Community Services Block Grants (CSBG): Funding and Reauthorization

Community Services Block Grants (CSBG):
Funding and Reauthorization
Updated October 14, 2008
Karen Spar
Specialist in Social Policy
Domestic Social Policy Division

Community Services Block Grants (CSBG):
Funding and Reauthorization
Summary
Community Services Block Grants (CSBG), administered by the Department
of Health and Human Services (HHS), provide federal funds to states, territories, and
tribes for distribution to local agencies for activities to reduce poverty. Small related
programs — Community Economic Development, Rural Community Facilities, Job
Opportunities for Low-Income Individuals (JOLI), and Individual Development
Accounts (IDAs) — also provide grants for anti-poverty efforts. CSBG and some of
these related activities trace their history to the War on Poverty of the 1960s.
The Bush Administration proposed for four consecutive years (including in its
budget request for FY2009) to eliminate funding for CSBG, arguing that the program
did not award grants competitively or hold grantees accountable for program results.
The Administration also proposed to end funding for related activities, except for
IDAs. Despite the request for zero funding in FY2008, Congress passed a measure
(P.L. 110-161) that provided $654 million for the CSBG (a $24 million increase over
the previous year) and generally maintained all related activities at their previous
levels, with a 16% increase for Community Economic Development.
The Senate Appropriations Committee again rejected the Administration’s
proposal to zero-out CSBG for FY2009, reporting a spending bill that would have
maintained CSBG and all related activities at their FY2008 levels, with a small
increase for Rural Community Facilities (S. 3230). The House Labor-HHS-
Education Appropriations Subcommittee approved increases for CSBG and most
related activities for FY2009, but the full House Appropriations Committee failed to
complete action on the FY2009 funding bill. On September 30, 2008, President
Bush signed into law a government-wide continuing resolution (P.L. 110-329) that
maintains funding for CSBG and related programs at their FY2008 levels through
March 6, 2009.
In contrast to its more recent actions, the House Appropriations Subcommittee
approved a one-third reduction for CSBG for FY2007, although the full committee
subsequently boosted this amount slightly (H.R. 5647, 109^th Congress). No final
action occurred on FY2007 appropriations, however, and all programs were
maintained at their previous year’s funding levels under a full-year continuing
resolution (P.L. 110-5).
Although Congress has continued to provide funding for CSBG and related
activities, legislative authority for these appropriations expired with FY2003. No
reauthorization legislation has been introduced in the 110^th Congress.
In 2006, the Government Accountability Office (GAO) faulted HHS for weak
oversight of CSBG and recommended greater monitoring of states and targeting of
technical assistance funds. HHS took steps in response to GAO, although the Senate
Appropriations Committee criticized HHS recently (S.Rept. 110-410) for failing to
report on its progress and for not implementing a training and technical assistance
needs assessment and delivery plan as directed earlier by the committee.

Contents
Recent Developments ..............................................1
FY2009 Funding..........................................1
Reauthorization ...........................................2
Background ......................................................3
The Block Grant...............................................4
Use of Funds.............................................4
Local Delivery System......................................4
State Role................................................5
Allocation of Funds........................................5
CSBG Program Data...........................................5
Related Activities..............................................6
Community Economic Development...........................6
Job Opportunities for Low-Income Individuals (JOLI).............6
Rural Community Facilities..................................7
National Youth Sports Program...............................7
Community Food and Nutrition Program.......................7
Individual Development Accounts.............................8
Administration Proposals............................................9
Zero Funding Request for FY2007, FY2008, and FY2009..............9
Strengthening America’s Community Initiative (SACI) ...............9
Request for IDAs.............................................11
Government Accountability Office (GAO) Review......................11
HHS Response...............................................12
Reauthorization ..................................................13
Program Goals...........................................14
State Plan Requirements...................................15
Training and Technical Assistance...........................15
Grantee Funding Reduction or Termination....................15
Grantee Monitoring and Fiscal Controls.......................16
Faith-Based Organizations..................................16
Recent Appropriations History......................................17
FY2009 ....................................................17
FY2008 ....................................................19
FY2007 ....................................................19
Continuing Resolution.....................................19^th
House Action in the 109 Congress...........................20
Senate Action in the 109^th Congress..........................20
FY2006 ....................................................20
Appendix: CSBG and Hurricane Katrina..............................23

List of Tables
Table 1. Funding for CSBG and Related Activities, FY2005-FY2009.......22

Community Services Block Grants (CSBG):
Funding and Reauthorization
Recent Developments
FY2009 Funding. For four consecutive years, including for FY2009, the
Bush Administration proposed to terminate funding for the Community Services
Block Grant (CSBG), arguing that the program lacked performance measures and
failed to hold grantees accountable for program results. The Administration noted
that the program received a “Results Not Demonstrated” rating in a 2003 PART
assessment,¹ but also stated that as a result of this assessment, efforts were underway
to improve program administration, accountability, and outcomes.
Also as part of its FY2009 budget request, the Administration proposed no new
funding for Community Economic Development and Rural Community Facilities,
claiming they were similar to existing programs in other federal agencies. In its
FY2009 budget justifications, the Department of Health and Human Services (HHS)
said the zero funding request reflected the Administration’s effort to target funds
more effectively. The Administration also requested no funds for a third CSBG-
related program, Job Opportunities for Low-Income Individuals (JOLI), citing
duplication with activities that states can conduct under the Temporary Assistance
for Needy Families (TANF) block grant. On the other hand, the Administration
requested $24 million in FY2009 for a fourth related program, Individual
Development Accounts (IDA), which was approximately that program’s funding
level in FY2008. (For details, see “Administration Proposals,” later in this report.)
The Senate Appropriations Committee on July 8, 2008, reported an
appropriations bill for the Departments of Labor-HHS-Education in FY2009 (S.
3230), which would have rejected the Administration’s request to zero-out CSBG
and most related activities. The committee-reported bill would have maintained
CSBG and related activities at their FY2008 levels, except for Rural Community
Facilities, which would have received a small increase. In reporting its bill, the
Senate committee noted the “importance of Community Action Agencies [local
entities that receive CSBG funds] as institutions that organize low-income
communities to identify emerging challenges to economically insecure Americans
and subsequently mobilize the resources, programs, and partnerships needed to
address local poverty conditions” (S.Rept. 110-410). At the same time, the Senate
committee faulted HHS for failing to report on progress made in correcting certain
program oversight deficiencies identified by the Government Accountability Office
(GAO) and for not implementing a needs assessment and delivery plan for training

¹ Program Assessment Rating Tool; for background, see CRS Report RL32663, The Bush
Administration’s Program Assessment Rating Tool (PART), by Clinton Brass.

and technical assistance as previously directed by the committee. (For more details
on the GAO recommendations and HHS response, see “Government Accountability
Office Review” later in this report.)
The House Labor-HHS-Education Appropriations Subcommittee approved a
funding bill for FY2009 on June 19, 2008, but the full House Appropriations
Committee did not complete action on this bill when it subsequently met on June 26.
The draft committee report on the subcommittee-approved bill said that “CSBG is
more important than ever, with unemployment and poverty increasing due to the
struggling economy and the number of low-income individuals and families in need
of assistance rising as a consequence.”² The subcommittee approved increases for
CSBG, Community Economic Development and Rural Community Facilities, and
recommended level funding for remaining related activities.
The 110^th Congress did not finalize action on a Labor-HHS-Education spending
bill for FY2009, and on September 30, President Bush signed into law a government-
wide continuing resolution (P.L. 110-329) that maintains funding for CSBG and
related programs at their FY2008 levels through March 6, 2009. (For more details
on the appropriations process for FY2009, see “Recent Appropriations History,” later
in this report.)
Reauthorization. In each of its budget submissions starting with the FY2006
request, the Bush Administration stated that it was no longer seeking reauthorization
of CSBG and related activities. The funding authorization for these programs
(except JOLI) expired at the end of FY2003, although Congress has generally
continued to fund them each year. Included in President Bush’s FY2006 budget
request was a proposed “Strengthening America’s Communities Initiative” (SACI),
which would have eliminated 18 existing community and economic development
programs, including CSBG and several of the related national activities, and replaced
them with a new program administered by the Commerce Department. This initiative
was rejected, and a modified version was proposed as part of the FY2007 budget.
However, the modified SACI proposal was no longer viewed as a successor to the
CSBG. (For further information on the President’s initiative, see “Administration
Proposals,” later in this report.)
In the 109^th Congress, Representative Osborne introduced H.R. 341, the
Improving the Community Services Block Grant Act, which would have amended
and reauthorized the CSBG and related activities in their current form through
FY2012. No action occurred on this bill. (For details of H.R. 341, see
“Reauthorization,” later in this report.) No legislation has been introduced in the^th

