Criteria for Participation in the Urban Development Action Grant Program Should Be Refined

The Housing and Urban Development's (HUD) Urban Development Action Grant Program helps revitalize severely distressed cities by using public funds to attract private investment in industrial, commercial, or neighborhood projects. About $1.5 billion has been provided for the program through fiscal year 1980. The Housing and Community Development Act of 1977, which established the program, did not specify the number of cities to which the program should be targeted. HUD established the following six eligibility criteria to determine which metropolitan and urban counties were to be selected for the program: age of housing, poverty rate, population growth, per capita income growth, unemployment rate, and employment growth. To be eligible, most cities must be ranked in the lower half of all cities for three of the six criteria. This has resulted in 333 of the Nation's large cities and urban counties being eligible for the program.