CDBG Entitlement FAQ

The City is thinking about creating a CDBG funded Microenterprise Loan Program. Could the loan program's eligibility/fundability be microenterprise assistance/low mod "limited clientele" or does the national objective have to be "job creation"?

Date Published: May 2015

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The national objective for microenterprise assistance under the authority of 24 CFR 570.201(o) may meet the low/moderate income limited clientele national objective. There is no requirement that microenterprise assistance must meet the low/moderate income jobs (job creation or retention) national objective. In addition, activities assisted under 24 CFR 570.201(o) do not have to meet the public benefit standards. 24 CFR 570.208(a)(2)(iii) states that a microenterprise assistance activity carried out in accordance with the provisions of 570.201(o) with respect to those owners of microenterprises and persons developing enterprises assisted under the activity during each program year who are low and moderate income persons. For purposes of this paragraph, persons determined to be low and moderate income may be presumed to continue to qualify as such for up to a three year period. Therefore, the low/moderate income limited clientele national objective may be used for microenterprise assistance activities under 24 CFR 570.201(o).

Tags: CDBG Entitlement Program Economic Development