The Community Development Block Grant (CDBG) program has been a cornerstone of federal funding for community development in the United States for decades.

Through this program, states and local governments receive critical financial assistance to improve housing, infrastructure, and public services, particularly in low and moderate-income communities.

Over the years, the CDBG program has evolved to meet new challenges, including disaster recovery and mitigation, as well as the impacts of the COVID-19 pandemic. 

Explore the history, purpose, and updates to the CDBG program, as well as the different types of funding available and how the non-federal match works. 

Key Takeaways of the Community Development Block Grant Program

  • The CDBG program offers flexible funding to address housing, infrastructure, economic development, and public services in low and moderate-income communities. 
  • Specialized funds, such as CDBG-DR and CDBG-MIT, support disaster recovery and long-term hazard mitigation. 
  • The non-federal match requirement allows for local investment and encourages collaboration across sectors. 
  • Recent updates to the program, including a focus on climate resilience and public engagement, reflect the growing complexity of community development challenges. 

The History and Purpose of the CDBG Program

The CDBG program was established in 1974 as part of the Housing and Community Development Act. Its goal was to create a flexible, decentralized funding mechanism to support community development initiatives.

Administered by the U.S. Department of Housing and Urban Development (HUD), the program allows states and local governments to tailor their use of funds to meet local needs while adhering to national priorities, such as improving affordable housing, reducing blight, and expanding economic opportunities for low and moderate-income individuals. 

Objectives of the CDBG Program

  • Affordable Housing: Funds are often used to develop or rehabilitate affordable housing, helping to address housing insecurity in vulnerable communities. 
  • Public Infrastructure: CDBG funds support critical infrastructure projects such as roads, water systems, and public facilities. 
  • Economic Development: The program helps communities create jobs and support small businesses, often through grants or loans. 
  • Public Services: Communities can use CDBG funds to provide essential public services, such as childcare, health services, and senior care programs.

Types of Funding Within the CDBG Program

The CDBG program offers various types of funding tailored to specific needs, including disaster recovery, mitigation, and response to public health emergencies like COVID-19.

General CDBG Funding

The traditional CDBG program provides annual grants to states and local governments to support community development initiatives.

These funds are highly flexible, allowing jurisdictions to use them for a variety of purposes, provided they benefit low and moderate-income residents.

Some examples of projects funded through regular CDBG grants include:

  • The construction of affordable housing units. 
  • Rehabilitation of public infrastructure such as roads and water systems. 
  • Funding for job training and workforce development programs. 

CDBG-Disaster Recovery (CDBG-DR)

Community Development Block Grant – Disaster Recovery (CDBG-DR) funding is designed to help communities recover from significant disasters such as hurricanes, floods, wildfires, and other natural events.

These funds are made available through supplemental appropriations by Congress in the aftermath of declared disasters.

CDBG-DR funds are often used to:

  • Rebuild damaged housing and infrastructure. 
  • Assist small businesses that suffered economic losses. 
  • Improve resilience to future disasters by upgrading critical facilities. 

Integrating CDBG-DR After Hurricane Harvey

Following Hurricane Harvey in 2017, Texas received over $5 billion in CDBG-DR funds.

These funds were distributed to support rebuilding homes, repairing public infrastructure, and enhancing flood mitigation measures.  

The Texas General Land Office (GLO), which coordinates the state’s disaster recovery, oversaw the allocation of these funds.

A significant portion of the funds were used for housing assistance programs, infrastructure repairs, and local buyout programs to move homeowners out of high-risk flood areas​.

CDBG-Mitigation (CDBG-MIT)

Community Development Block Grant – Mitigation (CDBG-MIT) funds focus on reducing future risks and building resilience to natural disasters.

Unlike CDBG-DR, which is aimed at immediate recovery, CDBG-MIT is proactive, emphasizing long-term strategies to mitigate potential hazards.

Projects funded through CDBG-MIT might include:

  • Elevating homes in flood-prone areas. 
  • Developing new flood control systems or enhancing existing ones. 
  • Improving disaster response infrastructure, such as emergency shelters.

