oversight

HUD Has Identified Performance Measures for Its Block Grant Programs, but Information on Impact Is Limited

Published by the Government Accountability Office on 2012-05-15.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

United States Government Accountability Office
Washington, DC 20548



          May 15, 2012

          Congressional Committees

          Subject: HUD Has Identified Performance Measures for Its Block Grant Programs, but
          Information on Impact Is Limited

          In fiscal year 2012, Congress appropriated about $3.4 billion for the Community
          Development Block Grant (CDBG) program and $1 billion for the HOME Investment
          Partnerships (HOME) program. The CDBG and HOME programs, which are administered by
          the Department of Housing and Urban Development’s (HUD) Office of Community Planning
          and Development (CPD), are the federal government’s largest block grant programs for
          community development and affordable housing production, respectively. Both programs
          give grantees discretion to fund a wide range of allowable activities; in particular, CDBG
          funds can be used for 26 eligible activities. Block grants typically devolve substantial
          authority for setting priorities to state or local governments, and state and local officials bear
          the primary responsibility for monitoring and overseeing the planning, management, and
          implementation of activities financed with federal grant funds. However, federal agencies
          have oversight responsibilities and are expected to ensure that block grant funds are used
          effectively.

          Section 231 of the Consolidated and Further Continuing Appropriations Act for fiscal year
          2012 directed us to review the effectiveness of the block grant programs administered by
          CPD. As part of this review, we were to examine performance metrics used by HUD and best
          practices utilized by program grantees. 1 As agreed with your offices, this report focuses on
          the CDBG and HOME programs. 2 Specifically, this report discusses (1) what is known about
          the effectiveness (or impact) of the CDBG and HOME programs, (2) the performance
          measures HUD has in place for the CDBG and HOME programs and any challenges HUD
          faced in developing these measures, and (3) promising practices HUD and others have
          identified for the CDBG and HOME programs.

          To determine what is known about the effectiveness (or impact) of the CDBG and HOME
          programs, we identified and reviewed studies that evaluated these programs or studied a
          particular aspect of them. To identify these studies, we conducted a literature review;
          interviewed HUD officials, representatives of selected national organizations that represent




          1
              Pub. L. No. 112–55 §231.
          2
           CPD also administers the Emergency Solutions Grants and Housing Opportunities for Persons with AIDS
          programs. These programs are dedicated to addressing the needs of special populations—individuals and
          families experiencing homelessness and low-income persons living with AIDS and their families, respectively. A
          review of the legislative history indicated interest in the effectiveness of CDBG and HOME.




                                                                           GAO-12-575R Effectiveness of Block Grants
grantees, and researchers; and contacted state auditors. 3 To describe the performance
measures HUD has in place for the CDBG and HOME programs and any challenges HUD
faced in developing them, we reviewed and summarized HUD’s guidance on its performance
measures for the CDBG and HOME programs and performance reports, and we interviewed
HUD officials. We compared this information with the GPRA (Government Performance and
Results Act) Modernization Act of 2010 requirements. We also identified and reviewed
studies that discuss the challenges associated with developing performance measures for
block grant programs, including CDBG and HOME. To identify promising practices, we
interviewed HUD officials, representatives from selected national organizations, and
researchers, and reviewed relevant documentation.

We conducted this performance audit from December 2011 to May 2012 in accordance with
generally accepted government auditing standards. These standards require that we plan
and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis
for our findings and conclusions based on our audit objectives. We believe that the evidence
obtained provides a reasonable basis for our findings and conclusions based on our audit
objectives. Enclosure I provides additional information on our scope and methodology.

Results in Brief

Information on the overall effectiveness (or impact) of the CDBG and HOME programs is
limited. According to HUD officials, the agency has faced challenges in evaluating the impact
of CDBG and HOME because, among other things, such an evaluation would have to
compare neighborhoods that received program assistance with those that did not. Our
previous work has also identified the difficulties of evaluating the impact of block grant
programs that do not represent a uniform package of activities or desired outcomes across
the country, as well as the common problem of attributing differences in communities’
outcomes to the effect of a program in the absence of controls for other explanations. 4 As a
result, few comprehensive studies on the impact of the CDBG and HOME programs exist,
but studies that focused on specific activities have generally found that each of the programs
has made positive contributions. We identified two studies that attempted to examine the
overall impact of the CDBG program on communities, but both studies encountered
evaluation challenges due to the program’s design. For example, a 1995 study that HUD
considers the most comprehensive evaluation of CDBG suggests that, at that time, the
program played a role in neighborhood stabilization and revitalization in a number of U.S.
cities included in the study. However, the study states that it did not attempt to isolate the
impact of CDBG-funded activities in these communities, in part because of the variability of
CDBG activities at the community level. The three additional CDBG studies we identified
focused on specific aspects of the program, such as disaster assistance, rather than the
entire program. Similarly, we identified five studies of the HOME program. Two of these
studies described implementation in the first 5 years of the program (fiscal years 1992–
1996). The remaining three studies examined specific aspects of HOME and suggested
some positive contributions of the program but did not evaluate its overall impact. For
example, a 2008 study examined the foreclosure and delinquency rates among

3
 We conducted a literature search to identify relevant studies published since 2002. Through our interviews, we
identified studies published prior to 2002 that we included because they offered insights on the impact of the
CDBG and HOME programs. The oldest study from which we reported findings was published in 1995. Because
HUD considers this study the most comprehensive evaluation of CDBG and the program has changed little since
1995, we included it in our review.
4
    GAO, Designing Evaluations: 2012 Revision, GAO-12-208G (Washington, D.C.: January 2012).

Page 2                                                         GAO-12-575R Effectiveness of Block Grants
HOME-assisted homebuyers. It found that compared with homebuyers whose mortgages
were insured by the Federal Housing Administration (FHA)—a group with a similar
population of lower-income, first-time homebuyers—foreclosure rates were slightly lower for
buyers who received HOME assistance from 2001 to 2005.

HUD collects performance information for both the CDBG and HOME programs, but the
information varies. Using a performance measurement system that HUD activated in 2006,
grantees are to select and report the objective, intended outcome, and outputs (direct
products or services delivered by the programs) of each activity they undertake. In fiscal
years 2007–2011, HUD collected data for the following types of activities funded under the
CDBG program: public services, economic development, rehabilitation and construction of
rental or homeowner housing, and homebuyer assistance. For example, for CDBG activities
related to economic development, grantees reported on the total number of businesses
assisted and total number of jobs created or retained. The data HUD collects for the HOME
program using this performance measurement system are not as detailed as those it collects
for CDBG because, according to HUD officials, the agency already collected accomplishment
data for HOME prior to development of the system and there are fewer eligible activities.
According to HUD officials, they also use this accomplishment data to assess the
performance of the HOME program. Specifically, for fiscal years 2007–2011, HUD used the
performance measurement system to report data such as the number of units assisted with
HOME funds and the number of units occupied by households with income that is less than
80 percent of the area median income. In addition, HUD has collected other information
since program inception, including the amount of other funds leveraged with HOME funds
and the per-unit cost of HOME units. According to HUD officials and others, one of the
challenges associated with creating outcome-oriented performance measures that can be
uniformly applied to all CDBG and HOME activities is the grantees’ flexibility to design and
implement activities tailored to meet local needs and priorities. Another challenge for
measuring the outcomes of CDBG is grantees’ ability to undertake a broad range of
activities.

