Reading City Council at its regular meeting Monday approved submission of the city’s 2026 Community Development Block Grant, HOME Investment Partnership and Emergency Solutions Grant Action Plan to the U.S. Department of Housing and Urban Development.
The plan outlines how roughly $3 million in federal funds will be used to support housing, community revitalization and social service programs across the city next year.
Developed through a series of departmental reviews, public hearings and community input sessions, the plan details the city’s priorities for spending $2.2 million in CDBG funds, $800,000 in HOME funds and $205,000 in ESG funds, along with program income from prior projects.
City Finance Director and Deputy Managing Director Jamar Kelly explained that HUD requires the city to submit both a five-year consolidated plan and a one-year action plan to remain eligible for federal grants.
The 2026 action plan builds on the five-year consolidated plan that runs through 2028, he said, noting it identifies programs targeting affordable housing, homelessness prevention, public infrastructure and neighborhood improvements.
Planned projects for the 2026 program year include demolition and site work on blighted properties, improvements at Oakbrook Athletic Field, continuation of the Commercial Façade Improvement Program and housing rehabilitation efforts carried out in partnership with organizations such as Habitat for Humanity, Kelly said.
Officials said the city will also maintain funding for emergency shelter operations and homeless prevention programs administered through its Human Relations Commission and partner agencies.
Council members discussed how the plan supports residents most affected by housing insecurity.
While the plan’s approval allows the city to move forward with HUD submission, Kelly cautioned that federal budget delays are disrupting the flow of reimbursement funds from Washington.
Because CDBG and related grants operate on a reimbursement model, meaning the city pays approved invoices and is later reimbursed by HUD, the federal budget impasse effectively paused that process.
“We are at the point where we have floated all that we can of our entitlement reserve that fluctuates around $350,000 to $400,000,” Kelly said. “We’re not currently being reimbursed, so we are going to be notifying our program participants to hold their invoices until the federal government starts reimbursing us again. Nothing that has not already been released will be processed. Our line of credit is frozen.”
Kelly said the city is maintaining communication with HUD and expects reimbursements to resume once a federal budget is enacted. Until then, local subrecipients, including nonprofit service providers and community organizations, have been advised to temporarily delay billing the city for CDBG-funded work.
Council President Donna Reed and other members of council emphasized the importance of maintaining funding for core community programs despite the temporary freeze.
“We’ve seen how much these programs mean for people facing eviction or struggling to find affordable housing,” Reed said, noting that the approval ensures the city remains on schedule with HUD’s requirements once federal funding resumes.
HUD’s review and approval process is expected to conclude before the start of the new fiscal year on Jan. 1, after which the city can begin implementing projects outlined in the action plan.