Leveraging Federal Funds for Housing, Community, and Economic Development

Each year the federal government funds numerous affordable housing and community and economic development initiatives through an array of programs, such as the Department of Housing and Urban Development's (HUD) Section 108 Loan Guarantee (Section 108) program. Yet, the need for federal money to fund these initiatives has continued to grow, while the federal budget increasingly has been strained by other competing funding priorities. To help finance their initiatives and achieve program goals, recipients of funding under these federal programs often have combined or "leveraged" their funds with other federal, state, local, and private sector resources. While leveraging is generally recognized favorably by public and private sector officials, its use in federal programs has not been widely analyzed. This report responds, in part, to Congress's request that we examine leveraging as it relates to federal housing, community, and economic development programs. Specifically, this interim report (1) examines the perspectives of stakeholders--government and industry officials, academics, and others with knowledge of or experience with leveraging--on the use, implications, and measurement of leveraging in housing and community and economic development programs and (2) describes the type of data HUD collects that could be used to determine the extent of leveraging in the Section 108 program. Additionally, enclosure II describes how federal funds may have been or could be leveraged in the Section 108 program.