HUD officials and others have identified promising practices for the CDBG and HOME
programs that relate to program management practices and use of funds. HUD officials have
identified program management practices that they believe assist CDBG and HOME
grantees to implement successful programs. These practices include developing a local
performance measurement system and internal operating procedures for effectively
managing subrecipients. 5 According to HUD officials, the agency has encouraged grantees
to develop local performance measurement systems because of challenges in developing
outcome-oriented performance measures for the programs as a whole resulting from the
wide discretion provided to grantees. For example, a 2005 HUD study on promising practices
in grantee performance measurement noted practices such as measuring outcomes as well
as outputs and efficiency measures and choosing outcomes that tie to goals. In addition,
HUD and national organizations with whom we spoke have identified a number of projects as
examples of how grantees have successfully utilized CDBG and HOME funds. For example,
in 2005 and 2011, HUD gave awards for a number of HOME-funded projects under various
categories, including neighborhood revitalization, innovative design, reaching underserved
populations, and producing sustainable housing.




5
    Subrecipients are entities that receive funding from CDBG or HOME grantees to implement projects.

Page 3                                                           GAO-12-575R Effectiveness of Block Grants
Background

HUD’s CPD, which administers the HOME and CDBG programs, provides financial and
technical assistance to states and localities in order to promote community-based efforts to
develop housing and economic opportunities. The CDBG program is the federal
government’s principal community development program. It provides annual formula grants
to states and entitlement communities—principal cities of metropolitan areas, other
metropolitan cities with populations of at least 50,000, and qualified urban counties with
populations of at least 200,000 (excluding the population of entitled cities)—to develop viable
urban communities by providing decent housing and a suitable living environment and by
expanding economic opportunities, principally for low- and moderate-income persons. 6
Under the CDBG program, states and entitlement communities develop their own programs
and funding priorities. Grantees can use their CDBG funds on 26 eligible activities, but all
funded activities must meet one of three national objectives. 7 These national objectives are
to (1) primarily benefit low- and moderate-income persons, (2) aid in the prevention or
elimination of slums and blight, or (3) meet urgent community development needs. In fiscal
year 2012, Congress appropriated about $3.4 billion for CDBG, $2.9 billion of which HUD
allocated to 1,137 entitlement communities (including Washington, D.C.), 49 states, and
Puerto Rico. 8 The remaining $467 million was for disaster assistance, Indian tribes, and
insular areas. 9

HOME is the largest federal program that awards block grants to state and local
governments exclusively to create affordable housing for low-income households. Its goals,
which are to (1) help build, buy, or rehabilitate affordable housing for rent or homeownership
or (2) provide direct tenant-based rental assistance, are more specific than those of CDBG. 10
HOME provides formula grants to states and localities—urban cities, urban counties, and
consortiums of cities and counties—to fund a range of activities to benefit low-income
people. 11 Under the HOME program, states and localities may use program funds to finance
a range of activities to meet program goals, such as providing eligible homeowners and new
homebuyers with home purchase or rehabilitation financing assistance, and building or

6
 The CDBG program was authorized under Title I of the Housing and Community Development Act of 1974
(Pub. L. No. 93-383, as amended, 42 U.S.C. 5301 et seq.). In 1981, Congress amended the act to allow states
the opportunity to administer CDBG funds for nonentitlement communities—units of general local government that
do not receive CDBG funds directly from HUD as part of the entitlement program.
7
 For reporting purposes, HUD classifies the 26 eligible activities into eight broad categories—acquisition,
administration and planning, economic development, housing, public improvements, public services, repayment of
section 108 loans, and “other” (including nonprofit organization capacity building and assistance to institutions of
higher learning). Congress established the section 108 program in 1974 as part of the CDBG program. This
program allows communities to borrow against their current and future CDBG allocations to fund larger-scale
housing rehabilitation and community and economic development projects.
8
 The state of Hawaii permanently has elected not to receive CDBG program funding. As a result, HUD awards
funds directly to the three eligible counties in Hawaii.
9
    The four insular areas are American Samoa, Guam, the Northern Mariana Islands, and the U.S. Virgin Islands.
10
 Under a tenant-based rental assistance program, states and localities provide HOME funds to eligible
households for the payment of a portion of the rent on units of their choosing.
11
 HOME was authorized under Title II of the Cranston-Gonzalez National Affordable Housing Act of 1990, as
amended (Pub. L. No. 101-625, 42 U.S.C. 12721, et seq.). States administer HOME funds for localities that do
not qualify to receive allocations directly from HUD.


Page 4                                                           GAO-12-575R Effectiveness of Block Grants
rehabilitating housing for rent or ownership. In fiscal year 2012, Congress appropriated
$1 billion for the HOME program, and HUD allocated these funds to 591 localities; all 50
states; Washington, D.C.; and Puerto Rico.

Few Comprehensive Studies on the Effectiveness of the CDBG and HOME Programs
Exist, but Some Studies Have Suggested Positive Contributions

Information on the overall effectiveness (or impact) of the CDBG and HOME programs is
limited. According to HUD officials, the agency has faced several challenges in evaluating
the impact of CDBG and HOME. First, the officials stated that the mix of eligible activities that
grantees implement can vary greatly. Second, neither program requires grantees to target
the use of funds in a specific geographic area. According to HUD officials and researchers
with whom we spoke, the diversity of activities and lack of statutory targeting requirements
make it difficult to collect information to assess the overall impact of the programs. However,
they noted that because the goals of the CDBG program are less specific than the HOME
program’s goals, these challenges are greater for CDBG. Further, officials noted that, to
study neighborhood effects, an evaluation would have to compare neighborhoods where
program investments had been made with those without such investments. Our previous
work has also identified the difficulties of evaluating the impact of block grant programs that
do not represent a uniform package of activities or desired outcomes across the country, as
well as the common problem of attributing differences in communities’ outcomes to the effect
of a program in the absence of controls for (or without being able to rule out) other
explanations. 12

As a result, few comprehensive and current studies on the impact of the CDBG and HOME
programs exist; however, studies focusing on specific activities have generally found that
each program has made positive contributions. We identified five studies of the CDBG
program. Two studies examined the overall impact of the program, and three studies focused
on specific aspects of the program rather than on the program as a whole. For the HOME
program, we also identified five studies. Two of these studies described implementation in
the first 5 years of the program (fiscal years 1992–1996). The remaining three studies
examined specific aspects of HOME and suggested some positive contributions of the
program but did not evaluate its overall impact.

