December 7 2010 (Shirley Allen)
In what is being promoted as an “entrepreneurial approach” to affordable housing and economic development in rural areas, the Secretary of the U.S. Department of Housing and Urban Development (HUD) Shaun Donovan announced the departments new Rural Innovation Fund.

In a speech to the Housing Assistance Council in Washington, Donovan detailed how $25 million in grants will be available to help rural and tribal communities struggling to address distressed housing conditions and concentrated poverty.

The new Rural Innovation Fund offers grants of up to $2 million to support innovative housing and economic development activities. Eligible applicants include federally recognized Indian tribes, state housing finance agencies (HFAs), state community development agencies, local rural non-profit organizations, community development corporations, or consortia of these groups.

Grantees can use their grant funding to support a variety of housing and economic development activities including construction, preparation of plans, land acquisition, demolition, homeownership counseling, and financial assistance.

Applicants may apply for only one of three grant types:

Single Purpose Grants – At least $7.5 million will be awarded to certain applicants that identify a specific area of need, with maximum individual grants of up to $300,000. HUD is encouraging, though not requiring, applicants to address both housing and economic development needs within the defined ‘project area.’

Comprehensive Grants – HUD will award up to $2 million to certain applicants that comprehensively examine the social, housing and economic needs of a target area and address those needs through activities that leverage other sources of public and private financing. Eligible activities under this category of grant are broader than those outlined in the Single Purpose Grant category. Highly ranked applicants can also be expected to work closely and leverage resources with regional entities in order to promote economic competitiveness beyond the local level.

Economic Development and Entrepreneurship for Federally Recognized Tribes – At least $5 million will be awarded to support economic development and entrepreneurship opportunities for federally recognized tribes, with maximum individual grants up to $800,000.

Tags: HUD, rural innovation fund, affordable housing, economic development, distressed housing conditions, poverty, Indian tribes, rural non-profit organizations