Recognizing a funding gap in their communities’ responses to housing challenges, many regional organizations have taken a more finance-oriented approach by helping communities find funding for projects using a variety of different tools. The main tools that EDDs and regional organizations have at their disposal include revolving loan funds (RLFs) and providing grant writing support and services to member communities looking for construction funds for new housing projects. Both approaches can build on already existing services and expertise provided by EDDs. As there are a plethora of existing resources that can be found at HUDexchange.info for grant writing support related to HUD housing and community development grants, this section will focus on how EDDs can build on already existing RLF capacity to create housing solutions.

Many EDDs already operate an EDA-supported RLF that provides small business support and many EDDs provide a variety of grant writing support to local communities for a variety of different federal and state funding opportunities. While EDA-supported RLFs cannot be used to support housing development, EDDs can source starting capitalization from several different federal and state sources, as well as contributions from local member governments to stand the program up. Building on these existing staff capacities and expertise can help EDDs quickly start up new housing-focused programming.

Operating an RLF geared toward providing low-cost and low-barrier financing for new housing construction solves two problems identified by regions across the country: lack of access to capital for local developers and high construction costs for new housing. An RLF creates a cheaper, more accessible process to access initial project capital for developers that may not be able to source capital from traditional lending institutions. Additionally, by offering loans that are typically lower-interest rate than traditional banking institutions options, overall projects costs are reduced in the long run.