According to HUD, the most comprehensive evaluation of the CDBG program was published
in 1995. 13 This study was conducted by the Urban Institute at HUD’s request and examined
selected dimensions of the program's performance and whether it had made a difference in
communities across the country. 14 The findings suggest that, at that time, the CDBG program
played a role in neighborhood stabilization and revitalization in a number of U.S. cities
included in the study. However, the study stated that it did not attempt to isolate the impact of
CDBG-funded activities in these communities, in part because of the variability of CDBG
activities at the community level resulting from the discretion provided to grantees.

12
     GAO-12-208G.
13
  While somewhat dated, we included this study in our review because the CDBG program has changed little
since 1995.
14
  Federal Funds, Local Choices: An Evaluation of the Community Development Block Grant Program, a special
report prepared at the request of the Department of Housing and Urban Development (Washington, D.C.: Urban
Institute, May 1995).


Page 5                                                       GAO-12-575R Effectiveness of Block Grants
Specifically, the program has multiple objectives, and communities can focus on any one of
them. In the end, the authors noted that communities may try to address some objectives
and not others, presenting a challenge to evaluating the CDBG program as a whole. 15 In
addition, a 2002 Urban Institute study evaluated the effect of CDBG spending on specific
characteristics of neighborhood improvements in 17 cities. 16 It found that, in general, certain
CDBG investments were linked to improvements in neighborhood quality in these 17 cities. 17
However, the study’s authors stated that the study was not broad enough to conclusively link
CDBG investments to specific measures of neighborhood quality because, for example, the
study did not include a nationally representative sample of communities, did not account for
the effects of other public investments, and could not take into account the effects of
previous years’ CDBG funding.

Three other studies evaluated specific aspects of CDBG. For example, two studies issued in
December 2010 and August 2011 evaluated the role that CDBG disaster recovery assistance
played in housing recovery in Louisiana, Mississippi, and Texas after Hurricanes Katrina and
Rita. 18 CDBG disaster recovery assistance is supplemental funding for presidentially
declared disaster areas that primarily benefits low-income residents in and around
communities that have experienced a natural disaster. According to both studies, CDBG
played a key role in the rebuilding efforts in these states. For example, the 2010 study found
that properties in Mississippi that received CDBG assistance were almost 2.5 times as likely
to have been rebuilt as properties that did not. In addition, a 2003 study found that nearly 80
percent of businesses that received CDBG-funded loans from 1996 to 1999 were still in
business in 2002. 19 It also found that 64 percent of the CDBG borrowers that had promised
to create or retain jobs met or exceeded their job targets and that 35 percent reported that
they would not have been able to undertake their projects without these loans.

We also identified five studies of the HOME program. The Urban Institute published two
studies in 1995 and 1999 that described implementation in the first 5 years of the program


15
     The authors noted other challenges as well, including differences in the definition of “community.”

16
 Chris Walker, Chris Hayes, George Galster, Patrick Boxall, and Jennifer Johnson, The Impact of CDBG
Spending on Urban Neighborhoods, a special report prepared at the request of the Department of Housing and
Urban Development (Washington, D.C.: Urban Institute, October 2002).
17
  The characteristics of neighborhood quality that the study identified were median loan amount, percent of loans
for home purchase, loan approval rate, numbers of jobs, number of businesses, and number of loan applications.
The study found a positive relationship between larger CDBG spending and five of the six characteristics—
median loan amount, percent of loans for home purchase, loan approval rate, numbers of jobs, and number of
businesses.
18
  Jennifer Turnham, Jonathan Spader, Jill Khadduri, and Meryl Finkel, Housing Recovery on the Gulf Coast
Phase I: Results of Windshield Observations In Louisiana, Mississippi, and Texas, a special report prepared at
the request of the Department of Housing and Urban Development (Cambridge, MA: Abt Associates, December
2010); and Jennifer Turnham, Kimberly Burnett, Carlos Martín, Tom McCall, Randall Juras, and Jonathan Spader,
Housing Recovery on the Gulf Coast Phase II: Results of Property Owner Survey in Louisiana, Mississippi, and
Texas, a special report prepared at the request of the Department of Housing and Urban Development
(Cambridge, MA: Abt Associates, August 2011).
19
 Christopher Walker, Martin D. Abravanel, Patrick Boxall, Roger C. Kormendi, Kenneth Temkin, and Marsha
Tonkovich, Public-Sector Loans to Private-Sector Businesses: An Assessment of HUD-Supported Local
Economic Development Lending Activities, a special report prepared at the request of the Department of Housing
and Urban Development (Washington, D.C.: Urban Institute, July 2003).


Page 6                                                               GAO-12-575R Effectiveness of Block Grants
(fiscal years 1992–1996). 20 The reports included information on the characteristics of state
and local programs, participation of nonprofit organizations, and HOME program developers.
The other three studies we identified focused on specific aspects of the program. For
example, a 2008 study examined the foreclosure and delinquency rates among HOME-
assisted homebuyers. 21 The study found that in comparison to FHA-insured homebuyers—a
group with a similar population of lower-income, first-time homebuyers—foreclosure rates
were slightly lower for buyers who received HOME assistance from 2001 to 2005. 22 A 2004
study evaluated the effectiveness of the HOME program in increasing homeownership
opportunities for low-income households. 23 In part, the study explored the outcomes for
buyers in terms of geographic mobility and success in sustaining homeownership. The study
found that, at that time, HOME-assisted buyers generally chose what the authors termed
“healthy neighborhoods”—those with, for example, racial and ethnic diversity, moderate-
income populations, and little welfare dependence—which was considered to be an
indication that the program supported both geographic and economic mobility by
homebuyers. The study also reported that among survey respondents, the foreclosure rates
for HOME-assisted buyers were lower than those of FHA-insured homebuyers and that sales
rates among these buyers were lower than those for the average homeowner. In addition, a
2001 study focused on the compliance of rental housing units developed using HOME funds
with the program’s affordable rent limit requirements. 24 The study’s analysis of data as of
February 2000 showed that slightly more than 95 percent of HOME-funded units had rents
that were at or below program affordability limits. 25




