Community development
Federal funding for community development
Community development efforts are an important complement to housing-related investments. Strategic investments in infrastructure, public facilities, and services are critical for ensuring that families of all income levels can access safe and livable neighborhoods.
Investments in transportation access, sewer and water infrastructure, broadband access, and community facilities such as parks and libraries can all encompass community development. Several federal programs for housing and community development investments include the Community Development Block Grant Program (CDBG) and several COVID-19 relief programs.
Balancing housing and community development investments. Jurisdictions should consider balancing the creation of new affordable housing in resource-rich areas with investments in community development in areas with ample affordable housing. Both strategies are valuable and merit support. Localities can undertake a neighborhood-by-neighborhood assessment of housing needs and community development priorities to facilitate a weighing of different options. This type of analysis can be vital to developing or implementing a comprehensive local housing strategy.
Targeting low- and moderate-income households. Because anyone can use infrastructure and community amenities, it can sometimes be challenging to determine whether a specific community development investment is likely to benefit the highest-needs households. Jurisdictions should consider how they will design and target investments to maximize benefits for the target population. For example, CDBG investments must target neighborhoods where most households have incomes below 80 percent of the Area Median Income (AMI).
Infrastructure needs in rural areas. Creating new affordable housing opportunities in rural and exurban communities is essential for providing low- and moderate-income families with diverse housing options. However, basic infrastructure – including roadways, water, and sewer connections – will often be a precondition to support multifamily or denser single-family development. Broadband access is also important, as many households require high-speed internet for school or employment. Localities targeting rural areas for affordable housing development should consider these infrastructure needs alongside the area’s housing needs.
Using State and Local Fiscal Recovery Funds (SLFRF) before they expire. SLFRF may be used to support community development and infrastructure projects but must be obligated by the end of 2024 and expended by the end of 2026. Jurisdictions wishing to use SLFRF for these purposes should consider how to use funds before the deadline effectively. For example, funds could finance infrastructure projects that are still at an early stage for pre-construction work, such as site preparation.
For more information, see this brief on Strengthening Communities Through Community Development Activities.