Disaster Recovery Timelines are Shortening, but Challenges Remain for the CDBG-DR Program

An Urban Institute report, “Housing Recovery and CDBG-DR: A Review of the Timing and Factors Associated with Housing Activities in HUD’s Community Development Block Grant for Disaster Recovery Program,” provides in-depth analysis of disaster recovery timelines and implementation challenges since 2006. The research finds that Community Development Block Grants for Disaster Recovery (CDBG-DR) took 4.7 years to complete, on average, with wide variation across housing activity types. The researchers found shared implementation barriers across grantees, including limited staff capacity, complex program requirements, and challenging application processes.

HUD’s CDBG-DR program is intended to address unmet needs after disasters once FEMA and Small Business Administration funding has been depleted. The funds require a special congressional appropriation following a presidentially declared disaster. Most CDBG-DR funding is used for housing activities, including relocation, new construction, and rehabilitation, but it can also be used for other activities such as social services and economic and community development.

The researchers completed both a quantitative analysis of CDBG-DR grant timelines and expenditures and a qualitative analysis of CDBG-DR administration challenges. Both analyses drew on data from CDBG-DR housing activities completed between FY2006 and FY2015. The quantitative analysis examined how long it took to complete specific CDBG-DR grant phases: appropriations (funds appropriated as a part of a specific recovery legislation), grants (funds allocated to state and local governments by HUD), and activities (specific projects completed as a part of the grant). The qualitative analysis included interviews with 13 HUD staff and 48 state and local CDBG-DR staff.

The researchers found that CDBG-DR grants took an average of 4.7 years to complete and that CDBG-DR housing activities took 3.8 years to complete. Timelines varied widely across type of program activities. Time-intensive activities included homeownership assistance and building new affordable rental units, which took 5.3 and 4.6 years on average, respectively. More immediate activities, such as housing relocation payments, took the least amount of time at an average of 1.1 years.

The time between HUD funding allocation and grantee activity completion has decreased since 2006 by approximately 6.9% annually, and the completion of the entire grant period has decreased 5.4% annually. For example, multiple grants in 2008, including those for Hurricanes Gustav and Ike, took over five years to complete. Several 2013 grants, such as those for Hurricane Sandy and Colorado severe storms, took only three and a half years to complete.

Despite these shortened timelines, challenges to administering CDBG-DR funds persist. Through interviews with HUD and CDBG-DR grantee staff, the researchers identified common implementation barriers across eight grantees. Many grantees struggled with staffing, including limited staff experience, capacity, and staff turnover. Grantees were also overwhelmed by the sheer number of applications they received, leading to delays in funding disbursement. Application requirements and eligibility also proved confusing to both grantees and applicants because requirements changed over time with the introduction of new HUD regulations. Lastly, cumbersome program regulations and requirements made it difficult for grantees to implement high-quality programs efficiently. For example, environmental review processes and duplication of benefit requirements significantly slowed down how quickly funding could be distributed.

The researchers conclude with a series of recommendations for CDBG-DR grantees, HUD technical assistance providers, HUD administrative departments, and the federal disaster recovery policy framework as a whole. First and foremost, Congress should permanently authorize the CDBG-DR program with statutory authority, increasing certainty during the approval and allocation process. In addition, recommendations included greater cross-agency collaboration between agencies involved in disaster recovery, outcome tracking, an increase in staffing levels.

CDBG-DR is not yet a formally authorized program, meaning that Congress must allocate funding for the program on a case-by-case basis with HUD publishing new rules each time the program is used. The lack of permanent authorization ties this important source of disaster recovery funds to Congressional politics and means that there is often little a state or local government can do ahead of time to ensure funds are distributed quickly. NLIHC and the DHRC have been pushing for permanent authorization of the program – most recently with the “Reforming Disaster Recovery Act of 2019,” sponsored by Representatives Anne Wagner (R-MO) and Al Green (D-TX), and Senators Brian Schatz (D-HI), and Todd Young (R-IN). That bill was unanimously passed by the House of Representatives.

The report can be found at: https://bit.ly/3tfvZzh

Read about the “Reforming Disaster Recovery Act” at: https://bit.ly/36rdG0a