Do you know what happens to areas where there’s an economic decline? One bleak scenario is that without money, it starts to become dilapidated and possibly crime-ridden, so that just accelerates the pace of businesses and residents leaving the area. Revenues decline further because of the shrinking tax base, and the downward spiral continues.
One way to prevent this is with an infusion of outside funding. One way a town or neighborhood can get a boost is with money from the federal government. One of the longest-running and most successful federal grant programs is the Community Development Block Grants.
Here’s how it works. A sum of money in the form of a federal grant is provided to a local government with just general guidelines on how it can be used. The local government gets to decide exactly how it should be allocated. The idea is that individual communities know better than a large, remote government what their most pressing needs are. Areas that are in danger of decline are often recipients of these federal grants so that the problem doesn’t spiral out of control.
Some common uses of the Community Development Block Grant are the creation or maintenance of affordable housing and infrastructure improvement. These federal grants help maintain the livability of communities and prevent abandoned houses, blighted areas, and dangers from crumbling infrastructure. The funding doesn’t have to be used just for building projects, though. Some other possible uses of this federal grant are anti-poverty programs and educational projects.
The general idea is to maintain the overall quality of a community and help keep it a decent, safe, affordable place to live and work. One of the reasons cited for the success of the Community Development Block Grant program is its bottom-up structure, which enables the federal grant money to go precisely to where it’s needed most.
If you are a real estate investor, you’ll want to see how Community Development Block Grant funding is allocated in your community. You may find that your investment properties are eligible for repair funding to help keep them safe, affordable, and energy-efficient. In the event, though, that you find that the federal grant money is not being allocated that way, you usually have the opportunity to make your wishes known to the officials who decide on how the funding will be split up. If enough community citizens’ voices are heard in favor of a particular need, then you’ll have an influence on the use of the federal grant money.
As a homeowner or real estate investor, you can also benefit indirectly from the funding. It may go to build or improve public spaces and common areas. That will make the neighborhood more pleasant and increase the value and desirability of your property.
Community Development Block Grant funding is a federal grant that can benefit you and your neighbors, so it’s worth finding out what’s available in your own community.