HUD’s Office of Community Planning and Development (CPD) posted on its website four short videos on using Community Development Block Grant (CDBG) funds for public service activities. CDBG entitlement communities and states may not use more than 15% of their annual allocation, plus any program income, for public service activities. The first two videos explain eligible and ineligible public service activities (4 minutes) and how to ensure a public service program meets a CDBG national objective, such as benefitting low and moderate income households (8 minutes). A third video discusses building an effective public service program (14 minutes) and the fourth provides a short summary (1 minute).
NLIHC notes that the second video does not mention the regulatory provisions about assessing a claim that a public service activity meets the national objective of benefitting low and moderate income households, those with income at or below 80% of the area median income, also referred to as “lower income.” The regulations enable advocates to challenge a claim that any CDBG activity benefits lower people by providing “substantial evidence to the contrary.” If provided such evidence, HUD has the responsibility to assess “the full range of direct effects of the assisted activity.” The regulations add that recipients must ensure that activities do not benefit moderate income persons (with incomes between 51% and 80% AMI) to the exclusion of low income persons (with incomes at or below 50% AMI).
Potential issues can arise with the Limited Clientele Test “presumed benefit” option and the Area Benefit Test. For example, the Limited Clientele Test presumes certain populations are lower income, such as elderly people. However, providing services to elderly people at a senior center in an affluent area might be of questionable benefit to truly lower income elderly people. The Area Benefit Test can consider an activity to be of benefit to lower income people if 51% of the population in the service area are lower income. Advocates need to look closely at a service in a nominally lower income area to assess whether the service truly serves lower income people.
The four videos are at: http://bit.ly/2tl8tVa
More information about CDBG is on page 8-3 of NLIHC’s 2017 Advocates’ Guide at: http://bit.ly/2sRPsZs