HUD NEWS
U.S. Department of Housing and Urban Development – Shaun Donovan, Secretary
Office of Public Affairs, Washington, DC 20410
HUDPH-113 FOR RELEASE
Larry Bush Thursday
(415) 489-6414 January 14, 2010
http://www.hud.gov/news/index.cfm
HUD SECRETARY DONOVAN ANNOUNCES $318,046,837 IN RECOVERY ACT GRANTS
TO STABLIZE NEIGHBORHOODS, REBUILD ECONOMIES IN CALIFORNIA
Neighborhood stabilization grants to 12 California communities hard hit by the foreclosure crisis
WASHINGTON – U.S. Housing and Urban Development Secretary Shaun Donovan today announced that HUD is awarding $318,046,837 in Recovery Act funding to Alameda County, Indio, Long Beach, Los Angeles, Los Angeles Neighborhood Housing Services, Modesto, Orange County, City of Santa Ana, Santa Clara Housing Trust, and targeted California communities through the Center for Community Self-Help, Chicanos Por La Causa, and Habitat for Humanity, under HUD’s Neighborhood Stabilization Program (NSP). The NSP grants announced today are part of $2 billion awarded nationwide to local communities and nonprofit housing developers to combat the effects of vacant and abandoned homes while creating jobs.
Funded through the American Recovery and Reinvestment Act of 2009, this round of NSP grants is being awarded competitively to applicants who developed the most innovative ideas to address the impact the foreclosure crisis has had on local communities, while demonstrating that they have the capacity to be responsible stewards of taxpayer dollars.
“Vacant homes have a debilitating effect on neighborhoods and often lead to reduced property values, blight, and neighborhood decay,” said Donovan. “This additional $2 billion in Recovery Act funding will help stabilize hard hit communities by turning vacant homes from eyesores into community assets.The Neighborhood Stabilization program is a key part of the Obama Administration’s comprehensive approach to address the national housing and economic crisis.”
Full descriptions of each community’s program, including funding and specific goals, are attached at the end of this release.
The Neighborhood Stabilization Program was created to address the foreclosure crisis, create jobs, and grow local economies by providing communities with the resources to purchase and rehabilitate foreclosed homes and convert them to affordable housing. Last year, HUD awarded nearly $4 billion in NSP formula funds to over 300 grantees nationwide to help state and local governments respond to rising foreclosures and falling home values.
In addition, on August 26, 2009, HUD awarded $50 million in technical assistance grants to help grantees more effectively manage the inventory of foreclosed homes they purchase under the Neighborhood Stabilization Program. HUD’s NSP technical assistance grants are helping NSP recipients to implement sound underwriting, management, and fiscal controls; measure outcomes created by public funds; build the capacity of public-private partnerships; develop strategies to serve low-income households; incorporate energy efficiency into NSP programs; provide support, and training on the operation of ‘land banks’; and train NSP recipients on HUD program rules and financial management requirements.
The additional $2 billion in NSP grants being awarded today will build on the work being done now to help state and local governments and non-profit developers collaborate to acquire land and property; to demolish or rehabilitate abandoned properties; and/or to offer downpayment and closing cost assistance to low- to middle-income homebuyers. Grantees can also create “land banks” to assemble, temporarily manage, and dispose of foreclosed homes.
The Neighborhood Stabilization Program will also help to prevent future foreclosures by requiring housing counseling for families receiving homebuyer assistance funds through NSP. In addition, it will protect homebuyers by requiring grantees to ensure that new homebuyers under this program obtain a mortgage from a lender who agrees to comply with sound lending practices.
CALIFORNIA AWARDS:
City of Indio-
The City of Indio, California in a consortium agreement with the Rancho Housing Alliance and the Indio Redevelopment Agency has been awarded $8,130,000 in NSP2 funds. The city will use these funds in targeted areas across 3 census tracts that have experienced serious housing market decline due to foreclosed and abandoned properties. This 3 member consortium will acquire, rehabilitate, and resell 100 abandoned or foreclosed homes, demolish 5 vacant homes and redevelop these 5 sites, and provide financing in the form of down payment assistance to ensure affordability of these 105 homes. Additionally, 100 homebuyers will receive counseling and 100 homes will receive lead based paint and termite inspections. This NSP2 program focuses on stabilizing neighborhoods with the highest combined foreclosure/vacancy rates, older neighborhoods needing greater assistance to thwart decline, and creating higher levels of homeownership for households at or below 80percent of area median income, with 25percent of funds benefiting households whose income does not exceed 50percent of area median income. The long term goal of this stabilization program is to increase sales of residential properties and increase median market values in targeted neighborhoods.
