The Building Blocks

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In this section:

Building Blocks

Implementation Mechanisms: Regulations, Programs, and Funding

While systems change efforts often focus on designing new legislation, in some cases the laws you seek may already be in place but not working as intended. Perhaps they are not serving the people they should or have not been funded adequately—or at all. In such cases, you will need to find a way to implement the existing laws more effectively, efficiently, and/or equitably. You can do this through the other three building blocks: regulations, programs, and funding.

We go into more detail about how to figure out whether you need legislative change or need to change a regulation, program, or funding source in the strategies for action section. For now, let’s dive into how each of these implementation mechanisms work.


Once elected officials pass new legislation, it usually goes to the agency or department in charge of implementing it. Their first step is to create the regulations, rules, or procedures that will guide its implementation.

Regulations, rules, and procedures can be nuanced and complex. They also vary from place to place. Regardless of the community or circumstances, the critical point here is that after legislation is passed, the department or agency develops detailed guidance for the day-to-day actions and decisions involved in implementing it. Sometimes this is called a regulation, other times it’s known as a rule or procedure. Some people and organizations distinguish between big “P” policy, which is passed by local government, and little “p” policy, which is made at the departmental level. In this guide, we’ll use the term “regulation.”

Regulations can be easier and faster to change than laws. For instance, your city likely requires developers to get permits to develop properties. One of the major hurdles developers face is getting through labyrinthine permitting processes in a predictable and timely way. When cities streamline their permitting processes, they can save precious time and resources for developers, which can in turn reduce overall construction costs. This streamlining can often happen at the department or agency level, without a city council overhauling policy.

While legislative changes often require a lot of political energy, regulatory or procedural changes can be more straightforward, especially when agency and department staff see the value of the change and have the capacity to make it.

One of the challenges of this building block is that city staff may be reticent to make changes the current political administration doesn’t support. They may also drag their feet if they think the change will complicate their workflow or if they don’t personally agree with it. Like legislative changes, regulatory changes almost always require internal champions. But once you have a strong champion on board, they may move faster than traditional policy changes.


When hospitals in Massachusetts build new facilities, the Department of Public Health (DPH) issues a Determination of Need (DoN) as required by state law. While the state legislature passed the law, the DPH crafted the regulations that govern how it is implemented. For instance, the law directed the DPH to analyze the impacts of new hospital facilities on the health of their communities, but the DPH wrote the criteria for analyzing those impacts.

As part of the DoN, the DPH requires hospitals to designate 5 percent of capital improvement project costs to community health, through activities and programs known as community benefit. DPH’s approved list of community benefits originally included grants but not investments designed to return funds to the hospital.

Boston Medical Center (BMC) had $6.5 million to spend for their DoN obligation. They hoped to deploy those funds as investments so they could be recycled, which would set a precedent for future use of DoN funds for investment.

DPH authorized BMC to make long-term loans with favorable 0 percent interest rates, rather than grants. They thus achieved BMC’s goal of changing how DoN could work.

Agencies also implement and refine legislation through regulations. At the state level, housing finance agencies score applications for competitive low-income housing tax credits through their Qualified Allocation Plans (QAPs). QAPs affect the types of projects that win tax credits and, as a result, determine the location, amenities, building size, and types of tenants served by subsidized affordable housing projects.

In California, the Tax Credit Allocation Committee and the Department of Housing and Community Development used the QAP in 2017 to incentivize development in high opportunity areas.

In Chicago, which is one of the only cities with its own tax credit allocation authority, the Department of Housing used the QAP to develop three different allocation strategies that fit the needs of different neighborhoods. In disinvested neighborhoods, the allocations prioritized revitalization; in gentrifying neighborhoods, they prioritized stability; and in wealthier neighborhoods, the allocations prioritized projects that would enable low-income residents to access their opportunities.


While regulations guide decision-making for policy implementation, programs are usually designed to provide a specific service specified in a policy. Departments and agencies create programs for different reasons, such as when enacting legislation requires dedicated staff, to test out new ideas, or as a way of deploying funding. Examples of community development programs include gap financing programs, small business technical assistance and support programs, down payment assistance programs, foreclosure prevention programs, and more. Government agencies can run programs themselves, or the city can fund outside organizations to run a program.


Local governments are often responsible for carrying out state or federal laws or allocating state or federal resources, and in many instances, they do this through programs. As part of their implementation of California’s COVID-19 eviction moratorium (a policy that prohibited evictions over a certain period of the pandemic), the City of Oakland worked with a renter and homeowner relief program called Keep Oakland Housed that provided financial assistance to low-income renters and homeowners. To develop this program, the city used funding from the Federal CARES Act but created its own criteria and procedures to guide implementation.

Established by Ordinance 9405 in 2014, Chicago’s Large Lot Program, a strategy from the Green Healthy Neighborhoods stabilization plan, was created to streamline the disposition of city-owned vacant lots and enhance community ownership in distressed neighborhoods. To date, the Large Lots program has resulted in the sale of over 1,400 parcels to neighboring property owners for the price of one dollar. It is run by the Planning Department which establishes eligibility criteria and procedures for the application, approval, and transfer of ownership and works with local aldermen to identify available sites.


Officially, budgets are policy documents that are approved by the relevant governing body (e.g., city council). However, because budgets have so many implications for community development practitioners, we’re highlighting funding as a separate building block. Local governments make many decisions through the budgeting process, and the resulting budgets demonstrate an administration’s capacities and priorities in clear terms. As such, they are an important target for advocacy and action.

Because funding for community development and investment comes from all levels of government, let’s zoom out for a moment to explore how this money flows across levels.

All levels of government have the power to tax, borrow, and spend money but the federal government holds the vast majority of public funds used in community development and has the most flexibility to change where and how resources flow. Most community development dollars flow from three federal government agencies:

  • The Department of Housing and Urban Development distributes Section 8, public housing funding, Community Development Block Grants, HOME, Choice Neighborhoods Planning Grants, Indian Housing Block Grants, and many more.
  • The Department of Agriculture has a set of loan and funding products for individuals, developers, and lenders.
  • The Treasury administers the Community Development Financial Institutions Fund, which includes the New Markets Tax Credit.

In addition, the IRS administers the Low-Income Housing Tax Credit, one of the largest sources of funding for community development. Other agencies fund economic development programs, including small business assistance and funding for infrastructure.

Federal funding is distributed to state governments who administer it through state agencies or public housing authorities. Tribal governments, which are sovereign nations that function similarly to states from a legal and governance perspective, have separate streams of federal community development funding that are disbursed within their own nations.

As federal funding shrinks, state, tribal, and local governments are attempting to pick up more of the tab for community development. They can generate new revenue by reallocating existing funds, developing new fees or taxes, and issuing municipal bonds, though some states have strict regulations around how local governments tax and spend.


In 2020, LA voters passed Measure J, an amendment to the county charter that requires 10 percent of the county’s unrestricted general funds to be invested in social services and alternatives to incarceration. Community development activities that have been prioritized include access to capital for small businesses run by people of color with a special emphasis on Black-owned businesses and capital funding for transitional housing, affordable housing, and supportive housing. Community engagement efforts have included a broad set of discussions on topics such as balancing short-term needs, like reentry housing for people returning from jails and prisons, and long-term strategies, like the expansion of community land trusts.