Last Wednesday, the House Subcommittee on Housing, Community Development and Insurance held a hearing on the Community Development Block Grant (CDBG) Program and its impact on addressing local challenges. Kimberly Robinson, Executive Director of the Pioneer Valley Planning Commission (PVPC) testified on behalf of the National Association of Regional Councils (NARC). Robinson was joined by Joseph Jaroscak, an analyst in Economic Development Policy at the Congressional Research Service; George Mensah, Director of the Miami, Florida, Department of Housing and Community Development; San Francisco Mayor London Breed; and Salim Furth, a Senior Research Fellow at George Mason University’s Mercatus Center.
CDBG has long been a critical source of funding for local projects that address poverty and inequality, especially through economic development and infrastructure programs. Regional councils often help to organize these efforts by providing technical support to communities who seek CDBG funding. PVPC, for example, both applies for and administers CDBG grants for member communities, while also facilitating cooperation between members in order to increase the amount of funding received and improve its efficiency.
While CDBG remains successful in its ability to provide for lower- and middle-income communities, shortfalls in funding over the last two decades have hampered the program’s ability to confront the economic development needs of the communities it serves. Robinson emphasized this point in her testimony, pointing to how CDBG’s funding of $3.44 billion in FY2021 is nearly $1 billion less than it was in 2004. Further, she pointed out that if the original allocation from 1975 were adjusted for inflation, funding for CDBG would exceed $10 billion today.
In her testimony, Robinson also highlighted how, although 70 percent of federal CDBG funds are allocated to larger entitlement communities — defined as principal cities of Metropolitan Statistical Areas, other metropolitan cities with populations exceeding 50,000, and qualified urban counties with populations exceeding 200,000 — the remaining 30 percent allocated to states is still crucial to the development of smaller communities, and CDBG thus cannot be viewed as just a “big city” program. As an example, she pointed to how PVPC aided 19 different communities with CDBG funding in FY2019, despite having just four members that qualify as entitlement communities.
Following the testimonies, Democratic Representative Joyce Beatty (OH-3) asked about how CDBG helps support affordable housing. Robinson responded by articulating how, although the funding cannot be used to construct new housing, it allows PVPC to undergo rehabilitation projects that keep vulnerable people — especially the elderly — in their homes. Representatives from both parties, as well as several of the witnesses, agreed that CDBG funds should not be prevented from going toward new construction and that restrictive zoning barriers limiting their effectiveness should be lifted.
Broadly speaking, there was bipartisan momentum at the hearing toward reforming the formulas used in CDBG allocation. While Democrats, including Chairman Cleaver, praised the flexibility of CDBG and supported increasing its funding in addition to reforming allocations, Republicans seemed hesitant to spend more on the program. Overall, discussion at the hearing suggested an increase in funding for CDBG is unlikely. However, restructuring the program to better serve non-entitlement communities and contribute more to affordable housing, without compromising flexibility appears to be a more attainable goal for the subcommittee.