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Introduction

quote The Community Development Block Grant (CDBG) program helps local governments develop viable urban communities. It is an important and flexible program that is used to address one of three national objectives:

How Can I ... meet the national objective to benefit low-and moderate-income persons?

The following activities are different ways of meeting the national objective to benefit low- and moderate-income persons. Select MORE for detailed examples, like those featured in this scrapbook.

  • Activities carried out in neighborhoods, consisting predominantly of persons of low- and moderate-income, to provide services for such persons, can qualify under the LMI Area Benefit national objective. More

    Examples may include the following when they are located in a predominately LMI neighborhood:

    • Acquisition of land to be used as a neighborhood park
    • Infrastructure improvements, such as sidewalks, in a residential neighborhood
    • Construction of a health clinic
    • Development of a community center

    The activities listed above benefit all residents in the service area (that is predominately LMI) and thus are the type of activities that may qualify under the LMI Area Benefit national objective.

  • Activities involving facilities, designed for use predominantly by persons of low- and moderate-income, can qualify under the LMI Limited Clientele national objective. More

    Examples include:

    • Acquisition of building to be used as shelter for homeless persons
    • Rehabilitation of a center for persons with disabilities to learn life skills
    • Demolition and clearance of a building to prepare a site for a future senior center
    • Public service activities such as provision of health care primarily for lower-income clients

    The listed examples qualify under the Limited Clientele national objective because the beneficiaries can be identified as LMI residents.

  • Activities that involve the acquisition or rehabilitation of property to provide housing, which upon completion will be occupied by low- and moderate-income persons, can qualify under the LMI Housing national objective. More

    Examples include:

    • Conversion of an abandoned warehouse into apartments where at least 51 percent of the units will be occupied by low- and moderate-income tenants
    • Rehabilitation of a single family house occupied by a low- and moderate-income household
    • Site improvements to a property on which rental housing will be constructed and in which at least 51 percent of the units will be occupied by low- and moderate-income tenants
  • Activities involving employment of persons, a majority of whom are persons of low- and moderate-income, can qualify under the LMI Jobs national objective. More

    Examples include:

    • Clearance activities on a site slated for a new business
    • Rehabilitation of a structure that will correct code violations and enable a business to survive and retain jobs
    • Financial assistance to a manufacturer for the expansion of its facilities that will create permanent jobs
    • Assistance to expand a small house cleaning business with four employees that agrees to hire three new low- and moderate-income employees

2 CDBG Making a Difference

Meet Stan Gimont, Director of HUD's Office of Block Grant Assistance

Since 1974, the CDBG program has invested over $144 billion in communities nationwide and made a difference in the lives of millions by investing in:

affordable housing, public facilities to improve quality of life, and economic opportunities
CDBG Making a Difference 3
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Decent Housing & Viable Communities

Experiencing Homeownership for the First Time in Midland, TX

How Can I ...

provide direct homebuyer assistance with CDBG funds?

How Can I ... provide direct homebuyer assistance with CDBG funds?

  1. Make loan payments affordable More
    by subsidizing interest rates and mortgage principal amounts, making grants to reduce the effective interest rates charged on the loans. Low- or no-interest subordinate loans can also be used to reduce overall loan repayment amounts and make the purchase price more affordable.
  2. Pay all or part of the mortgage insurance premium required upfront by a private mortgagee.
  3. Pay any or all of the reasonable closing costs associated with the home purchase.
  4. Pay up to 50 percent of the down payment required by the mortgagee for the purchase.

How Can I ... provide direct homebuyer assistance with CDBG funds?

  1. Make loan payments affordable More
    by subsidizing interest rates and mortgage principal amounts, making grants to reduce the effective interest rates charged on the loans. Low- or no-interest subordinate loans can also be used to reduce overall loan repayment amounts and make the purchase price more affordable.
  2. Pay all or part of the mortgage insurance premium required upfront by a private mortgagee.
  3. Pay any or all of the reasonable closing costs associated with the home purchase.
  4. Pay up to 50 percent of the down payment required by the mortgagee for the purchase.

