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National Objectives 570.208 All CDBG activities must either: (a) Benefit low- and moderate-income persons (1) Area Benefit (2) Limited Clientele (3) Housing (4) Job Creation and Retention (b) Prevent slums or blight (1) Area (2) Spot (c) Meeting urgent community need 46
Remember: All National Objectives Are Not Equal • LMI Priority – Grantees must spend ≥70% of CDBG funds to benefit LMI (primary CDBG objective – develop viable communities for benefit of LMI persons) – So, only 30% can be spent on (b) Preventing Slums and Blight and (c) Urgent Need • Documentation – Different National Objectives Require Different Documentation 47
Page 2 and 3: Welcome • HUD’s Office of Commu
Page 4 and 5: Learning Objectives • Be familiar
Page 6 and 7: Agenda (cont) • Day 3 • Infrast
Page 8 and 9: ECONOMIC DEVELOPMENT STRATEGIES (TO
Page 10 and 11: Overview of Economic Development
Page 12 and 13: The Process Economic Analysis Evalu
Page 14 and 15: Economic Analysis • Assess qualit
Page 16 and 17: Strategy Options CDBG 108 Other Fed
Page 18 and 19: Implementation • Describe goals
Page 20 and 21: Summary: ED Strategies • Economic
Page 22 and 23: Topics • CDBG history background
Page 24 and 25: Primary Purpose • Develop viable
Page 26 and 27: “Companion” Programs to CDBG
Page 28 and 29: CDBG ED Project Decision Process 1.
Page 30 and 31: Typical CDBG-Funded ED Activities
Page 32 and 33: Eligible Activities • Wide variet
Page 34 and 35: Eligible Activities - ED Projects T
Page 36 and 37: Special Econ. Development • Comme
Page 38 and 39: Commercial Rehab • Limited types
Page 40 and 41: Special Activities by CBDOs • Typ
Page 42 and 43: Planning and Capacity Building •
Page 44 and 45: ACTIVITY: DETERMINING PROJECT ELIGI
Page 48 and 49: LMI: Area Benefit • Activity that
Page 50 and 51: Documenting Area Benefit • Bounda
Page 52 and 53: Job Training, Placement, or Support
Page 54 and 55: LMI: Housing Activities • Permane
Page 56 and 57: LMI: Job Creation & Retention • A
Page 58 and 59: Job Retention with LMI Benefit •
Page 60 and 61: Counting Jobs • Each business tra
Page 62 and 63: Counting Jobs • Count all jobs cr
Page 64 and 65: Documenting Job Creation • When
Page 66 and 67: Determining Income Status - Written
Page 68 and 69: Slum & Blight: Area Basis • Activ
Page 70 and 71: Slum & Blight: Spot Basis • Activ
Page 72 and 73: Urgent Need • Activities that all
Page 74 and 75: ACTIVITY: MEETING NATIONAL OBJECTIV
Page 76 and 77: Limitations on Job Relocation • J
Page 78 and 79: Faith-Based Organizations • Final
Page 80 and 81: 570.209 Public Benefit Standards
Page 82 and 83: Test at Two levels • Individual S
Page 84 and 85: Aggregate Standards • Create/reta
Page 86 and 87: Projects Automatically Fail Individ
Page 88 and 89: Summary: CDBG Foundation • Three
Page 90 and 91: REVITALIZATION STRATEGY AREAS (TOOL
Page 92 and 93: Revitalization Strategies • Writt
Page 94 and 95: • Area must be: - Contiguous - Pr
Page 96 and 97:
Assessment • Describe economic co
Page 98 and 99:
Benchmarks • Must describe measur
Page 100 and 101:
Review & Approval • Submitted wit
Page 102 and 103:
SMALL BUSINESS DEVELOPMENT (TOOLKIT
Page 104 and 105:
SMALL BUSINESS DEVELOPMENT 104
Page 106 and 107:
What Is a Small Business? • Not u
Page 108 and 109:
Technical Assistance • Business c
Page 110 and 111:
Typical Training & TA Providers •
Page 112 and 113:
Financial Assistance • Types of A
Page 114 and 115:
MICROENTERPRISE ASSISTANCE 114
Page 116 and 117:
Microenterprise Assistance • Fina
Page 118 and 119:
National Objective • Limited Clie
Page 120 and 121:
Key Steps In Setting Up Program •
Page 122 and 123:
Key Steps • Design TA and trainin
Page 124 and 125:
BUSINESS INCUBATORS 124
Page 126 and 127:
Benefits of Incubators • Help red
Page 128 and 129:
Financial Burden • Incubator is a
Page 130 and 131:
Funding Incubator Construction •
Page 132 and 133:
Evaluating Incubator Applications
Page 134 and 135:
Summary: Incubators • TA is impor
Page 136 and 137:
JOB TRAINING & OTHER PUBLIC SERVICE
Page 138 and 139:
What Is Job Training? • Help unem
Page 140 and 141:
Other ED Public Services • To sup
Page 142 and 143:
Who Can Undertake Training? • Gra
Page 144 and 145:
National Objective • Training as
Page 146 and 147:
Key Steps • Conduct a needs asses
Page 148 and 149:
Summary: Job Training • Job train
Page 150 and 151:
LARGE-SCALE COMMERCIAL DEVELOPMENTS
Page 152 and 153:
What Are Large-Scale Commercial Dev
Page 154 and 155:
CDBG Roles • Financing to busines