20
  Implementing Block Grants for Housing: An Evaluation of the First Year of HOME, a special report prepared at
the request of the Department of Housing and Urban Development (Washington, D.C.: Urban Institute, November
1995); and Expanding the Nation’s Supply of Affordable Housing: An Evaluation of the HOME Investment
Partnership Program, a special report prepared at the request of the Department of Housing and Urban
Development (Washington, D.C.: Urban Institute, March 1999).
21
  Karmen Carr, Christopher Herbert, Ken Lam, and Yusuf Makhkamov, Rates of Foreclosure in HOME and ADDI
Programs, a special report prepared at the request of the Department of Housing and Urban Development
(Washington, D.C.: Concentrance® Consulting Group, Inc., November 2008). The study included homebuyers
that received homebuyer assistance through the HOME program and the American Dream Downpayment
Initiative. In the context of the study, these two programs were combined into one and analyzed jointly; therefore,
results are not available by program. The American Dream Downpayment Initiative was created under the HOME
program to help low-income, first-time homebuyers cover the up-front costs of buying a home (up to the greater of
$10,000 or 6 percent of the purchase price). Funds for this program were appropriated for fiscal years
2004–2008.
22
  After comparing foreclosure rates provided by grantees to FHA-provided foreclosure information, the authors
found some error in grantees’ reporting rates; that error may be responsible for some of the differences observed
between HOME recipients and FHA homebuyers overall.
23
  Jennifer Turnham, Christopher Herbert, Sandra Nolden, Judith Feins, and Jessica Bonjorni, Study of
Homebuyer Activity through the HOME Investment Partnerships Program, a special report prepared at the
request of the Department of Housing and Urban Development (Cambridge, MA: Abt Associates, January 2004).
24
  Christopher E. Herbert, Jessica Bonjorni, Meryl Finkel, Naomi Michlin, Sandra Nolden, Karen Rich, and K. P.
Srinath, Study of the Ongoing Affordability of HOME Program Rents, a special report prepared at the request of
the Department of Housing and Urban Development (Cambridge, MA: Abt Associates, June 2001).
25
  All rental housing units acquired, built, or rehabilitated with HOME funding must meet affordability and income
targeting requirements. The rents for most HOME units are set so as to be affordable to households earning 65
percent of area median income adjusted for family size.


Page 7                                                           GAO-12-575R Effectiveness of Block Grants
HUD Has Established Some Performance Measures for the CDBG and HOME
Programs

HUD collects some performance information for the CDBG and HOME programs. In 2004
and 2005, a working group—which included HUD and representatives of several national
organizations—developed a performance measurement system for the CDBG and HOME
programs that collects information on outputs. 26 HUD activated the system in May 2006.
Using the performance measurement system, grantees are required to select and report the
objective, intended outcome, and output of each activity they undertake (see fig. 1). 27 First,
grantees are to select one of three objectives that best describes the purpose of the funded
activity. The three objectives are (1) suitable living environment, (2) decent housing, and
(3) creating economic opportunities. 28 Grantees are then required to select one of three
outcome categories that best reflects what they are seeking to achieve with the funded
activity. The outcome categories are (1) availability/accessibility, (2) affordability, and (3)
sustainability, which is defined as promoting livable or viable communities. 29 Based on the
objective and outcome selected, grantees then are required to report specific output
information for each activity. According to HUD, only the specific measures appropriate for
the activity are available for the grantee to report, and the grantee is required to report on at
least one of these measures.




26
  Grantees of the Emergency Solutions Grants and Housing Opportunities for Persons with AIDS programs are
also required to use this performance measurement system. However, for purposes of this report, we are focusing
our discussion of the system on the CDBG and HOME programs. The working group was made up of
representatives from the Council of State Community Development Agencies, National Association for County
Community Economic Development, National Association of Housing and Redevelopment Officials, National
Community Development Association, National Council of State Housing Agencies, CPD, HUD’s Office of Policy
Development and Research, and the Office of Management and Budget.
27
  Grantees are required to report this performance information through HUD’s Integrated Disbursement and
Information System (IDIS). Developed in fiscal year 1996, IDIS is a management information system that
consolidates reporting processes across HUD’s CPD programs.
28
   Because the performance measurement system applies to four HUD programs, the objectives it uses are
different than the programs’ statutory objectives. HUD states that activities that fall under the suitable living
environment objective are designed to benefit communities, families, or individuals by addressing issues in their
living environment. The decent housing objective focuses on housing programs intended to meet individual family
or community needs, rather than programs where housing is an element of a larger effort. Finally, the creating
economic opportunities objective applies to activities related to economic development, commercial revitalization,
or job creation.
29
  The availability/accessibility category applies to activities that make services, infrastructure, public services,
public facilities, housing, or shelter available or accessible to low- and moderate-income people. The affordability
category applies to activities that provide affordability in a variety of ways to low- and moderate-income people,
including the creation or maintenance of affordable housing or services such as transportation or day care. The
sustainability category applies to projects aimed at improving communities or neighborhoods, helping to make
them livable or viable. Grantees are encouraged to only select one outcome category; however, if a grantee
believes that two outcomes of equal importance will be realized, then a second outcome may also be selected.

Page 8                                                            GAO-12-575R Effectiveness of Block Grants
Figure 1: Example of HUD’s Performance Measurement System for the CDBG and HOME Programs




Note: Grantees are required to report the performance information through HUD’s Integrated Disbursement and Information
System (IDIS).


Since 2007, HUD has collected data for the CDBG program by objective, outcome, and
output measure. For fiscal years 2007–2011, this information was organized by type of
activity funded—including public services, economic development, rehabilitation and
construction of rental or homeowner housing, and homebuyer assistance. For example, for
economic development activities, grantees reported the total number of businesses assisted
or total number of jobs created or retained as a result of the activity. These measures were
further divided into different categories, such as type of business, type of jobs created or
retained, and number of jobs with employer-sponsored health care benefits. For activities
related to building and rehabilitating rental or owner-occupied housing, grantees reported on
the number of units produced. This measure was further divided into several categories,
including units made accessible to persons with disabilities.

The data HUD reports for the HOME program using the performance measurement system
are not as detailed as those it reports for CDBG because, according to HUD officials, the
agency already collected accomplishment data for HOME and there are fewer eligible
activities for the program. Specifically, from fiscal years 2007–2011, HUD used the
performance measurement system to report data on the number of units receiving HOME
assistance, number of those units brought into compliance with property standards, and
number of those units occupied by households with income that is less than 80 percent of the
area median income. HUD did not divide this data into other categories, such as number of
units that were made accessible to persons with disability, or report it by activity type.
According to HUD officials, the agency collects such information for the HOME program but
does not publish it in a standard report. In addition, HUD has collected other information
since program inception, including the amount of other funds leveraged with HOME funds
and the per-unit cost of HOME units. According to HUD officials, they also use this
information to assess the performance of the HOME program. Enclosure II lists the CDBG
and HOME measures that HUD uses to collect information at the national level.