How Can I ... support development of housing?

Although new construction of housing is, generally, not eligible under the CDBG program, grantees may provide support for the development of new housing.

You can use CDBG funds to:

  1. Acquire property. Grantee or nonprofit can acquire property to resell to an affordable housing developer. Local development corporation and certain nonprofit organizations may also acquire property for housing it will develop itself.
  2. Clear a site. Grantee may clear a site in preparation for housing.
  3. Make on-site improvements. Grantees can make public improvements on publicly-owned property. Examples include water lines, sewer lines, and utility lines.
  4. Make off-site improvements. Grantees can make site improvements to publicly owned land to enable the property to be used for the new construction of housing.
Teresa Martinez was homeless for two years before her family was approved for a homeownership opportunity in the Sparks Neighborhood, one of the target areas participating in Midland's Selected Target Area Program.

To make this opportunity a reality, the City used CDBG funds to:

How Can I ...

support development
of housing?

How Can I ... support development of housing?

Although new construction of housing is, generally, not eligible under the CDBG program, grantees may provide support for the development of new housing.

You can use CDBG funds to:

  1. Acquire property. Grantee or nonprofit can acquire property to resell to an affordable housing developer. Local development corporation and certain nonprofit organizations may also acquire property for housing it will develop itself.
  2. Clear a site. Grantee may clear a site in preparation for housing.
  3. Make on-site improvements. Grantees can make public improvements on publicly-owned property. Examples include water lines, sewer lines, and utility lines.
  4. Make off-site improvements. Grantees can make site improvements to publicly owned land to enable the property to be used for the new construction of housing.
By The Numbers
4 CDBG Making a Difference

Meet Teresa Martinez

quoteThe neighborhood is now a mix of 30 new homes interspersed with existing, renovated, and reconstructed homes, with upgraded roads and sidewalks.

Other eligible housing activities that can be assisted with CDBG include:

  • Housing rehabilitation (one of the most common activities administered nationwide),
  • Rental housing acquisition and/or rehabilitation, and
  • Homebuyer counseling.
CDBG Making a Difference 5
How Can I? Test Your Knowledge

stickerDecent Housing & Viable Communities

Preventing Foreclosures Citywide in Philadelphia, PA

Frederick C. Brinkley Sr., a veteran and tractor trailer driver/instructor, was rear-ended and his car rolled over three times. The accident put him out of work and in danger of foreclosure. A call to the SaveYourHomePhilly hotline connected him to the City's foreclosure prevention program.

How Can I ...

implement a successful foreclosure prevention program?

How Can I ... implement a successful foreclosure prevention program?

To ensure success and give homeowners every opportunity to prevent the loss of their homes, the SaveYourHomePhilly program implemented the following components:

  • Outreach by neighborhood advisory committees and other nonprofit organizations that reaches homeowners facing foreclosure at their homes and alerts them to available resources;
  • Hotline that connects homeowners to housing counselors following case analysis by trained paralegals;
  • Housing counselors that assist homeowners in negotiating mortgage modifications with lenders and in developing the financial skills to stay in the home; and
  • Pro bono attorneys that provide legal assistance when necessary in negotiating with lenders.

The City created the Mortgage Foreclosure Prevention Program using CDBG monies to fund:

To prevent the loss of homes, the First Judicial District issued an order: no owner-occupied residential property in Philadelphia could foreclose without giving the homeowner the opportunity to meet with the lender as part of a court-supervised conciliation process. There, pro bono attorneys provide legal assistance.

By The Numbers
6 CDBG Making a Difference

Meet Frederick Brinkley

quoteAdditionally, PNC Bank offers a "Tools for Financial Growth" course to help participating homeowners remain in their homes after foreclosure has been averted. Frederick C. Brinkley Sr. is, now, two months ahead on mortgage payments whereas he was, previously, four and a half years in arrears.

