Under the Community Development Block Grant (CDBG) program, instead of applying for individual grants and loans, a grantee is able to develop a flexible, locally designed comprehensive community development strategy in order to address the program's primary objective: "...development of viable urban communities, by providing decent housing and suitable living environment and expanding economic opportunities principally for persons of low and moderate income" (Sec. 570.2).

The funding allocation of the CDBG program is based on a statutory formula which assures each entitlement grantee an annual sum of money to carry out its community development program. An entitlement grantee is a metropolitan city (the central city of a metropolitan area or a city with a population of 50,000 or greater) or an urban county. Under the law, 70 percent of the annual distribution of funds is reserved for entitlement communities. In order to receive its allocation of funds, a community must submit to the Department of Housing and Urban Development (HUD) a Consolidated Plan.

Within certain federal limitations (and state limitations under certain state-administered non-entitlement programs), localities have complete decision-making power over how and where the block grant is to be spent. There is no federal project-by-project approval process as in the past.

Since 1974, Title I has undergone some significant revisions. The Housing and Community Development Act of 1977 (Public Law 95-128) introduced a dual funding allocation formula, which was designed to benefit the older cities of the Northeast and Midwest, the eligibility of various economic development activities, and stronger citizen participation requirements. In addition, the 1977 Act significantly revised the discretionary block grant program for cities with populations below 50,000 and added a new program, urban development action grants (UDAG), which is designed to leverage private investments into cities suffering from a number of economic distress factors.

The Omnibus Budget Reconciliation Act of 1981 (The Housing and Community Development Amendments of 1981, Public Law 97-35) simplified the block grant application process, allowed communities to use block grant funds for economic development projects involving for-profit businesses, gave state governments the option of administering the small cities program in their jurisdiction according to their own award selection procedures, and significantly reduced citizen participation requirements. The 1981 Act also repealed the Section 701 comprehensive planning grant program, but permitted its activities to be included as CDBG eligible activities.

The Cranston-Gonzalez National Affordable Housing Act of 1990 required grantees to increase the use of their funds for activities benefiting low- and moderate-income persons over a three-year period to 70 percent.

CDBG Grantees (City Fiscal Year 2011)

Contact

Michael Shiroma, 768-7751 or mshiroma1@honolulu.gov