“it’s purpose and relevancy in the new millennia”

“It’s purpose and relevancy in the New Millennia”

A Policy Paper Presented By:

NACCEDCommunity Development Committee

2025 M Street, NWSuite 800

Washington, DC 20036

The CDBG Program

Mr. Nick Autorina – ChairmanCobb County, GA

Ms. Cheryl Markham – Vice ChairmanKing County, WA

NACCED Presentation V.2 2

A Special Thank You

NACEED’s Community Development Committee owes a special debt of gratitude to the following NACCED members who were gracious with their time and energy in providing statistics for this report. Without their help, this report would not be possible

Allegheny County, PA

Mr. Jack Exler

Ms. Donna Joyce

Anne Arundel County, MD

Ms. Erin Shearman Karpewicz

Ocean County, NJ

Mr. Tony Agliata

Cobb County, GA

Ms. Diana Belanger

“…HUD will put in place systemic reform and policy innovation, and harness private sector capital and

talent as well as new kinds of partnership and collaboration to respond to the nation’s housing

crisis, address new national priorities and change the way HUD does business.”

-HUD Secretary Shaun Donovan’s opening remarks regarding HUD’s FY 2010 Budget to shift HUD’s focus on responsibility, effectiveness and transparency


Presentation Purpose:

Provide an Historical Overview; Analyze the impact of CDBG regarding the program’s

success and accomplishments assisting American cities and counties to preserve and sustain our communities;

Explain why the program – after 35 years – remains the cornerstone of federal urban policy;

Provide an overview of HUD’s strategic intent for CDBG in the future


Original Legislative Intent

“To develop viable urban communities, by providing decent housing and a suitable living environment and expanding economic opportunities, principally for persons of low and moderate income.”


CDBG Statutory Requirements

Address the needs of low and moderate income persons, of which not less than 70% of all CDBG funds must benefit low-income persons;

Eliminate Slums and Blight;

Address urgent needs that pose an immediate threat to health, safety, and public welfare


Inherent Flexibility

CDBG funds:

Enable communities to define and address their community needs at the local level under the governance of local elected officials;

Promote a viable funding source to revitalize and preserve older neighborhoods through strategic planning and implementation;

Can provide resources in time of urgent need


Urgent Need

“9-11” Congress appropriated $3.483

billion in CDBG funds to New York City to aid in the City’s recovery from a coordinated terrorist attack on the “Twin Towers”

“Hurricane Katrina” December 2005-Congress

appropriated $16.5 Billion in CDBG funds to address recovery efforts along the Gulf Coast after the destruction left by Hurricane’s Katrina, Rita and Wilma.


Urgent Need

In 2008, HUD allocated $9.423 billion in CDBG funds for the following:

1. $6.123 billion to assist the victims of Hurricanes Ike;

2. $3 Billion for Gulf Coast Recovery;

3. $300 million for Midwest Flooding


How Does HUD Allocate CDBG Funds?

CDBG funds are allocated by dual formulas, based on the following factors: Population Poverty Overcrowded Housing Aged Housing Population growth lag


Who Receives CDBG Funding?

Metropolitan Cities and Counties – 70% Metro Cities – Populations that exceed 50,000

representing approximately 1,154 cities Urban Counties – Populations that exceed

200,000 in 176 Counties, representing approximately 4,000 small cities

States – 30% Approximately 5,000 small cities and towns

receive funds through their state allocation


Eligible CDBG Activities

As defined in 24 CFR 570 Public Services

Projects Assisting “Limited Clientele” such as: Abused Children Battered Spouses Elderly Persons Homeless Persons Illiterate Adults Severely Disabled Persons Living with AIDS


Eligible CDBG Activities

As defined in 24 CFR 570 Public Facilities

Acquisition of Land / or Buildings Architectural Barrier Removal (ADA) Construction of New Streets* Construction or Renovation of Community Centers* Construction or Renovation of Parks and Recreation Facilities* New Sidewalks* Property Acquisition / Disposition / Clearance / Demolition Renovation of Historic Properties

*Denotes work completed in LMI Service area


Urban Counties

CDBG is designed to be a flexible funding mechanism to promote an intergovernmental, regional approach to urban community development and affordable housing strategies;

Counties represent multiple urban growth centers linked together geographically, politically, culturally and historically;

Funding decisions are based on cost effective, equitable regional planning efforts and an open citizen participation process.


How do Urban Counties Allocate their CDBG funds?

Through 2008, approximately 176 Counties collectively received over $539 million through HUD for the CDBG Program. Counties used CDBG to

primarily fund the following activities.

Source: “HUD: Use of CDBG By Entitlement Communities” - 2008

2008 National Entitlement Trend by Activity TypeAcquisition

6%

Economic Development

6%

Housing31%

Public Facilities25%

Public Services15%

Administration17%


NACCED Member Examples

This presentation will highlight three current NACCED Members:

Allegheny County, Pennsylvania

2008 Allocation: $16,166,176

Anne Arundel County, Maryland

2008 Allocation: $2,083,194

Ocean County, New Jersey

2008 Allocation: $1,383,405


Allegheny County’s Use of CDBG funds Versus National Trend

Acquisition3%


Housing Rehabilitation

3%


14%

Administration19%

Public Services7%

Acquisition6%


6%

Housing31%


Public Services15%

Administration17%

2008

Allegheny County

Appropriations by Activity Type

2008

National Entitlement

Trend by Activity Type


Anne Arundel County’s Use of CDBG funds Versus National Trend


Public Services20%


23%

Acquisition17%

Administration 20%

Acquisition6%


6%

Housing31%


Public Services15%

Administration17%

2008

Anne Arundel County


2008




Ocean County’s Use of CDBG funds Versus National Trend

Public Services12%


22%

Administration20%


Acquisition6%


6%

Housing31%


Public Services15%

Administration17%

2008

Ocean County


2008




Allegheny’s Funding Decline

From 2004 through 2008 , Allegheny County has experienced a 16.35% decrease in CDBG funding.

$14,500,000

$15,000,000

$15,500,000

$16,000,000

$16,500,000

$17,000,000

$17,500,000

$18,000,000

$18,500,000

$19,000,000

$19,500,000

2004 2005 2006 2007 2008

5 year high = $19,327,000

5 year low = $16,167,168


Anne Arundel’s Funding Decline

From 2004 through 2008, Anne Arundel County has experienced a 17.44% decrease in CDBG funding.

$-

$500,000.00

$1,000,000.00

$1,500,000.00

$2,000,000.00

$2,500,000.00

$3,000,000.00

2004 2005 2006 2007 2008

5 year high = $2,635,000

5 year low = $2,175,387


Ocean County’s Funding Decline

From 2004 to 2008, Ocean County has experienced a 7.68% decrease in CDBG funding.

*2008 total includes $197,978 that was allocated to Jackson-which became its own entitlement

$1,250,000

$1,300,000

$1,350,000

$1,400,000

$1,450,000

$1,500,000

$1,550,000

$1,600,000

$1,650,000

$1,700,000

$1,750,000

2004 2005 2006 2007 2008

5 year high = $1,713,000

5 year low = $1,435,524


CDBG Program Macro-Analysis

According to an analysis performed by Professor Stephen Fuller of George Mason University in 2001, the CDBG Program created: 2 million jobs, and; $50 billion in personal earnings from 1974 to 1998

In 2008: 31,723 jobs were created 149,254 households received assistance 4,521 became new homeowners 18.6 million persons were served by new or reconstructed public

facilities and infrastructure 13.5 million people received assistance from CDBG-funded activities

for employment training, battered and abused spouse services, transportation services, crime awareness activities, senior services, persons with disabilities and youth related activities

Grantees also leveraged $3 in private funding for every $1 dollar of CDBG dollars spent


CDBG Program Macro-Analysis

CDBG ACCOMPLISHMENTS

4-Year Snapshot: Persons Served

2008 2007 2006 2005

HOUSING *149,254 *152,164 *179,385 *170,644

ECONOMIC DEVELOPMENT **31,723 **39,123 **55,957 **91,287

PUBLIC SERVICES 13,488,631 12,521,895 11,538,162 15,337,677

PUBLIC FACILITIES 2,714,757 4,377,035 1,856,073 4,768,477

*denotes households**jobs created

Source: “HUD-CDBG National Accomplishments Profile 2005 – 2008”