7 CDBG Making a Difference
How Can I? Test Your Knowledge

stickerDecent Housing & Viable Communities

Engaging Residents in Neighborhood Revitalization in Philadelphia, PA

Denise Ripley is a homeowner, block captain and head of the residents' council who took initiative to organize community residents during the planning process of the Cecil B. Moore Homeownership Zone (HOZ) development. The community's input was important in minimizing dislocation for longtime residents of the area.

The Cecil B. Moore Homeownership Zone (HOZ) development – named after Cecil B. Moore (1915-1979), a City Councilman, civil rights advocate and community leader – is a large-scale neighborhood revitalization.

How Can I ...

develop a neighborhood/community revitalization strategy?

How Can I ... develop a neighborhood/community revitalization strategy?

A comprehensive area-based revitalization strategy or approach will address all of the following key components:

  • Neighborhood and boundaries – tightly focused areas tend to succeed better;
  • Demographic criteria;
  • Community consultation – residents must be actively involved;
  • Partner engagement – including school districts, law enforcement, health agencies, and businesses;
  • Assessment of economic conditions, opportunities and problems;
  • Economic empowerment activities to be undertaken;
  • Performance Measures; and
  • Funding – including public, private and non-profit (foundation) sources, as available.

An area-based revitalization strategy or approach can be adopted without formal approval by HUD.

An area-based revitalization strategy or approach can also be formally adopted with HUD approval as a Community or Neighborhood Revitalization Strategy Areas (CRSAs or NRSAs). A formally adopted and approved initiative has the advantage of flexibility in applying certain provisions of the CDBG regulations. To learn more the CRSAs or NRSAs, see Chapter 10 of Basically CDBG (for Entitlements and for States).

It transformed 61 acres of formerly blighted land into a safe and vibrant community by creating nearly 300 new units of affordable housing over a 15-year development process.

By The Numbers
8 CDBG Making a Difference

Meet Denise Ripley

quoteThe transformation could not have happened without CDBG funding, which was used to leverage more than $35 million for the HOZ and to fund:

  • Housing counseling,
  • Home improvement programs, and
  • Neighborhood services.
9 CDBG Making a Difference
How Can I? Test Your Knowledge

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Suitable Living Environments

Prioritizing Sidewalks for Safety in Indio, CA

quote Street and sidewalk improvements may not seem like much, but they have made a big difference to the residents of Indio, CA. Parents were walking their children to school on the streets. Residents visiting nearby recovery centers in wheelchairs were forced into the road.

quoteYearly, the City of Indio's Better Neighborhoods Program identifies at least one low- and moderate-income neighborhood and works with residents on infrastructure and public facilities projects prioritized by the residents.

By The Numbers
10 CDBG Making a Difference

Meet Lana Hall

Typical activities funded by CDBG include:

  • Street and sidewalk improvements, such as re-paving, curb and gutter work
  • Streetscapes, including safe and secure street lighting, signage, and landscaping
  • Water and sewer improvements, such as installation/replacement of water lines, sanitary sewers, storm sewers, and fire hydrants
  • Concentrated neighborhood clean-up projects
  • Coordinated outreach and education regarding City services and codes
  • Parks and recreation facilities
11 CDBG Making a Difference
Did You Know? Test Your Knowledge

stickerSuitable Living Environments

Providing Health Care Regardless of Ability to Pay or Insurance Status in Quincy, MA

Meet Leo Kelly and Hank Rittal, patients who are excited about the state-of-the-art care they are able to access at Manet, a community health center constructed with CDBG funds.

The dream of constructing a community health care center in the Hough's Neck neighborhood of Quincy, Massachusetts was the brainchild of Ward One City Councilor, Leo Kelly. After the "Blizzard of 78" ravaged this peninsular section of the city, residents were stranded without any access to health care services.

How Can I ...

document the national objective commonly used to qualify public facilities?

How Can I ... document the national objective commonly used to qualify public facilities?

