If you had a chance to earn a few hundred thousand dollars, what would you want to do with it?

That’s a question you’ll probably never have to answer, but it’s a conundrum for the city of Arcata. (If you do, please hit me up; I’m sure I can suggest something.) California’s Housing and Community Development department is funding some $27 million of Community Development Block Grants (CDBG) this year. How much of that money Arcata will apply for isn’t yet determined.

The grants are distributed by the state to rural communities around California to programs that will benefit people making less than about 80% of the area median income. That mandate can be interpreted broadly, and what communities end up doing with the funds varies greatly. Arcata’s used the funds to improve the wastewater treatment facility, lend money to small businesses, and assist building housing projects. 

What projects the city will attempt to fund during this round are unsettled. Arcata is hosting several meetings, open to the public, to brainstorm ideas, one of which was held at the city council meeting last week. Many of the ideas the councilmembers kicked around were focused on improving services for the homeless, like fixing solar panels and damaged units at The Grove or founding a multi-family rehab center. 

Focusing on those projects might be difficult. David Loya, Arcata’s director of Community Development, told the Outpost that because the federal government has stopped prioritizing funding programs for the homeless, many other cities will likely apply for CDB grants for their housing programs. The competition might be tough. Although it’s an important issue for the community, Arcata doesn’t have a history of using CDGB funds for homeless services, Loya said, a factor HCD will consider when reviewing Arcata’s application. 

“The city has never run a program like that,” Loya said. “We can’t demonstrate success at doing it. It would be kind of a heavy lift for us.”

Arcata does, however, have decades of expertise at using those grants for economic development. The city has a robust lending program for businesses that create or retain low-income jobs: It threw a lifeline to around 20 of them during the Covid pandemic and loaned $2.1 million to the Wing Group a decade ago. At the council meeting, Loya mused about helping business owners affected by the Jan. 2 fire or developing the Little Lake site. Arcata’s water meters will eventually need to be replaced as well, though Loya said he thinks it unlikely that that application would be successful.

The CDBG program can fund community-wide projects, like the water meters, because more than 50% of Arcata’s population is low-income. Because the city as a whole benefits, Arcata doesn’t have to ensure that only low-income individuals are using the program. 

Ultimately, where city hall decides to focus its efforts will be up to the council. Anyone can suggest an idea, no matter how outlandish. The next public meetings will be Feb. 17 (in the library conference room at 5 p.m.) and 18 (during the city council meeting). The council will decide what to focus on in mid-March.