110 Congress that would reauthorize the CSBG.

² Unnumbered draft House Appropriations Committee report, reflecting actions of the
Subcommittee on Labor-HHS-Education on the FY2009 spending bill: [http://www.cq.com/
flatfiles/editorialFiles/budgetT r acker /reference/docs/20080626l hreport.pdf].

Background
Administered by the Department of Health and Human Services (HHS), the
Community Services Block Grant (CSBG) program provides federal funds to states,
territories and Indian tribes for distribution to local agencies in support of a variety
of antipoverty activities. The origins of the Community Services Block Grant date
back to 1964, when the Economic Opportunity Act (P.L. 88-452; 42 U.S.C. § 2701)
established the War on Poverty and authorized the Office of Economic Opportunity
(OEO) as the lead agency in the federal antipoverty campaign. A centerpiece of OEO
was the Community Action Program, under which a nationwide network of local
Community Action Agencies (CAAs) was developed. A key feature of Community
Action is the direct involvement of low-income people in the design and
administration of antipoverty activities, through mandatory representation on the
CAAs’ governing boards. Currently, at the local level, CAAs are the primary
grantees of the CSBG.
In 1975, OEO was renamed the Community Services Administration (CSA), but
remained an independent executive branch agency. In 1981, CSA was abolished and
replaced by the CSBG, to be administered by HHS. At the time CSA was abolished,
it was administering nearly 900 CAAs, about 40 local Community Development
Corporations, and several small categorical programs that were typically operated by
local CAAs. The CSBG Act was enacted as part of the Omnibus Budget
Reconciliation Act of 1981 (P.L. 97-35, Title VI, Section 671; 42 U.S.C. § 9901) as
partial response to President Reagan’s proposal to consolidate CSA with 11 other
social service programs into a block grant to states. Congress rejected this proposal
and instead created two new block grants, the Social Services Block Grant, under
Title XX of the Social Security Act, and the CSBG, which consisted of activities
previously administered by CSA. The CSBG Act was reauthorized in 1984 under
P.L. 98-558, in 1986 under P.L. 99-425, in 1990 under P.L. 101-501, in 1994 under
P.L. 103-252, and in 1998 under P.L. 105-285. The authorizations for CSBG and
most related programs expired in FY2003. Reauthorization legislation was passed^th
by the House and Senate during the 108 Congress but not enacted. Similar
legislation was introduced in the 109^th Congress but not considered, and CSBG^th
remains an agenda item in the 110 Congress.
Several related national activities — Community Economic Development,
Rural Community Facilities, Job Opportunities for Low-Income Individuals (JOLI),
and Individual Development Accounts (IDAs) — also offer grants to assist local low-
income communities with economic development, rural housing and water
management, and asset development for low-income individuals, among other
services. These activities are administered at the federal level by the same Office of
Community Services at HHS that administers the CSBG, and in some cases, are also
authorized by the CSBG Act. Prior to FY2006, national activities that received
separate appropriations also included the National Youth Sports and Community
Food and Nutrition programs.

The Block Grant
Use of Funds. CSBG funds are used for activities designed to have a
“measurable and potentially major impact on causes of poverty.” The law envisions
a wide variety of activities undertaken on behalf of low-income families and
individuals, including those who are welfare recipients, homeless, migrant or
seasonal farm workers, or elderly. States must submit an application and plan to
HHS, stating their intention that funds will be used for activities to help families and
individuals achieve self-sufficiency, find and retain meaningful employment, attain
an adequate education, make better use of available income, obtain adequate housing,
and achieve greater participation in community affairs. In addition, states must
ensure that funds will be used to address the needs of youth in low-income
communities; coordinate with related programs, including state welfare reform
efforts; and ensure that local grantees provide emergency food-related services.
Local Delivery System. States are required to pass through at least 90% of
their federal block grant allotments to “eligible entities” — primarily (but not
exclusively) Community Action Agencies (CAAs) that had been designated prior to
1981 under the former Economic Opportunity Act. The distribution of these funds
among local agencies is left to the discretion of the state, although states may not
terminate funding to an eligible entity or reduce its share disproportionately without
determining cause, after notice and an opportunity for a hearing. There are more than
1,000 eligible entities around the country, the majority of which are private nonprofit
organizations. Many of these organizations contract with others in delivering various
services. Once designated as an eligible entity for a particular community, an agency
retains its designation unless it voluntarily withdraws from the program or its grant
is terminated for cause. Eligible entities are monitored within a systematic schedule;
return visits are made when goals are not met. In designating new or replacement
entities, states may select a public agency only when no qualified private nonprofit
organization is available, in accordance with the 1998 CSBG amendments.
Local activities vary depending on the needs and circumstances of the local
community. Each eligible entity, or CAA, is governed by a board of directors, of
which at least one-third are representatives of the low-income community. Under the
1998 amendments to the CSBG Act, low-income board members must live in the
community that they represent. Another third of the board members must be local
elected officials or their representatives, and the remaining board members represent
other community interests, such as business, labor, religious organizations, and
education. A public entity must either have a governing board with low-income
representation as described above, or another mechanism specified by the state to
assure participation by low-income individuals in the development, planning,
implementation and evaluation of programs.
There is no typical CAA, since each agency designs its programs based on a
local community needs assessment. Examples, however, of CSBG-funded services
include emergency assistance, home weatherization, activities for youth and senior
citizens, transportation, income management and credit counseling, domestic
violence crisis assistance, parenting education, food pantries, and emergency shelters.
In addition, local agencies provide information and referral to other community