As a reminder, the most commonly used national objective is LMI Area Benefit but other national objectives such as Limited Clientele, Housing, Jobs, Slum/Blight or even Urgent Needs can be used in certain circumstances. To qualify the public facilities/improvement must benefit all residents of an area where at least 51% of the residents are LMI. The service area need not have coterminous boundaries with Census tract borders or other officially recognized boundaries, but must be primarily residential in nature.

If qualifying an activity under the LMI Area Benefit national objectives, records to keep include:

  • Boundaries of the service area; and
  • Income characteristics demonstrating that at least 51% of the service area residents are LMI.

Today, 36 years later, Manet Community Health Center continues to operate in Hough's Neck as a Federally Qualified Health Center (FQHC) dedicated to providing preventive, primary and non-emergency urgent care to all, regardless of financial ability to pay or health insurance status.

Manet Map
Low-Income Population in Our Service Area
12 CDBG Making a Difference

Meet Leo Kelly

quoteManet has grown from a small facility with one site and 3 doctors, into a multi-site agency, operating a total of six centers in the South Shore region of Massachusetts, which employs over 150 people.

13 CDBG Making a Difference
How Can I? Test Your Knowledge

stickerSuitable Living Environments

Providing more than just Literacy Classes and Meals, Creating Community in Quincy, MA

Born and raised in the Germantown neighborhood of Quincy, Rory Elliffe, now works at the Neighborhood Center helping clients obtain GEDs and study math and English.

How Can I ...

support public facilities using CDBG funds?

How Can I ... support public facilities using CDBG funds?

Eligible activities include acquisition, construction, reconstruction, rehabilitation, or installation of public facilities and improvements. More

For entitlement communities, these activities can be carried out by a grantee, subrecipient, or nonprofit. For States, these activities can be carried out by a Unit of General Local Government (UGLG), subgrantee, or nonprofit. Note that if the assisted facility is owned by a nonprofit, the CDBG regulations stipulate that the facility must be open to the public during normal working hours.

The Germantown Neighborhood Center, purchased and rehabilitated using CDBG funds, is located in a predominantly lower income neighborhood in Quincy, Massachusetts and provides a wide array of public services to residents of all ages.

There are 868 public housing units in Germantown and single mothers head over 65% of the households. Children under 14 comprise over 40% of the population.


By The Numbers
14 CDBG Making a Difference

Meet Rory Elliffe

quoteThe Germantown neighborhood is isolated on a peninsula and has a very high concentration of public housing. "The Center," as it is fondly called by residents, has brought the community together and given a disenfranchised population a voice.

15 CDBG Making a Difference
How Can I? Test Your Knowledge

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Economic Opportunities

Creating Opportunities by Supporting Local Businesses in Rock Island, IL

Did You Know? Public Benefit Standards Apply to Economic Development ProjectsMeet Nicole Watson-Lam who expanded her business, Miss BriMani's Hair and Beauty Supply, with the help of the Rock Island Commercial/Industrial Revolving Loan Fund (CIRLF). The CDBG funded loan program paid for:

How Can I ...

meet the Public Benefit Standard?

How Can I ... meet the Public Benefit Standard?

Entitlement communities must apply the aggregate standards to all activities for which funds were first obligated during any given program year. States apply the aggregate standards to all funds distributed for applicable activities from each annual grant. Grantees may elect to apply the standards to the creation/retention of jobs or to the provision of goods and services to LMI residents, but cannot count an activity under both standards.

CIRLF has been providing gap financing for business start-ups or for expansion projects since 1983. The program offers low-interest loans to industrial, commercial, light manufacturing, retail, and service industries.

By The Numbers
16 CDBG Making a Difference

Meet Nicole Watson-Lam

quoteFunds can be used toward the purchase of fixed assets (land, building, and equipment) and for working capital purposes. The program requires that at least one job is created for each $10,000 borrowed, and at least 51% of jobs created must go to persons with low- and moderate-incomes.

