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Eligible Activities—Economic Development

Community Development Block Grant Program

1. California Community Economic Enterprise Fund: You may use enterprise funds to finance eligible projects such as:
   1. Business loans which provide financing to businesses for projects that will result in the creation or retention of jobs. Such loans may be used for equipment purchase; inventory, supplies or materials; working capital; business start-up costs; or building construction, rehabilitation or leasehold improvements.
   2. Public infrastructure improvements (e.g., sewer, water, streets, storm drains, business incubator facilities) needed to accommodate specific business expansion/retention projects or to support developer projects which meet a CDBG national objective and result in the creation or retention of jobs.
   3. Microenterprise assistance which provides financing to existing microenterprises or provides training and technical assistance to existing and prospective owners of microenterprises. Such activities may include loans to microenterprises, training and technical assistance programs that target existing or prospective low-income entrepreneurs, or support services such as child care or transportation for clients.
2. Over-the-counter. Funds from this component may be used to assist a specific business development project which will result in near-term creation or retention of jobs. This funding may be used for:
   1. Business loans which provide financing to businesses for projects that will result in the creation or retention of jobs. Such loans may be used for equipment purchase; inventory, supplies or materials; working capital; business start-up costs; or building construction, rehabilitation or leasehold improvements.
   2. Public infrastructure improvements (e.g., sewer, water, streets, storm drains, business incubator facilities) needed to accommodate specific business expansion/retention projects or to support developer projects which meet a CDBG national objective and result in the creation or retention of jobs.

Examples of ineligible economic development activities include: subsidies to an individual project exceeding $50,000 per full-time permanent job created or retained; subsidies exceeding $1,000 per TIG person to whom goods or services are provided by the activity; general promotion of the whole community; assistance to professional sports teams; assistance to privately-owned recreational facilities that serve a predominately higher-income clientele and where the recreational benefit to users or members clearly outweighs employment or other benefits to TIG persons; acquisition of land for an unidentified use; and assistance to a for-profit business while that business or any other business owned by the same person(s) or entity(ies) is the subject of unresolved compliance findings related to prior CDBG assistance.