CDBG-CV (COVID-19 Response)

In response to the COVID-19 pandemic, Congress allocated special Community Development Block Grant – Coronavirus (CDBG-CV) funds to help communities address the economic and health impacts of the pandemic.

These funds were used to:

  • Provide emergency rental assistance to prevent evictions. 
  • Support small businesses affected by pandemic-related closures. 
  • Improve access to public health services, particularly for vulnerable populations. 

Integrating CDBG-CV After COVID-19

CDBG-CV funds were critical in providing emergency rental assistance, supporting small businesses affected by closures, and improving access to public health services, especially for vulnerable populations. 

Cities across the U.S. utilized CDBG-CV funds to prevent evictions through rental assistance programs and to establish temporary housing solutions for homeless individuals during the pandemic. 

For instance, several jurisdictions leveraged these funds to provide six months of emergency rent or mortgage assistance to help stabilize low-income households that were hit hardest by the economic disruptions of COVID-19.  

Additionally, CDBG-CV funding was used to support small businesses through grants or loans, and many communities focused on increasing healthcare access, including testing and vaccination efforts, in underserved areas. 

These initiatives were part of the broader CDBG-CV program aimed at preparing for and responding to the pandemic, following guidance from HUD to maximize the impact of the funds through public services and economic support initiatives. 

Recent Updates to the CDBG Program

The CDBG program has undergone several updates in recent years to reflect new challenges in community development, disaster recovery, and resilience building.

Spring 2024 Updates to the CDBG Program

In the Spring of 2024, HUD introduced several updates to the CDBG program to improve efficiency and better target resources toward high-impact projects.

These updates include:

  • Streamlining the Application Process: The new guidelines simplify the process for local governments to apply for CDBG funds, reducing administrative burdens and allowing communities to access funds more quickly. 
  • Enhanced Focus on Climate Resilience: HUD has encouraged the use of CDBG funds for projects that address the impacts of climate change, such as extreme heat, floods, and wildfires. 
  • Public Engagement Requirements: The updated rules require more robust public engagement, ensuring that community members have a voice in how CDBG funds are used. 

Summer 2024 Updates to the Public Assistance Program

In the Summer of 2024, FEMA invited county leaders to provide feedback on an updated draft of the Public Assistance Program and Policy Guide (PAPPG).

The updates were meant to provide greater flexibility for CDBG-funded projects, especially in areas affected by natural disasters.

 The changes include:

  • Incentives for Mitigation Projects: Communities that incorporate mitigation measures into their CDBG projects are now eligible for additional federal funds. 
  • Faster Reimbursement: The reimbursement process for CDBG-funded projects has been expedited, reducing delays in getting funds to communities in need.

These updates reflect a growing recognition of the need for more agile, resilient community development strategies in the face of increasing disasters and economic challenges.  

The current version of the Public Assistance Program and Policy Guide can be found here.

Understanding the CDBG Program’s Non-Federal Match Requirement

A unique aspect of the CDBG program is the non-federal match, which requires that local governments contribute a portion of the project funding themselves.

This match ensures that local jurisdictions are invested in the success of their projects, typically ranging from 10% to 25% of the total project cost, depending on the type of funding.

How Non-Federal Match Works

  • Local Investment: Communities are required to provide a percentage of project costs through local funds, private investment, or in-kind contributions. 
  • Leveraging Federal Dollars: By requiring a non-federal match, the CDBG program encourages the leveraging of additional resources, helping stretch federal dollars further. 
  • Flexibility in Meeting the Match: Local governments can meet the non-federal match requirement through various means, including private donations, state funding, or volunteer labor.

The non-federal match increases local ownership of community development projects and encourages partnerships between governments, private companies, and nonprofits.

The Future of the CDBG Program

As communities face evolving challenges such as climate change, economic inequality, and public health crises, the CDBG program will continue to play a key role in fostering resilient, thriving communities.  

The program’s flexibility, combined with its ability to address both immediate recovery needs and long-term development goals, makes it a critical tool in the federal government’s approach to community engagement and development. 

Get in touch with the Tidal Basin team for more information on the Community Development Block Grant program and how it supports resilient communities.