A $13.9 million program meant to support people with low to moderate incomes through housing improvements will focus on housing preservation this year, according to a newly approved state plan.

The Housing, Appropriations and Commerce committees on Thursday approved the fiscal year 2023 allocation plan for the Small Cities Community Development Block Grant Program. The program is federally funded and offers money for housing and infrastructure projects to Connecticut’s towns with populations under 50,000.

It’s an important program for small towns in Connecticut, many of which have an aging housing stock. The state also lacks close to 89,000 units of housing that are affordable and accessible for its lowest income renters.

Housing experts and town officials have said the problem is complicated by older housing that needs preservation in order to stay viable. The state risks losing thousands of units of affordable housing in the next few years, according to estimates from the National Housing Preservation Database.

The U.S. Department of Housing and Urban Development allocates the money annually to states. Connecticut’s most recent allocation is $13.9 million, a very slight decrease from last year, according to public testimony from Department of Housing Commissioner Seila Mosquera-Bruno.

Now that the legislative committees have approved the plan, the state will send it to HUD. The federal government is expected to sign off on the plan within 45 days, then the money can go to towns.

The state plan is focused on giving money to projects that help preserve the State-Sponsored Housing Portfolio, or certain housing that follows state statutes including designated affordable housing, moderate-income housing and housing set aside for the aging population.

Funding in other years has pushed more for homeowner rehabilitation projects or to fight homelessness.

The program allows funding for infrastructure that supports housing or rehabilitation of existing housing but not new construction.

“We are anxious to submit this approved plan that we have submitted to you guys to HUD so that we can receive the funding and we could support those projects that are waiting for the resources to be able to continue with the work,” Mosquera-Bruno said Thursday.

Eight towns so far have submitted applications to the state. In total, they’ve asked for about $11 million, Mosquera-Bruno said. All but 22 towns are eligible for the grant program.

In December, Gov. Ned Lamont announced that seven towns would get $13.4 million in community development block grant money. The projects included $2 million to convert a community space at McCluggage Manor in Griswold into a two-bedroom apartment and make a range of ADA and infrastructure improvements, $2 million to upgrade accessible units at Bantam Falls in Litchfield, and $2 million to replace heat pumps at Oak Terrace in Naugatuck, among other projects.

“These housing grants go a long way to improving neighborhoods so that we can make our communities more attractive and encourage continued growth for the benefit of all our residents,” Lamont said in his December announcement.

During Thursday’s legislative meeting, lawmakers asked a handful of questions of housing department officials, mostly focused on how the money will be spent. All of the legislators present voted in favor of approving the plan.

The national goals for the program include that the program must help people with low and moderate incomes, prevent or eliminate blight, or meet community development needs that have “particular urgency” because the conditions threaten the health or welfare of a community.

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