17 CDBG Making a Difference
Did You Know? How Can I? Test Your Knowledge

stickerEconomic Opportunities

Expanding a Local Business with Strong Regional Ties to Anchor Downtown in La Crosse, WI

Dave has been selling his vegetables to the People's Food Co-Op since they started in 1973, when a group of residents formed a buying club in an effort to access natural foods in bulk.

How Can I ... support local businesses in my area?

CDBG funds may be used in a variety of ways to encourage economic development and support new and existing businesses. Examples of eligible activities that can be funded by CDBG include:

  • Technical assistance to businesses
  • Microenterprise assistance
  • Commercial rehabilitation
  • Infrastructure to assist businesses
  • Job trainings and
  • Special economic development activities

How Can I ... support local businesses in my area?

CDBG funds may be used in a variety of ways to encourage economic development and support new and existing businesses. Examples of eligible activities that can be funded by CDBG include:

  • Technical assistance to businesses
  • Microenterprise assistance
  • Commercial rehabilitation
  • Infrastructure to assist businesses
  • Job trainings and
  • Special economic development activities

How Can I ... qualify local businesses providing essential goods and services for assistance?

Projects providing essential goods and services will typically qualify either on the basis of:

LMI Area Benefit. More
To qualify under the LMI Area Benefit National Objective, the service area must be primarily residential in nature. There must be documentation that the business is providing essential goods and services to that service area population. Goods and services might include grocery stores, dry cleaners, pharmacies, health care, etc. A high-end boutique or souvenir shop would not be considered as providing essential goods and services.

or

LMI Job Creation/Retention. More
A Job Creation/Retention activity is one that creates or retains permanent jobs, 51% of which are held by or made available to LMI persons. Jobs indirectly created by an assisted activity (i.e., trickle-down jobs) may not be counted.

How Can I ... qualify local businesses providing essential goods and services for assistance?

Projects providing essential goods and services will typically qualify either on the basis of:

LMI Area Benefit. More
To qualify under the LMI Area Benefit National Objective, the service area must be primarily residential in nature. There must be documentation that the business is providing essential goods and services to that service area population. Goods and services might include grocery stores, dry cleaners, pharmacies, health care, etc. A high-end boutique or souvenir shop would not be considered as providing essential goods and services.

or

LMI Job Creation/Retention. More
A Job Creation/Retention activity is one that creates or retains permanent jobs, 51% of which are held by or made available to LMI persons. Jobs indirectly created by an assisted activity (i.e., trickle-down jobs) may not be counted.

The buying club expanded quickly, opening a retail store and moving a couple of times before settling downtown in 1993. They soon outgrew the downtown location, but, instead of moving, they created a plan to upgrade (add an in-house butcher and bistro, expand the deli and bakery).

The Co-Op had a financing gap and turned to the City.


By The Numbers
18 CDBG Making a Difference

Meet Dave Miles & the People's
Food Co-Op

quoteThe City funded the expansion with a small business development loan after determining that the project fit the goals for revitalizing downtown by creating jobs and providing essential goods and services.

Today, the Co-Op serves as a local community anchor, providing fresh food access to low-income residents and helping hundreds of local farmers, like Dave Miles, expand their market.

19 CDBG Making a Difference
How Can I? Test Your Knowledge
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Summary

20 CDBG Making a Difference


When we invest in people, we invest in community. The CDBG program encourages people to bring forward their own voices and shape where they live. Through the stories on the previous pages, we've seen how CDBG benefits low- and moderate-income persons. The program:

  • Targets public and private investment to the low- and moderate-income persons and neighborhoods.
  • Fosters housing and neighborhood investment creating community pride, diversity, and opportunity.
  • Supports a holistic approach by investing in public facilities and services.
  • Increases tax revenue and personal incomes that boost the local economy and quality of life.

For more information on how to make the CDBG program work for your community: https://www.onecpd.info/resource/3878/cdbg-fact-sheet

To see more stories about how communities are using CDBG funds: https://onecpd.info/community-development/cdbg-ta-products/project-profiles

Connect with other CDBG grantees to share your experience and best practices on Twitter using #CDBGturns40, or email it to CDBGturns40@hud.gov.

