April 10, 2018

HUD Announces CDBG-DR Awards, Provides Massive Amounts for Puerto Rico and Mitigation

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Today the Department of Housing and Urban Development announced awards for the $28 billion tranche of Community Development Block Grant Disaster Recovery (CDBG-DR) funding that Congress appropriated as part of the Bipartisan Budget Act of 2018 (PL 115-123) disaster supplemental back in February. This CDBG-DR funding is primarily to assist areas affected by Hurricanes Harvey, Irma, and Maria in 2017.

Of the $28 billion, the law requires HUD to allocate up to $16 billion to address ‘unmet needs,’ of which no less than $11 billion must be allocated to areas affected by Hurricane Maria (i.e. Puerto Rico and U.S. Virgin Islands), and requires that no less than $12 billion be allocated for mitigation activities in states and jurisdictions that received CDBG-DR funds for disasters occurring in 2015, 2016, and 2017. HUD must also set aside $15 million for technical assistance for grantees and nonprofits in the affected area, $10 million for Community Planning and Development staff and travel costs, and $10 million for HUD’s Office of the Inspector General.

HUD has estimated that the total remaining unmet need for 2017 disasters is $12.03 billion, including the $11 billion for Maria-affected areas.  As a result, HUD is shifting the remaining $3.935 billion for unmet needs over to fund mitigation activities, increasing total mitigation funding to $15.93 billion.

HUD’s allocation means that disaster-affected areas will receive unprecedented funding for mitigation, and Puerto Rico will receive more funding than any grantee in the history of the program. Mitigation funding is allocated based on the grantee’s relative share of the $22.425 billion of CDBG-DR funds awarded for natural disasters occurring in 2015, 2016, and 2017. Puerto Rico will receive just over half of all mitigation funding. Texas, Louisiana, Florida, California, the Virgin Islands, and numerous local jurisdictions will also receive significant awards.  

Selected PL 115-123 CDBG-DR Allocations

Grantee

Unmet Need Funding for Disasters Occurring in 2017

Total Mitigation Funding for Disasters Occurring in 2015, 2016, and 2017

Puerto Rico

$10,153,130,000

$8,285,284,000

Texas

$652,175,000

$4,297,189,000

Florida

$157,676,000

$633,485,000

Virgin Islands

$846,870,000

$774,188,000

Louisiana

n/a

$1,213,917,000

California

124,155,000

88,219,000

This latest announcement of CDBG-DR awards follow the $7.4 billion tranche of CDBG-DR funding that Congress appropriated in the September 2017 disaster supplemental (PL 115-56). From this first tranche, HUD awarded Texas with $5.02 billion, Florida with $616 million, Puerto Rico with $1.5 billion, and the Virgin Islands with $243 million to address unmet needs. 


In the latest CDBG-DR awards, some factors in HUD’s formula to determine unmet need in disaster areas include:

  • Repair estimates for seriously damaged owner-occupied units without insurance after FEMA grants and SBA loans
  • Repair estimates for seriously damaged rental units occupied by renters with income less than 50 percent of the Area Median Income
  • Repair and content loss estimates for small businesses with serious damage in which the SBA denied loans
  • No less than $ 2 billion to improve the electrical grid in areas affected by Hurricane Maria
  • No less than $11 billion is awarded to areas affected by Hurricane Maria

Today’s announcement does not address how HUD will deploy the $15 million technical assistance and capacity building funding.   When the unexpected happens, no unit of government ever has the existing capacity to administer a recovery program at the scale required after a catastrophic disaster like Harvey, Irma, or Maria, and all agencies need to scale up exponentially to receive hundreds of millions or billions of disaster recovery grants.  The set-aside will allow HUD to help prepare communities to be effective stewards and realize the transformative potential of recovery dollars without depleting funds Congress already made available to support recipients of annual block grants.

 Enterprise continues to provide grants, loans, and technical assistance to support communities as they recover from natural disasters, and we are committed to advocating for renters and low-income communities, who are often worst-affected by floods, fires, and storms.

See Enterprise’s technical resources to help communities rebuild stronger and mitigate risk before the next disaster strikes. Check back with Enterprise for more analysis on CDBG-DR and the disaster recovery process when HUD publishes the rules governing the use of these funds and as grantees write and implement their recovery action plans.