Federal aid to promote sound community development
Nature of the program: Provides annual Community Development Block Grants (CDBG) on a formula basis to entitled communities to carry out a a wide range of community development activities directed toward neighborhood revitalization, economic development, and improved community facilities and services.Entitlement communities develop their own programs and funding priorities and consult with local residents before making final decisions. All CDBG activities must benefit low-and moderate-income persons, or aid in the prevention or elimination of slums and blight; or address other community development needs that present a serious and immediate threat to the health and welfare of the community. Some of the activities can be carried out with community development funds include the acquisition of real property; rehabilitation of residential and nonresidential properties; provisions of public facilities and improvements, such as water and sewer, streets, and neighborhood centers; and assistance to profit- motivated business to help with economic development activities.No less than 70 percent of the funds must be used for for activities that benefit low-and moderate-income persons, over a period specified by the grantee, but not to exceed three years.
Grantee Eligibility: Metropolitan cities with urban counties are entitled to receive annual grants. Metropolitan cities are central cities of Metropolitan Statistical Areas (MSAs) or other cities within the MSAs that have populations of at least 50,000. Urban counties are within MSAs that are authorized to undertake community development and housing activities and meet certain population requirements.
Funding Distribution: From each year's appropriation, excluding the amounts provided for Special Purchase Grants, Neighborhood Development Demonstration Programs, Early Childhood Development Programs and Indian Tribes, 70 percent is allocated to metropolitan cities and urban counties. The amount of each entitlement grant is determined by statutory formula, which uses several objective measures of community need, including poverty, population, housing overcrowding, age of housing, and growth lag.