21 CDBG Making a Difference
Suitable Living Environments
Prioritizing Sidewalks for Safety in Indio, CA
Providing Health Care Regardless of Ability to Pay or Insurance Status in Quincy, MA
Providing more than just Literacy Classes and Meals, Creating Community in Quincy, MA
Economic Opportunities
Creating Opportunities by Supporting Local Businesses in Rock Island, IL
Expanding a Local Business with Strong Regional Ties to Anchor Downtown in La Crosse, WI
23 CDBG Making a Difference
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Test Your Knowledge

Housing activities in areas/neighborhoods with a majority LMI population meets the national objective of benefit to LMI persons.
True
False

Test Your Knowledge

CDBG can provide homebuyers with all of the down payment required by the mortgage.
True
False

Test Your Knowledge

While housing counseling for the purposes of purchasing a unit is an eligible CDBG activity, homeownership counseling to individuals who already own their homes, is not.
True
False


Test Your Knowledge

To adopt an area-based revitalization strategy or approach, a grantee must submit a written request and obtain formal approval from HUD.
True
False


Test Your Knowledge

All of the residents who live within the service area of a sidewalk improvement project must be LMI to qualify the project under the LMI Area Benefit national objective.
True
False

Test Your Knowledge

When using the Area Benefit national objective to qualify a public improvement project, what kind of records have to be maintained?
A: Boundaries of the service area
B: Income characteristics of households in the service area (Census or survey data)
C: Both of the above
D: None of the above

Test Your Knowledge

Costs associated with acquisition and construction are only eligible for infrastructure improvements, not neighborhood facilities or facilities for persons with special needs.
True
False

Test Your Knowledge

The public benefit requirement is the same as the national objective requirement that 51% of the jobs actually created or retained be taken by LMI persons.
True
False

Test Your Knowledge

Economic development projects must be located in commercial districts. Economic development activities in residential areas are ineligible for CDBG funding.
True
False

By The Numbers

Did You Know ... new construction of housing is, generally, not eligible under the CDBG program?

New construction of housing is, generally, not eligible under the CDBG program. However, the regulations allow for certain eligible entities to carry out this activity on behalf of the grantee. More
For entitlement grantees, More
the eligible entities are neighborhood-based non-profit organizations (NBOs), Sec 301(d) Small Business Investment Companies (SBICs), and SBA-approved local development corporations (LDCs). Additional requirements apply, including type of project (neighborhood revitalization, community economic development, or energy conversation project) and role of the eligible subrecipient (the CBDO must carry out the project in its entirety).


For State grantees, More
the eligible entities are Nonprofit Development Organizations who meet the definition outlined under Section 105(a)(15) of the Housing and Community Development Act. These are nonprofits serving the development needs of non-entitled areas, including but are not limited to section 301(d) Small Business Investment Companies (SBICs), SBA-approved local development corporations (LDCs), and Community Housing Development Organizations (CHDOs). Additional requirements apply, including type of project (neighborhood revitalization, community economic development, or energy conversation project) in order to use CDBG for new construction. Particularly, new housing construction carried out by an eligible 105(a)(15) must be part of a larger effort to revitalize the neighborhood (based on a comprehensive plan), not just for the sake of the CDBG project.


Also, grantees may provide support for the development of new housing. More
You can use CDBG funds to:
  1. Acquire property. More
    Grantee or nonprofit can acquire property to resell to an affordable housing developer. A CDBO may also acquire property for housing it will develop itself.
  2. Clear a site. More
    Grantee may clear a site in preparation for housing.
  3. Make site improvements. More
    Grantees can make public improvements on publicly-owned property or on privately-owned land by obtaining easements on privately-owned land before carrying out the improvements. Examples include water lines, sewer lines, and utility lines.
  4. Make street improvements. More
    The construction or reconstruction of publicly-owned streets, bridges, and alleys is eligible as a public facilities and improvements activity.


