Does not require a cost share or matching funds

Summary: HUD’s CDBG Section 108 Loan Guarantee Program allows local governments to transform a portion of their CDBG funds into low-cost, federally guaranteed loans for economic development, housing rehabilitation, public facilities, and other physical infrastructure projects, including those to increase resilience to natural disasters. While these funds are focused on entitlement communities (larger cities), small municipalities can apply for financing with the assistance of their state.

Eligible activities: Guaranteed loan funds may be used for many of the CDBG-eligible activities, including open-space acquisition; construction, repair, replacement, or relocation of public facilities; and improvements, such as dams and levees. Funded activities must be part of a large-scale economic development, housing, or public facilities project.

Funding: 

• Entitlement communities can receive loan guarantees equal to five times the entitlement community’s CDBG award amount.
• Communities in non-entitlement areas that are assisted in the submission of applications by their state can receive loan guarantees equal to five times the state’s grant under the CDBG program.

Cost share: This program has no cost-share requirements.

Application process: 

• For application information, contact your local HUD Community Planning and Development field office.
• Identify your office online.