Allegheny County Metrics2004 - 2008

Metrics for Allegheny County 2008 2007 2006 2005 2004

Total persons served 1,278,686 1,278,062 1,045,943 503,938 818,026

# of Low/Mod persons served 1,277,577 1,276,953 1,045,240 503,714 817,930

Public Facilities renovated or new construction 256 211 167 187 121

Infrastructure new or existing 327 275 232 184 135

Housing Metrics

Multi-Family Rehabs (Units) 76 30 89 24 55

Single-Family Rehabs (Units) 17 24 2 1 0

Multi-Family New Construction (Units) 14 14 42 0 0

Single-Family New Construction (Units) 31 12 14 42 2

Owner-Occupied Rehabs (includes Lead paint abatement) 94 95 88 147 28

Housing units sub-total 232 175 235 214 85

Housing counseling

Downpayment assistance provided 56 47 78 63 61

Mortgage reductions provided 58 25 42 53 43

Total Assistance 346 247 355 330 189


Anne Arundel County Metrics2004 - 2008

Metrics for Anne Arundel County

2008 2007 2006 2005 2004

Total Persons Served 6,071 7,963 5,076 20,641 9,442

# Low/Mod Persons Served 5,930 7,421 4,836 20,347 9,406

Total Households Served 51 163 199 125 107

Housing Rehab Units 31 87 151 35 30

Downpayment Assistance 23 34 22 43 36

Mortgage Assistance 23 34 22 43 36

Public Facilities 1 2 0 0 1

Acquisition/Development Homeownership units 4 6 4 4 4


Ocean County Metrics2004 - 2008

Metrics for Ocean County

2008 2007 2006 2005 2004

Total Persons served 14,532 22,248 22,451 18,451 16,249

# Low/Moderate 12,352 18,910 19,083 15,683 13,812

# Housing Rehab completed 107 106 111 98 120

# Public Facilities renovated/constructed 6 13 13 11 10

# Infrastructure new or existing 7 7 7 7 6


NACCED Member Summary

Regardless of the entitlement amount, the flexibility of CDBG still makes an impact;

Despite a funding decline over the past five years, the number of low/mod persons served continues to increase;

The jurisdiction’s area of greatest need can always count on CDBG


The Future of CDBG

“Fully Fund the Community Development Block Grant: In the long run, regions are only as strong as their people and neighborhoods. The Community Development Block Grant (CDBG) program is an important program that provides housing and creates jobs primarily for low- and moderate-income people and places.”

“2008 Obama-Biden Democratic Platform”


HUD’s FY 2010 Budget: A change in the focus for CDBG

“Since the mid 1970’s, CDBG has provided communities and states with extremely flexible funding to address locally determined community and economic development priorities.”

“Despite these attributes, the formula driving the allocation of CDBG funds has been in place since 1977 and has neither kept current with shifting population and social dynamics nor distributed funds adequately to communities that are in most need.”



“HUD hopes to ensure that its main community development programs reflect America as it is today, not as it was three decades ago before the impact of major population growth, as well as immigration shifts. Increased funding will allow an update to a formula this is more than 30 years old without any jurisdiction receiving a reduction in funding…”

“With a higher funding level, HUD can hold all grantees harmless at their FY 2009 funding amount, leaving the proposed increase to expand funding for the needy communities that do not receive their fair share because of problems in the existing formula.”



“HUD also seeks to strengthen CDBG performance by helping grantees tailor their community development strategies to local market and social realities while better measuring performance to enhance accountability… These efforts will focus on developing appropriate performance metrics to measure progress over time…”


After 35 Years CDBG Still Works!

CDBG… Is Flexible; Leverages Private Investment - 3:1; Focuses on those in need at or below 80% AMI; Open citizen participation process is a model for democratic governance ; Supports balanced community growth through economic, community, and

housing development; Provides local jurisdictions with a funding mechanism for non-profit

collaboration; Provides necessary “gap financing” for local governments to aggressively

pursue infrastructure and public facilities that cater to eligible clientele; Helps provide funding sources to prevent housing decay, promote

stabilization of existing housing, with a corollary tax benefit for home values;

“it’s purpose and relevancy in the new millennia”

Documents

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wanacced presentation

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impact of cdbg

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possibleallegheny county

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inherent flexibilitycdbg