Housing and Urban Development Community Grants Available to Water and Wastewater Utilities
The U.S. Department of Housing and Urban Development (HUD) operates the Community Development Block Grants (CDBG) program to provide grants for long-term needs to repair, construct, or buy public infrastructure. The program includes water and sewer systems. HUD also provides loans through the Section 108 Loan Guarantee Program.
Visit HUD's CDBG website for more information.
Community Development Block Grants
Community Development Block Grant (CDBG) funds are generally used for long-term community needs, including mitigation. Grants cannot duplicate funding available from the Federal Emergency Management Agency (FEMA), the U.S. Small Business Administration, or the U. S. Army Corps of Engineers (USACE).
Utilities can use these grants to buy, construct, or fix public facilities such as water and sewer systems. They can also match FEMA grants. Grantees may fund activities that meet urgent community development needs.
- Acquisition of real property
- Acquisition of property for public purposes
- Construction or reconstruction of water and sewer facilities, streets and other public works
- Relocation and demolition
- Rehabilitation of public and private buildings
- Public services, within certain limits
- Planning activities
- Activities relating to energy conservation and renewable energy resources
- Assistance to nonprofit entities for community development activities
- Assistance for profit-motivated businesses to carry out economic development and job creation/retention activities
CDBG - Entitlement Communities
- Metropolitan cities with populations of at least 50,000
- Principal cities of Metropolitan Statistical Areas (MSAs)
- Urban counties with populations of at least 200,000 (excluding the population of entitled cities)
CDBG - State Administered
- Are cities with populations of less than 50,000 people
- Do not include cities that are designated as principal cities of Metropolitan Statistical Areas
- Include some counties with populations of less than 200,000 people
Forty-nine states and Puerto Rico participate in the program. Non-entitlement communities must apply for CDBG funds through their state (except in Hawaii). Non-entitlement communities in Hawaii apply directly to HUD.
CDBG Disaster Recovery Assistance
In response to presidentially-declared disasters, the U.S. Congress may authorize disaster recovery funding for the CDBG program. This funding helps cities, counties and states recover from disasters, especially in low-income areas. Disaster Recovery grantees are required to spend at least 50 percent of their funds on activities that principally benefit low-and moderate-income persons.
- Debris removal not covered by the Federal Emergency Management Agency
- Acquisition, construction or rehabilitation of public facilities such as neighborhood centers
- Construction or reconstruction of streets
- Construction or repair of water, sewer, or drainage systems
- Construction or reconstruction of water lift stations
- Public services
- Helping businesses retain or create jobs in disaster-impacted areas
- Planning and administration costs (no more than 20 percent of the grant)
Find more information at HUD's CDBG Disaster Recovery Assistance website.
CDBG Section 108 Loan Guarantee Program
Section 108 loan guarantees provide communities with public project financing. This includes public facilities and economic development such as housing rehabilitation and large-scale physical development projects. Local governments can transform a small portion of their CDBG funds into federally guaranteed loans.
- Economic development activities eligible under CDBG
- Acquisition of real property
- Repair of publicly owned real property
- Construction, reconstruction or installation of public facilities
- Related relocation, clearance and site improvements
- Payment of interest on the guaranteed loan and issuance costs of public offerings
- Debt service reserves
- Public works and site improvements in colonias (colonias are rural communities located within 150 miles of the U.S.-Mexico Border)
- Metropolitan cities and urban counties (i.e., CDBG entitlement recipients)
- Non-entitlement communities that are assisted by states administering the CDBG program
- Non-entitlement communities receiving funds under the HUD-Administered Small Cities CDBG program (Hawaii)
- Entitlement public entities -- may apply for up to five times the entity's latest approved CDBG request
- State-assisted public entities -- may apply for up to five times the latest approved CDBG amount received by its state
For more information, see our CDBG Section 108 Loan Guarantee Program at a Glance document, or visit HUD's CDBG Section 108 website.