City to lose $3M in block grant funds

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When President Barack Obama released his 2011 budget proposal in February, it included a 7.5 percent cut to Community Development Block Grants. Though many Pittsburgh government officials worried how the loss of CDBG funds would impact the city, White House representatives said this cut was far less than the 70 percent cut Republicans desired.

Pittsburgh

Then, on April 8, in an effort to stave off government shut down, Obama compromised on a 16.2 percent cut more than doubling what he originally proposed. This compromise was part of $38 billion in total cuts to federal spending.

“As part of the deal to prevent a government shutdown last Friday (April 8), the administration and congress agreed to cut the Community Development Block Grant formula program by 16.2 percent. This means that CDBG formula funding will decrease from $3.99 billion in FY 2010 to $3.343 billion in FY 2011, a $647 million cut,” said Tom Cochran, CEO and executive director of the United States Conference of Mayors in an announcement on April 12. “On top of this, all domestic discretionary programs will have an additional 0.2 percent cut.”

Nearly one month later, Pittsburgh government is still unsure how the cut will impact the city, and how to factor it into their upcoming budget. The federal cut translates to a loss of $3 million from the city’s CDBG funds.

“I can tell you that we have not received official word regarding exactly how we will be impacted,” said Joanna Doven, spokesperson for the Mayor’s office. “Right now we are expecting to receive $15 million in CDBG funds. That number takes into account $3 million in cuts that may affect Pittsburgh. We are working on a capital budget that prioritizes residents greatest needs and takes into account any cuts in CDBG funding.”

When the initial 7.5 percent cut was proposed in February, District 9 Councilman Rev. Ricky Burgess took proactive measures to ensure the remaining CDBG funds would be used to benefit suffering neighborhood like those in his district. His introduction of Council Bill 2011-1531, which reduced the city’s CDBG budget by $2.75 million in order to allocate more dollars for low- and moderate-income families and the organizations that serve them, follows several pieces of CDBG related legislation proposed by Burgess over the course of his term.

“Last year, City Council unanimously passed legislation requiring that CDBG funds be used only as an enhancement to low- and moderate-income communities, not a replacement,” Burgess said. “This legislation will protect the most vulnerable of city residents while keeping the city in compliance with Ordinance Number 29 of 2010 and maintaining a balanced budget, a requirement under the City’s Home Rule Charter.”

In the past CDBG dollars have been used to fund youth employment programs and housing developments.

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