HUD RECOGNIZES 14 LOCAL COMMUNITIES FOR OUTSTANDING ACHIEVEMENT IN COMMUNITY DEVELOPMENT
Santa Fe Recognized for its Business Incubator Program

WASHINGTON - The Department of Housing and Urban Development today announced 14 communities are receiving HUD's Community Development Excellence Award for their outstanding work in using Community Development Block Grant funding to create better communities and to improve the lives of their lower income residents. HUD presented the awards during a two-day national conference in Washington to celebrate the 30th anniversary of the
Community Development Block Grant Program.

The City of Santa Fe was honored for its Business Incubator, a CDBG-funded project in Tierra Contenta that is creating strong businesses. A summary of the project is at the end of the release.

"These 14 communities are outstanding examples of how CDBG works," said HUD Secretary Alphonso Jackson. "In a climate where results and performance count, these communities, and many others like them, are doing wonderful work building better neighborhoods and creating greater opportunities for their lower income residents."

In selecting these communities, HUD's Office of Community Planning and Development solicited recommendations
from the Department's field offices around the country. Each winning nominee represents a CDBG-funded project or initiative that has been completed, has completed a major phase, or has a proven track record of improving communities and benefiting the people who live in them, specifically lower income residents.

Background on CDBG

When President Gerald Ford signed the Housing and Community Development Act of 1974 into law, state and local leaders around the country got a powerful new tool to help stimulate community development and job growth - the Community Development Block Grant Program. Thirty years later, CDBG continues to help more than a thousand communities to do what they could not accomplish themselves.

For the past 30 years, CDBG has awarded over $108 billion to state and local governments to target their own community development priorities. While, the rehabilitation of affordable housing has traditionally been the largest single use of the grants, CDBG is also an important catalyst for job growth and business opportunities. CDBG funds
are distributed by formula around the country based on a community's population, poverty levels, growth rate, housing overcrowding and the age of its housing stock.

HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as
well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet and espanol.hud.gov.

Santa Fe, New Mexico

Business Incubator

The "business incubator" concept is a very successful method for creating strong businesses. Since opening in December 1997, the Santa Fe Business Incubator has developed 45 companies that have created over 260 new
jobs and increased tax revenues. The City of Santa Fe provides Community Development Block Grant (CDBG) funds
to the Business Incubator to expand economic opportunities for persons of low and moderate income. The Business Incubator is located in Tierra Contenta, a planned community that focuses on affordable housing for low- and moderate-income residents. The 30,000-square foot facility includes office, service and production spaces, along
with meeting rooms, break areas and administrative spaces.

The objective of the Business Incubator is to assist the participants in increasing their economic opportunities by helping them start and grow their own successful businesses and create more jobs. This program provides rent subsidies, special technical assistance and educational opportunities for low- to moderate-income entrepreneurs,
and assists the participants in attending business seminars and workshops. Through their participation in the
Business Incubator, these entrepreneurs are exposed to professional business practices, consulting and technical assistance. They also have the use of a full-range business facility, a business library and resource room, workshops and business training. They have access to the help and support of the Business Incubator's CEO, staff, the
Advisory Council, and other entrepreneurs in the Business Incubator. Most clients stay approximately three years before "graduating" into commercial space in the community.

CDBG funds are used to fund the Low- and Moderate-Business Opportunity Program (BOP). The BOP is especially important in that it provides intensive assistance to low- and-moderate-income entrepreneurs in Santa Fe where
high rents and labor costs make it difficult to start and grow new businesses. The Business Incubator is a very successful tool for creating strong businesses and the BOP makes its programs more readily accessible to lower income members of the community.

Since 1998, the Santa Fe Business Incubator and the Business Opportunity Program achievements include:

• 12 companies have created 35 new jobs.
• Of the seven companies currently enrolled in the BOP, five are women- and/or minority-owned businesses.
• One BOP company increased revenues by 32 percent last year. Another achieved a 25 percent revenue
  growth.

In addition to the BOP program, the Business Incubator received $60,000 in planning funds from CDBG in 1995-1997. Also, the Business Incubator has been awarded a Section 108 Loan Guarantee Grant in the amount of $300,000 for construction of Phase II of Business Incubator and rehabilitation and retrofit of Phase I facility and an Economic Development Initiative grant of $300,000. These funds have not yet been disbursed, but should be available during the first half of FY 2004/05.

###