services, such as job training and vocational education, depending on the needs of
individual clients.
State Role. At the state level, a lead agency must be designated to develop the
state application and plan. As noted above, states must pass through at least 90% of
their federal CSBG allotment to local eligible entities. States also may use up to
$55,000 or 5% of their allotment, whichever is higher, for administrative costs.
Remaining funds may be used by the state to provide training and technical
assistance, coordination and communication activities, payments to assure that funds
are targeted to areas with the greatest need, supporting “asset-building” programs for
low-income individuals (such as Individual Development Accounts, discussed later),
supporting innovative programs and activities conducted by local organizations, or
other activities consistent with the purposes of the CSBG Act. In addition, as
authorized by the 1998 amendments, states may use some CSBG funds to offset
revenue losses associated with any qualified state charity tax credit.
Allocation of Funds. Of funds appropriated annually under the CSBG Act,
HHS is required to reserve 1.5% for training and technical assistance and other
administrative activities, and half of this set-aside must be provided to state or local
entities. In addition, 0.5% of the appropriation is reserved for outlying territories
(Guam, American Samoa, the Virgin Islands, and the Northern Mariana Islands).
The law further requires that 9% of the total appropriation be reserved for certain
related activities, which are described below, and that the remainder be allocated
among the states. In practice, however, Congress typically specifies in annual
appropriations laws exactly how much is to be made available for the block grant and
each of the related activities. Block grant funds are allotted to states (including
Puerto Rico) based on the relative amount received in each state, in FY1981, under
a section of the former Economic Opportunity Act. HHS may allow Indian tribes to
receive their allotments directly, rather than through the state.
CSBG Program Data
The Community Services Block Grant Statistical Report FY2007 is based on
responses from 50 states, the District of Columbia, and Puerto Rico to a survey
administered by the National Association for State Community Services Programs.³
According to a fact sheet on this survey (the most recent made available), the
nationwide CSBG network spent more than $11.2 billion in FY2007; these funds
came from all sources, including federal, state, local, and private. Of this total, $578
million came from the federal block grant. For each CSBG dollar spent, the survey
found that $18.40 in other (non-CSBG) federal, state, local and private resources
were spent. Excluding other non-CSBG federal spending, each CSBG dollar
generated $5.59 in state, local, and private spending. In addition, volunteers provided
almost 46 million hours of support to the CSBG network. Almost all counties in the
United States — 99% — were served by a CSBG-eligible entity.

³ Highlights from the FY2007 Community Services Block Grant Information System
(CSBG/IS) Survey Statistical Report, National Association for State Community Services
Programs, Washington, DC; available at [http://www.nascsp.org/documents/FY2007CSBG
ISHighlights.pdf].

According to this survey, the CSBG network provided services to more than

16.2 million individuals in more than 6.4 million low-income families in FY2007.

More than 3 million families served had incomes below the federal poverty
guidelines, and nearly 1.4 million were “severely poor,” with incomes at or below
50% of poverty. More than 1.7 million families were “working poor” and relied on
wages or unemployment insurance, while more than 1.2 million families included a
family member who was a retired worker. More than 384,000 families were TANF
recipients, and more than 1.3 million families were headed by a single mother.
Related Activities
In addition to the block grant itself, the CSBG Act authorizes several related
national activities that are administered through the Office of Community Services
within HHS. Also, two other programs that are not directly authorized by the CSBG
Act, the Job Opportunities for Low-Income Individuals and Individual Development
Accounts, are administered by the Office of Community Services and are included
in the six separate activities described below. Funding authorization for all these
activities (except JOLI) expired at the end of FY2003; however, Congress has
continued to fund them, with some recent exceptions (see Table 1).
Community Economic Development. The Community Economic
Development program helps support local community development corporations
(CDCs) to generate employment and business development opportunities for low-
income residents. Projects must directly benefit persons living at or below the
poverty level and must be completed within 12 to 60 months of the date the grant was
awarded. Preferred projects are those that document public/private partnership,
including the leveraging of cash and in-kind contributions; and those that are located
in areas characterized by poverty, a Temporary Assistance for Needy Families
(TANF) assistance rate of at least 20%, high levels of unemployment or incidences
of violence, gang activity, and other indicators of socioeconomic distress.
During FY2007, HHS supported 45 grants, of which all were new starts, plus
six contracts and two interagency agreements, according to agency budget
documents. For FY2008, the Department expected to support 53 grants, of which
one was a continuation of an existing grant and the rest were new starts, plus five
contracts and two interagency agreements. HHS budget documents also indicate that
the Community Economic Development program created 3,636 jobs during FY2007,
compared with 3,463 in FY2006 and 3,314 and 3,187 in FY2005 and FY2004,
respectively.
Job Opportunities for Low-Income Individuals (JOLI). JOLI is
permanently authorized under the Family Support Act of 1988 (P.L. 100-485, Section
505), as amended by the Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 (P.L. 104-193, Section 112).⁴ Although JOLI is not

⁴ JOLI is one of several — mostly larger — programs that would have been covered by a
broad waiver authority proposed by the Bush Administration as part of its welfare reform
initiative. The waiver was included in various versions of welfare reform legislation in the
(continued...)

authorized under the CSBG Act, it is funded and administered as one of the CSBG-
related activities. JOLI funds are awarded on a competitive basis to community
based, non-profit and tax-exempt organizations, including community development
corporations, faith-based, charitable, and tribal organizations. Organizations awarded
grants must demonstrate and evaluate ways of creating new employment
opportunities with private employers for individuals who receive TANF and for other
individuals whose family income level does not exceed 100% of the official poverty
guidelines. Examples of these projects include self-employment and micro-
enterprise, new businesses, expansion of existing businesses, or creating new jobs or
employment opportunities. Funds for this project cannot be used for new
construction or for the purchase of real property.
During FY2007, HHS supported 10 grants, all of which were new starts, plus
four contracts and two interagency agreements, according to agency budget
documents. In FY2008, the Department also expected to support 10 new grants, four
contracts and two interagency agreements. HHS budget documents indicate that
JOLI created 300 jobs in FY2007, compared with 360 in FY2006 and 300 and 275
in FY2005 and FY2004, respectively.
Rural Community Facilities. Funds are for grants to public and private
nonprofit organizations for rural housing and community facilities development
projects to train and offer technical assistance on the following: home repair to low-
income families, water and waste water facilities management, and developing low-
income rental housing units.
During FY2007, HHS supported nine grants, all of which were continuation
grants, plus 3 contracts and two interagency agreements, according to agency budget
documents. In FY2008, the Department expected to support the same level of
program activity. HHS budget documents indicate that the Rural Community
Facilities program served 2,306 communities in FY2007, which is the same number
served for the previous three fiscal years.
National Youth Sports Program. Under this program, a grant traditionally
was made to a single organization, namely the National Collegiate Athletic
Association (NCAA), to provide recreational and instructional services for low-
income youth, typically on college campuses. In FY2005, one award was made, and
no funding has been provided since that year. The program remains alive, however,
and is currently administered by the non-profit National Youth Sports Corporation
with support from the USDA summer food service program and in-kind assistance
from the NCAA.⁵
Community Food and Nutrition Program. This program authorized
grants to public and private nonprofit organizations to coordinate food assistance

⁴ (...continued)
107^th through 109^th Congresses but not in the final law (P.L. 109-171). See CRS Report
RS21219, “Superwaiver” Proposals in Current Welfare Reform Debate, by Karen Spar.
⁵ Seethe following website for current information on the National Youth Sports Program:
[http://www.nyscorp.org/ nysp/home.html ].

resources, to help identify potential sponsors of child nutrition programs and to
initiate programs in areas with inadequate food assistance resources, and to develop
innovative approaches at the state and local level to meet the nutritional needs of
low-income people. Authorizing legislation required that 60% of the amount
appropriated (up to $6 million) must be allocated to states for statewide programs and
that 40% must be awarded on a competitive basis. Amounts appropriated in excess
of $6 million were allotted as follows: 40% awarded to eligible agencies for
statewide grants; 40% awarded on a competitive basis for local and statewide
programs; and 20% awarded on a competitive basis for nationwide programs,
including programs benefitting Native Americans and migrant farm workers.
FY2005 funding for this program was expected to support 104 new grants, one
contract, and two interagency agreements. No funding has been provided for this
program since FY2005.
Individual Development Accounts.⁶ The Assets for Independence Act
(Title IV, P.L. 105-285) initially provided for a five-year demonstration initiative to
encourage low-income people to accumulate savings. Individual Development
Accounts (IDAs) are dedicated savings accounts that can be used for specific
purposes, such as buying a first home, paying for college, or starting a business.
Contributions are matched, and participants are given financial and investment
counseling. To conduct the demonstration, grants are made to public or private
nonprofit organizations that can raise an amount of private and public (nonfederal)
funds that is equal to the federal grant; federal matches into IDA cannot exceed the
non-federal matches. The maximum federal grant is $1 million a year.
According to Administration budget documents, in FY2007 the program
supported 59 new grants, 10 contracts and two interagency agreements. In FY2008,
HHS expected to support 60 new grants, seven contracts and three interagency
agreements. According to the most recent outcome data included in HHS budget
documents, 36,077 IDAs were opened under the program in FY2006, and a
cumulative total of $31.5 million in participant savings had been deposited into IDA
accounts. HHS reports that more participants are using the program to withdraw
smaller amounts for educational purposes, rather than larger amounts for help in
buying a home.
The Assets for Independence Act expired at the end of FY2003, although
Congress has continued to provide appropriations for the IDA program under this
authority.

