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Frequently Asked Questions

What grant programs does ECD administer for economic and community development?

Are these programs funded by the state?

How much money is involved in these programs?

What can these funds be used for?

Is this assistance in the form of grants or loans?

Who is eligible to apply?

How does one make an application for assistance?

How long does it take to get an application approved?

 

FAQ: General

Q: What grant programs does ECD administer for economic and community development?
A: The department administers the Community Development Block Grant (CDBG) program, the Appalachian Regional Commission (ARC) program, the  Delta Regional Authority (DRA) program, the FastTrack Infrastructure Development Program (FIDP) and various energy-related grant and loan programs (see FAQ: Energy Grants and Loans for more information). The state also administers the allocation of private activity bond authority.
 
Q: Are these programs funded by the state?
A: The CDBG, ARC and DRA programs are funded by the federal government. The FIDP program is state funded. The bond program is the authority for the exemption of interest on individual development bonds from federal taxation.

Q: How much money is involved in these programs?
A: ECD receives $30 million in CDBG funds each year, and receives about $5 million via the ARC program. DRA received $387,000 in 2004. Last year ECD received $17.5 million in FIDP funding. Tennessee's allocation of bond authority is based on $80 per capita.
 
Q: What can these funds be used for?
A: CDBG and ARC funds can be used for almost anything except political activities and for funding the general operation of government. In practice, however, most of the funds go for projects which create jobs (grants for industrial infrastructure and loans for industrial buildings and equipment) and for projects that are related to health and safety. FIDP funds can only be used for industrial infrastructure (with most going for water and sewer improvements for new and expanding manufacturing businesses). Bond financing goes primarily for buildings and equipment for manufacturers.
 
Q: Is this assistance in the form of grants or loans?
A: Both. The basic distinction is that grants are made for things which are in the public domain (water, sewer, transportation improvements), and loans are made for things which are for exclusive use of one industry (buildings and equipment).
 
Q: Who is eligible to apply?
A: For CDBG the applicant must be a city or county government. Most applicants for FIDP, ARC and DRA grants are also cities and counties, although industrial boards and other quasi-government units may apply. The applicants for bond authority are always local industrial boards since they are the ones who actually issue the bonds.
 
Q: How does one make an application for assistance?
A: In all five programs there are formal application forms that must be submitted. The CDBG, ARC and DRA programs are more complex because of the federal regulations that are involved. Development districts, consultants and engineers are available throughout the state to assist in application preparation.
 
Q: How long does it take to get an application approved?
A: It varies considerably depending on which program is being applied for and the quality of the application. The federal programs are more complex and applications take longer to be approved than do the applications for the FIDP program. Federal programs may take weeks or months to be approved. FIDP grants can normally be approved in two or three weeks. The time involved for approval will be lengthened considerably in all programs if applications are incomplete, have conflicting information or raise additional questions that must be answered.