Economic Development: Section 1 - General Applicant Information

Economic Development: Section 2 - Program Information and Policies
Economic Development: Section 3 - General Economic Development Component
Economic Development: Section 4 - Application Preparation and Forms
Economic Development: Section 5 - Attachments



For 2005, the state's federal Community Development Assistance Program tentative allocation is $37,851,155.  Funds for the Competitive Housing Rehabilitation and Public Facilities Components will come from the federal 2006 program allocation.  Each program component has a maximum funding level or grant ceiling.  While grant ceilings establish the upper limits that may be requested, individual grants are invited only in amounts commensurate with requirements of the proposed project.  Fund availability will be distributed as follows:


Program Category

Funding Level

Grant Ceiling

General Economic Development*

$ 8,000,000


Competitive Public Facilities Construction and
Competitive Design Engineering*



Competitive Planning Assistance*



Competitive Housing Rehabilitation*



Housing Rehabilitation for Physically Disabled Persons



Emergency Set-Aside for Public Facilities*



State Reserve for Technical Assistance


State Administration




*Separate application packages are available for these programs.



Only units of general local government (i.e., cities, villages, townships and counties) may apply for funding.  Municipalities must be 50,000 or less in population and must not be located in an urban county that receives "entitlement" funds.  County and township applicants should not include areas that are incorporated within a city or village.  Incorporated areas should apply on their own behalf, regardless of whether a water district or sanitary district is involved.

Illinois has 39 metropolitan cities and eight urban counties that are receiving an annual allocation directly from the Department of Housing and Urban Development on an entitlement or formula basis.  (See Direct HUD Entitlements  for a listing of those areas.)

Local governments are limited in the number of applications which may be submitted and awarded in a program year.  A local government may submit one application per component, per funding cycle and may be funded only once per component in a program year under all components except for the General Economic Development and Emergency Public Facilities components.  Public Facilities Construction and Design Engineering are considered as one component.

Units of local government may also submit "on behalf of " applications for local entities that otherwise may not be eligible to apply.  In a situation where two or more eligible local governments face a common problem, a joint application may be filed.  (See Page 63 of this Application Guide for a sample cooperation agreement.)  Local governments, however, must not only share a common problem but must be able to demonstrate that a joint effort is required to solve the problem.  Joint applications which are submitted only for administrative convenience will not be accepted.  Local governments considering a joint application must contact the department prior to submittal.  An "on behalf of " or joint application may not be filed for an entitlement city or a city located in an entitlement county.  In addition, an "on behalf of" or joint application may not be filed solely for the purpose of circumventing the rule that a unit of local government may submit only one application per component.


Under the CDAP Economic Development component funds may be used to assist for-profit and not-for-profit firms to carry out economic development projects.  Generally, CDAP grant funds will be provided by the unit of local government to the profit or not-for-profit business under a financial assistance agreement.  “Financial assistance” means the provision of funds to an eligible economic development project through the purchase of any note, stock, convertible security, treasury stock, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, preorganization certificate of subscription, transferable share, investment contract, certificate of deposit for a security, certificate of interest or participation in a patent or application therefor, or in royalty or other payments under such a patent or application, or in general, any interest or instrument commonly known as a “security” or any certificate for, receipt for, guarantee of, or option, warrant or right to subscribe to or purchase any of the foregoing, but not including any instrument which contains voting rights in the possession of the Grantee, or other means whereby financial aid is made to or on behalf of an Illinois company as appropriate to the form of agreement, for working capital, the purchase or lease of machinery and equipment, or the lease or purchase of real estate, but does not include refinancing debt.  Loans, investments and lines of credit may be extended in participation with other financial institutions.  By providing expanded application for CDAP funds, the unit of local government will have enhanced capacity to pool public and private resources in support of a community project.  The business may use the funds for land acquisition; construction, reconstruction, installation or rehabilitation of commercial or industrial buildings, structures and other real property; equipment and improvements; and working capital expenses.  Working capital is defined as  inventory, employee salaries, general operational expenses and advertising/ marketing expenses.  CDAP funds may not be used as grants or loans to help service or refinance existing debt.  Alternatively, CDAP funds may be used to finance public facilities and improvements in support of economic development (e.g., water system upgrade to serve an expanding business).


The following activities are considered ineligible.

1. Construction of buildings, or portions thereof, used predominantly for the general conduct of government (e.g., city halls, courthouses, jails, police stations, etc.).
2. General government expenses.
3. Costs of operating and maintaining public facilities and services (e.g., mowing parks and replacing street light bulbs).
4. Servicing or refinancing of existing debt.

NOTE:  Although an activity may be eligible, it may not be competitive given the state’s funding criteria.


The screening and review process for the program is designed to ensure that limited CDAP funds are awarded to communities that demonstrate the need for financial assistance and have a well-designed project.  The actual number and types of awards will be subject to funding availability and the amount of each applicant's request.  All recommendations are forwarded to the director of the department who makes the final funding decisions; however, all decisions will be based on the general distribution of funds outlined on the following pages.

The department will review all applications as follows:

  • Projects which do not benefit at least 51 percent low-to-moderate income persons will not be reviewed further.
  • Each application will be evaluated according to the evaluation criteria described  in Section III of the applicable application guidebook.  After reviewing each application, site visits may be made  for the purpose of verifying information and further evaluating projects.  The department reserves the right to collect additional project documentation.
  • Characteristics that will be considered in the final funding decision include the following:
    • demonstrated need for CDAP financial assistance;
    • capacity to implement the project immediately and complete it in the shortest time possible;
    • financial soundness and design of a project; and/or
    • coordinated use of other resources. 


1. Costs incurred in preparation of applications are not reimbursable under this grant program.
2. The department reserves the right to reject any or all applications received, to negotiate or to cancel in part, or in their entirety, grants resulting from application awards if it is in DCEO's best interest to do so.
3. The department reserves the right to withdraw a commitment for CDAP funds where special grant conditions have not been satisfied 60 days after the date of the executed grant agreement or at the discretion of the department if it is determined the project will not progress.
4. Project applications may consist of one or more activities which are directly related to or obviously complementary to or supporting one principal activity.  The principal activity must clearly be designed to address needs appropriate to the particular CDAP component under which an applicant may apply.  The selection of the appropriate program component is the responsibility of the applicant.
5. The department reserves the right to establish the amount of grant funds awarded, raise the individual grant ceilings, and to shift funds from one CDAP component funding area to another.
6. The department reserves the right to deny funding when submitted applications involve eligible units of government with serious unresolved audit or monitoring findings related to the performance capacity.
7. On an annual basis, the department will re-evaluate the timely distribution of funds under all program components, as well as the availability of unspent and recaptured funds.  Unspent and recaptured funds will be awarded to fund additional projects.  Depending upon available funds, a Back-up Funding round may be implemented in November.


Applications may be submitted on an as-needed basis.  All applicants should complete the application package and submit an original and two copies to the department. Facsimile submissions will not be accepted.  The following address should be used for all application submissions under CDAP's economic development component:

Department of Commerce and Economic Opportunity
Division of Community Assistance
620 East Adams Street, Mail Code:  CIPS-3
Springfield, Illinois  62701


If you have any questions concerning the application process, please call DCEO at 217/785-6142, TDD: 800/785-6055.