Communities eligible for Community Development Block Grant (CDBG) funding in the City of Urbana has increased, meaning the money available cannot meet the growing needs, according to a CDBG Coalition report published early this year.
Sheila Dodd, manager in the Grants Management Division in the Urbana Community Development Services Department, agrees.
“So if you have a pot of money and it’s divided by 500, and that same pot of money is suddenly divided by 600, your piece of the pie is smaller,” she said.
The Coalition consists of 32 national organizations representing local elected officials, housing and community development professionals, and a wide array of non-profit organizations.
Urbana is one of many cities in the nation that are part of the long-standing CDBG program, administered by the U.S. Department of Housing and Urban Development. The local program is monitored by the Grants Management Division.
The Community Development Services Department overall works to create programs for planning, housing and economic development to improve the quality of life for Urbana residents.
Dodd said the amount of funding available has been different every year.
“It’s kind of been an up-and-down cycle,” Dodd said.
This year, the city received $442,000, which is about $15,000 more than last year. Dodd said she isn’t aware of any specific reason why funding has been sporadic each year; all she knows is that these decisions are made at the congressional level.
In Urbana, Dodd said the CDBG funds are used for small grants to social service agencies and capital investment projects. In addition, they are used to provide stable housing for seniors or people with disabilities. For example, if any accessibility repairs are needed in these homes, the department uses the CDBG funds to ensure that residents can continue to live in their homes.
The report released in July shows that when the program began in 1975, CDBG allocated $2.4 billion to 594 grantees. In 2019, however, CDBG allocated $3.3 billion to 1,268. This means on average, funds per grantee has decreased over time from roughly $4.0 million to about $2.6 million at the national level.
“If resources were maintained with inflation, $2.4 billion allocated in July 1975 would have the same buying power as $11.2 billion today,” page 14 of the report reads.
Dodd said Urbana and Champaign work closely together.
“Most of your social service projects don’t stop at Wright Street, so if there’s a homeless issue, we’ll work together … (we) try to see areas where we can come together to make a bigger impact, whether it’s applying for additional funds or … writing a letter of support,” she said.
However, the two cities work together not with CDBG funds, but with HOME Investment Partnerships Program funds, said Janel Gomez, community development specialist in the Champaign Neighborhood Services Department.
The HOME program is a federal grant program established by the National Affordable Housing Act of 1990 Title II.
The two cities receive both HOME and CDBG funds from the Housing and Urban Development Department. HOME funds, however, are allocated to the city of Champaign as a Consortium. Urbana is the Consortium’s lead entity, so the two cities are required to submit select plans together. This is not the case for CDBG funds because they are directly given to each city.
Regardless, both Urbana and Champaign are facing issues of underfunding.
Like Urbana, Champaign also saw an increase in CDBG funds this year. In fact, Gomez said Champaign has seen increases for the past two years, negating approximately a 15-year trend of the amount decreasing. Champaign got $643,164 in 2017 to 2018, $832,235 in 2018 to 2019 and $855,190 in 2019 to 2020.
This still does not cover the number of issues in the area, such as inadequate amounts of affordable housing. Gomez said 47% of renters in Champaign are housing-cost burdened, meaning they pay more than 35% of their gross income for rent and utilities.
“… our recent one-day-open application period for Bristol Place received for 1,000 applications for 90 units of affordable housing,” Gomez said. “Rising housing prices combined with stagnant or slow-growing wages have exacerbated the problem.”
Gomez said many non-profit organizations in Champaign are either struggling or have already closed because of insufficient federal funds.
“We currently do not have a full-time, year-round homeless shelter in the community,” she said.
Dodd said Urbana is working to advocate for the importance of CDBG and also HUD programs. She said people have to be aware of how crucial the funds are in helping the community and what would happen if those funds did not exist.
“You just have to make adjustments and cut accordingly,” Dodd said. “Each year you look at what your greatest need is and how we’re going … to meet that need, and you’ll learn how to stretch a dime to a dollar.”