Lastly, grantees may use CDBG to construct last resort housing. More
For displacees of a CDBG-assisted activity, subject to the Uniform Relocation Act, when the project is prevented from proceeding because comparable replacement housing is not otherwise available, grantees may construct housing of last resort.
Did You Know ... CDBG rules give communities implementing CRSAs/NRSAs some flexibility?

To promote innovation and ensure that comprehensive strategies can be implemented successfully, CDBG rules give communities implementing Neighborhood Revitalization Strategy Areas (NRSAs) or Community Revitalization Strategy Areas (CRSAs) some flexibility in the following areas:
  • Applying the LMI housing criteria. More
    This is the flexibility to aggregate housing units (for which CDBG funds are obligated during each program year) and treat them as a single structure (wherein 51 percent of the total number of units must be occupied by LMI households). In turn, grantees have flexibility in providing housing to residents of the NRSA/CRSA neighborhood. Note, however that the flexibility to aggregate housing units assisted does not change the requirement that homeownership assistance provided under 570.201(n) must be provided only to LMI households.
  • Using Area Benefit category for Job Creation or Retention Activities. More
    Job creation or retention effort focused on the selected neighborhood may be classified as meeting the LMI Area Benefit national objective requirements. Meaning that businesses that receive such assistance need not track the specific income of newly hired employees to demonstrate LMI benefit. This provision reduces the administrative burden to the business and is intended to provide an incentive to businesses to participate in the community's job creation/retention programs.
  • Exemption from the aggregate Public Benefit Standards. More
    Economic development activities carried out in the NRSA/CRSA may be excluded from the aggregate Public Benefit Standards. This reduces recordkeeping requirements and affords greater flexibility in selecting and implementing economic development activities, and reduces the amount and scope of information that grantees must collect and document regarding its programs. Note, however, that projects are still subject to the individual/project Public Benefit Standards.
  • Exemption from the public services cap. More
    All public services offered within the NRSA/CRSA and carried out as part of qualified projects under the NRSA/CRSA by eligible entities (CBDOs for Entitlement communities and Nonprofit Development Organizations under 105(a)(15) for States) are exempt from the public services cap. This permits grantees to offer a more intensive level of services within the approved community, as needed to stimulate revitalization. This flexibility includes job training and other employment related services and as such, it can provide an important foundation for economic opportunity for neighborhood residents.
To learn more, see Chapter 10 of Basically CDBG (For Entitlements and for States).
Did You Know ... the national objective commonly used to qualify public facilities/improvements is LMI Benefit?

The most commonly used national objective is LMI Area Benefit but other national objectives such as Limited Clientele, Housing, Jobs, Slum/Blight or even Urgent Needs can be used in certain circumstances.

To qualify under LMI Area Benefit, the public facilities/improvement must benefit all residents of an area where at least 51% of the residents are LMI. The service area need not have coterminous boundaries with Census tract borders or other officially recognized boundaries, but must be primarily residential in nature.
Did You Know ... what types of facilities and improvements are eligible for CDBG assistance?

Examples of the types of facilities and improvements eligible for CDBG assistance include:
  • Infrastructure improvements (construction or installation) including, but not limited to streets, curbs, and water and sewer lines;
  • Neighborhood facilities including, but not limited to public schools, libraries, recreational facilities, parks, playgrounds; and
  • Facilities for persons with special needs such as facilities for the homeless or domestic violence shelters, nursing homes, or group homes for the disabled.
Did You Know ... the national objective commonly used to qualify public facilities/improvements is LMI Benefit?

The most commonly used national objective is LMI Area Benefit but other national objectives such as Limited Clientele, Housing, Jobs, Slum/Blight or even Urgent Needs can be used in certain circumstances.

To qualify under LMI Area Benefit, the public facilities/improvement must benefit all residents of an area where at least 51% of the residents are LMI. The service area need not have coterminous boundaries with Census tract borders or other officially recognized boundaries, but must be primarily residential in nature.
Did You Know ... what types of facilities and improvements are eligible for CDBG assistance?

