Canal Corridors Initiative (CCI) Program Description
Summary:
CCI awarded grants and loan guarantees
to communities along the Erie Canal (and connecting waterways) for
economic development projects.
Purpose:
The 524-mile New York State Canal System
was once a major economic link between the Northeast and the Midwest.
As other transportation took over the canal's role, the industrial
and commercial base of many cities in the region suffered. These
cities experienced declining populations, urban decay, and high
unemployment. CCI's goal was to revitalize the economies of these
communities by attracting commercial investment and tourism.
Type of Assistance:
HUD promoted development along
the corridor through two existing programs. First, it provided direct
grants from New York's Small Cities Community Development Block
Grant (CDBG) program. Second, it provided Section 108 loan guarantees
to assure repayment of notes issued by local governments to raise
money for approved projects in the canal area. HUD awarded grants
of up to $900,000 for each canal-related development project.
Eligible Grantees:
Counties and cities along the
New York State Canal System (and connecting waterways) that were
not eligible to receive CDBG entitlement funds could apply for CCI
funding.
Eligible Customers:
CCI primarily benefited low-income
residents of the counties and cities along the canal. In general,
under regulations for the two programs comprising CCI, grantees
must use at least 70 percent of funds for activities in which either
the majority of people who benefit are low- and moderate-income
or the majority of the residents of the neighborhood that benefits
are low- or moderate-income.
Eligible Activities:
Grantees may use CCI funds
for development projects related to the New York State Canal System.
Eligible activities (for fiscal year (FY) 1997 only) included purchase
and rehabilitation of property; economic development activities;
housing rehabilitation; and the purchase, construction, rehabilitation,
or installation of public facilities. Examples include: new marinas,
parks, trails, restaurants, retail stores, businesses, and restored
historic sites. After FY 1997, grantees can only use CCI funds for
the repayment of any amounts due on debt guaranteed by Section 108
loan guarantees. Each activity must meet one of the national CDBG
objectives (i.e., it benefits low- and moderate-income persons,
eliminates slums or blight, or meets urgent needs).
Application:
This program was only authorized for
1 year. To receive CDBG funds, applicants developed and submitted
a Consolidated Plan that contained strategies and activities to
redevelop areas around the canal. HUD made preliminary commitments
for Section 108 loan guarantees and then negotiated agreements with
the selected recipients over succeeding months, resolving issues
such as the nature and amount of security to be required and the
permissible uses of the loan funds.
Funding Status:
The nonentitlement CDBG program
allocated almost $56 million for New York State for FY 1997 from
which the CCI projects were funded. HUD also expected to make $80
million in Section 108 loan guarantee commitments for CCI projects.
Technical Guidance:
As a CDBG-related initiative,
CCI was authorized by the Housing and Community Development Act
of 1974 (42 U.S.C. 5301 et seq.). Program regulations are at 24
CFR Part 570. The Office of Block Grants at the HUD Office of Community
Planning and Development (CPD) administered the program. Contact:
Mr. Joseph D'Agosta at (212) 264-0771.
For More Information:
Community Connections (www.comcon.org) (1-800-998-9999) distributes Canal
Corridor Initiative: Unlocking the Past for New York's Future (www.comcon.org/programs/cccanal.html) (1996
CD1058 and CD1065).