Refreshing the Community Development Block Grant Program Formula: A Modern Allocation to Community Need

Greg Miller
Aidy

This article builds on the critique presented by Miller and Richardson (2023) of the Community Development Block Grant (CDBG) program formula, which has remained unchanged since 1977 despite its reliance on outdated metrics, such as pre-1940 housing and growth lag. The formula’s inefficiency in targeting communities needing development funds has been well documented, yet political hurdles and zero-sum funding allocation have stalled modernization efforts. In addressing such criticisms, this article explores alternative formulas, proposing a “replacement formula” that emphasizes poverty and dated infrastructure with adjustments for fiscal capacity alongside a more conservative “repair formula” that modifies the existing dual formula structure to address its most critical flaws. This article also proposes a phased implementation of a new formula that may resolve the political challenges of reform, offering a path toward a more equitable and effective distribution of CDBG funds.