Federal funds are made available annually through the U. S. Department of Housing and Urban Development (HUD) to the State of North Carolina for the Small Cities Community Development Block Grant (CDBG) program.  These guidelines are provided to assist local governments in applying for funding under the CDBG Economic Development (ED) category for demolition projects that result in industrial or commercial sites.  The Department of Commerce (DOC) has administrative responsibility for the CDBG program in North Carolina.  The Rural Economic Development Division (REDD) administers the CDBG-ED funds. The Division is located at 301 North Wilmington Street, Raleigh. State rules related to the CDBG program are found in North Carolina Administrative Code 4 NCAC 19L and specific ED rules are found at 4 NCAC 1K.


Under the authority of Title I of the U. S. Housing and Community Development Act of 1974 (as amended), the CDBG demolition program in North Carolina is designed to demolish vacant dilapidated industrial buildings and properties under the elimination of slums and blight national objective. The demolition activity is expected to create a site at which it can reasonably be expected new jobs and private sector investment will locate. Since the demolition activity is qualified under the slums and blight national objective, new job creation with a private employer does not require a legally binding contract.  Jobs creation during the demolition phase of the grant should be collected for CDBG reporting purposes.

Eligible Applicants

In North Carolina, all counties except for Wake, Mecklenburg, and Cumberland and all municipalities except for 24 entitlement communities are eligible to apply for Small Cities CDBG funding. The entitlement units, which receive CDBG program funds directly from HUD, include Asheville, Burlington, Cary, Chapel Hill, Charlotte, Concord, Durham, Fayetteville, Gastonia, Goldsboro, Greensboro, Greenville, Hickory, High Point, Jacksonville, Kannapolis, Lenoir, Morganton, New Bern, Raleigh, Rocky Mount, Salisbury, Wilmington and Winston-Salem.  The Town of Holly Springs in Wake County and the Town of Linden in Cumberland County continue to be eligible for Small Cities CDBG funds as they opted to participate in the State’s program.

The local government applicant must also have the capacity to administer the proposed project with either its own staff or with the assistance of a consultant.  All applicants must also meet basic threshold and performance requirements for any prior CDBG grants. 

Program Contacts

Applicants are encouraged to contact the Rural Economic Development Division early in the development of a project. In many cases, the project company involved may find other financing programs administered within the REDD such as the Utility Account or the state rural development programs more beneficial.  Basic facts and project structural information are general to most economic development programs, and the Department of Commerce is interested in avoiding unnecessary duplication as projects are developed.


Questions relating to CDBG economic development projects should be directed to the following REDD staff member:

Valerie Fegans
Interim CDBG Program Director
North Carolina Department of Commerce
919 814 4673