By Eugene T. Lowe
March 23, 2009

Representative Yvette Clarke (NY) introduced legislation, the Affordable Housing and Community Development Act of 2009 (H.R. 1270) March 3, that would authorize the funding level of the Community Development Block Grant (CDBG) program at $8 billion. The legislation would also establish an annual inflation index for the program and provide $5 million in technical assistance funds. The Conference of Mayors has been urging the funding of CDBG at the $8 billion level for more than eight years. Most recently, mayors called for the increased CDBG funding in their 10-Point Plan that was widely circulated beginning in January 2007 and throughout the 2008 presidential primaries and presidential campaign. “The nation’s mayors recommend that CDBG formula funding be doubled to $8 billion. This additional funding would address the delayed projects and activities that have come about because of cuts to CDBG, and further build on the proven record of an effective affordable housing and revitalization program,“ as noted in the 10-Point Plan.

In a letter of thanks to Clarke and a pledge to work for passage of the legislation, the Conference of Mayors along with the National Community Development Association (NCDA) and other national local government groups representing elected and appointed officials touted the accomplishments of the CDBG program. Taking only FY08 alone, the letter said that the Department of Housing and Urban Development (HUD) data shows that “over 95 percent of CDBG funding principally benefitted low-and moderate-income persons. Moreover, CDBG housing projects assisted 149,254 households, including providing financial assistance to new homeowners and rehabilitation assistance to the elderly and existing homeowners. Unlike the private market, CDBG-assisted homeowners have not faced the turmoil of foreclosure due to the diligent underwriting and oversight provided by CDBG grantees.”

Most certainly, an increased level of funding for CDBG would help address the decline in program funds over the last several years. But a permanent annual inflation index to increase funding for the CDBG program would also be extremely important for local and state governments. The letter to Clark emphasizes that, “The program has never been adjusted for inflation in its 35-year history.” As for technical assistance funds, the letter says “…nearly 1,200 grantees receive CDBG funds, but are provided no training resources from HUD. We applaud the $5 million in annual technical assistance funds provided in the bill. These funds will allow HUD to provide ongoing training to grantees nationwide.”