Examples of the types of facilities and improvements eligible for CDBG assistance include:
  • Infrastructure improvements (construction or installation) including, but not limited to streets, curbs, and water and sewer lines;
  • Neighborhood facilities including, but not limited to public schools, libraries, recreational facilities, parks, playgrounds; and
  • Facilities for persons with special needs such as facilities for the homeless or domestic violence shelters, nursing homes, or group homes for the disabled.
Did You Know ... what types of facilities and improvements are eligible for CDBG assistance?

The national objective commonly used to qualify public facilities and improvements is LMI Benefit, under the Area Benefit criteria. To qualify the public facilities/improvement must benefit all residents of an area where at least 51% of the residents are LMI. The service area need not have coterminous boundaries with Census tract borders or other officially recognized boundaries, but must be primarily residential in nature. Facilities benefitting the entire city are generally not eligible.
Did You Know ...

infrastructure improvements (construction or installation) including, but not limited to streets, curbs, and water and sewer lines;
Neighborhood facilities including, but not limited to public schools, libraries, recreational facilities, parks, playgrounds; and
Facilities for persons with special needs such as facilities for the homeless or domestic violence shelters, nursing homes, or group homes for the disabled.
Did You Know ... Public Benefit Standards apply to economic development projects?

When CDBG funds are used for the purposes of creating/retaining LMI jobs or to assist local businesses that provide essential goods and services in predominately LMI areas, there is a minimum Public Benefit Standard that applies. This is in addition to the regulatory requirement to meet a national objective.

The Public Benefit Standards have two levels:

(1) Standards for individual activities. More
An activity provides insufficient public benefit and cannot be assisted with CDBG funds if:
  • The amount of CDBG is greater than $50,000 per full-time-equivalent, permanent job (created or retained), or the CDBG cost of goods and services provided by the activity exceeds $1,000 per LMI person.
  • The activity consists of or includes: general promotion of the community (as a whole); assistance to professional sports teams; assistance to privately owned recreational facilities that serve a predominantly higher income clientele where the benefit to users clearly outweighs the benefit of jobs created or retained; acquisition of land for which a specific use has not been identified (i.e., land banking); or
  • The for-profit business that is, or its owner is, the subject of unresolved findings of noncompliance related to previous CDBG assistance.

(2) Aggregate standards. More
Activities, in the aggregate, must either:
  • Create or retain at least one full-time-equivalent, permanent job per $35,000 of CDBG funds used;
  • Provide goods and services to an area where the number of LMI persons served by the assisted business amounts to at least one LMI person per $350 of CDBG funds used; or
  • Certain activities can be excluded from the aggregate standards (refer to 570.209(b)(2)(v) or 570.482 (f) (3)(v)for the complete list).

How to Use the Multimedia Scrapbook

The scrapbook tells the stories of several people who have benefited from a program or project funded with the Community Development Block Grant (CDBG) Program.

We invite you to flip through the pages of the scrapbook at your own pace and view the content that is most interesting to you. For best viewing, we recommend that we adjust your screen resolution to 1680 x 1050, and view the page at 100%. Look for the navigation arrows on either side of the book to move forward or backwards through the scrapbook.

There are several features embedded in the pages of the scrapbook including:

  • Short videos – beneficiaries using their own words to tell their stories
  • Did you know? – quick facts about the CDBG program
  • Test your knowledge – questions to help you learn more about the CDBG program
  • Apply your knowledge – detailed information that can help you take the first steps to implementing a program or project
  • Project profile – an example of how other communities are using CDBG funds to benefit low- and moderate-income people
  • Resources – links to additional resources provided by HUD

We hope the scrapbook helps you get a better sense of how low- and moderate-income people benefit from different types of CDBG projects and programs and how these benefits spread to the broader community.

Connect with other CDBG grantees to share your experience and best practices on Twitter using #CDBGturns40, or email it to CDBGturns40@hud.gov.