Forty years ago, President Gerald Ford signed a law creating one of the hallmark programs of the U.S. Department of Housing and Urban Development, or HUD—the Community Development Block Grant, or CDBG. Each year, CDBG funds are distributed to state and local governments according to their population size, poverty level, and key housing variables to help communities address a wide range of development needs—from housing to social services.
Since the program’s inception, thousands of urban and rural communities have come to rely on this critical resource, with $144 billion invested in these communities over four decades. Last year alone, CDBG grants were awarded to 7,250 local governments, benefitting more than 9.8 million people across the country. This is particularly significant as CDBG dollars are leveraged by other sources: Between fiscal years 2010 and 2012, every dollar of CDBG grants was leveraged by an additional $4 in other public and private investments.
Each CDBG-funded activity must meet at least one of the program’s three national objectives:
- Benefit low- and moderate-income people.
- Aid in the prevention or elimination of slums or blight.
- Address an urgent need that poses a serious threat to the health or welfare of a community for which no other funding is available.
Federal investments in nutrition, health, education, and job training have been critical in mitigating or preventing poverty and hardship for millions of Americans. Likewise, the CDBG program has enabled communities to make complementary investments in affordable housing and infrastructure, and in creating greater economic opportunity.
Housing
One of the most significant uses of CDBG grant dollars has been to preserve the dwindling supply of affordable housing. Between 2004 and 2013, more than 1.3 million low- and moderate-income households were rehabilitated. Last year alone, more than 94,000 households received housing assistance, including activities ranging from assisting elderly residents to energy-efficiency repairs that resulted in more affordable energy bills.
Preserving affordable housing is particularly important to address homelessness. For example, in 2009, in Loudoun County, Virginia, CDBG funds closed a funding gap, allowing the county to upgrade its homeless services by co-locating an emergency shelter, cold weather shelter, single men’s shelter, and transitional housing in one centrally located building. As a result, the county was able to provide more housing and improved case management.
Infrastructure
CDBG funding has also provided critical investments in the public facilities and infrastructure needed to help local economies grow, including sanitary water and sewer systems, safe streets and transit ways, and improved drainage systems. Between 2005 and 2013, CDBG funding supported improvements to public facilities that benefited more than 33.7 million people. For example, in Somerton, Arizona, CDBG funds allocated through the state allowed the city to purchase and install solar panels to provide energy to its water-treatment plant as part of a strategy to reduce energy costs. So far, the city has saved an average of $20,000 per year while also curbing energy use.
Furthermore, CDBG is an important source of funding for recovery and resilience efforts in the face of extreme weather events. In response to disasters, Congress may appropriate additional funding for the program in the form of CDBG Disaster Recovery, or CDBG-DR, grants to rebuild affected areas and start the recovery process. For example, following Superstorm Sandy, HUD launched a design competition using CDBG-DR funds to support innovative ideas for building resilience to extreme weather in communities. One of the winning designs focused on protecting Hunts Point in the Bronx, which is an important hub for the city’s food supply and the accompanying jobs. The plan proposes using a waterfront greenway that creates green space while utilizing natural barriers against flooding. In a recent report, the Center for American Progress recommended that HUD should ensure that CDBG—and supplemental disaster-recovery funds channeled through this program—support climate-resilient projects such as sustainable housing in order to protect low-income communities from extreme weather.
Economic opportunity
CDBG funds have made a difference in the lives of millions of people across the country. Between 2004 and 2013, CDBG economic-development activities—such as technical assistance and training to microenterprises—have helped create or retain more than 421,183 jobs. Last year alone, these activities employed approximately 28,000 workers in new or ongoing jobs. This is illustrated through efforts in Arlington, Texas, where CDBG funds helped create a new workforce-development center in 2004, which serves more than 5,000 employers and job seekers yearly and includes rooms for workshops and seminars.
Conclusion
Over the past 40 years, CDBG has been a critical resource for communities nationwide and has benefited millions of Americans. It is important that members of Congress preserve and expand this program, allowing local leaders to face our nation’s growing backlog of affordable housing, aging infrastructure, and economic development needs.
Tracey Ross is a Senior Policy Analyst for the Poverty to Prosperity Program at the Center for American Progress.