⁶ For more information on IDAs, see CRS Report RS22185, Individual Development
Accounts (IDAs): Background and Current Legislation for Federal Grant Programs to Help
Low-Income Families Save, by Gene Falk.

Administration Proposals
Zero Funding Request for FY2007, FY2008, and FY2009
In each of its FY2007 through FY2009 budget proposals, the Administration
requested no further funding for the CSBG or any related activities (with the sole
exception of IDAs). As rationale for terminating the CSBG, the Administration
stated that the program lacked performance measures and did not hold grantees
accountable for program results.⁷ The Administration further argued that the
program lacked competition “as evidenced by the same grantees receiving funding
year after year” and that grantees had “little incentive to improve their performance
since they are not held to minimum performance standards as a condition for
continued grant awards.”⁸ HHS noted that CSBG received a “Results Not
Demonstrated” rating in 2003 by the Program Assessment Rating Tool, although it
also said that in response to this rating, the program was restructuring its monitoring
and evaluation to improve state and local administration, accountability, and
outcomes.⁹ The Administration further justified its zero-funding request by stating
that key CSBG services such as employment, housing, nutrition, and health care were
provided by other federal programs.¹⁰
Similar arguments were advanced to justify no further funding for Community
Economic Development, Rural Community Facilities, and JOLI. According to
Administration budget documents, these activities lacked performance standards “to
assess their impact, are too narrowly focused to have a major benefit, duplicate other
Federal programs, and award grants on a noncompetitive basis.”¹¹
Strengthening America’s Community Initiative (SACI)
President Bush’s FY2006 budget request included a proposal to eliminate 18
existing community and economic development programs and replace them with a
new “Strengthening America’s Communities Initiative.”¹² Programs that would have

⁷ Administration for Children and Families, HHS, appropriations justifications, FY2007,
FY2008, and FY2009.
⁸ Office of Management and Budget, Major Savings and Reforms in the Administration’s

2008 Budget, p. 49.

⁹ For a discussion of the PART assessment process, see CRS Report RL32663, The Bush
Administration’s Performance Rating Assessment Tool (PART), by Clinton Brass. Also see
discussion later in this report, under “Government Accountability Office (GAO) Review,”
for information about recent HHS improvements to its monitoring process in response to
recommendations from GAO.
¹⁰ Office of Management and Budget, The Budget for Fiscal Year 2007, p. 118, and Major
Savings and Reforms in the Administration’s 2008 Budget, p. 49.
¹¹ Office of Management and Budget, Major Savings and Reforms in the Administration’s

2008 Budget, p. 50.

¹² See CRS Report RL32823, An Overview of the Administration’s Strengthening America’s
(continued...)

been included were the Community Services Block Grant and some of the related
activities discussed in this report. In conjunction with the SACI proposal, the
Administration requested no separate funding in FY2006 for CSBG, Community
Economic Development, JOLI, or Rural Community Facilities.
Programs that would have been included in the proposed SACI were
administered by various federal agencies, including HHS and the Department of
Housing and Urban Development (HUD); however, the Administration proposed to
base the new initiative in the Department of Commerce. The President requested
$3.7 billion for FY2006 to fund SACI; programs that would have been included were
funded in FY2005 at an estimated total of $5.6 billion. The largest program proposed
for inclusion was HUD’s Community Development Block Grant (CDBG), funded in
FY2005 at $4.1 billion.
Three separate congressional committees held hearings on the SACI proposal,
including the House Government Reform Subcommittee on Federalism and the
Census (March 1, 2005), the House Transportation and Infrastructure Subcommittee
on Economic Development, Public Buildings and Emergency Management (March

17, 2005), and the House Financial Services Committee (April 6, 2005). In general,

the congressional response was not enthusiastic. In reporting the FY2006 budget
resolution (H.Con.Res. 95), the House Budget Committee stated: “Community
Services Block Grants provide invaluable assistance to low-income families and
communities. These funds are used to build healthy and stable communities. Due
consideration should be given to this program before Congress implements any
changes.” Formal legislation to establish the SACI initiative was not submitted or
introduced during the 109^th Congress.
In its FY2007 budget request, the Administration proposed a modified version
of the Strengthening America’s Communities Initiative, which would have reformed
certain programs but maintained them at their current agencies. Most notably, the
Community Development Block Grant would remain at HUD. This version of SACI,
however, contained no mention of Community Services Block Grants or the related
programs discussed in this report. Rather, as discussed above, the Administration
proposed to eliminate CSBG and related activities altogether.
Separate from the SACI proposal, the Administration requested no funding in
FY2006 for two additional CSBG-related activities — the National Youth Sports
Program and the Community Food and Nutrition Program — stating that they
duplicated activities that could be provided by such programs as the Social Services
Block Grant or those administered by the U.S. Department of Agriculture’s (USDA)
Food and Nutrition Service. As described later in this report, under “Recent
Appropriations History,” Congress rejected the SACI proposal and chose to continue
separate funding in FY2006 for the CSBG, Community Economic Development, and
Rural Community Facilities. However, as requested by the Administration, no
funding was provided for National Youth Sports or Community Food and Nutrition.

¹² (...continued)
Communities Initiative, coordinated by Eugene Boyd.

Request for IDAs
As noted earlier, Individual Development Accounts, authorized by the expired
Assets for Independence Act, were the only CSBG-related activity for which the
Administration requested funding in either FY2006, FY2007, FY2008, or FY2009.
The President’s budget for FY2009 requested $24 million for this program, which
was the same level provided in FY2008. HHS budget documents stated that the
program received an “Adequate” PART assessment in 2004, and that the Department
supported reauthorization of the program and would pursue efforts — both
administratively and in legislation — to improve program flexibility, encourage
program simplification, and increase participation eligibility. No legislation has been
introduced in the 110^th Congress to reauthorize the Assets for Independence Act and
IDA program.
Government Accountability Office (GAO) Review
The Government Accountability Office (GAO) released a report on the CSBG
program in July 2006, which was originally requested by the House Education and
the Workforce Committee¹³ in April 2005.¹⁴ GAO’s review focused on three topics
related to program monitoring and training and technical assistance: (1) HHS
compliance with legal requirements and standards governing its oversight of state
efforts to monitor local CSBG grantees; (2) efforts by states to monitor local grantee
compliance with fiscal requirements and performance standards; and (3) targeting by
HHS of its training and technical assistance funds and the impact of such assistance
on grantee performance.¹⁵
GAO concluded that the Office of Community Services (OCS, the office within
HHS that is charged with administering the CSBG) “lacks effective policies,
procedures, and controls” to ensure its own compliance with legal requirements for
monitoring states and with federal internal control standards. GAO found that OCS
had visited states as mandated by law but failed to issue reports to the states after the
visits or annual reports to Congress, which also are mandated by law. OCS failed to
meet internal control standards because their monitoring teams lacked adequate
financial expertise; moreover, OCS lost the documentation from the monitoring visits
to states. Finally, OCS was not systematic in its selection of states to visit, and did

