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Housing to Broaden CDBG-Funded Programs

By on November 9, 2018

Editor’s note: The following originally appeared in the Nov. 8-14, 2018, issue of Caribbean Business.

By Nov. 18, the Puerto Rico Housing Department is slated to submit an amendment to an action plan submitted earlier this year to federal authorities that would increase the number of programs that will be funded through $20 billion in Community Development Block Grants (CDBG).

Puerto Rico’s reconstruction program is one of the largest with more than 110,000 homes either having undergone or undergoing reconstruction after hurricanes Irma and Maria destroyed the lion’s share of the infrastructure. “Among our national objectives is to eliminate slums…deal with people’s needs,” noted Puerto Rico Housing Secretary Fernando Gil Enseñat during a presentation to the Associated General Contractors-Puerto Rico Chapter.

The federal government has allocated more than $20 billion to Puerto Rico in CDBG funds. Housing already completed an action plan in July that discusses the distribution of some $1.5 billion coming before year’s end. The governor signed the grant agreement to distribute funding to 19 programs.

However, Gil Enseñat said the amendment, to be completed this month, proposes the distribution of $8.2 billion through nine programs that will be added to the 19 already in the original action plan. All new programs are infrastructure-related. After Housing turns in the amendment to the action plan, it must wait 45 days for approval.

The action plan is slated to be amended again in the future. “We are going to distribute an additional $1.9 billion for power-grid projects. This money is not going to the [Puerto Rico Electric Power Authority,] but is for the energy sector,” he said. An additional $8.3 billion, he added, will be for mitigation projects.

The funds will be distributed either directly by Housing or by delegating them through a memorandum of mutual understanding for all or some aspect of each program to a so-called “subrecipient,” or nonprofit group, or through a partnership.

Gil Enseñat said the plan proposes the distribution of $520 million for economic development programs, including business financing, small-business incubators, a workforce training program, revolving construction and commercial loans, as well as tourism and marketing programs.

Among the new programs, the government is proposing the distribution of $2.1 billion for single-family home repairs, reconstruction and relocation, and $436 million for community energy and water resiliency installations.

The plan also has a “title clearance” program in which homeowners who do not have title deeds can exchange them for homes for which they will have title deeds. About $40 million will be allocated to this program. Another $10 million is proposed for rental assistance.

Another program consists of a “mortgage catch,” in which a family who got behind with their mortgage payments after the hurricanes will be able to qualify for $20,000. The government is proposing the use of $100 million for this program.

Some $5 million is being proposed for a home-resilience innovation competition to allow institutions such as University of Puerto Rico to propose ideas for resiliency, he said.

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