Administration and Planning
There are only three categories of activities that HUD requires be charged to administration: financial management, compliance and monitoring, and reporting. Grantees may charge the cost to carry out activities as activity delivery costs, which are eligible under the same authority as the activity itself. Administrative and planning costs for all CDBG-CV grantees are capped at 20 percent of the total award received from all rounds of funding. State grantees may use up to 5 percent of all CDBG-CV funding received for general administration costs plus an additional 2 percent for technical assistance. The remainder may be used by units of general local government funded by the state for administrative costs.
States should keep in mind that they must set aside for nonentitlement local governments an amount at least equal to their first CDBG-CV allocation. States cannot count any portion of funds used for their own program administration and technical assistance costs towards the minimum nonentitlement threshold. If a state CDBG-CV grantee used a portion of its CV1 allocation for its own costs, the state must allocate sufficient funds from subsequent amounts received under CV2 and CV3 to nonentitlement local governments to ensure no less than an amount equal to the CV1 allocation is provided for their use.
Planning activities are crucial to ensuring that flexible CDBG-CV funding is used to fill gaps that cannot be filled from other federal funding sources. When deciding how best to deploy CDBG-CV resources, it is suggested that grantees take the following actions:
- Identify the local stakeholders who have information and potential resources.
- Identify opportunities to leverage resources; and
- Identify unmet needs and service gaps that would be best filled with CDBG-CV funds.