# Presentation: 919337

## CDBG WEBCAST

***CDBG WEBCAST***
***HUD, OFFICE OF BLOCK GRANT ASSISTANCE***

## MODULE 1: Welcome, Statutory/Regulatory Context, National Objectives

## WELCOME

- Training Presented by HUD, Office of Community Planning and Development, Office of Block Grant Assistance (OBGA)
- Richard Kennedy, Director, OBGA
- Stan Gimont, Deputy Director, OBGA
- Steve Johnson, Director of Entitlement Programs
- Diane Lobasso, Director of State Programs
- Paul Webster, Director of Financial Management Division

## CDBG TRAINING SERIES

- Eight modules in series:
**Module 1: Welcome, CDBG Statutory/Regulatory Context, National Objectives**
- Module 2: State CDBG Program
- Module 3: Administration/Planning, Financial Management, Including Program Income
- Module 4: Housing and Other Real Property Activities
- Module 5: Public Facilities And Public Services
- Module 6: Economic Development, Including Public Benefit
- Module 7: Section 108
- Module 8: IDIS, Performance Measurement, Reporting
- Training presented by OBGA staff
- Available on HUD’s website at: http://www.hud.gov/offices/cpd/communitydevelopment/programs/index.cfm

## CDBG TRAINING OBJECTIVES

- Purpose of these modules:
- Provide overview of key CDBG topics
- Answer common questions
- Serve as resource for grantee staff new to CDBG
- Other CDBG resources:
- _[www.HUD.gov/programs/cpd/CDBG](http://www.hud.gov/programs/cpd/CDBG)_
- Statute at Section 101 – 122 of the Housing and Community Development Act (HCDA) of 1974, as amended
- Regulations at 24 CFR Part 570
- Guide to Eligible Activities and National Objectives (State and entitlement versions)
- Basically CDBG Training manual

## MODULE 1 TOPICS AND TRAINERS

- Topics:
- CDBG primary objective
- Steps in choosing activities
- LMI targeting
- National objectives
- Trainers:
- Dick Kennedy
- Stan Gimont

## CDBG HISTORY

**Authorized under Title I of the Housing and Community Development Act of 1974**

## CDBG PRIMARY OBJECTIVE

**CDBG PRIMARY OBJECTIVE**

- Development of viable urban communities, _*principally for low/mod persons*_, through:
- Decent housing
- Suitable living environment
- Expanded economic opportunity

## KEY TERMS

- Entitlement Program
- State CDBG Program
- CDBG Recipient/Grantee
- Consolidated Plan
- Low and Moderate Income Person
- Household v. Family

## CDBG ROLES

- Key partners in CDBG programs include:
- HUD
- Entitlements (cities and urban counties)
- States
- Units of General Local Government (UGLGs)
- Subrecipients
- Community Based Development Organizations (CBDOs)
- Contractors
- Beneficiaries

## CDBG MONEY FLOW

- Entitlement grantees have options in funding projects
- States must award funds to UGLG

**Entitlement**

**Subrecipient**
**Contractor, CBDO**

**Beneficiary**

**HUD**

## SELECTING CDBG ACTIVITIES

- Six key questions prior to funding activity
- Is it outlined in the approved Con Plan and Action Plan?
- Is the activity eligible?
- Is it ineligible?
- Will it meet a national objective?
- Will it help to meet the low/mod income targeting requirements?
- Will it comply with all “other federal requirements”?
- Answers critical to determine prior to assisting project

## QUESTION 1: THE CONSOLIDATED PLAN

- Helps determine activities and organizations to fund
- Components:
- Lead agency description
- Housing and homeless needs assessment
- Housing market analysis
- Strategic plan
- One-year action plan

## THE CONSOLIDATED PLAN (cont)

- Citizen participation required
- Con Plan reviewed and approved by HUD
- Submitted to field office at least 45 days prior to start of program year
- Amendments allowed
- Annual performance reporting measured against Con Plan goals and activities

