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Building blocks: Community development grants a frequent city tool

Grand Forks City Hall, 255 N. 4th St. (GF Herald photo/Sam Easter)

This year, just like any other, a very specific set of funds will flow from Washington, D.C., straight into Grand Forks, and end up part of a new building, growing program, or nonprofit project. In years past, those dollars have helped keep the lights on at the Salvation Army, backed renovations at the Third Street Clinic's pharmacy and funded the city's new social detox center.

Those dollars are part of the Community Development Block Grant program—CDBG, for short, and it's administered from City Hall. In the 20 years since the 1997 flood, they've been an important, if declining, part of an anti-poverty and disaster-recovery funding stream coming into Grand Forks.

A recent Herald investigation followed an attempt to found a nonprofit project that collapsed after it didn't meet eligibility for the program. Project founders envisioned a kind of farmers market for new Americans at the Grand Cities Mall—something that would help them launch their own businesses in time. But the project's inability to meet certain requirements meant it never quite got the momentum it had to have.

"We don't just cut people a check and say, 'enjoy.' There's a monitoring component," said Meredith Richards, a city staffer who helps administer the program. "They send us invoices that are for eligible CDBG uses. We either reimburse them, because they've already paid it, or we pay directly to the plumber or the whomever."

The program manages both annual federal grant funding and "program income." The latter group is largely a remnant of the big influx of federal cash that came to the city after 1997's floodwaters receded. When the city sells land it purchased with that money, for example, funding comes back into the program. In 2015, more than $2 million flowed into the program under such circumstances—though Richards said that kind of revenue has become rare.

The program first began distributing funds to Grand Forks in the 1980s, Richards said, and has three national objectives: It battles "slum and blight," helps people of low-to-moderate income, and deals with an "urgent need." That final item was hugely important in bringing tens of millions to Grand forks after the 1997 flood.

City staff work with a volunteer committee to help allocate estimated funding for a coming year, confirm those allocations with the City Council, and wait on the U.S. Department of Housing and Urban Development to come through with funding.

From 2014 to the end of 2016, those projects have included $255,000 in fit-up and operating costs at the community's new social detox center, where intoxicated persons who aren't a danger to others can get sober without burdening hospitals and police, according to city documents. The Grand Forks Senior Center received $942,000 for renovations in 2015 and 2016. The Northlands Rescue Mission received $45,000 in operating funds in 2016.

Becky Cournia, assistant director at the senior center, said the funding helped her organization make a slew of building upgrades, including an expanded lobby, more senior-accessible restrooms and a new entrance canopy.

"We also looked at the foundation of the building," she said. "We had some water leakage issues on the front of our building, which was addressed when they were digging and doing the additions."

After funding is distributed, Richards said, the city keeps close tabs on it. If it's a building project, the city will check that it's completed before money is released. Funded programs are also tracked. A neonatal program for new Americans, Richards said, had to collect participant data, show it serves an "eligible population" and set goals in application materials for how many people will be helped.

"Our responsibility as the money goes out the door is that the money that was advertised in the application process is what actually happens," Richards said. "So there's no chance for us to just give somebody a check and then have them misuse that."

Across the course of the last several years, federal income for CDBG projects has been between $300,000 and $400,000, and program income has varied widely. A year of zero income in 2014 was followed by a $2 million-plus land sale in 2015, then a year of relatively minimal income, then this year an estimated $390,000.

In the roughly two decades Richards has worked with the program, the federal government hasn't had to reclaim funding, she said. A federal audit recently flagged an expense of less than $1,000 for the Bhutanese Society of Grand Forks, prompting an ongoing second look from the city. Richards said it hinges on regulatory interpretation—the difference between a salary and a stipend.

Though no money was reclaimed, city staff recently made a "procedural error," as Richards called it at the time, by spending some CDBG money before federal rules allowed, resulting in a delay on a downtown housing project.

City Council member Bret Weber, a social work professor at UND, completed his dissertation on War on Poverty programs, which he said are precursors to CDBG. He lamented watching federal support for the program wane—including during the Obama administration. He said many local poverty problems, like "economic refugees" from elsewhere in the country, reflect matters beyond City Hall's control.

"A lot of the poverty issues that we have in the city are not the result of things that we're doing right or wrong in the city," he said. "They're the result of regional and federal issues."

Sam Easter

Sam Easter is a City Government reporter for the Grand Forks Herald. You can reach him with story tips, comments and ideas at 701-330-3441.

(701) 780-1108