HUD has faced challenges in developing outcome-oriented performance measures for the
CDBG and HOME programs at the national level. Office of Management and Budget
guidance on implementation of the GPRA Modernization Act of 2010 states that, while output
measures may be used in some circumstances, quantitative and outcome-focused measures



Page 9                                                                GAO-12-575R Effectiveness of Block Grants
are preferred. 30 However, according to HUD officials and others, one challenge associated
with creating outcome-oriented performance measures that can be uniformly applied to all
CDBG and HOME activities is grantees’ flexibility to design and implement strategies tailored
to meet local needs and priorities. Another challenge for CDBG is grantees’ ability to
undertake a broad range of activities. HUD officials told us that the diversity of these
activities makes gathering, combining, and presenting robust and consistent performance
information difficult, leading to challenges demonstrating the overall outcomes of these
efforts. Selected studies we reviewed also stated that it is challenging to develop
performance measures for block grant programs. For example, a National Academy of Public
Administration study on CDBG performance measures noted that most experts
acknowledged that it was challenging to craft a performance measurement system for a
block grant program that promotes flexible investments in people, places, organizations, and
things, based on locally determined needs. 31 The study concluded that the potential to gather
outcome-oriented measurement data at the national level that truly reflect program
performance is remote because linking outcome-oriented measures directly to programs,
projects, and activities is difficult. In addition, we have previously found that design features
that encourage performance accountability in federal grant-making programs, such as CDBG
and HOME, can limit state and local grantee flexibility. 32

However, HUD officials told us that the agency plans to consult with national organizations
that represent grantees, individual grantees, and other interested parties to determine how to
improve HUD’s data collection efforts. This effort will focus on redesigning the CDBG
performance measures to focus on critical measures and reduce grantees’ reporting burden.
HUD officials also expect that additional attention to data-quality issues will lead to
improvements in performance measurement. 33

HUD and Others Have Identified Several Promising Practices for the CDBG and HOME
Programs

HUD officials and others we interviewed identified promising practices for the CDBG and
HOME programs that fell into two categories: program management and use of funds.
Program management practices may be transferable to other grantees. The use of funds
promising practices that we discuss below are illustrative examples of projects that were


30
 OMB Circular A-11, Part 6 (“Preparation and Submission of Strategic Plans, Annual Performance Plans, and
Annual Program Performance Reports”), Section 220.7.IV.

31
  Nicolas Retsinas, Thomas M. Downs, David F. Garrison, and Barry White, Developing Performance Measures
for the Community Development Block Grant Program, a special report prepared at the request of the Department
of Housing and Urban Development (Washington, D.C.: National Academy of Public Administration, February
2005).
32
 GAO, Grants Management: Enhancing Performance Accountability Provisions Could Lead to Better Results,
GAO-06-1046 (Washington, D.C.: Sept. 29, 2006).

33
  Section 232 of the Consolidated and Further Continuing Appropriations Act for fiscal year 2012 (Pub. L. No.
112-55) required HUD to take necessary actions to improve data quality, data management, and grantee
oversight and accountability with respect to programs and activities administered by CPD. HUD was required to
report to Congress on the progress it has made with respect to addressing these problems, identify further
improvements that can be made, and propose actions and timelines to carry out such improvements. See HUD,
Report to Congress: HUD’s Efforts to Improve CPD Data Quality, Data Management, and Grantee Oversight and
Accountability (Washington, D.C.: March 2012).

Page 10                                                        GAO-12-575R Effectiveness of Block Grants
recognized as being successful or promising. However, these practices may not be
generalizable to other grantees.

Promising Practices for Program Management

HUD officials have identified program management practices that they believe assist CDBG
and HOME grantees to implement successful programs. These practices include developing
a local performance measurement system and internal operating procedures, such as for
effectively managing subrecipients. According to HUD officials, the agency has encouraged
grantees to develop local performance measurement systems because of challenges in
developing outcome-oriented performance measures for the program as a whole. For
example, a 2005 study on promising practices in grantee performance measurement
examined the efforts of five grantees that received CDBG or HOME funding to measure their
performance in meeting local goals. 34 According to the report, the five communities visited—
which were different in terms of community size, community development objectives, and
experience with performance measurement—had crafted systems to measure and assess
performance. The report identified useful practices that may help other grantees develop or
refine performance assessment in community development. For example, the study identified
the following 10 lessons learned:

•    start with an established approach to performance measurement;

•    reflect local concerns and goals;

•    involve key partners;

•    measure community outcomes, as well as outputs and efficiency measures;

•    choose outcomes that tie to goals;

•    select a reasonable number of outcomes and measures with available data;

•    create accountability through reporting;

•    integrate performance measures into agency procedures and policies;

•    build in a feedback loop for program planning and decision making; and

•    change the performance measurement system as needed.

To help grantees better track their performance, HUD made enhancements to its
consolidated planning process that included providing improved data, a mapping tool, and a

34
   Economic Systems, Inc., Promising Practices in Grantee Performance Measurement, a special report prepared
at the request of the Department of Housing and Urban Development’s Office of Policy Development and
Research, April 2005. The study examined five grantees: Minneapolis, Minnesota; Charlotte, North Carolina;
Austin, Texas; Burlington, Vermont; and King County, Washington. These grantees were chosen from a list of 23
“finalists” because, according to the study, they best met the site selection criteria. These criteria considered the
following factors: the technical quality of the grantees’ performance measures (including whether the system had
outcome measures), evidence of system value to decision makers, system coverage of multiple community
development activities, and regional dispersion.

Page 11                                                             GAO-12-575R Effectiveness of Block Grants
standard template for all grantees to use. 35 According to HUD officials, these enhancements
will facilitate local decision making by providing grantees with better data to assess their
community’s needs and target and leverage their resources. HUD released these
enhancements on May 7, 2012.

In addition, HUD officials identified specific operating procedures for CDBG grantees that
HUD considers to be important for administering a successful program. Some of these
practices include (1) using data to prioritize and target investments; (2) researching the local
housing stock, housing market conditions, and target-area demographics to design
rehabilitation programs tailored to different physical and economic needs; (3) ensuring that
activities are implemented in a timely manner to maximize the use of funds and benefits to
citizens; and (4) developing processes for effectively managing subrecipients. 36 For example,
a 2005 HUD study identified several effective local practices for managing subrecipients,
including providing incentives such as tying funding to performance goals to encourage
better performance. 37

Similarly, HUD officials identified a number of operational practices that grantees could use
to successfully administer their HOME programs. According to HUD officials, some HOME
grantees’ policy of employing an underwriting process for affordable rental housing projects
as well as homeownership projects is a good practice. Specifically, many grantees use an
underwriting process for their rental housing projects to evaluate grant and loan applications
to determine the likelihood that a project is and will remain financially viable. According to
HUD, to be successful, such an underwriting process should evaluate whether a HOME-
funded loan will be repaid to the grantee, and it should review a project’s cost analysis to
identify proposed funding sources and uses. Other practices HUD identified for successful
administration of the HOME program include evaluating whether a developer applying for




35
  Grantees must submit a strategic plan that addresses the housing, homeless, and community development
needs in their jurisdictions at least once every 5 years. The plan covers CDBG, HOME, and two other formula
grant programs administered by CPD—the Emergency Solutions Grants and the Housing Opportunities for
Persons with AIDS programs. Annually, grantees must submit an action plan that identifies the activities they will
undertake to meet the objectives in their strategic plans. At the end of each year, grantees must submit to HUD
an annual performance report detailing progress they have made in meeting the goals and objectives outlined in
their strategic and action plans.
36
 HUD has published two guidebooks on managing the use of CDBG funds in a timely manner that, according to
HUD officials, include examples of successful techniques. See HUD, Keeping Your CDBG Funds Moving:
Guidelines for Managing Your Overall Community Development Block Grant Program in a Timely Manner, HUD-
2002-13A-CPD (Washington, D.C.: May 2002); and Ensuring CDBG Subrecipient Timeliness: Guidelines for
Grantee Selection, Management, and Oversight of Subrecipients in the Community Development Block Grant
Program, HUD-2003-13C-CPD (Washington, D.C.: May 2003).
37
  Carol Star, James Broughman, John Nagoski, Chris Walker, Marsha Tonkvotich, Andy Zene, and Scott Ledford,
Managing Subrecipients of CDBG Grantees, a special report prepared at the request of the Department of
Housing and Urban Development’s Office of Policy Development and Research (Bethesda, MD: Econometrica,
Inc., December 2005). The study suggested that an “effective” approach for managing subrecipients includes
ensuring compliance with program requirements and creating an appropriate framework of incentives and
disincentives.

