Sec. 7. Community challenge grant program

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In this section— the terms consortium of units of general local governments , eligible entity , and eligible partner have the meanings given those terms in section 6; and the term grant program means the community challenge grant program established under subsection (b). The Director shall establish a community challenge grant program to make grants to eligible entities to— promote integrated planning and investments across policy and governmental jurisdictions; and implement projects identified in a comprehensive regional plan.

The Director shall ensure geographic diversity among and adequate representation from eligible entities in each of the categories described in section 6(c)(1). Except as otherwise provided in this section, a grant under the grant program shall be made on the same terms and conditions as a grant under section 6. An eligible entity that receives a grant under the grant program shall expend any funds received under the grant program not later than 5 years after the date on which the grant agreement under subsection

(g)is made. An eligible entity that desires a grant under the grant program shall submit to the Director an application, at such time and in such manner as the Director shall prescribe, that contains— a copy of the comprehensive regional plan, whether developed as part of the comprehensive planning grant program under section 6 or developed independently; a description of the project or projects proposed to be carried out using a grant under the grant program; a description of any preliminary actions that have been or must be taken at the local or regional level to implement the project or projects described under subparagraph (B), including the revision of land use or zoning policies; a signed copy of a memorandum of understanding among local jurisdictions, including, as appropriate, a State, units of general purpose local government, units of special purpose local government, metropolitan planning organizations, rural planning organizations, and regional councils that demonstrates— the creation of a consortium of units of general local government; and a commitment to implement the activities described in the comprehensive regional plan; a certification that the eligible entity has solicited public comment on the contents of the project or projects described in subparagraph

(B)that includes— a certification that the eligible entity made information about the project or projects available and afforded citizens, public agencies, and other interested parties a reasonable opportunity to examine the content of the project or projects and to submit comments; a description of the process for receiving public comment, and a description of the outreach efforts to affected populations and stakeholders; and a certification that the eligible entity— held a public hearing to obtain the views of citizens, public agencies, and other interested parties; made the proposed project or projects and all information relevant to the hearing available for inspection by the public during normal business hours not less than 30 days before the hearing under subclause (I); and published a notice informing the public of the hearing under subclause

(I)and the availability of the information described in subclause (II); a budget for the project or projects that includes the Federal share of the cost of the project or projects requested and a description of the source of the non-Federal share; and such additional information as the Director may require. An eligible entity that is an Indian tribe is not required to submit a memorandum of understanding under paragraph (1)(D). In evaluating an application for a grant under the grant program, the Director shall consider the extent to which the application— demonstrates that the applicant has or will have the legal, financial, and technical capacity to carry out the project; demonstrates the extent to which the eligible entity has developed partnerships throughout an entire region, including partnerships with units of special purpose local government and transportation providers; demonstrates clear and meaningful interjurisdictional cooperation and coordination of housing (including healthy housing), transportation, and environmental policies and plans; demonstrates a commitment to implementing a comprehensive regional plan and documents action taken or planned to implement the plan; minimizes the Federal share necessary to carry out the project and leverages a significant amount of State, local, or private resources; identifies original and innovative ideas to overcoming regional problems, including local land use and zoning (or other code) obstacles to carrying out the comprehensive regional plan; promotes diversity among the geographic regions and the size of the population of the communities served by recipients of grants under the grant program; demonstrates a commitment to substantial public input throughout the implementation process; demonstrates that a Federal grant is necessary to accomplish the project or projects proposed to be carried out; and demonstrates such other qualities as the Director may determine. An eligible entity that receives a grant under the grant program may use not more than 10 percent of the grant for planning activities. Activities related to the updating, reform, or development of a local code, plan, or ordinance to implement projects contained in a comprehensive regional plan shall not be considered planning activities for the purposes of a grant under the grant program. An eligible entity that receives a grant under the grant program shall carry out 1 or more projects that are designed to achieve the goals identified in a comprehensive regional plan. Each eligible entity that receives a grant under the grant program shall agree to establish, in coordination with the Director, performance measures, reporting requirements, and any other requirements that the Director determines are necessary, that the eligible entity shall meet at the end of each year in which the eligible entity receives funds under the grant program. If the Director determines that an eligible entity has not met the performance measures established under subsection (g), is not making reasonable progress toward meeting such measures, or is otherwise in violation of the grant agreement, the Director may— withhold financial assistance until the requirements under the grant agreement are met; or terminate the grant agreement. Not later than 90 days after the date on which the grant agreement under subsection

(g)expires, an eligible entity that receives a grant under the grant program shall submit a final report on the project to the Secretary. The report shall include— a detailed explanation of the activities undertaken using the grant, including an explanation of the completed project and how it achieves specific transit-oriented, transportation, housing, or sustainable community goals within the region; a discussion of any obstacles encountered in the planning and implementation process and how the eligible entity overcame the obstacles; an evaluation of the success of the project using the performance measures established under subsection (g), including an evaluation of the planning and implementation process and how the project contributes to carrying out the comprehensive regional plan; and any other information the Director may require. The Director may require an eligible entity to submit an interim report before the date on which the project for which the grant is awarded is completed. There are authorized to be appropriated to the Secretary for the award of grants under this section, to remain available until expended— $30,000,000 for each of fiscal years 2015 and 2016; $35,000,000 for fiscal year 2017; $40,000,000 for fiscal year 2018; and $45,000,000 for fiscal year 2019.