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June 2015 Policy Study, Number 15-6


The Nanny State Is Expanding And Private-Property Rights Are Decreasing


Cities Taking Other Options



Another major “big” government program is the Community Development Block Grant (CDBG) funds.  The CDBG monies are supposed to help “develop viable communities by providing decent housing and suitable living environments and expanding economic opportunities, principally for persons of low and moderate incomes.”  The types of projects which can be funded by CDBG include water and sewer facilities, community buildings, housing rehabilitation, economic development, and job training.[28]


The amount of tax money “allocated” to Iowa for the CDBG in 2014 was $21.6 million. The state priorities for spending this money are owner-occupied housing for elderly individuals, infrastructure for low and moderate-income communities (LMC), day-care centers and sheltered workshops for low and moderate-income individuals (LMI), and economic development programs to retain or create jobs for LMI.[29]  The amount set aside for owner-occupied housing rehabilitation in 2014 was $5.4 million.  Another 60 percent or almost $13 million was allocated for non-housing activities, including $4.3 million for economic development and job training and emergency set-aside funds of just over $1 million.[30]  Much of these funds were used for the LMI focus. 


Because of the onerous regulatory, reporting, and legal constraints of the Section 8 voucher program and the CDBG programs, more and more cities and towns are opting out of the programs.  The nanny state control just is not worth the money. 


In September 2014 Earlham city council members tabled acceptance of CDBG funds for further consideration.[31]  Following further research by a Regional Planner with the Southern Iowa Council of Governments (SICOG), an individual with an extensive background in federally funded housing issues, the Earlham city council voted in October to proceed with the grant.[32]  At the same time they voted to select SICOG to provide “technical services” to manage the housing rehabilitation program.[33]  The SICOG is exactly the type of organization that HUD wants intimately involved in the implementation of the AFFH regulation.  In this case they were not only successful at convincing the city council to accept the federal money, but to give them control over spending it.


In a more definitive and independent action in September 2014 the Ankeny, Iowa, city council decided to defer their acceptance of entitlement status from HUD for a CDBG block grant.  The council members then went further, in contrast to Earlham, and refused to allow city staff to proceed with developing a draft application for the Downtown Revitalization and Single Family Owner-Occupied Housing Rehabilitation program.  The motion to proceed with developing an application failed for lack of a motion to consider directing staff to proceed.[34]  




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