Page 12                                                           GAO-12-575R Effectiveness of Block Grants
HOME funding has the ability to complete a project on time and on budget and having robust
project selection processes in order to efficiently distribute HOME funds. 38

Promising Practices for Grantees’ Use of Funds

HUD and national organizations with whom we spoke identified a number of projects as
examples of how grantees have successfully utilized CDBG and HOME funds. 39 On its
website, HUD has recognized promising practices in projects that were at least partially
funded with CDBG money. 40 For example, in 2010, a HUD Secretary’s Award for Excellence
was given to a community that developed strong partnerships—between a resident group, a
developer, and the city—and used CDBG, HOME, and other funds to revitalize a historic
neighborhood. The project created both affordable and market-rate housing and other
amenities in the neighborhood that benefited existing residents and attracted new residents.
According to HUD’s description, the project’s architects partitioned a historic building into two
separate structures to balance the need for commercial space and apartments large enough
to appeal to renters.

In 2005 and 2011, HUD recognized a number of HOME-funded projects through its HOME
Door Knocker awards. It gave awards under various categories, including neighborhood
revitalization, innovative design, reaching underserved populations, and producing
sustainable housing. 41

•    Neighborhood revitalization. In 2005, HUD recognized a project that was developed on
     the largest vacant parcel in a community, which had been a major impediment to the
     area’s revitalization for decades. According to the award description, the project
     demonstrated that with proper planning, community input, and a diverse funding blend,
     even the most distressed and blighted parcels can be revitalized and neighborhoods
     transformed. The result of this project was 62 units of housing, of which 59 were
     affordable housing units. The project housed 62 families, including 6 who had previously
     been homeless.

38
  In December 2011, HUD issued a proposed rule making mandatory some of the practices HUD officials
identified to us as promising for program management. For example, HUD proposed requiring grantees to
underwrite and conduct a subsidy evaluation for all HOME projects. Grantees would be required to, at a minimum,
include in these evaluations an assessment of the market conditions of the neighborhood in which the project
would be located, the experience of the developer, and whether firm financial commitments for the project existed.
Public comments on the proposed changes were due by February 14, 2012. See HUD, HOME Investment
Partnerships Program: Improving Performance and Accountability; and Updating Property Standards, 76 Fed
Reg. 78344-78382 (Dec. 16, 2011) (proposed rule).

39
 According to HUD officials, HUD also has disseminated promising practices to HOME grantees through several
mechanisms including program guides, training, procedural policy documents, and technical assistance.
40
  HUD publishes best practices that highlight federal, state, and local strategies that increase affordable housing
opportunities, apply sustainable features and practices, and increase access to public transportation. Some of the
descriptions of the featured projects include information about the project’s funding sources, including CDBG and
HOME. See HUD, Best Practices, accessed March 20, 2012,
http://www.huduser.org/portal/bestpractices/home.html.

41
  In 2005, HUD gave Door Knocker Awards in seven categories: (1) homeownership housing, (2) innovative
design, (3) neighborhood revitalization, (4) rural housing, (5) special needs housing/reaching underserved
populations, (6) tenant-based rental assistance, and (7) underserved populations and rental housing. In 2011, the
awards were given in four categories: promoting long-term affordability, reaching underserved populations,
producing sustainable housing, and building community housing development organization capacity.

Page 13                                                           GAO-12-575R Effectiveness of Block Grants
•    Innovative design. In 2005, HUD recognized a project that demonstrated the use of
     sustainable design and green building techniques in a downtown setting. The project was
     a mixed-use building—that is, used for housing and commercial purposes—with a
     geothermal heating, cooling, and water heating system. 42 According to the award
     description, the system would cut tenants’ heating bills by approximately 50 percent and
     water heating bills by approximately 70 percent, increasing affordability for low-income
     tenants. In addition, the system would reduce the overall energy consumption for the
     building by 32 percent.

•    Reaching underserved populations. In 2011, HUD recognized a project that combined
     tenant-based rental assistance with case management services to help ensure housing
     stability for people experiencing homelessness, very low-income people, and people with
     disabilities. According to the award description, the grantee reached out to the local
     housing authority and more than 20 landlords and local management companies to
     identify units for families and to help those families access appropriate social,
     educational, and vocational resources to meet a variety of needs. The project used a
     blend of outreach, financial assistance through HOME funds, and case management to
     assist people moving from homelessness into stable housing.

•    Producing sustainable housing. In 2011, HUD recognized a 70-unit affordable housing
     project that serves young families and youth transitioning out of foster care. According to
     the award description, residents in the existing neighborhood were consulted extensively
     on this project. The project was built with state-of-the-art green techniques, including
     high-quality insulation and windows and other energy-efficient materials and appliances.
     According to the project description, this project was the first in the county to receive a
     Leadership in Energy and Environmental Design Platinum rating. 43

National organizations that represent CDBG and HOME grantees also recognize projects
with promising practices. For example, according to the National Association for County
Community and Economic Development’s website, the organization recognizes innovative,
effective, and exemplary activity in various categories, including community development,
economic development, and affordable housing. Similarly, according to the National
Community Development Association (NCDA), the organization’s award program recognizes
exemplary uses of CDBG and HOME funds that address the needs of families and
neighborhoods. Some of the projects identified and recognized by the national organizations
feature characteristics similar to those HUD recognized as promising practices. For example,
in 2012, NCDA recognized a CDBG-funded project that, according to NCDA, provided
essential shopping and services to the residents of a low-income neighborhood. The project
helped double the number of businesses, from 19 to 38, in the commercial site that was
developed and almost tripled the number of jobs, from 38 to 108. In addition, according to
the project description, the project spurred an interest in revitalizing the area. The grantee
and neighborhood residents partnered to create a plan for the area, which is a long-term
vision for the community’s revitalization efforts and future development.
42
  Geothermal energy is a unique type of renewable resource in that it can provide power that is independent of
weather and climate, thereby enabling a consistent and uninterrupted supply of heat and electricity. Geothermal
energy also creates fewer environmental impacts than the production of natural gas and other conventional fossil
fuels that are used to generate electricity.

