Budget cuts to a grant program could lead to “significant reductions in a range of services” for about 5 million low-income and moderate-income U.S. residents, according to survey released this week by a coalition of housing, community development and other community groups.

The survey found that hundreds of thousands of senior citizens, children, persons with special needs and the homeless will lose programs that directly benefit them, according to the survey. “Everything from housing rehabilitation and home-buyer assistance programs to job creation and projects to reduce environmental contamination and to construct fire and public safety facilities will be affected.”

A 14 percent reduction in money for the Community Development Block Grant program over the last two fiscal years “has had a substantial, negative effect on the collective ability of states, cities, and counties to serve Americans in need, promote home ownership, grow local economies, and strengthen the nation’s infrastructure,” said Montez Martin, vice president of Community Revitalization and Development for the National Association of Housing and Redevelopment Officials.

Martin and other representatives of groups in the coalition spoke during a presentation this week of the “Consequences for American Communities” survey, and members of the group protested an additional proposed reduction of 25 percent reduction in CDBG funding for the fiscal year 2007 budget.

Representatives from the U.S. Conference of Mayors, the National League of Cities, the National Association of Counties, the Local Initiatives Support Corp., and Real Estate Roundtable also participated.

There are 17 national groups represented in the coalition, including: the American Federation of State County Municipal Employees, Council of State Community Development Agencies, Enterprise, Habitat for Humanity International, Housing Assistance Council, International Economic Development Council, National Association for County Community and Economic Development, and the National Association of Development Organizations, among others.

“On CDBG, our message is united: this program is too precious — too important to us as a critical tool to revitalize and preserve the quality of life for our citizens. We cannot let the Congress try and balance the budget on the backs of our local communities,” said James C. Hunt, president of the National League of Cities. “But we want to make sure that any amendments that support full funding for CDBG are not based on accounting gimmicks. At the end of the day, we have to make sure that our cities and towns have $4.3 billion for CDBG (in the 2007 fiscal year).”

“CDBG funds are critical for us at the county level. They not only help us serve our less fortunate citizens, but they allow us to address various quality of life, public safety, and economic development issues specific to our individual communities,” said National Association of Counties president-elect Colleen Landkamer.

Thirty-four states and 317 communities responded to the survey, representing about 50 percent of all CDBG formula grants for fiscal year 2006.

Among the survey findings:

  • 5 million low-income and moderate-income people no longer have access to programs funded through CDBG, including 256,000 elderly, 391,000 children and young people, 253,000 people with special needs, and 196,000 homeless.

  • 50,000 households will no longer be assisted through housing rehabilitation programs, including 5,200 elderly.

  • 5,600 fewer businesses, including minority-owned businesses, will lose support and the potential for 15,000 new jobs will be lost.

  • 158 new water and sewer projects serving 120,000 people would be canceled or delayed, with another 30 or more involving sites suspected with environmental contamination postponed.

  • 303 new projects for street improvements will be canceled or delayed, and 127 projects to build community and neighborhood centers for seniors, youth, children, and the disabled and handicapped will be canceled or delayed, along with 208 new parks and recreational projects and 26 new fire stations and purchases of fire equipment.

Roger Platt, senior vice president and counsel for the Real Estate Roundtable, said, “CDBG funds are critical to attracting private capital and building public-private partnerships for brownfields and other important development projects. These partnerships combine very different but complementary strengths of the business community and the public sector to ensure seed money from the CDBG program is leveraged to produce maximum benefit to local communities, including affordable housing.”


Send tips or a Letter to the Editor to glenn@inman.com or call (510) 658-9252, ext. 137.

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