HUD’s Office of Community Planning and Development (CPD) posted the second round of CARES Act CDBG supplemental funding, CDBG-CV, on May 11. The methodology for distributing the $1 billion second round was posted on May 12.
The CARES Act requires the second round of funding to be allocated to states and insular areas "to prevent, prepare for, and respond to coronavirus within the state or insular area, including activities within entitlement and non-entitlement communities. This $1 billion is to be distributed based on public health needs, risk of transmission of coronavirus, number of coronavirus cases compared to the national average, economic and housing market disruptions, and other factors as determined by HUD using the best available data.” HUD had 45 days (from March 27) to allocate this $1 billion.
CPD established a method for distributing funding to states based on the three factors in the CARES Act. For public health needs, the count of low-income elderly people receives 50% of the weight in the formula, and the count of children in poverty receives 10%. For economic and housing market disruptions, 40% of the weight goes to the aggregate count of unemployment insurance claims over the six-week period ending April 25, minus the count during the same period last year. For risk of transmission and number of coronavirus cases compared to the national average, CPD uses the per capita rate of confirmed cases as of May 3, adjusted by up to 15% more for places with rates of cases above the national average. The methodology also lists the amount each state is set to receive.
The CARES Act provides up to $5 billion in CDBG supplemental funding. Of that amount, the first allocations of $2 billion were announced on April 1 (see Memo, 4/6) and were distributed to states and entitlement jurisdictions using the same statutory formula used to distribute the regular annual FY20 CDBG allocations.
The remaining portion of the $5 billion is to be distributed directly to a state or unit of local government, at HUD’s discretion, according to a formula based on factors to be determined by HUD. These allocations can be made on a rolling basis based on available data.
The list of all CARES Act supplemental fund allocations, including the second round of CDBG-CV is at: https://bit.ly/3fKDK9k
The methodology for amounts distributed to states is at: https://bit.ly/363pEf2
More information about the regular CDBG program is on page 8-3 of NLIHC’s 2020 Advocates’ Guide.