Federal housing and community development funding operates primarily through formula grants to states and entitlement communities, with nonprofits and developers typically accessing these funds through local government sub-grant competitions rather than applying directly to HUD. The Community Development Block Grant (CDBG) distributes approximately $3.3 billion annually to over 1,200 entitlement jurisdictions and states, which fund local housing rehab, infrastructure, economic development, and public services. The HOME Investment Partnerships program provides approximately $1.5 billion annually for affordable housing construction, rehabilitation, and homebuyer assistance — with at least 15% reserved for Community Housing Development Organizations (CHDOs). HUD's Continuum of Care program (CoC) funds homeless services through local collaborative applications, with individual organizations applying within their local CoC rather than directly to HUD. Competitive HUD programs — Choice Neighborhoods ($30–50M per award), Strong Cities Strong Communities, and the Environmental Justice initiative — are accessible directly by local governments and their nonprofit partners. The Treasury Department's CDFI Fund and New Markets Tax Credit program provide complementary investment tools for community development financial institutions and affordable housing developers working in low-income communities.

Frequently Asked Questions

What is the CDBG program?

The Community Development Block Grant (CDBG) is HUD's flagship community development program, providing annual formula grants to cities and counties. Funds can be used for housing rehabilitation, infrastructure, economic development, public services, and planning. At least 70% of funds must benefit low- and moderate-income persons.

How do nonprofits access HUD homeless grants?

HUD's Continuum of Care (CoC) program is the primary funding source for homeless services nonprofits. Organizations apply through their local Continuum of Care collaborative, which submits a unified application to HUD. Eligible uses include transitional housing, permanent supportive housing, rapid rehousing, and homelessness prevention.

What is HUD's HOME Investment Partnerships program?

HOME is HUD's largest affordable housing block grant, distributing approximately $1.5 billion annually to states and entitlement communities. Funds can be used for homebuyer assistance (down payment, closing costs), rental housing construction and rehabilitation, and homeowner rehabilitation. Community Housing Development Organizations (CHDOs) — HUD-certified nonprofits — must receive at least 15% of each jurisdiction's HOME allocation. States and local participating jurisdictions administer HOME through their own competitive processes.

Are there federal grants for affordable housing construction by nonprofits?

Yes. In addition to HOME, nonprofits can access USDA Section 515 Rural Rental Housing loans and Section 516 Farm Labor Housing grants for rural areas. HUD's Choice Neighborhoods grants ($30–50M) fund transformation of distressed public housing into mixed-income communities, with nonprofits typically partnering with housing authorities. The Treasury Department's Community Development Financial Institutions (CDFI) Fund and New Markets Tax Credit program channel investment to nonprofits developing affordable housing in low-income communities.

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