## Wide variety possible
Housing & other real property activities
Economic development
Pubic facilities
Public services
CBDO activities
Planning and administration
Others 
Reg cites §570.201 - §570.206, §570.482
Statutory cites at Section 105
See other web modules for more details on eligible activities

- Wide variety possible
- Housing & other real property activities
- Economic development
- Pubic facilities
- Public services
- CBDO activities
- Planning and administration
- Others
- Reg cites §570.201 - §570.206, §570.482
- Statutory cites at Section 105
- See other web modules for more details on eligible activities

**QUESTION 2: ELIGIBLE ACTIVITIES**

## QUESTION 3: INELIGIBLE ACTIVITIES

**QUESTION 3: INELIGIBLE ACTIVITIES**

- Regs expressly prohibit:
- Buildings for conduct of government & general government expenses
- Political activities
- New housing construction (some exceptions)
- Income payments
- Purchase of equipment
- Operating and maintenance expenses
- Some exceptions for ED and CBDO activities, interim assistance

## QUESTION 4: NATIONAL OBJECTIVES

**QUESTION 4: NATIONAL OBJECTIVES**

- Reg cite §570.208, 570.480
- All CDBG activities must:
- Benefit low/mod income persons
- Prevent or eliminate slums and blight OR
- Meet an urgent need

## NATIONAL OBJECTIVES

-   Urban renewal objective not for state program

## LOW/MOD BENEFIT AREA BENEFIT

**LOW/MOD BENEFIT ****AREA BENEFIT**

- Activities that benefit all residents of area
- 51% LMI persons
- Some entitlement grantees are “exception communities”
- Area must be primarily residential
- Must determine service area of activity
- Typical activities: water/sewer, parks, community centers

## LOW/MOD BENEFIT LIMITED CLIENTELE

- Activities that benefit specific populations
- Presumed clientele
- 51% of participants are LMI persons
- Participation limited to LMI persons only
- Nature and location indicate low/mod benefit
- Some activities may qualify
- Removal of architectural barriers (some activities);or
- Microenterprise activities with LMI owners; or
- Certain types of job training efforts.
- Typical activities: job training, senior services, facilities for persons with special needs

## LOW/MOD BENEFIT HOUSING

**LOW/MOD BENEFIT HOUSING**

- To meet the housing national objective, structures must be occupied by low/mod _households_
- One unit structures occupied by LMI
- One unit of duplex occupied by LMI
- 51% of 3+ units LMI occupied by LMI
- May have less than 51% LMI occupancy only under certain circumstances
- Aggregation allowed in some instances
- Note: This is the only L/M national objective for housing activities
- Typical activities: homeowner unit rehab, rental acquisition and rehab, homebuyer assistance

## LOW/MOD BENEFIT JOB CREATION/RETENTION

**LOW/MOD BENEFIT ****JOB CREATION/RETENTION**

- In order to meet this criteria, activities must ***create**** *_*or*_* ****retain*** permanent jobs
- AND
- 51% of the jobs created/retained must be ***available to**** *_*or*_* ****held by*** LMI persons
- Jobs counted on full time equivalent (FTE) basis
- Typical activities: business loans, commercial rehabilitation, infrastructure to a business

## LOW/MOD BENEFIT JOB CREATION/RETENTION (cont)

- For jobs ***created***, 51% of the jobs must be available to or held by LMI persons
- For jobs to be considered ***retained***, document that jobs would be lost without CDBG and that job
- Is currently held by LMI person OR
- Is expected to turn over in 2 years and will be filled by/available to LMI person.