¹³ The House Education and the Workforce Committee was renamed the Education and
Labor Committee in the 110^th Congress.
¹⁴ The Senate Appropriations Committee cited this GAO report in its reports on the FY2008
and FY2009 HHS appropriations bills (S.Rept. 110-107 and S.Rept. 110- 410). See “Recent
Appropriations History” for more details, later in this report.
¹⁵ Community Services Block Grant Program: HHS Should Improve Oversight by Focusing
Monitoring and Assistance Efforts on Areas of High Risk, GAO-06-627, U.S. Government
Accountability Office, June 2006. GAO had revealed some of the findings of this review
in February 2006 in a letter submitted to HHS (“Community Services Block Grant Program:
HHS Needs to Improve Monitoring of State Grantees,” letter to Wade F. Horn, Assistant
Secretary for Children and Families, Department of Health and Human Services, from the
U.S. Government Accountability Office, February 7, 2006).

not use available information on state performance or collect other data to allow
more effective targeting of its limited monitoring resources on states at highest risk
of management problems.
In connection with its assessment of state efforts to monitor local grantees, GAO
visited five states and found wide variation in the frequency with which they
conducted on-site monitoring of local grantees, although officials in all states said
they visited agencies with identified problems more often. States also varied in their
interpretation of the law’s requirement that they visit local grantees at least once in
a three-year period, and GAO noted that OCS had issued no guidance on this
requirement. States reported varying capacities to conduct on-site monitoring and
some states cited staff shortages; however, the states all performed other forms of
oversight in addition to on-site visits, such as review of local agency reports (e.g.,
local agency plans, goals, performance data, and financial reports) and review of
annual Single Audits where relevant. Several states coordinated local oversight with
other federal and state programs, and also used state associations of Community
Action Agencies to help provide technical assistance.
GAO found, with regard to federal training and technical assistance funds, that
OCS targeted at least some of these funds toward local agencies with identified
financial and program management problems, but generally was not strategic in
allocating these funds and had only limited information on the outcome of providing
such training and technical assistance.
GAO made five recommendations to OCS in its report (and HHS indicated its
agreement and intent to act upon these recommendations). According to GAO, OCS
should
^!conduct a risk-based assessment of states by systematically
collecting and using information;
^!establish policies and procedures to ensure monitoring is focused on
the highest-risk states;
^!issue guidance to states on complying with the requirement that they
monitor local agencies during each three-year period;
^!establish reporting guidance for training and technical assistance
grants so that OCS receives information on the outcomes for local
agencies that receive such training or technical assistance; and
^!implement a strategic plan for targeting training and technical
assistance in areas where states feel the greatest need.
HHS Response
HHS took a series of steps in response to the GAO report. On October 10,
2006, HHS issued an information memorandum to state agencies responding to
GAO’s third recommendation and providing guidance on compliance with the
statutory requirement that states conduct a full on-site review of each eligible entity

at least once during every three-year period.¹⁶ Subsequently, on March 1, 2007, HHS
issued another information memorandum, responding to GAO’s first two
recommendations and providing a schedule of states that will receive federal
monitoring in each of the next three years (FY2007-FY2009).¹⁷
The October memorandum explained that states were selected through a process
intended to identify states that would receive the most benefit from federal
monitoring visits. This process considered the extent to which eligible entities in the
state were considered vulnerable or in crisis; the physical size of the state, its number
of eligible entities, and the number of state personnel assigned to the CSBG program;
the extent of poverty in the state compared to the number of eligible entities and state
CSBG personnel; the number of clients served compared to the number of eligible
entities and state CSBG personnel; evidence of past audit problems; and tardiness by
the state in submitting CSBG state plans to HHS or responses to information surveys
conducted by the National Association of State Community Services Programs.¹⁸
On August 23, 2007, HHS announced the development of a CSBG state
assessment tool to help states prepare for federal monitoring.¹⁹ On September 6,
2007, HHS issued a strategic plan for the CSBG program, which is intended to
describe training, technical assistance, and capacity-building activities and promote
accountability within the CSBG.²⁰
Reauthorization
In the 109^th Congress, Representative Osborne introduced H.R. 341, the
Improving the Community Services Block Grant Act, which was virtually identical^th
(except for dates) to legislation passed by the House during the 108 Congress (H.R.
3030).²¹ H.R. 341 would have reauthorized the CSBG and related activities through
FY2012, and was referred to the House Education and the Workforce Committee
(renamed the Education and Labor Committee in the 110^th Congress), where no
action occurred. (See “Recent Developments,” at the beginning of this report, for

¹⁶ Office of Community Services (OCS) Information Memorandum, Transmittal No. 97,
dated 10/10/06: [http://www.acf.hhs.gov/programs/ocs/csbg/documents/10h.html].
¹⁷ Office of Community Services (OCS) Information Memorandum, Transmittal No. 98,
dated 3/1/07: [http://www.acf.hhs.gov/programs/ocs/csbg/documents/im98.html]. The
monitoring schedule was subsequently revised by OCS Information Memorandum
Transmittal No. 105, dated December 21, 2007, which now covers FY2008-FY2010:
[ h t t p : / / www.vi r t ual cap.or g/ cmsCont ent / f i l e s/ OCS_IM _105_12_21_07.pdf ] .
¹⁸ See discussion of this survey earlier in this report.
¹⁹ Office of Community Services (OCS) Information Memorandum, Transmittal No. 102,
dated 8/23/07: [http://www.virtualcap.org/cmsContent/files/OCS_IM_102_08_23_07.pdf].
²⁰ Office of Community Services (OCS) Information Memorandum, Transmittal No. 103,
dated 9/6/07: [http://www.virtualcap.org/cmsContent/files/OCS_IM_103_09_06_07.pdf].
²¹ H.R. 3030 contained an unrelated unemployment compensation provision, which was not
included in H.R. 341.

discussion of a Government Accountability Office review of CSBG, which was
requested by the committee shortly after the legislation was introduced.) In his
introductory remarks, Representative Osborne noted key provisions of H.R. 341, such
as promoting increased quality and accountability of CSBG programs, encouraging
initiatives to improve conditions and eliminate barriers to self-sufficiency in rural
areas, and providing youth mentoring services to address education needs and crime.
Other provisions of H.R. 341 would have
^!changed the definition of the “eligible entity” by requiring such
entities to establish and meet local goals as well as state goals,
standards and requirements;
^!required that a state take swift action to improve the performance or
terminate funding of low-performing eligible entities or ones that
failed to meet local and state requirements;
^!provided that a state justify to the Secretary its continued support of
low-performing eligible entities;
^!required a state to use funds to improve economic conditions and
remove barriers to self-sufficiency for the rural poor;
^!required a local eligible entity to establish goals for reducing poverty
in the community;
^!based subsequent grant awards on the success or failure of an
eligible entity in meeting goals;
^!prohibited a religious organization providing services under
provisions of this act from discriminating against a person seeking
assistance because of religion or a religious belief;
^!required the Secretary to establish procedures that would allow grant
funds or intangible assets acquired with grant funds to become the
sole property of the grantee if the grantee agrees to continue to use
the funds or property for the purposes for which the grant was
provided;
^!added water and wastewater facility needs to activities allowed for
rural community development; and
^!added improvement of academic achievement to the goals of
national or regional programs designed to provide instruction
activities.
During the 108^th Congress, the committee reported and the House passed
legislation, H.R. 3030 (virtually identical to H.R. 341 in the 109^th Congress), while
the Senate passed S. 1786, the Poverty Reduction and Prevention Act. Conferees
never met to resolve differences in the two bills. Both bills in the 108^th Congress
would have reauthorized CSBG and related programs at such sums as necessary,
except for the National Youth Sports Program, which would have been reauthorized
at $15 million annually by the House bill and $18 million by the Senate bill. The
following compares provisions of H.R. 3030 and S. 1786 from the 108^th Congress;
readers should note that H.R. 341, introduced in the 109^th Congress, contained the
same provisions as H.R. 3030.
Program Goals. H.R. 3030 and S. 1786 contained similar provisions
concerning goals of eligible entities. H.R. 3030 would have required entities to

establish and meet locally determined goals for reducing poverty in the community.
It would also have added “improving academic achievement” to the list of required
goals. Both bills would have required an entity to include goals for leveraging
community resources, fostering coordination of federal, state, local, private and other
assistance, and promoting community involvement.
S. 1786 would have provided that grants to states support both improving the
causes of poverty and the conditions that cause poverty. The measure would have
revised the poverty line determination; it would have allowed a state to raise its
eligibility threshold to a minimum of 125% of the federal poverty line or a maximum
of 60% of state median income; however, the state would have had to give priority
to serving individuals with the lowest income who sought services. Also, S. 1786
would have made a tripartite board the sole mechanism for determining consideration
of eligible entities, and thus would have eliminated current provisions that allow a
state to specify another mechanism for doing so. H.R. 3030 did not contain
provisions concerning the poverty eligibility threshold or the role of a tripartite board
in determining an eligible entity.
State Plan Requirements. H.R. 3030 and S. 1786 would have revised state
application and plan requirements. H.R. 3030 would have specified that youth
development activities may include mentoring programs. The bill also would have
added, as a use of funds to be included in the state plan, “initiatives to improve
economic conditions and mobilize new resources in rural areas to eliminate obstacles
to the self-sufficiency of families and individuals in rural communities.” S. 1786
would have revised the current state plan provisions by requiring not only that the
Secretary review the plan but also approve it. Among information for inclusion in
a state’s plan submitted to the Secretary was an assurance that grant funds would be
used for the following purposes: to improve literacy, communications, and technical
skills of participant low-income families; for initiatives to assist those moving from
welfare to work to obtain jobs at decent wages with benefits; for initiatives to
increase the development of household assets of individuals (such as individual
development accounts and home-ownership opportunities); to improve economic
conditions and mobilize new resources in rural and other at-risk areas to eliminate
obstacles to the self-sufficiency of persons in those communities, and for initiatives
to reduce the concentration of poverty in cities and inner suburbs and provide
economic opportunities for persons in those areas; and in support of partnerships
with nonprofit or community-based organizations that address child abuse
prevention, including programs that are school-based and that focus on adolescent
victims, and victimizers.
Training and Technical Assistance. Both bills contained training and
technical assistance provisions. H.R. 3030 would have added “dissemination
regarding best practices” to the use of funds by the Secretary. S. 1786 would have
revised training and technical assistance provisions by devising, in consultation with
national and state networks of eligible entities, a strategic plan for annual technical
assistance; and would have improved management information and reporting systems
by developing a common state financial and organizational protocol.
Grantee Funding Reduction or Termination. Provisions relating to
reducing or terminating funding for eligible entities were included in H.R. 3030 and

S. 1786. H.R. 3030 would have allowed, but not required, the Secretary to review
determinations by a state to reduce or terminate funding to an eligible entity. Further,
the bill would have amended the definition of “cause” in the case of a funding
reduction to include failure to meet poverty reduction goals. States would have been
required to give priority to entities that received funding on the date of enactment, if
they fulfilled their poverty reduction goals. If no entity was entitled to such priority,
the state would designate another entity from qualified applicants. H.R. 3030 also
would have required states to replace the lowest performing existing grantees
beginning in FY2005. S. 1786 would have established procedures for termination
of designation as an eligible entity or reduction of funding by giving eligible entities
a right to a public hearing on a state decision; changing from 90 to 30 days the time
frame within which the Secretary must have made a determination concerning a
state’s decision to terminate or to reduce funding for an eligible entity; and requiring
the Secretary to continue funding the entity at its previous year’s level until a
decision was made on a state’s action.
Grantee Monitoring and Fiscal Controls. Both measures would have
amended current provisions of the CSBG Act relating to monitoring eligible entities.
H.R. 3030 would have required federal reviews to determine whether local
performance goals were being met. S. 1786 would have changed current law
requirements for full on-site federal reviews of eligible entities every three years to
a biennial basis. In addition, S. 1786 would have required an annual follow-up visit
to entities that failed to meet state-established goals.
S. 1786 would have addressed fiscal controls by requiring states to submit a
separate audit of CSBG funds to the Secretary covering disbursements to eligible
entities, use of state administrative funds, and disbursement of state discretionary
funds; H.R. 3030 contained no such provisions. S. 1786 would have authorized the
Secretary to withhold administrative funds from states that were not in compliance
with the CSBG Act and provide funds directly to the eligible entities. H.R. 3030 and
S. 1786 would have provided that funding be directed at improving the self-
sufficiency of families and individuals in rural communities.
Both H.R. 3030 and S. 1786 contained similar provisions that would have
authorized the Secretary to allow grantees to keep assets obtained with program
funds. H.R. 3030 would have allowed the Secretary to add water and waste water
treatment to the list of community facility needs. H.R. 3030 would have allowed
funds to be used for construction or substantial rehabilitation of buildings and
facilities and for loans or investments in private business enterprises owned by
community development corporations. S. 1786 would have authorized the Secretary
to allow funds for long-term loans or investments for private business enterprises,
capital to businesses owned by community development corporations, and marketing
and management assistance for businesses providing jobs and business opportunities
to low-income individuals.
Faith-Based Organizations. Another key provision of H.R. 3030 and S.
1786 related to the participation of faith-based organizations in CSBG-funded
programs. H.R. 3030 would have prohibited discrimination against a beneficiary or
potential beneficiary of the program on the basis of religion. S. 1786 would have
added religion to current provisions of the CSBG Act that prohibit exclusion of a

person from program participation based on color, national origin, sex, or age. S.
1786 also would have amended current law, which requires government agencies to
consider participation of religious organizations on the same basis as other
nongovernmental organizations, to require religious organizations to meet
requirements of the act.
There was debate on H.R. 3030 both in the House Committee on Education and
the Workforce and on the House floor on provisions in current law that allow a
religious organization to discriminate in hiring. The Committee defeated an
amendment that would have prevented a grantee from using religion as a basis for
discriminating against a job applicant and agreed to one that would have prohibited
a religious organization from using religion or a religious belief as a basis for
discriminating against a person seeking program services.
After considering a number of amendments, the House passed H.R. 3030 on
February 4, 2004. The House rejected H.Amdt. 459 (Woolsey) in the nature of a
substitute that would have prohibited organizations from using CSBG funds to
discriminate in hiring on the basis of religion. The House rejected both H.Amdt. 460
(Robert Scott) which would have required organizations to separate their religious
services or activities from programs that used CSBG funds and H.Amdt. 461 (Robert
Scott) which would have prohibited the use of federal CSBG funds to discriminate
in hiring based on religion. (See CRS Report RL32736, Charitable Choice Rules
and Faith-Based Organizations, by Joe Richardson, for a discussion of these rules
and the CSBG.)
Recent Appropriations History
FY2009
The House Labor-HHS-Education Appropriations Subcommittee approved a
draft FY2009 funding bill on June 19, 2008, that would have increased funds for
CSBG and two related activities. The full House Appropriations Committee met but
did not complete action on this bill on June 26, 2008. As approved by the
subcommittee, the measure would have provided $700 million for the CSBG in
FY2009 (a $46 million increase from the FY2008 level), $36 million for Community
Economic Development (a $4.5 million increase), $10 million for Rural Community
Facilities (a $2.1 million increase), and level funding for JOLI and IDAs. The draft
committee report stated that “the CSBG is more important than ever, with
unemployment and poverty increasing due to the struggling economy and the number
of low-income individuals and families in need of assistance rising as a
consequence.”²² The draft report directed that $500,000 of training and technical
assistance funds be used for a national community economic development training
and capacity development initiative that would provide CAA leaders with the

