(Washington, DC)— Testifying this week before the House Budget Committee, Congresswoman Diane E. Watson (CA-33rd) urged Congress to restore the President’s proposed budget cuts to Community Development Block Grant programs (CDBG). 

“For thirty years, CDBG programs have empowered local groups to revitalize their communities and create economic opportunity,” remarked Congresswoman Watson.  “CDBG funds are at work in neighborhoods all across my hometown of Los Angeles.  In Hollywood and South Los Angeles, CDBG programs help ex-gang members to become productive members of the community.  The LA County Community Development Commission uses CDBG funds to operate its Business Technology Center, California’s largest high-tech business incubator.  And along the Crenshaw corridor, CDBG funds are being used to reinvigorate a decades-old shopping center.”

“CDBG is not a government handout – rather, it is one of the most effective tools cities and neighborhoods have to fight economic distress and create jobs and wealth.”

In her testimony, Congresswoman Watson criticized the President’s proposal to consolidate 18 programs, including CDBG, into a new program to be administered by the Department of Commerce.

“The President’s funding for this consolidated program would be 35% lower than the combined FY 2005 appropriated level for these 18 programs,” said Congresswoman Watson.  “I am  concerned that CDBG funds in the past have been used to rehabilitate rental apartments, single family homes and to help first-time homebuyers.  One might assume that, after moving to the Commerce Department, these funds would not be eligible for use on housing.  This would cripple local affordable housing efforts at a time when housing prices are skyrocketing.”

Congresswoman Watson also criticized the President’s replacement of CDBG’s current funding formula: “Changing the funding formula–in effect, allowing CDBG funds for only the poorest communities–would unnecessarily undermine the efforts of moderate income communities to bring their poorer and excluded residents into the economic mainstream.”

For a full text of Congresswoman Watson’s testimony, contact Bert Hammond @ (202) 225-7084.