Change to HUD Policy Allows NJ Sandy Victims Access to Grants

July 17th, 2013 - 2:46 pm

By: Margaret Olsen

New JerseyThe federal government announced last week that it will change regulations that have kept New Jersey residents affected by last fall’s Superstorm Sandy damage from receiving Community Development Block Grants.

After the storm, the Department of Housing and Urban Development (HUD) had told homeowners who had residences damaged to apply for loans even if they weren’t sure they needed one. Because many New Jersey residents could not afford to repay the terms of a loan once they were offered, they instead looked for funds via the CDBG program.

Before the change in HUD policies, the state of New Jersey did not believe it had the authority to give CDBG grants to those residents who applied for SBA loans and then declined them even though they still needed funds from the CDBG.

The HUD policy change went into effect on Tuesday, and now gives New Jersey the flexibility to provide CDBG funds to those who declined SBA loans — as long as the state identifies why the SBA loan was declined and establishes why CDBG assistance is necessary for the applicant’s particular case.