August 2009 Featured Article
It’s Time to Start Planning Your Small Cities Project
(Updated from September 2008 Article)
The New Jersey Department of Community Affairs (DCA) recently released its final plan for the Small Cities Community Development Block Grant (CDBG) program. The CDBG program will have a total allocation of $7,086,011, with funds allocated to the following programs:
- Emergency Housing Repair;
- Innovative Development;
- Housing Rehabilitation;
- Public Facilities; and
- 108 Loan Authorization.
Non-entitlement municipalities and counties are eligible to apply for funding through the CDBG. Applications will be accepted throughout the program year for the Emergency Housing Repair, Innovative Development and 108 Loan Program Funds. Public Facilities projects must be submitted no later than October 2, 2009 and Housing Rehabilitation projects submitted during the month of October 2009 will have priority. Therefore, the time to start planning for your Public Facilities and/or Housing Rehabilitation projects is now.
When planning for a Public Facilities and/or Housing Rehabilitation project, the first step is to determine whether or not you are an eligible unit of local government. The DCA has published a list of eligible municipalities and counties on their website at www.nj.gov/dca/divisions/dhcr/offices/docs/sccdbg/cdbgmdi.pdf. Listed next to each eligible municipality or county is a corresponding Municipal Distress Index (MDI) ranking. The MDI ranking determines the level of matching share that your community must provide. The lower the MDI ranking, the lower the matching share. For example, an MDI rank of 0 to 100 must provide a match of 10% of the project, while an MDI rank of 401 and above must provide a 50% match.
Once you have determined that you are eligible you can start to develop your project. If your community lacks affordable housing consider the Housing Rehabilitation Fund. The DCA is allocating $2,000,000 to activities that improve the condition of affordable housing in New Jersey. County-managed programs may be awarded up to $500,000, multi-jurisdictional programs can receive grants of up to $350,000 and programs serving one municipality may not exceed $200,000 in grant funding. No less than 70% of the funds will be used to benefit persons of low and moderate income.
The DCA has also allocated $3,853,431 to the Public Facilities Fund. This was established to assist communities in constructing or improving essential public facilities that will primarily benefit people of low and moderate income. The maximum grant awarded in this category will be $500,000. It is imperative that you schedule a meeting with your municipal engineer right away to begin the process of developing a public facilities project.
Once you have developed your project, it is time to begin writing the application. As in recent years, all applications must be submitted through the DCA’s SAGE system. The threshold requirements can be found in the final draft plan for the CDBG program submitted by the DCA. The proposal needs to meet one of the National Objectives set forth in the Housing and Community Development Act and must address at least one of the areas identified in your Statement of Community Development and Housing Needs. Additionally, all housing rehabilitation applications must include a provision for a revolving loan fund. A link to the final plan and the application guidelines can be found at www.nj.gov/dca/divisions/dhcr/offices/cdbg.html.
Further, you will need to conduct a Public Hearing at least 20 days prior to submitting a CDBG application. Copies of each published notice, and proof of publication and hearing minutes must be included as part of the application package.
It is important to note that all federal compliance items must be included in the application: resolutions for citizen participation and affirmatively furthering fair housing, a grant management plan, an environmental review record, professional services agreement drafts, an adopted policies and procedures manual for housing programs and matching funds certification all must be 100% complete and ready for execution. These items must be included in the application, or your community will not be eligible for funding.
If your community has met the threshold requirements, then your application will be scored on criteria such as your MDI, readiness to proceed documents (for Housing Rehabilitation: a list of several income eligible households with biddable work write-ups; and for Public Facilities: biddable plans and specifications), balance ratio (the remaining balance of grant awards received over a three year period) and a rating of your past performance. Entities that have a positive past performance will receive extra points on their overall score, while those with a poor performance may lose points.
Applicants may apply for one Housing Rehabilitation grant, one Public Facilities grant and one Innovative Development grant per year. The DCA retains the discretion to award only one grant each year per jurisdiction.
If you are interested in submitting an application for a Housing Rehabilitation and/or Public Facilities project, the time to start planning is NOW. The CDBG program through the DCA is an excellent way for non-entitlement municipalities and counties to ascertain funds to assist low and moderate income persons throughout the State of New Jersey. Schedule a meeting with your engineer and/or your community development liaison to get the ball rolling. You can also contact Terry Schrider at the Small Cities CDBG Unit at (609) 633-6283. Information regarding citizen participation requirements, environmental reviews and application guidance can be found within the DCA’s website at www.nj.gov/dca/divisions/dhcr/offices/cdbg.html#applications.