Thinking of a Career in Emergency Management?
- BY Nicole Pelette
The Administration for Children and Families (ACF), Office of Community Services (OCS) will award approximately $13.6 million in Community Economic Development (CED) discretionary grant funds to Community Development Corporations (CDC) for well-planned, financially viable, and innovative projects to enhance job creation and business development for individuals with low-income.
The CED program provides funding for projects aimed at business development opportunities and creating employment for individuals with low incomes located in geographic areas with a demonstrated need for the proposed project. To accomplish this, the program requires that all created businesses and positions support a service area with unemployment and poverty rates that are at or above the state or national levels. The CED program also seeks to fund projects that address the personal and community barriers that must be overcome to help individuals with low incomes become self-sufficient.
The CED program is built on the premise that nonprofit CDCs know their communities and are poised to efficiently and effectively create new community economic development projects in their communities. The objective of the program is to support businesses that develop new products, services, and commercial activities that result in new positions for individuals with low incomes. These positions should:
CED funds may be used for the start-up or expansion activities of participating businesses, as consistent with the cost principles, as implemented in 45 CFR Part 75, Subpart E, provided that the expenditures result in the creation of positions that can be filled with individuals with low incomes. This includes start-up capital for operating expenses, such as salaries, facilities, and equipment that will be replaced by projected earnings. Further, OCS recognizes that many businesses supported with CED funds in the past have been put in jeopardy due to the COVID19 pandemic. For the purposes of this FOA, job creation efforts include the re-creation or restoration of full-time, full-year positions that were lost due to the COVID-19 pandemic. These flexibilities are only applicable for the FY 2020 funding opportunity announcement. The training and placement of individuals in positions existing prior to the start of the project, even positions guaranteed to individuals with low incomes through a formal agreement with an employer, is not considered job creation.
Many projects use grant funds to provide loans to identified, viable, participating businesses, and/or as an equity or stock investment. Regarding the equity/stock investment, grantees can convey grant funds to third parties to help finance participating businesses creating jobs for eligible program participants. In exchange for a percentage ownership (via stock purchase or equity) specified in a third-party agreement (contract), a participating business receives cash needed to buy, start, or expand a business, provided they agree to specified CED program terms and conditions, including reporting jobs and other benefits to grantees. If there is no third-party business and the grantee is the sole owner of the business creating jobs, funds are typically conveyed to the grantee’s for-profit subsidiary via a loan or purchase of 100 percent of the stock in the participating business. Grant funds can be used to support one or multiple project strategies
CED grant funds may not be used for:
To be eligible for the CED program, an applicant must meet the following three conditions: