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Community Development Block Grant 1110 The Community Development Block Grant ( CDBG ) program, under the aegis of the U. S . Department of Housing and Urban Development ( HUD) , provides cities and counties with funding for the initiation and continuation of a diverse array of housing and community development projects. Community Development Block Grants are allocated by virtue of a formula allocating 80% of the funds to Standard Metropolitan Statistical Areas (SMSA ) , and 20% to non-metropolitan areas . Of the 80% of the money distributed to SMSA' s, most of the grant money takes the form of entitlement grants. A city or county eligible to receive an entitlement grant automatically receives the grant by submitting an application containing eligible uses for the `money. Jurisdictions eligible for entitlement grants include cities with population over 50 , 000 which are central cities of an SMSA, urban counties ( counties having a poplulation of at least 200 , 000 not including the population of the central city) , and central cities of an SMSA with population under 7)0 , 000 . The remaining cities and counties may apply on a competitive basis for discretionary grants to fund eligible activities . 1thouch CDBC money is designed to be a source of :financial1111 assistance to help meet housing and community development needs , :estri :tions upon the use of these funds exist. There are two general rules with respect to the type of projects or activities that may be funded through the CDBG proara- . The ,initial rule establishes the three categories of projects for which the block grant projects or activities can he used . These categories include projects or activities that, ( 1 ) principally benefit low and moderate income persons ; ( 2 ) eliminate slums or blight; or ( 3 ) meet other community development needs having a particular urgency. The second rule stipulates that 75% of the program funds should be used for projects or activities that principally •^ - • •• - - - e income persons. Eligible uses for CDBG money include acquisition of real property, relocation payments , street improvements, neighbor- hood facilities , recreation facilities , solid waste disposal facilities , public improvements, removal of architectural barriers , fire protection and parking facilities , historic preservation , economic development, public services such as child care and rehabilitation loan and grant assistance . Ineligible activities include funding for buildings and facilities for the general conduct of government and the construction of the following public facilities : ( 1 ) facilities used for exhibitions , spectator events , and cultural purposes ; ( 2 ) schools and educational facilities ; (3 ) airports and bus , 4110 rail , or other transit facilities ; ( 4 ) hospitals , nursing homes , and other medical facilities ; ( 5 ) treatment for sewage or industrial wastes ; ( 6 ) general government expenses ; and ( 7 ) new housing construction .