State Will Allocate $228 Million in Federal Community Development Block Grant Disaster Recovery Funds to Address Housing Needs, Resilient Infrastructure Projects, and Other Critical Recovery Initiatives

TRENTON, NJ – The Murphy Administration today announced the federal government’s approval of New Jersey’s plan to spend $228 million of federal Community Development Block Grant Disaster Recovery (CDBG-DR) funds to assist households and communities that were impacted by Hurricane Ida.

The approval of New Jersey’s Action Plan by the U.S. Department of Housing and Urban Development (HUD) will allow the State to restore Ida-damaged homes, provide rental assistance to people impacted by Hurricane Ida, support hardest hit and financially strained communities, buy out homes in communities vulnerable to repetitive flooding, and finance resilient infrastructure projects throughout New Jersey to protect the state from future storms. The New Jersey Department of Community Affairs (DCA), which houses the Division of Disaster Recovery and Mitigation, is the state agency responsible for administering the federal CDBG-DR funds.

“The State of New Jersey thanks HUD for its review and approval of our Ida Action Plan and for partnering with us in a collaborative working relationship as we continue recovering from Hurricane Ida,” said Governor Phil Murphy. “New Jersey’s communities are still dealing with the effects Hurricane Ida left behind. But with federal approval of our Action Plan, we will continue moving forward with the job of repairing from Ida and building more resilient communities, preparing us for the next storm.”

“There are still many people who are not fully back on their feet from Hurricane Ida,” said Lt. Governor Sheila Oliver, who also serves as DCA Commissioner. “With HUD’s approval of our Action Plan, we can put these disaster recovery funds to use to get families back into their homes as quickly as possible and find opportunities to help communities build back even stronger.”

As announced in November 2022, the State of New Jersey will also receive an additional $149.2 million in CDBG-DR funds for Hurricane Ida recovery. Upon issuance of rules from HUD for use of these funds, DCA will draft an amendment to the Hurricane Ida Action Plan to specify how the $149.2 million will be used and will post the amendment for public comment later this year.

In the HUD-approved plan for the $228 million, at least 70 percent of these funds will benefit low- to moderate-income persons or households. To address New Jersey’s substantial housing recovery needs, the State will spend $153 million to support Ida-impacted homeowners and renters. The Action Plan calls for:

  • $68.9 million for the Homeowner Assistance and Recovery Program (HARP). HARP will provide grants to eligible homeowners for work necessary to restore their Ida-damaged homes, including rehabilitation, reconstruction, elevation, and/or mitigation activities such as utility retrofits, grading and slope stabilization, and drainage improvements. The maximum HARP grant assistance per applicant will be $300,000 for a single-family home.
  • $30 million for Smart Move, which will subsidize the development of quality, energy-efficient, resilient, and affordable housing in lower flood risk areas within or near storm-impacted communities that are participating in Blue Acres or other residential property buyout programs. The program aims to provide safe housing to enable Ida-impacted residents to stay in or near their communities after selling their high-risk properties.
  • $20 million for the Small Rental Repair Program, which will provide zero-interest, forgivable loans to owners of rental properties with one to seven units that need to be rehabbed because of damage from Hurricane Ida. The program will restore or create additional affordable rental units in disaster-impacted areas. The properties must maintain rent affordability for a certain period of time after initial occupancy.
  • $16 million for the Blue Acres Program, which involves the voluntary buyout of residential properties located in floodways and floodplains to reduce the risk from future flooding. Buyout properties will be voluntarily sold to the NJ Department of Environmental Protection (DEP) for current fair market value and converted to open space, recreation, or wetlands. The program also may provide incentives to eligible homeowners to help them afford the costs related to relocating to a lower flood risk area.
  • $15 million for the Tenant-Based Rental Assistance Program, which will provide rental assistance to low-income households impacted by Hurricane Ida who rent, thereby making rental housing more affordable. The program will initially prioritize households with incomes at or below 30% of area median income (AMI).
  • $3 million for Housing Counseling and Legal Services, which is a collaboration of HUD-certified, nonprofit, community-based organizations and legal services providers that provide a wide range of supportive services such as foreclosure prevention, relocation services, debt management, assistance with application intake for CDBG-DR-funded programs, and legal advice and representation.

Recognizing that Hurricane Ida highlighted vulnerabilities in communities’ infrastructure systems, the State will invest $58 million for infrastructure programs. The Action Plan calls for:

  • $54 million for the Resilient Communities