43
  Leadership in Energy and Environmental Design is a third-party certification program and the nationally
accepted benchmark for the design, construction, and operation of high-performance green buildings, according
to the U.S. Green Building Council.

Page 14                                                          GAO-12-575R Effectiveness of Block Grants
Agency Comments and Our Evaluation

We provided a draft of this report to HUD for its comment. HUD provided technical
comments, which were incorporated as appropriate.

                                            -----

We are sending copies of this report to the appropriate congressional committees and the
Secretary of Housing and Urban Development. In addition, the report is available at no
charge on the GAO website at http://www.gao.gov.

Should you or your staff have questions concerning this report, please contact me at (202)
512-8678 or shearw@gao.gov. Contact points for our Offices of Congressional Relations and
Public Affairs may be found on the last page of this report. Key contributors to this report are
listed in enclosure III.




William B. Shear
Director, Financial Markets and
  Community Investment

Enclosures




Page 15                                                GAO-12-575R Effectiveness of Block Grants
List of Committees

The Honorable Patty Murray
Chairman
The Honorable Susan Collins
Ranking Member
Subcommittee on Transportation, Housing and
 Urban Development, and Related Agencies
Committee on Appropriations
United States Senate

The Honorable Tom Latham
Chairman
The Honorable John W. Olver
Ranking Member
Subcommittee on Transportation, Housing and
 Urban Development, and Related Agencies
Committee on Appropriations
House of Representatives




Page 16                                       GAO-12-575R Effectiveness of Block Grants
Enclosure I


                                        Scope and Methodology

The objectives of this report were to describe (1) what is known about the effectiveness (or
impact) of the Community Development Block Grant (CDBG) and HOME Investment
Partnerships (HOME) programs, (2) the performance measures the Department of Housing
and Urban Development (HUD) has in place for the CDBG and HOME programs and any
challenges HUD faced in developing these measures, and (3) promising practices HUD and
others have identified for the CDBG and HOME programs. The Consolidated and Further
Continuing Appropriations Act for fiscal year 2012 directed us to review the effectiveness of
the block grant programs administered by HUD’s Office of Community Planning and
Development (CPD). 44 The CDBG and HOME programs are the federal government’s largest
block grant programs for community development and affordable housing production,
respectively.

To determine what is known about the effectiveness (or impact) of the CDBG and HOME
programs, we identified and reviewed studies that evaluated these programs or studied a
particular aspect of them. To identify these studies, we conducted a literature review;
interviewed HUD officials, representatives of national organizations that represent program
grantees, and researchers; and contacted state auditors. Specifically, we conducted a
literature search to identify relevant studies published since 2002. Through our interviews,
we identified studies published prior to 2002 that we included because they offered insights
on the impact of the CDBG and HOME programs. The oldest study from which we reported
findings was published in 1995. Because HUD considers this study the most comprehensive
evaluation of CDBG and the program has changed little since 1995, we included it in our
review. We reviewed the methodology of the studies and determined them to be of sound
quality and reliable for the purposes of our report. To identify the organizations with whom we
spoke, we reviewed a previous GAO report and relevant HUD documentation, including the
Federal Register notice that established the performance measurement system for the
CDBG and HOME programs, and we interviewed HUD officials. 45 We interviewed
representatives of the Council of State Community Development Agencies, National Alliance
of Community Economic Development Associations, National Association for County
Community and Economic Development, National Association of Counties, National
Association of Housing and Redevelopment Officials, National Community Development
Association, and National Council of State Housing Agencies.

To describe the performance measures HUD has in place for the CDBG and HOME
programs and any challenges HUD faced in developing them, we reviewed and summarized
HUD’s guidance on its performance measures for the programs and performance reports
and interviewed HUD officials. We compared this information with the GPRA (Government
Performance and Results Act) Modernization Act of 2010 requirements. We also conducted




44
  CPD also administers the Emergency Solutions Grants and Housing Opportunities for Persons with AIDS
programs. These programs are dedicated to addressing the needs of special populations—individuals and
families experiencing homelessness and low-income persons living with AIDS and their families, respectively. A
review of the legislative history indicated interest in the effectiveness of CPD’s block grant programs—CDBG and
HOME.
45
 GAO, Community Development Block Grants: Entitlement Communities’ and States’ Methods of Distributing
Funds Reflect Program Flexibility, GAO-10-1011 (Washington, D.C.: Sept. 15, 2010).

Page 17                                                          GAO-12-575R Effectiveness of Block Grants
Enclosure I


a literature search to identify and review studies that discuss the challenges associated with
developing performance measures for block grant programs, including CDBG and HOME. 46

To identify promising practices, we interviewed HUD officials, researchers, and
representatives from the national organizations mentioned above and reviewed relevant
documentation. For example, we reviewed HUD studies that identified promising practices
for administering the CDBG and HOME programs. In addition, we reviewed information
about projects that had received CDBG and HOME funding and that HUD and the national
organizations we interviewed had recognized through their awards. We reviewed the award
descriptions for these projects to identify illustrative examples of projects that were
recognized as being successful or promising. However, the practices that were identified
may not be an exhaustive list of promising practices and may not be generalizable to other
grantees.

We conducted this performance audit from December 2011 to May 2012 in accordance with
generally accepted government auditing standards. These standards require that we plan
and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis
for our findings and conclusions based on our audit objectives. We believe that the evidence
obtained provides a reasonable basis for our findings and conclusions based on our audit
objectives.




46
  See Nicolas Retsinas, Thomas M. Downs, David F. Garrison, and Barry White, Developing Performance
Measures for the Community Development Block Grant Program, a special report prepared at the request of the
Department of Housing and Urban Development (Washington, D.C.: National Academy of Public Administration,
February 2005) and Carl W. Stenberg, “The Community Development Balancing Act: Reconciling Expectations
for a Hybrid Block Grant,” Journal of Public Budgeting, Accounting & Financial Management, vol. 20, no. 1 (2008).

Page 18                                                          GAO-12-575R Effectiveness of Block Grants
Enclosure II


     Measures for the Community Development Block Grant and HOME Investment
                             Partnerships Programs

The Department of Housing and Urban Development (HUD) has used a number of measures
to collect information on the Community Development Block Grant (CDBG) and HOME
Investment Partnerships (HOME) programs. The measures for the CDBG program vary by
activity (see table 1).

