GOP block grant cuts could hurt W.Va.
CHARLESTON, W.Va. -- A bill advancing through the Republican-led House of Representatives would cut nearly in half federal funds that Charleston and other West Virginia cities use to fund senior centers and homeless shelters and to pave streets in low-income neighborhoods.
The bill would cut national funding for Community Development Block Grants from $3.1 billion annually to about $1.6 billion for the 2014 fiscal year. That would mark the lowest level of funding since the program began in 1974.
The CDBG money is part of a much larger House bill that funds the Departments of Transportation and Housing and Urban Development. It passed out of committee in late June on a party-line vote -- Republicans voted for it, Democrats against it -- and the full House is expected to begin debating it Tuesday.
The CDBG program gives money directly to eight cities in West Virginia, and also gives a block grant to the state to provide services in smaller cities and towns.
There are some constraints -- no more than 20 percent of the money can be spent on administrative fees, and any roadwork must be done in low-income communities -- but cities are largely free to spend the money as they see fit.
Charleston received $1.4 million for the current fiscal year, which ends June 30, 2014. That's down from $1.8 million the previous year, partly due to the automatic federal budget cuts known as sequestration.
The money will go to a broad range of services, according to Brian King, the director of the Mayor's Office of Economic and Community Development in Charleston.
The city plans to spend $303,000 paving streets and sidewalks in low-income communities.
The CDBG money also pays for building inspectors and public facility improvements.
The city will give about $210,000 to 15 nonprofit agencies, such as the YWCA women's and children's shelter; the Roark-Sullivan homeless shelter and West Virginia Health Right, which provides free health care to the uninsured.
"When they're cutting CDBG funds, those are the funds that go to the poorest people," said Charleston Mayor Danny Jones, a Republican. "I get what they're trying to do, but it's going to affect real people. It's just sad. I'm not angry, I'm just sad."
King said that if the CDBG money were to decrease by nearly half, city officials would have to make some difficult decisions.
"A whole lot of things would slow down. We try to do the best we can with that money and spread it around as much as we can, so obviously we're going to put a hole in our budget," King said. "For the nonprofits it's going to mean one less agency to go to for fiscal assistance. If we get that little I'm sure we would not be supporting 15 agencies."
Parkersburg is getting about $800,000 in CDBG funds this year, less than half of the $1.7 million the city got in 2001, according to Ann Conageski, the city's development director
Like Charleston, they've used the money to improve infrastructure in low-income areas, paving roads and sidewalks and also building ramps to make buildings compliant with the Americans with Disabilities Act. They give money to local shelters and use money to tear down abandoned, dilapidated houses
They've also used CDBG money to promote economic development in downtown Parkersburg.
If downtown businesses invest in renovating their building's façade, they can get a grant for up to $10,000 in matching CDBG funds. The stipulation is that employment levels cannot decline for at least five years, or else the business has to reimburse the grant money. Conageski said that seven downtown businesses have taken advantage of the façade grants.
In 2006, when Highmark Blue Cross Blue Shield was looking for a new building, Parkersburg was able keep the business downtown by giving them a $200,000 economic development grant to buy a new headquarters, Conageski said. The insurance company had to commit to increasing its workforce by at least 50 employees for five years. Conageski said that its workforce grew from 500 to 750, before declining somewhat in the last couple years.
Conageski said that cutting CDBG funds in half would have a huge impact.
"I have a staff of four, but if it cuts in half we'd have to lay off," she said. "We use our funds properly and it really serves a community need. For us it would really kind of be a disaster if these funds were cut."
Martinsburg has also seen its share of CDBG money plummet in recent years. They're getting $260,000 this year but as recently as 2004 they were getting nearly $500,000.
In addition to capital improvements in low-income neighborhoods -- paving and storm water management to prevent floods -- Martinsburg uses the money to fund senior centers, respite care, Boys and Girls Club memberships and local parks.
Patricia McMillan, the city's community development director, said that at some point if the grant money keeps getting smaller they might have to consider no longer accepting what money is available.
"In my opinion, if you can afford to administer it, you accept the grant, but HUD's reporting requirements don't diminish because you have less money," McMillan said.
The city still needs to hold public hearings, do environmental reviews and submit detailed reports of how the CDBG money is spent -- fixed costs that don't diminish nearly as fast as the grant money has been diminishing.
"Can you afford staffing to do that?" McMillan asked.
"I think the question becomes whether local governments think that this is something worth fighting for," she said. "Members of Congress, do they feel like that this is a type of funding that has enough value that they should protect the funding levels in their efforts to balance the budget. Is this what has to go?"
The Democratic-controlled U.S. Senate has written its own funding bill that does not cut CDBG funding from its current levels. That bill cleared a procedural hurdle last week by a vote of 73-26, with bipartisan support.
A spokesman for West Virginia Rep. David McKinley, a Republican who has five CDBG-eligible cities in his northern district, said in an email that McKinley was undecided on the bill. The spokesman, Jim Forbes, said they were considering an amendment to add money for CDBG funding, but had no details as of Sunday evening.
On Friday House Democratic leaders advised members that any amendments to the bill should be ready by 3:30 p.m. Tuesday.
Rep. Shelley Moore Capito, a Republican who represents two CDBG cities, Charleston and Martinsburg, did not directly respond when asked if she would support the bill.
"With our national debt approaching $17 trillion, it is critical that we tighten our belts and direct our resources to important priorities. I believe that funding for CDBG should be a high priority and I will support efforts to sustain the program," Capito said in an email.
Rep. Nick Rahall, a Democrat who represents one CDBG city, Huntington, also did not explicitly give a position on the bill, although his intentions seemed clear.
"The House Republican leadership is putting forward bills that would slash not only critical economic development programs for our state and communities, but also safety net and social services programs that are essential for the health and well being of working families. A lot of good has been done by our local leaders using Community Development Block Grants, and I fully support the program," Rahall said in an email.
Reach David Gutman at email@example.com or 304-348-5119.