²² Unnumbered draft House Appropriations Committee report, reflecting actions of the
Subcommittee on Labor-HHS-Education on FY2009 spending bill: [http://www.cq.com/
flatfiles/editorialFiles/budgetT r acker /reference/docs/20080626l hreport.pdf].

necessary professional skills to finance and implement innovative housing, economic,
and community development partnerships.
The Senate Appropriations Committee reported its version of the FY2009
funding bill for the Departments of Labor, HHS, and Education on July 8, 2008 (S.
3230, S.Rept. 110-410). The Senate committee would have maintained CSBG and
all related activities at their FY2008 funding levels, except for Rural Community
Facilities, which would have received $8.5 million (a $600,000 increase). The
Senate committee noted “the importance of Community Action Agencies (CAAs) as
institutions that organize low-income communities to identify emerging challenges
to economically insecure Americans and subsequently to mobilize the resources,
programs and partnerships needed to address local poverty conditions.” The report
further stated that “CSBG is a unique Federal resource that supports CAAs while
they initiate creative responses to local poverty conditions and seek new sources of
support and investment to implement their initiatives. The Committee believes that
CSBG funding is an investment, analogous to venture capital, in the future of low-
wage workers, retirees and their families.”
In its report, the Senate Committee faulted the Office of Community Services
within HHS for failing to report on progress made in correcting the deficiencies in
program oversight identified by GAO (see earlier discussion of GAO report). The
committee also noted that OCS did not comply with a directive included in the
conference report on the FY2005 appropriation, regarding the implementation of a
training and technical assistance needs assessment and delivery plan in consultation
with CSBG state and local grantees. The committee further stated that OCS should
develop and deliver professional skills training for CAA leaders so they can finance
and implement innovative housing, economic and community development
partnerships (similar to language in the draft House report); that OCS should support
linkages between local agencies, national organizations, and academic institutions
that would disseminate research on effective responses to poverty; and finally, that
OCS should continue funding statewide CAA associations to continue and expand
cost-effective training and other capacity-building services for members.
Both the draft House and the Senate committee-approved FY2009 bills
contained language intended to clarify congressional intent with regard to the
disposition of intangible assets, including loans and investments, acquired under the
Community Economic Development program.
The 110^th Congress did not finalize action on an FY2009 spending bill for the
Departments of Labor, HHS, and Education. On September 30, 2008, President
Bush signed into law a government-wide continuing resolution (P.L. 110-329) that
maintains funding for the CSBG and related programs at their FY2008 levels through
March 6, 2009.
See Table 1 for a comparison of FY2009 levels approved by the Senate
Appropriations Committee and House Labor-HHS-Education Appropriations
Subcommittee with funding levels of earlier years.

FY2008
The House on July 19, 2007, passed H.R. 3043 (Labor-HHS-Education
Appropriations Act for FY2008), which would have provided $660.4 million for the
CSBG, for a $30 million increase above the FY2007 and FY2006 levels. The House
bill also would have increased funding for Community Economic Development by
nearly $6 million, from $27.02 million to $32.7 million, and provided a small
increase for Rural Community Facilities. JOLI and IDAs would have been
maintained at current levels.
The Senate Appropriations Committee on July 13, 2007, reported its version of
the FY2008 funding bill (S. 1710), including $670.4 million for the CSBG, for a $40
million increase. The full Senate then passed H.R. 3043 on October 23, after
substituting the language of the committee-reported S. 1710. The Senate bill would
have maintained Community Economic Development at its current level, rather than
the higher level approved by the House, but would also have provided the same small
increase for Rural Community Facilities. As in the House bill, the Senate would
have maintained JOLI and IDAs at their current levels.
In its report on the FY2008 funding bill (S.Rept. 110-107), the Senate
Appropriations Committee cited the recent GAO findings related to training and
technical assistance for states and grantees under the CSBG. The Committee
instructed HHS to make better use of funds reserved for training and technical
assistance and to ensure these funds only go to help state grantees and eligible
entities, or their associations, and not to support federal administrative costs. The
Committee also requested that HHS report back on the results of its training and
technical assistance activities at the end of each grant period. FY2008 funding for
training and technical assistance should support, among other things, a system for
rating the quality and effectiveness of training and technical assistance activities;
technical assistance to help establish and assess voluntary local agency performance
benchmarks; and a system for effectively responding to needs identified through
program monitoring or corrective action plans.
President Bush on November 13 vetoed a House-Senate compromise version
of H.R. 3043 (H Rept. 110-424). The compromise would have funded the CSBG at
$665.43 million and would have provided the higher levels for Community
Economic Development and Rural Community Facilities. JOLI and IDAs would
have remained at current levels. However, on December 26, President Bush signed
into law the Consolidated Appropriations Act for FY2008 (P.L. 110-161), containing
increases for the CSBG, Community Economic Development, and Rural Community
Facilities, and slight decreases for JOLI and IDAs. P.L. 110-161 included a 1.747%
across-the-board reduction for programs in the Departments of Labor, HHS, and
Education.
FY2007
Continuing Resolution. Like much of the federal government, CSBG and
related activities were funded through FY2007 at their FY2006 levels under a
continuing resolution (P.L. 110-5). This continuing resolution was made necessary

because the 109^th Congress did not complete action on certain regular appropriations
bills for FY2008.
House Action in the 109^th Congress. As described earlier, the
Administration requested no funding for the CSBG or any related activities in
FY2007, except for IDAs. In response to this request, the House Labor-HHS-
Education Appropriations Subcommittee approved legislation on June 7, 2006, that
would have continued funding for CSBG, but at a reduced level. Specifically, the
subcommittee would have provided $430.4 million for the CSBG in FY2007, for
about a one-third reduction from its FY2006 level. This amount was increased by
$19 million when the full Appropriations Committee reported the FY2007 spending
bill with a total of $449 million for the block grant (H.R. 5647). In its report on the
bill (H.Rept. 109-515), the House Committee acknowledged the funding reduction
for the block grant and expressed concern about the impact of this reduction on rural
areas. “Rural areas depend on these funds to provide the infrastructure to deliver
antipoverty activities. Therefore, the committee encourages the authorizing
Committee of jurisdiction [i.e., the House Education and Labor Committee] to
review the funding allocations for the Community Services Block Grant to ensure
that limited funding is reaching those areas with the greatest need.”
The subcommittee and full committee rejected Administration proposals to
eliminate two national activities and instead would have provided the same level of
funding as available in FY2006 for Community Economic Development and Rural
Community Facilities. As requested, however, no funding was recommended by
either the subcommittee or full House Appropriations Committee for the JOLI
program in FY2007. The IDA program would have been maintained at its FY2006
level.
Senate Action in the 109^th Congress. The Senate Appropriations
Committee reported its version of the FY2007 spending bill for Labor, HHS and
Education on July 20, 2006, approving the same level of funding for CSBG and
related activities (including JOLI) as they received for FY2006 (S. 3708). Explaining
its decision regarding the block grant, the Senate Committee stated in its report
(S.Rept. 109-287), “The Nation’s Community Action Agency network relies on
CSBG funding to help initiate and administer programs designed to alleviate poverty.
The universal characteristic of these CSBG-funded programs is that they provide
people with the resources and the tools to become self-sufficient.”
FY2006
An FY2006 appropriations for the Departments of Labor, HHS, and Education
was enacted on December 30, 2005, and provided generally level funding for the
CSBG and most related activities (P.L. 109-149). However, two long-standing
national activities — the National Youth Sports Program (NYSP) and the
Community Food and Nutrition Program (CFNP) — received no funding in this act,
as proposed by the Administration. In their respective versions of the bill (H.R.
3010), the House chose to eliminate funding for CFNP while the Senate would have
continued funding at the FY2005 level. Both the House and the Senate
Appropriations Committee, in its reported version of H.R. 3010, chose to zero out
funding for NYSP. The Senate approved a floor amendment offered by Senators

Domenici and Bayh, adding $10 million for the program, but these funds were
dropped in conference.
Under the spending law for FY2006, the following amounts were provided:
CSBG, $637 million; Community Economic Development, $32.7 million (which
includes $5.4 million for the Job Opportunities for Low-Income Individuals
program); $7.4 million for Rural Community Facilities; and $24.7 million for
Individual Development Accounts. Also enacted on December 30, 2005, however,
was the FY2006 appropriations law for the Department of Defense (P.L. 109-148),
which included a mandatory 1% across-the-board rescission from all non-emergency
discretionary appropriations provided for FY2006.

