Community Development Grant Provides Necessary Funds for Low-Income Families

| September 13, 2014 | 0 Comments

Community Development Block GrantThe Community Development Grant or CDBG is one of the oldest funding programs of the United States government. The grant is awarded by the U.S. Department of Housing and Urban Development and is meant to provide affordable housing and fund anti-poverty programs in all states of America.

The program started in 1974 and became one of the most effective and distributed grants in the United States.

Even though the Community Development Grant can be seen as a categorical grant, there are some significant differences. For example, this specific grant needs less evaluation from the federal government, because most of the funds are distributed amongst local governments. They, in their turn, decide which organizations they award their acquired funds to.

Although this grant is a lot more lenient concerning government evaluation, there are still some requirements applicants need to adhere to.

How the CDBG is Allocated

The annual appropriation of the Community Development Grant is allocated between states and local government bodies. These are also known as “non-entitled” and “entitled” communities. Entitled communities are central cities in Metropolitan Statistical Areas, also called MSAs and usually have a population of at least 50,000 people.

There are also entitled urban counties that have a population of 200,000 or more. The funding amount is determined by the U.S. Department of Housing and Urban Development and depends on various factors, for example: poverty scale, population, housing shortage, age of existing housing facilities and the current population growth.

Citizen Participation

An applicant needs to make a good proposal when applying for a Community Development Grant. This proposal usually has a detailed plan for citizen participation, which has to come from low-income and moderate-income families and communities. The plan is not only a good idea for the government proposal, but also for the citizens who will participate in the project.

When awarded the grant, the applicant must develop a plan where citizens get access to local meetings, where they get a chance to review the proposed activities. The applicant must also provide answers to written complaints and grievances that may have been received.

Of course, the awarded grant money cannot be used for everything as there are some restrictions upon receiving this grant. The grantee must spend at least 70 percent of the awarded Community Development Grant in the first three years of approval. This money must be used on activities that are meant for people with a low- and/or moderate income.

Activity Criteria

The activities themselves are also subject to certain criteria, for example: the activities must be of benefit for people with low- and/or moderate income; it must prevent or eliminate slums or blights and/or address the urgent community development needs. Urgent problems should always be handled first, since they are an immediate threat to the community welfare. There is also no other funding for these problems, so the Community Development Grant must be used to handle these urgent difficulties first.

One thing is certain; the Community Development Grants has helped millions of people over the last 40 years. Many urban counties and rural communities are now relying on this grant for their development. The government department has already invested up to $144 billion for the improvement of facilities and the creation of affordable housing.

It is estimated that nearly 3.3 million residents have benefited from this grant since its start in 1974. We hope that this admirable project can go on for another 40 years, since its influence and funding has become an indispensable part of the United States and its people. The program provides improved living conditions for low-income people. In short, it is a project we can all stand behind.

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Category: Business Grants

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