Page 156 and 157:
Special ED Activities • Acquisiti
Page 158 and 159:
National Objective • Job creation
Page 160 and 161:
Key Steps in Design • Determine i
Page 162 and 163:
INFRASTRUCTURE (TOOLKIT CH 7) 162
Page 164 and 165:
What Is Infrastructure? • Non-hou
Page 166 and 167:
Privately Owned Utilities • Cover
Page 168 and 169:
Ineligible Infrastructure Activitie
Page 170 and 171:
Special Assessments (cont) • If a
Page 172 and 173:
Special Assessments Are Not • Not
Page 174 and 175:
National Objective (cont) • Low/M
Page 176 and 177:
Key Steps • Decide if want to tar
Page 178 and 179:
Summary: Infrastructure • Public
Page 180 and 181:
Topics • Financing options • Re
Page 182 and 183:
Methods of Financing • Grants •
Page 184 and 185:
Equity • Contribution of cash or
Page 186 and 187:
Debt Options • Direct loans - Sub
Page 188 and 189:
Contingent Payment Loans • “Def
Page 190 and 191:
REVOLVING LOAN FUNDS 190
Page 192 and 193:
Typical Borrowers • Existing busi
Page 194 and 195:
Steps: Market & Client Scan • Con
Page 196 and 197:
Step: Select Administrative Entity
Page 198 and 199:
CDFIs 198
Page 200 and 201:
Definition of a CDFI • Specialize
Page 202 and 203:
CDFIs & CDBG • Job creation/reten
Page 204 and 205:
UNDERWRITING (TOOLKIT CH 9) 204
Page 206 and 207:
Underwriting Defined • Underwriti
Page 208 and 209:
HUD Appropriateness Criteria • Tw
Page 210 and 211:
Risks: Inflated costs Understated c
Page 212 and 213:
Necessity of Public Funding • Sho
Page 214 and 215:
Reasonable Return & Terms • Loan
Page 216 and 217:
Public Benefit Test • Applies to
Page 218 and 219:
Public Benefits: Aggregate Portfoli
Page 220 and 221:
Two Primary Types of ED Lending •
Page 222 and 223:
Underwriting Business Loans • Abi
Page 224 and 225:
Debt Coverage Ratio Guidelines •
Page 226 and 227:
What Is Value? Fair market value Li
Page 228 and 229:
General Guidelines: LTV • Commerc
Page 230 and 231:
Commitment • Commitment by owners
Page 232 and 233:
Management • Must be experienced
Page 234 and 235:
Small Startups • Likely to have a
Page 236 and 237:
Underwriting Real Estate Loans •
Page 238 and 239:
Collateral • Use Loan-to-Value Ra
Page 240 and 241:
Experience • Be certain developme
Page 242 and 243:
Summary of Appropriateness • Good
Page 244 and 245:
History of Appropriateness Criteria
Page 246 and 247:
Risks: Inflated costs Understated c
Page 248 and 249:
Gap Analysis • Financing gap •
Page 250 and 251:
Rate of Return + Reasonable cost -
Page 252 and 253:
Project Feasibility & Return • Te
Page 254 and 255:
Summary: Underwriting • CDBG has:
Page 256 and 257:
SECTION 108 (TOOLKIT CH 10) 256
Page 258 and 259:
SECTION 108 OVERVIEW 258
Page 260 and 261:
How much can communities borrow?
Page 262 and 263:
Advantages of 108 • Leverage - Ac
Page 264 and 265:
Eligible Activities • Acquisition
Page 266 and 267:
Program Requirements • National o
Page 268 and 269:
Section 108 Guarantee HUD Guarantee
Page 270 and 271:
Players & Roles • Community • H
Page 272 and 273:
Risks of Using Section 108 • Loan
Page 274 and 275:
Risk Management • Avoid construct
Page 276 and 277:
• Covers early payment Defeasance
Page 278 and 279:
Overview of Process • Screen proj
Page 280 and 281:
Application Types • Generic Appli
Page 282 and 283:
Citizen Participation • Provide a
Page 284 and 285:
HUD Review • Review by area offic
Page 286 and 287:
Disbursing & Servicing • Custodia
Page 288 and 289:
RELATED INITIATIVES 288
Page 290 and 291:
Brownfields & BEDI • Brownfields:
Page 292 and 293:
PROGRAM ADMINISTRATION (TOOLKIT CH
Page 294 and 295:
PROGRAM DESIGN & ADMINISTRATION 294
Page 296 and 297:
Typical Roles in ED Programs • In
Page 298 and 299:
Policies & Procedures • Recommend
Page 300 and 301:
Marketing • Develop a rollout str
Page 302 and 303:
Program-Wide Records • Consolidat
Page 304 and 305:
Financial Records • Bank records,
Page 306 and 307:
Subrecipient • Subrecipient appli
Page 308 and 309:
HUD REPORTING 308
Page 310 and 311:
Objectives • Suitable living envi
Page 312 and 313:
Indicators & Reporting • Grantees
Page 314 and 315:
Job Reporting (cont) • For job re
Page 316 and 317:
Businesses Assisted Reporting (cont
Page 318 and 319:
MEASURING ED PROGRAM SUCCESS 318
Page 320 and 321:
Monitoring • Grantees are respons
Page 322 and 323:
Monitoring Actions • Technical As
Page 324 and 325:
Summary: Administration • CDBG ED
Page 326:
Wrap Up • Final questions • Eva
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HUD's Office of Community Planning and

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