CRS-22
Table 1. Funding for CSBG and Related Activities,
FY2005-FY2009
($ in millions)
^FY²⁰⁰⁹^FY²⁰⁰⁹^FY²⁰⁰⁹
^Sena^t^e^Hou^s^e^d^Co^nt.^e
^Program^FY²⁰⁰⁵^a^FY²⁰⁰⁶^b^FY^{2007 FY}²⁰⁰⁸^c^C^o^mm.^Subco^m^m^.^Res.
^Bl^ock^G^r^an^t^636.79^629.99^630.43^653.80^653.80^700.00^653.80
^Co^m^m^uⁿ^ity^Ecoⁿ^o^m^ic^27.30^27.00^27.02^31.47^31.47^36.00^31.47
^D^e^v^e^l^opm^en^t
^J^{ob Opportu}ⁿ^ities^f^o^{r L}^o^w^-^5.44^5.38^5.38^5.29^5.29^5.29^5.29
^In^com^e^In^di^vⁱ^du^al^s^(JOL^I)
^Ru^r^a^{l Co}^m^m^uⁿ^ity^Facilities⁷^.2⁴⁷^.2⁹⁷^.2⁹⁷^.8⁶⁸^.5⁰¹⁰^.⁰⁰⁷^.⁸⁶
ⁱ^{ki/CRS-RL32872}^Natioⁿ^a^{l Yo}^u^t^h^Sp^o^r^{ts P}^r^o^g^r^a^m¹^.⁸⁶⁰⁰⁰⁰⁰⁰
^g/w
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^Source:^T^a^{ble prepared by}^th^{e C}^oⁿ^g^r^es^sⁱ^on^{al R}^e^s^earch^Serv^{ice (C}^R^S⁾^.^S^o^ur^c^e^s^of^{data are ag}^en^cy^bu^dg^{et j}^u^s^tif^ication^s^an^{d con}^g^r^es^sⁱ^on^al
^appropri^a^tⁱ^oⁿ^s^docu^m^en^t^s^.
^{a. F}^uⁿ^dⁱⁿ^g^ref^l^ect^s^{a 0.80%}^acros^s^-^t^h^e-^{board res}^cⁱ^s^sⁱ^on^as^m^aⁿ^d^at^{ed by}^t^h^{e C}^oⁿ^s^olⁱ^d^at^{ed A}^ppropri^a^tⁱ^oⁿ^s^A^c^t^,^{2005 (P.L}^{. 108-}⁴⁴⁷^).
^b.^Fundⁱⁿ^g^ref^l^ect^s^{a 1%}^acros^s^-^t^h^e-^{board res}^cⁱ^s^sⁱ^on^as^m^aⁿ^d^at^{ed by}^t^h^{e D}^e^f^eⁿ^s^{e D}^e^part^m^eⁿ^t^A^ppropri^a^tⁱ^oⁿ^s^A^c^t^,^{2006 (P.L}^{. 109-}^{148). S}^e^e
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^{c. F}^uⁿ^dⁱⁿ^g^ref^l^ect^s^{a 1.747%}^acros^s^-^t^h^e-^{board redu}^ctⁱ^oⁿ^as^m^aⁿ^d^at^{ed by}^t^h^{e C}^oⁿ^s^olⁱ^d^at^{ed A}^ppropri^a^tⁱ^oⁿ^s^A^c^t^,^{2008 (P.L}^{. 110-}¹⁶¹⁾^.
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^March^6,^2009.^T^h^e^Bu^s^h^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^requ^es^t^e^{d n}^o^f^uⁿ^dⁱⁿ^g^f^o^{r an}^y^of^t^h^{e prog}^ram^s^s^h^owⁿ^f^o^{r F}^Y^{2009, w}ⁱ^t^h^t^h^{e ex}^ceptⁱ^oⁿ^of^In^di^vⁱ^du^al
^Dev^e^lopm^en^{t A}^ccouⁿ^t^s^,^f^o^{r w}^h^ich^{$24.02 m}^illion^w^a^s^requ^es^ted.

Appendix: CSBG and Hurricane Katrina
On September 2, 2005, in response to the damage caused by Hurricane Katrina,
HHS sent an Information Memorandum to CSBG administrators, regional and state
Community Action Associations, and local Community Action Agencies, urging
them to take “immediate steps” to support families disrupted by the storm. Then-
Assistant HHS Secretary Wade Horn suggested that all grantees, especially those in
the affected areas, conduct a quick inventory of services and resources they could
deploy to assist victims, including physical resources and the services of
professionals such as doctors, social workers, mental health personnel and
community workers. The memorandum also stated that CSBG funds could be used
flexibly to cover the expanded services, and that declarations of eligibility could be
adequate, at state option, since many affected individuals would lack identification
and verifying materials. A subsequent information memorandum, dated October 6,
2005, provided more detailed guidance on determining eligibility of affected
individuals and households for CSBG-funded services; described a new “evacuee
designation status” for expediting access to benefits; described strategies for assisting
individuals and families during the initial phases of relief and recovery; identified
additional sources of support; and encouraged coordination and communication with
emergency responders and service providers throughout the crisis assistance and
recovery process.²³
On September 21, 2005, Senators Enzi and Kennedy introduced the Community^th
Services Disaster Assistance Act (S. 1745, 109 Congress), which would have
reauthorized appropriations for CSBG through FY2006. The bill would have
allowed states to transfer a portion of their CSBG allotments to Louisiana,
Mississippi, or Alabama; would have authorized HHS to waive income eligibility
rules under CSBG in Katrina-related emergency or disaster areas; and would have
authorized CSBG grantees to send their staff to such areas to help provide disaster
assistance. On November 16, 2005, the House passed the Hurricane Regulatory
Relief Act (H.R. 3975, 109^th Congress), a multi-purpose bill that would have
authorized HHS to waive statutory deadlines for states to file CSBG applications and
plans for up to 90 days; allowed states to temporarily fund alternative agencies when
existing CSBG grantees in hurricane-affected areas were unable to provide services;
and required states to consult with affected eligible entities before recapturing and
redistributing unobligated funds. Like S. 1745, the House-passed bill would have
allowed states to transfer a portion of their CSBG allotments to hurricane-affected
states and would have authorized CSBG-funded staff from other states to deliver
disaster assistance in hurricane-affected states, although the language in the two bills^th
was not identical. No further action occurred on either bill in the 109 Congress.

²³ Office of Community Services (OCS) Information Memoranda, Transmittal No. 90, dated
September 2, 2005, and Transmittal No. 91, dated October 6, 2005; available online at
[ ht t p: / / www.acf .hhs.gov/ pr ogr ams/ ocs/ csbg/ document s / 10h.ht ml ] .