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The Community Development Block Grant Program (CDBG) is the leading federal program for local-led projects and services. Administered by the U.S. Department of Housing and Urban Development (HUD), CDBG invests in our nation’s communities by supporting activities for low-to-moderate income populations. The program funds public facilities, housing, economic development, and public services among other critical investments.
CDBG reaches every corner of the country from urban cities to rural towns and populations in between. Funding is directed to all states, territories, and congressional districts annually. Most funds are dedicated to large and mid-size localities (70%) while states receive remaining funds (30%) to serve small and rural communities.
The program supports jobs, infrastructure, affordable housing, and services critical to public health and well-being. From 2005 to 2020, CDBG facilitated creation and retention of 454,961 jobs; contributed to infrastructure developments benefitting approximately 538 million persons; assisted over 837 million persons through public service activities; and met housing needs of over 1.6 million households. The program also demonstrates a high return-on-investment for taxpayer dollars. In 2020, every dollar of CDBG invested led to $3.64 from other public and private sources; this totaled $3.41 billion leveraged across 5,700 CDBG projects.
This report serves to inform stakeholders on the importance of CDBG to community advancement and success. The CDBG Coalition consists of 32 national organizations which recognize CDBG’s contributions to people and places, and seek to strengthen the program to promote meaningful local-led activities. The following information showcases how CDBG empowers communities and serves as a key contributor to place-based opportunities.
As the foundation for commerce, social, physical, and environmental activities, infrastructure maintains a prominent role in community well-being. CDBG contributes extensively to public facilities (infrastructure) and overall, these activities receive the highest amount of program investment among eligible categories. In 2021, nearly 36% of total CDBG funds were expended for public facilities. For states, this was nearly doubled as 63% of funds went to infrastructure developments.
Although not a considerable use of CDBG, property acquisition and demolition play an important role in community renewal with localities applying program funds to repurpose land to need public needs. In 2021, communities targeted $177 million to these activities representing about 5% of total CDBG expenditures for the year. Property redevelopment often to activities supporting community growth including housing, community centers, business relocation, and disaster mitigation.
As rural communities face unprecedented challenges, federal resources through programs like CDBG are critical to improving quality of life and connecting places to the 21st century economy. Infrastructure remains key to this progress and CDBG is primarily used to address deficiencies in utilities, transportation, and similar public facilities. Infrastructure investments matter to not only protect people and provide access to common amenities but also attract and retain business.
As economic development remains a priority for rural areas, CDBG is strong resource to promote jobs and business. Smaller communities often struggle to identify capital for projects aligned with competing in the global economy. With local revenue minimal and insufficient to meet infrastructure and human capital demands, other sources need to fill this void. CDBG provides this funding source amenable to rural communities for leveraging private investment. In Rogers County Oklahoma (pop. 87k), a CDBG-funded water line extension will support Sofidel Inola’s new $400 million facility which will bring 256 jobs to the area. A couple of states over, Grambling in Lincoln Parish, Louisiana, used a $329,000 CDBG grant to cover utility and related infrastructure for the community’s first grocery store in 35 years. With Legends Market, Grambling (pop. 3.5k) can provide residents with food in close proximity as well as generate tax revenue previously lost to neighboring towns.
Place-making is also a goal for many rural jurisdictions as local leaders act to reverse population loss and attract people to visit and relocate to their community; CDBG accommodates this strategy and activities therein. In Michigan, Ludington’s Downtown Development Authority secured CDBG investment to transform their downtown square and surrounding area. The James Street Plaza will serve Ludington (pop. 8k) as an open area to host events, shopping, recreational activities, and cultural experiences. Further down Highway 31 is the city of Hart (pop. 2k) which recently acquired CDBG funds for a park development. The Hart Pocket Park was redeveloped from a vacant, unused lot into public space hosting library story hours, yoga, musical performances, and related activities.
One of CDBG’s greatest strengths is its ability to leverage other investments. As a flexible resource designed to accommodate local needs, CDBG often serves to match other sources of public and private funds. Program resources also helps projects and services become reality providing gap funding to meet budget needs.
One great example of CDBG’s leverage capability is Celoron, NY’s Chautauqua Harbor Hotel. The community was awarded $750,000 in NYS CDBG Economic Development funds to assist Chautauqua Harbor Hotel, LLC open a destination hotel on waterfront property. The new 130,000 square foot facility includes 132 guest rooms, 8,000 square feet of event space with pre-function areas and breakout rooms, indoor and outdoor swimming pools, a fitness room, dining and lounge areas, and seasonal outdoor food and beverage facilities. The $26,516,000 project created 86 full time equivalent jobs over two years, with 68 (84%) made available to low-moderate income persons. New York CDBG funding leveraged both state funds (nearly $2m) as well as private investment ($23m).
Additionally, Virginia’s use of CDBG for the Greenhouse Village successfully leveraged other funding sources to create affordable housing in Rockbridge County. The development was completed in two phases creating 20 units of affordable housing for low-to-moderate income households. CDBG funding supported street, water, and sewer connections while other funding including Habitat for Humanity and USDA Rural Development. The Virginia Department of Housing & Community Development contributed $432,828 to the project leveraging over $1.2 million from other public and private sources.
CDBG also promotes local recovery and resiliency following major disaster events. Notably through the CDBG-Disaster Recovery (CDBG-DR) program, federal funds invest in housing, infrastructure, and business assistance needs critical to long-term community rebuilding and mitigation against future disasters. As a flexible resource responsive to community needs, CDBG is a significant and meaningful federal program to support post-disaster activities.
Following major flooding from Tropical Storm Lee, Pine Gove Borough in Pennsylvania used CDBG-DR funds to create a floodplain diverting water from the community and therefore preventing further damage from future flooding. The 2011 flooding impacted 180 residential dwellings, numerous commercial businesses, and the town’s largest employer (Guilford Mills with over 300 employees). The Pine Grove Floodplain Restoration is protecting residents, employees, and property for the small town (pop. 2,186). CDBG contributed $2.5 million to developing the floodplain alongside state funds with a total project cost of $3 million. Additional improvements are being considered further downstream which will also be supported by CDBG-DR and state funds.
As demonstrated in the series of highlighted projects, CDBG enables communities to identify and address priority needs across housing, infrastructure, public services, and economic development. The leading federal investment in community-based initiatives, CDBG is…
FLEXIBLE CDBG supports a wide range of activities integral to social and economic outcomes especially for vulnerable populations.
RESPONSIVE The program’s flexibility allows states and localities to effectively adapt CDBG support activities responsive to individual communities.
SUSTAINABLE Projects advanced through CDBG are sustainable improvements with long-term benefits for low-to-moderate income residents.
COLLABORATIVE Program funds also work in tandem with other public and private sources attracting capital to ensure projects can be completed.
EMPOWERING CDBG invests in comprehensive local action – from planning to project completion and use – allowing communities to effectively take on their specific priorities.