HUD lead grants: leverage, the 10 percent, and the budget math

On a $1.5 million request, $150,000 in leverage makes you eligible and more than $225,000 earns all three bonus points.

The 10 percent is a gate

Healthy Homes Production states plainly that cost sharing is not required. What it requires is leverage, 10 percent of the amount you're asking for. Hitting exactly 10 percent scores zero points. The points start above it.

Lead Hazard Reduction uses the same 10 percent but calls it a match and says cost sharing is required. Its rating factors award no points for exceeding it. Same number, opposite legal framing, different documentation. The two NOFOs published together and read alike, so it's worth checking which one a given sentence came from before you rely on it.

The tiers HUD confirmed

This table prints blank in the published PDF. I asked HUD's NOFO team on July 29 and they sent it back the same afternoon:

On a $1.5 million ask:

• $150,000 to be eligible, zero points
• $150,000 to $210,000, one point
• $210,000 to $225,000, two points
• More than $225,000, three points

The top tier has no stated ceiling in HUD's reply, so I can't say whether a higher tier exists that wasn't in the answer. And HUD may publish a correction, so check Grants.gov before locking it in.

What counts

• State, local, or tribal money designated to this work. CDBG counts, since it's treated as local money once allocated.
• Property owner contributions, verified by a third party. An owner's own labor counts at market rate.
• Donated materials or equipment at market rate.
• Discounted services, where only the discount counts and not the full price.
• Donated staff time from a partner organization.

Every commitment letter has to state the amount, the source, and the use. The lead grant is stricter on paperwork: its letters must name that specific NOFO and be signed on or after the day it published, so letters from an earlier planning cycle won't carry over.

What doesn't count

Federal money already in hand. HOME funds, Indian Housing Block Grant funds, and Weatherization Assistance Program funds are all excluded. A leverage plan resting on a HOME allocation doesn't clear the 10 percent.

The two ratios that constrain the budget

At least 65 percent of the grant has to go to the actual assessment and remediation work. Administrative costs are capped at 10 percent, and that cap includes your indirect rate plus any subrecipient admin.

HUD also states an expected average of $15,000 to $20,000 per unit, covering assessment, contractor labor, and follow-up.

Those numbers set the unit count for you. On a $1.5 million request the 65 percent floor is $975,000, which at HUD's own per-unit range covers roughly 50 to 65 units. A narrative promising 100 units on that budget contradicts the NOFO's own benchmark. The per-unit figure is specific to Healthy Homes Production, so don't carry it into a lead grant budget.

Assembling six figures of leverage

This is the hardest part of the application for a small applicant, and it's the part that takes calendar time rather than writing time.

The permissible sources above are mostly small and separate: a county CDBG line already earmarked for the target neighborhood, a property owner's documented labor and materials on units already in the pipeline, committed hours from the weatherization provider, a local foundation grant tied to the same blocks, a donated materials letter from a vendor. Each needs its own signed letter stating amount, source, and use.

Start asking now. Signatures take weeks, and under the lead grant's rules the letters cannot be dated before the NOFO published.