## LOW/MOD BENEFIT JOBS AVAILABLE TO LMI

**LOW/MOD BENEFIT ****JOBS **_**AVAILABLE TO**_** LMI**

- For jobs to be considered *available to* LMI persons,
- No special skills/education required
- LMI persons must receive first consideration
- Must have a written agreement with business

## LOW/MOD BENEFIT JOBS HELD BY LMI

**LOW/MOD BENEFIT ****JOBS **_**HELD BY**_** LMI**

- For jobs to be considered *held by* LMI persons:
- 51% of the FTE jobs must be LMI
- Must document income of LMI persons hired or have evidence of presumption
- Must have a written agreement with business

## LOW/MOD BENEFITLMI PRESUMPTION FOR JOBS

**LOW/MOD BENEFIT****LMI PRESUMPTION FOR JOBS**

- May be presumed LMI for jobs if:
- Reside in Census tract/block numbering area (BNA) with 20% poverty and general distress;
- Reside in Census tract/BNA with 30% poverty, CBD, and general distress;
- Reside in EZ/EC area;
- Reside in Census tract/BNA with 70% LMI;
- Business and job located in Census tract/BNA with 20% poverty and general distress;
- Business and job in Census tract/BNA with 30% poverty, CBD, and general distress; or
- Business and job in EZ/EC area.

## SLUM AND BLIGHT AREA BASIS

**SLUM AND BLIGHT ****AREA BASIS**

- Area must meet definition of slum/blighted area under state/local law _AND _
- Meet either A) or B) below:
- A) At least 25% of properties throughout the area experience 1 or more of the following conditions:
- Physical deterioration of buildings or improvements
- Abandonment of properties;
- Chronic high occupancy turnover rates or chronic high vacancy rates in commercial/industrial buildings;
- Significant declines in property values or abnormally low property values relative to other areas in community; or
- Known or suspected environmental contamination.
- B) The public improvements in the area are in a general state of deterioration
- Typical activities: code enforcement, infrastructure, commercial rehabilitation

## SLUM AND BLIGHT SPOT BASIS

**SLUM AND BLIGHT ****SPOT BASIS**

- Activities that address specific conditions of blight, physical decay or environmental contamination not in slum/blight area
- Activities limited: acquisition, clearance, relocation, historic preservation, remediation of environmentally contaminated properties, or building rehab
- Acquisition & relocation must be precursor to another eligible activity that addresses slum/blighted conditions
- Rehab limited to elimination of conditions detrimental to public health & safety

## SLUM AND BLIGHT URBAN RENEWAL

**SLUM AND BLIGHT ****URBAN RENEWAL**

- Related to extinct HUD Urban Renewal Program
- Activities in Urban Renewal or Neighborhood Development Program action areas
- Activities necessary to complete an existing Urban Renewal Plan
- Not applicable to the state program
- Typical activities: infrastructure, economic development

## URGENT NEEDNATIONAL OBJECTIVE

**URGENT NEED****NATIONAL OBJECTIVE**

- To meet the urgent need test:
- Existing conditions pose serious & immediate threat to health/welfare of community
- Existing conditions are recent or recently became urgent
- Generally 18 months
- Recipient cannot finance on its own
- Other funding sources not available
- Typical activities: infrastructure, interim assistance, rehab of community facilities

## QUESTION 5: LOW/MOD BENEFIT  REQUIREMENT

**QUESTION 5: LOW/MOD BENEFIT  REQUIREMENT**

- Ties to primary objective of CDBG Program
- Requires that 70% of all CDBG expenditures benefit low/mod persons (i.e., meet LMI national objective)
- Cumulative expenditures, not budgeted
- Certification period of 1-3 years—grantee’s choice
- Section 108 is a CDBG expenditure
- Planning/admin not included
- Reported in CAPER (or PER)

## QUESTION 6: OTHER FEDERAL REGULATIONS

- Myriad of other Federal regulations may apply to CDBG-funded activities
- List includes regulations about:
- Fair housing and equal opportunity
- Handicapped accessibility
- Financial management
- Environmental review
- Lead paint hazard reduction
- Relocation/acquisition and one-for-one replacement
- Davis Bacon labor standards and related acts
- Excluded parties (debarred/suspended)
- Others, as applicable
- Refer to other regulations for applicability