Using HUD Community Development Block Grants for Local Code Programs 1

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1 Using HUD Community Development Block Grants for Local Code Programs Presentation at ICC Annual Business Meeting September 30, Today s Agenda I. Overview of HUD CDBG & Code Programs II. Keys to Using CDBG for Local Code Programs III. Who Obtains CDBG? Entitlement & Non Entitlement Communities IV. What and Where is CDBG for? Meeting a CDBG National Objective V. How Can You Use CDBG? Eligible Activities including Codes VI. Making Codes Part of the Plan Consolidated& Action Plans VII. Examples of CDBG for Codes in Action VIII. Summing It All Up IX. More Information X. Q&A 2 Background on Sustainable Strategies DC Who Are We? Government affairs and strategic consulting firm Represent local governments, green technology companies and non profit organizations across the nation Focus on community revitalization, sustainable economic development, clean energy, brownfields and smart growth, clean air and clean water, and infrastructure improvements 3 Grants for Local Code Programs 1

2 Overview of HUD CDBG & Code Programs Purposes of CDBG Program Community revitalization, decent housing and a suitable living environment, economic empowerment, infrastructure development, and the prevention and elimination of community blight and deterioration HUD Support for Local Code Programs HUD recognizes the role of codes in community restoration, and allows CDBG dollars to support local code programs HUD Collaboration with ICC Forthcoming HUD Guidance on CDBG for Codes Key to Using CDBG for Local Code Programs CDBG funds can and do support local code programs but there is strong competition for limited CDBG funds, and you must understand CDBG requirements Must understand who controls your locality s CDBG in Entitlement Communities, your own city or urban county controls the funds; in Non Entitlement Communities, your State controls the funds Must meet a CDBG national objective benefit low and moderate income persons; prevent or eliminate deterioration, slums & blight; or meet urgent needs Key for code programs to delineate the service areas where you will conduct the activities Key to Using CDBG for Local Code Programs Must use CDBG on eligible activities which includes salaries and expenses related to code inspections and enforcement Must have code enforcement included in CDBG Consolidated & Action Plans Grants for Local Code Programs 2

3 Who Obtains CDBG? Entitlement & Non Entitlement Communities HUD CDBG funding is allocated annually to nearly 1,200 communities directly and serves another nearly 3,800 through states and counties, based on congressional funding levels and a formula that considers community needs, including the extent of poverty, population, housing overcrowding, age of housing, and population growth lag in relation to other communities Entitlement Communities are cities with population > 50,000, principal cities of metro areas, or counties with population > 200,000 that receive a direct annual CDBG allocation from HUD Non Entitlement Communities are smaller communities not eligible for direct CDBG funding, who must obtain funds from their State A few special situations including communities in Hawaii, insular areas, and minientitlement communities in a handful of states What and Where Is CDBG for? Meeting a National Objective CDBG funds must be used to meet one of three national objectives: Benefit to low and moderate income persons on an area basis generally means that benefit must go to areas where 51% of more of persons have low or moderate income. But, there can be an alternate measure in some communities. Data used is usually census data, although surveys may be done. Prevent or eliminate slums & blight on an area basis must address deterioration as defined by local or state law and meet minimum HUD standards that at least 25% of structures be deteriorated or public improvements throughout the area are in a general state of deterioration. Code activities must, with other measures, address the conditions of deterioration. Urgent needs usually associated with disaster or catastrophe Very important to define and target specific service area! How Can You Use CDBG? Eligible Activities including Codes CDBG funds can be used for salaries, legal proceedings, and other expenses associated with code inspections and code enforcement. CDBG funds cannot be used for code inspections for the purpose of processing rehabilitation applications or overseeing rehabilitation, or for the costs of building owners to correct code violations. But, the costs of correcting code violations may be eligible for CDBG assistance as a rehabilitation activity (which has its own CDBG requirements). Grants for Local Code Programs 3

4 Other Eligible Code Activities but Challenges to Use Biggert legislation identified other uses of CDBG for codes training of code staff and increasing of staff competence and professional qualifications, for individual certification or departmental accreditation, or for capital expenditures specifically dedicated to the administration of a building code enforcement department. BUT there are challenges to these expanded uses including match requirements and the sunsetting of the law. ICC recommends sticking with the basics. Making Codes Part of the Plan Consolidated & Action Plans The entity that controls CDBG funding (city/urban county for Entitlement Communities or the State for Non Entitlement Communities) must conduct regular planning for use of CDBG funds. Consolidated Plan Each 3 5 years, CDBG grantees must conduct a needs assessment, engage in public participation process, and form Consolidated Plan with CDBG (and other HUD funding) priorities and uses of funds. Plan can be amended. Annual Action Plan Each year, grantee must submit and get HUD approval of Action Plan, a concise summary of the actions, activities and the specific federal and nonfederal resources that will be used in that year to address the priority needs and specific goals identified by the Consolidated Plan. States must also establish a Method of Distribution for funding non entitlements. Engage key stakeholders to see the value of code programs! Examples of CDBG for Codes in Action Columbus, Ohio (pop. 787,033) An Entitlement Community that knows that code programs are a key part of revitalizing two older, distressed sections of the city. Mayor Coleman sees code enforcement as a important tool in his vacant and abandoned property initiative. West Springfield, Massachusetts (pop. 28,410) A Non Entitlement Community that put $62,400 toward code inspector salaries to focus on a low income, deteriorated, high violation area. The designated code inspector averages inspections/re inspections of single and multifamily structures in the approved area each year. Grants for Local Code Programs 4

5 Examples of CDBG for Codes in Action Durham, North Carolina (pop. 233,252) An Entitlement Community that uses $200,000 annually of a $1.6 CDBG allocation to support the salaries of code enforcement officials. Durham s CDBG supported code enforcement activities have also helped to increase the impact of the City s Neighborhood Stabilization and Vacant and Boarded Remediation Programs. A cautionary tale: HUD found violations at a large HUD CDBG grantee for failing to delineate a specific area for CDBG funded code activities, failing to identify the conditions of deterioration, and failing to keep good records for how the CDBG funding was spent on appropriate code activities Summing It All Up CDBG funds can & do support local code programs including salaries, legal proceedings, and expenses for code inspections and enforcement. Understand & work with those who control your locality s CDBG. Meet a CDBG national objective to benefit low and moderateincome persons; address slums & blight; or meet urgent needs. Delineate the service areas where you will conduct the activities and keep good records. Get code programs included in CDBG Consolidated & Action Plans. For More Information Local & State CDBG Officials at evelopment/programs/contacts The Basically CDBG Training Manual at evelopment/training/basicallycdbg and Basically CDBG for States Training Manual at evelopment/programs/stateadmin (see link on right column) HUD Field Offices, list at odirectors The International Code Council with its ICC Guide on HUD CDBG Funds for Local Code Programs and additional technical assistance. Contact 888 ICC SAFE, x6235 for more info. Grants for Local Code Programs 5

6 Questions & Discussion 16 Grants for Local Code Programs 6