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TIMING of CDBG FUNDING and NEPA RESTRICTIONS Costs incurred prior to the CDBG award letter cannot be reimbursed by CDBG.Eligible costs will be reimbursed by Commerce after a grant contract has been formally executed and the CDBG-specific procedures under NEPA and SEPA are completed.Executing the grant contract and completing the environmental review can occur concurrently. Unless the activity is exempt or categorically excluded and not subject to 24 CFR 58.5 under NEPA,the local governmentgrantee,subrecipients,contractors and all other participants may not commit CDBG or non-CDBG funds if the activity would have an adverse environmental impact or limit the choice of reasonable alternatives.This restriction applies to activities as of the date the CDBG program receives jhe gragl_application.Portions of preliminary design work needed for completion of the environmentalreview are allowable. Title 1 of the Housing and Community DevelopmentAct of 1974 as amended and the environmentalreview procedures found in 24 CFR 58.22 apply to any activities as part ofa CDBG project.The environmentalreview activities completed for other federal or state funding can contribute towards but not entirely meet the CDBG-specificprocedurefor NEPA and SEPA.Section 6 of the COBO Management 11andhook providesfurther detail and the necessary CDBG forms. Project Phase Restrictions on Eligible Activities Before CDBG With the award letter,the grantee can begin to incur costs up to 10%ofcontractisawardforthefollowingactivitieswhichdon't require an enviromnentalexecutedandreviewIFthegrantapplicationrequestedCDBGfundingofthesecosts:environmental review is Administration:Executing the CDBG contract.Establishingcompleteadministrative,financial,reporting,and record keeping systems,including staffing,travel and training. Environmental Review: Review of environmental laws and authorities,including 24 CFR 58.5 and Section 106 of the National Historic Preservation Act of 1996,such as: •Consultationletters to affected tribes •Cultural resource survey •Floodplain/wetlanddetermination Preliminary engineering feasibility studies for the environmental assessment such as surveying and geotechnical or geophysical analysis (excluding ground-disturbingactivity of over one cubic sq.ft.). Subcontracting:Subrecipient agreetnents or professionalservice contracts for any of the above activities. Contract Page 035