September 22, 2023

HUD: $25 Million Loan Guarantee Announced for Birmingham, AL Loan for Black, Indigenous, People of Color Fund

Today, the U.S. Department of Housing and Urban Development (HUD) awarded the City of Birmingham, Alabama a $25.2 million loan fund under its loan guarantee program for the Community Development Block Grant Program, Section 108. The City of Birmingham plans to use these funds to establish a $25 million citywide Loan Pool to provide financing for businesses, non-profit entities, and City departments.

The Loan Pool will provide a ready source of long-term and reasonably priced financing that is not conventionally available to prospective borrowers. The Loan Pool will bridge financing gaps and enable borrowers to create and retain jobs, increase affordable housing, and advance equity and equitable development opportunities. For example, the city intends to support mixed-use projects through adaptive reuse and other approaches. Projects will support investments in communities and neighborhoods of color, and provide financing to Black, Indigenous, and people of color-led developers, businesses, and organizations.

“The purpose of the Section 108 loan guarantee is to facilitate community development,” said Secretary Marcia L. Fudge. “This opportunity highlights exactly how a community can benefit from HUD programs. This loan guarantee will provide the City of Birmingham the necessary services to thrive.”

“With this Section 108 funding, Birmingham has demonstrated a commitment to using every resource available to invest in local priorities through equitable, innovative, and most importantly community-driven solutions,” said Principal Deputy Assistant Secretary for Community Planning and Development Marion McFadden. “The city will fund transformative initiatives to increase affordable housing, support small businesses, and spur community development through this loan pool.”

Section 108 provides Community Development Block Grant (CDBG) funds to communities as a source of low-cost, long-term financing for economic and community development projects that primarily benefit low- and moderate-income persons. Section 108 can be used for a variety of projects, such as housing, infrastructure, and other physical development projects. The flexibility of the program makes it an attractive and effective tool for state

This post was originally published here.