The Office of Management and Budget (OMB) has approved a HUD request to allow NSP2 grantees to keep lines of credit open after September 30, 2013.
The American Recovery and Reinvestment Act of 2009 (Recovery Act) appropriated funds for NSP2. OMB policies required all Recovery Act funds to be expended prior to September 30, 2013. Treasury rules require that program income must be spent before funds are drawn from the line of credit. Most NSP2 grantees have earned program income and therefore risked having grant funds left in their lines of credit and potentially subject to recapture.
HUD requested a waiver of this policy; OMB recently approved it. NSP2 grantees may use original grant (line of credit) funds or program income to complete their NSP2 programs beyond Sept. 30. NSP1 and NSP3 grants are not affected by this requirement; these grants have no expiration date. HUD does, however, expect all NSP grantees to make diligent and conscientious progress towards completing their NSP programs, drawing down funds in the lines of credit, and closing out their grants.