Table 1: Measures HUD Reported for CDBG by Activity, Fiscal Years 2007–2011

Public facilities and infrastructure
Number of persons assisted with                 •   new access to a facility
                                                •   improved access to a facility
                                                •   access to facilities that are no longer substandard
Number of households assisted with              •   new access to a facility
                                                •   improved access to a facility
                                                •   new access to a facility that is no longer substandard
Public services
Number of persons assisted with                 •   new (or continuing) access to a service
                                                •   improved (or continuing) access to a service
                                                •   new access to a service that is no longer substandard
Number of households assisted with              •   new (or continuing) access to a service
                                                •   improved (or continuing) access to a service
                                                •   new access to a service that is no longer substandard
Economic development
Total number of businesses assisted
Of total number of businesses assisted          •   new businesses assisted
                                                •   existing businesses assisted
                                                •   number of business facades/buildings rehabilitated
                                                •   assisted businesses that provide a good or service to a service
                                                    area/neighborhood/community
Total number of jobs created
Of total number of jobs created, number with
employer-sponsored health care benefits
Types of jobs created (e.g., professional,
technicians, sales, etc.)
Number of persons unemployed prior to
taking jobs
Total number of jobs retained
Of total number of jobs retained, number with
employer-sponsored health care benefits
Types of jobs retained (e.g., professional,
technicians, sales, etc.)
                                            a
Number of acres of brownfields remediated
Rehabilitation of rental housing
Total number of low- and moderate-income
housing units
Total number of slum/blight and urgent-needs
units
Of total number of units, number that were      • made accessible to persons with disabilities
                                                                          b
                                                • qualified as Energy Star
                                                • brought from substandard to standard condition
                                                • created through conversion of nonresidential to residential
                                                  buildings
                                                • brought to lead-safety compliance
                                                • affordable




Page 19                                                            GAO-12-575R Effectiveness of Block Grants
Enclosure II


Of affordable units                            • number subsidized by another federal, state, or local program
                                               • number occupied by elderly
                                               • number of years of affordability
                                                                                                  c
                                               • average number of years of affordability per unit
                                               • number designated for persons with HIV/AIDS (and the
                                                 number of these for the chronically homeless)
                                               • number of permanent housing units for homeless persons and
                                                 families (and the number of these for the chronically homeless)
Construction of rental housing
Total number of low- and moderate-income
housing units
Total number of slum/blight and urgent-needs
units
Of total number of units, number that were     •   made accessible to persons with disabilities
                                                                            b
                                               •   qualified as Energy Star
                                               •   affordable
Of affordable units                            •   number subsidized with project-based rental assistance by
                                                   another federal, state, or local program
                                               •   number occupied by elderly
                                               •   number of years of affordability
                                                                                                    c
                                               •   average number of years of affordability per unit
                                               •   number designated for persons with HIV/AIDS (and the
                                                   number of these for the chronically homeless)
                                               •   number of permanent housing units for homeless persons and
                                                   families (and the number of these for the chronically homeless)
Owner-occupied housing rehabilitation
Total number of low- and moderate-income
housing units
Total number of slum/blight and urgent-needs
units
Of total number of units, number that were     •   occupied by elderly
                                               •   brought from substandard to standard condition
                                                                           b
                                               •   qualified as Energy Star
                                               •   brought to lead-safety compliance
                                               •   made accessible to persons with disabilities
Development of homeowner housing
Total number of low- and moderate-income
housing units
Total number of slum/blight and urgent-needs
units
Of total number of units, number that were     • made accessible to persons with disabilities
                                                                         b
                                               • qualified as Energy Star
                                               • occupied by households previously in subsidized housing
                                               • affordable
                                               • years of affordability
                                                                                                  c
                                               • average number of years of affordability per unit
Of affordable units                            • number occupied by elderly
                                               • number designated for persons with HIV/AIDS (and the
                                                 number of these for the chronically homeless)
                                               • number of permanent housing units for homeless persons and
                                                 families (and the number of these for the chronically homeless)
Homebuyer assistance
Total households assisted
Of total households assisted                   • number of first-time homebuyers (and the number of these that
                                                 received housing counseling)
                                               • number of households receiving down payment/closing costs
                                                 assistance
Housing subsidies
Total number of households


Page 20                                                           GAO-12-575R Effectiveness of Block Grants
Enclosure II


Of total number of households                      number of households receiving short-term rental assistance
                                                    (less than or equal to 3 months)
                                                   number of households assisted that were previously homeless
                                                    (and the number of these that were chronically homeless
                                                    households)
Shelter for homeless persons
Number of beds created in overnight
shelter/other emergency housing
Number of homeless persons given overnight
shelter
Homeless prevention
Number of persons assisted that received           emergency financial assistance to prevent homelessness
                                                   emergency legal assistance to prevent homelessness
Source: HUD.

a
 Brownfields are abandoned, idled, or underused real property where expansion or redevelopment is complicated
by the presence or potential presence of environmental contamination.
b
 Energy Star was created in response to the Clean Air Act amendments of 1990 and the Energy Policy Act of
1992. In general, the program is designed to identify models for 60 categories of household and commercial
products that are the most energy efficient (efficiency of up to 10 to 25 percent over the minimum federal
standards).
c
 HUD did not report on the average number of years of affordability per unit in fiscal year 2007.

For the HOME program, HUD collected similar information for all eligible activities (see table
2).

Table 2: Measures HUD Reported for HOME, Fiscal Years 2007–2011

    All eligible HOME activities combined
    Number of units           number of units brought to compliance with property standards
                              number of units occupied by households with income of 80 percent or less
                               of the area median income
Source: HUD.


Note: Eligible activities under the HOME program are activities to help build, buy, or rehabilitate affordable
housing for rent or homeownership or provide direct tenant-based rental assistance.

In addition to the information in table 2, HUD has collected the following information for the
HOME program since its inception:

      Amount of HOME funding used for completed projects (by activity type and tenure)47

      Number of units completed (by activity type and tenure)

      Per-unit cost of HOME units (by activity type and tenure)

      Percentage of units occupied by households with income of

          30 percent or less of the area median income (by activity type and tenure)



47
  The activity types are new construction, rehabilitation, acquisition, and tenant-based rental assistance, and the
tenure types are rental, homebuyer, and homeowner.

Page 21                                                             GAO-12-575R Effectiveness of Block Grants
Enclosure II


    •   30 to 50 percent of the area median income (by activity type and tenure)

    •   50 to 60 percent of the area median income (by activity type and tenure)

    •   60 to 80 percent of the area median income (by activity type and tenure)

•   Leveraging

•   Number of families that have received tenant-based rental assistance since 1992

•   Beneficiary household type (e.g., single/nonelderly, elderly) by tenure

•   Racial/ethnic breakout of beneficiaries by tenure

•   Number of Energy Star units




Page 22                                                 GAO-12-575R Effectiveness of Block Grants
Enclosure III


                        GAO Contact and Staff Acknowledgments

GAO Contact

William B. Shear, (202) 512-8678 or shearw@gao.gov

Staff Acknowledgments

In addition to the individual named above, A. Paige Smith, Assistant Director; Cindy Gilbert;
Kirsten Lauber; John McGrail; Brenda Muñoz; Josephine Perez; and Jennifer Schwartz
made key contributions to this report.




(250651)


Page 23                                               GAO-12-575R Effectiveness of Block Grants
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