Lowell officials flag HUD guidance that could narrow who can receive CDBG, ESG and HOME money
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Summary
DPD Director Yvonne Bayraiz Rose told a Lowell City nonprofit subcommittee that new federal language is changing compliance requirements for entitlement funds and could require immigration verification, restrict DEI and climate-related activities and increase city monitoring; staff will release the RFP Jan. 5 with technical assistance.
DPD Director Yvonne Bayraiz Rose told the Lowell City nonprofit subcommittee that changes to federal guidance for HUD entitlement funding will alter what the city can put into its RFPs and grant agreements and could limit which nonprofits qualify for Community Development Block Grant (CDBG), Emergency Solutions Grant (ESG) and HOME funds.
"This is not funding, that is a competitive request," Bayraiz Rose said, explaining that entitlement communities receive automatic distributions but that new compliance language from HUD requires certifications from subgrantees. She listed three primary buckets the city administers — CDBG, ESG and HOME — and said the city typically plans RFP awards on prior-year baselines because HUD final awards arrive after the RFP cycle begins.
Bayraiz Rose said the city’s rough baseline this cycle is about $2,000,000 for CDBG and less than $200,000 for ESG; the transcripted figure for HOME allocation was not clearly audible and is not specified here. She warned that prior presidential budget recommendations have sought to eliminate these programs and said such cuts would be "significantly" harmful to nonprofit grant recipients and to staff positions funded through administration dollars.
The director described specific compliance conditions being added to grant agreements: recipients will be required to certify they are not conducting certain diversity, equity and inclusion (DEI) activities; they cannot provide information related to abortion access; they must limit gender language in documents; they may be restricted from referencing climate change or environmental-justice programming; and they cannot provide benefits to undocumented immigrants unless a program is explicitly exempt. "Organizations ... will have to sign off as an organization that they are in compliance with all of these things," she said.
Bayraiz Rose said the city will have to monitor subgrantees for compliance, including reviewing organizational websites and program activities, and that monitoring requirements will be added to RFP language and grant agreements. She also described cases where HUD has put whole plans on hold to force changes to specific sections, prompting the city to try to preemptively align RFPs with federal expectations.
On verification of immigration status, Bayraiz Rose said that programs delivering direct payments or stipends to individuals (for example, HOME down-payment assistance, small-business expansion grants paid to a business owner as an individual, or some homelessness-prevention payments) would require staff to collect and input legal-status documentation into the federal SAVE (Systematic Alien Verification for Entitlements) system. She clarified that organizations purchasing materials or running programming that do not provide direct payments typically would not need to collect individual immigration documentation.
To help nonprofits adapt, DPD plans to release its RFP on Jan. 5 with applications due Jan. 30 and to provide technical assistance and application review through roughly Jan. 23. Bayraiz Rose said the department will offer mandatory sessions and one-on-one technical support so organizations can submit compliant applications.
Mayor and council questions focused on how broad the new federal directives are and which programs might be affected; Bayraiz Rose said similar executive orders appear to be informing multiple federal agencies but that HUD guidance is what her department is directly following. She also cited a recent $5,000,000 brownfields remediation grant that required pre-submission language adjustments to remain compliant.
Bayraiz Rose’s presentation and the council’s questions framed the issue as both a funding risk and an administrative challenge for smaller nonprofits that lack grant-reimbursement capacity or the bandwidth for compliance monitoring. The subcommittee asked staff to provide application review and technical assistance ahead of the January deadlines so organizations can adjust their applications before submission.
The subcommittee did not take formal votes on policy changes at the meeting; staff said award recommendations will be brought to the council following the RFP review and HUD submission process.
