LegiStorm

Summary:

The Community Development Block Grant (CDBG) program, administered by the Department of Housing and Urban Development (HUD), was first authorized by Title I of the Housing and Community Development Act of 1974, P.L. 93-383 (42 U.S.C. 5301, et seq.). The program is one of the largest and longest-standing federal block grants in existence, annually allocating billions of dollars in federal assistance to state and local governments in support of local neighborhood revitalization, housing rehabilitation, and community and economic development efforts. During the program's 40-year existence, Congress has allocated approximately $145 billion in CDBG formula grants to help state and local governments undertake these activities. The block grant nature of the program provides recipient jurisdictions fairly substantial administrative discretion. Funds are awarded by formula to so-called "entitlement communities" and states, who act as pass-through agents awarding funds to small communities unable to meet the minimum population threshold for entitlement status. During FY2013, approximately 1,237 entitlement communities and states qualified for a direct allocation of funds. Grant funds may be used to undertake any of 27 categories of eligible activities, including the acquisition, demolition, and sale of real property; the construction of public facilities; the undertaking of public services; historic preservation; energy conservation; and the provision of assistance to for-profit and not-for-profit entities in support of private-sector job creation. Although communities and states are given great discretion and flexibility in the selection of activities to be funded, the program's governing statute requires that all activities meet one of three national objectives. Eligible activities must: principally benefit low or moderate income persons; aid in preventing or eliminating slums or blight; or address an imminent threat to the health and safety of residents. In addition, the act quantifies the "principally low and moderate income persons" (LMI) benefits national objective by requiring each entitlement community and state to expend in the aggregate, over a one-, two-, or three-year period, at least 70% of its CDBG allocation on activities that principally benefit low and moderate income persons. Before undertaking program activities, a recipient of funds must develop a consolidated plan assessing its current housing and non-housing community development conditions and it must propose a plan to address the community's housing and community development needs. Grant recipients are also required to submit to HUD an annual performance report detailing progress that has been made in achieving proposed outcomes and identifying the status of activities identified in its annual plan. In addition to the CDBG formula portion of the program, HUD administers a number of smaller grant and loan guarantee programs intended to support or augment the activities and objectives of the larger CDBG formula grant program. These programs support regional planning, the reclamation of brownfields, rural housing, and the provision of technical assistance to community development corporations and community housing development organizations. Critics have contended that many of these programs duplicate the activities of the CDBG formula grant program. This report is intended as a primer to acquaint the reader with a basic understanding of CDBG and related programs. In-depth policy discussions and funding history may be found in other CRS products, including CRS Report R43208, Community Development Block Grants: Funding Issues in the 113th Congress, and CRS Report R43394, Community Development Block Grants: Recent Funding History. This report will be updated as events warrant.