time elapsed between receipt and expenditure of funds shall also be applied to sub - recipients (i.e. Owners).