City of Los Angeles-
The City of Los Angeles has been awarded $100,000,000 in NSP2 funds to use in targeted areas in the city across 164 census tracts. These areas are marked by a high concentration of foreclosures resulting in declining home values and increasing poverty and unemployment rates. The City will use NSP2 funds to further support and enhance NSP1 projects already underway. NSP2 funds will be used to acquire, rehabilitate and resell foreclosed and abandoned homes in the form of 265 single family homes and 947 units of multifamily rental properties. The City will also provide financing for mortgage assistance and rehabilitation loans for the purchase and rehabilitation of foreclosed homes in the target areas. All activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds benefiting households whose income does not exceed 50precent area median income. The City’s goal is to reduce the number of vacant and abandoned properties, reduce the absorption period for sales of foreclosed properties, and stabilize home values.
City of Santa Ana-
The City of Santa Ana, California has been awarded $10,000,000 in NSP2 funds. These funds will be used across targeted areas in 18 census tracts with high rates of abandonment and foreclosure that if left unaltered, will have a debilitating impact on real estate values, crime rates, and neighborhood stability. The housing market in these areas is marked by overvaluation, subprime and adjustable loans, and high unemployment. The City will use these funds to provide down payment assistance for 10 units and to acquire and rehabilitate foreclosed properties in the form of 60 units of single family homes and 30 units of rental housing. These rehabilitated homes will be made available to households whose income is at or below 120percent of the area median income, with 25percent of the funds going to households at or below 50percent median income. Through these activities, the City will be able to stabilize the targeted areas by eliminating the rehabilitating impacts of foreclosure and abandonments.
City of Modesto-
The City of Modesto, California has been awarded $25,000,000 in NSP2 funds. These funds will be used in targeted areas across 36 census tracts where over-valuation and over-building have caused high numbers of residential foreclosures and abandonment. The City will use the awarded funds to acquire and rehabilitate 175 foreclosed or vacant properties. Forty (40) of these homes will be specifically allocated to provide housing for special needs households who are in need of permanent housing. All activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent area median income. Overall, the program will serve and estimated 200 families and individuals over 3 years while stabilizing the targeted areas to arrest further decline throughout the community.
Center for Community Self-Help-
The Center for Community Self-Help has been awarded $11,763,553 in NSP2 funds. These funds will be used in targeted areas across 778 census tracts in the Central Valley and Bay Area of California, Chicago, Los Angeles, New Haven, and Atlanta. The Center for Community Self-Help is taking a unique approach for its use of NSP2 grant to fund loan loss reserves, a financing mechanism, which will provide additional security for repaying various types of financing, which include lease-purchase mortgages, direct home mortgages, developer credit lines, and mortgages for investor-owned properties for a proposed 560 foreclosed residential properties. These activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent of area median income. Providing these permanent financing options in the targeted areas is essential to the continued success of NSP activities already underway to help revitalize the housing market and ensure neighborhood stabilization in these metropolitan areas.
Housing Trust of Santa Clara County, Inc.-
The Housing Trust of Santa Clara County, Inc. in a consortium agreement with the City of San Jose and Neighborhood Housing Services Silicon Valley has been awarded $25,000,000 in NSP2 funds. These funds will be used in targeted areas across 35 census tracts that have been the hardest hit by foreclosures within the City of San Jose. The consortium will use the funds to provide financing mechanisms, in the form of down-payment assistance and closing cost assistance, for the individual purchase and redevelopment of 100 foreclosed homes and will acquire and rehabilitate 105 foreclosed or abandoned properties. These activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent of area median income. These funds, and the leveraging of $2,250,000 in additional funds, will reduce the number of foreclosed or abandoned homes and residential properties in the targeted areas and lead to stabilization of the housing market.
City of Long Beach, California-
The City of Long Beach, California in a consortium agreement with Habitat for Humanity Greater Los Angeles has been awarded $22,249,980 in NSP2 funds. These funds will be used in targeted areas across 44 census tracts affected by high foreclosure rates and subprime mortgages. The consortium will establish financing mechanisms, in the form soft second loans, loan loss reserves, and shared-equity loans, for 86 individuals to purchase and redevelop foreclosed upon homes and the consortium will purchase and rehabilitate 25 homes that have been abandoned or foreclosed upon in order to sell, rent, or redevelop these properties. These activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent of area median income. These funds, and the leveraging of $1,725,000 in other funds, will help stabilize high foreclosure areas, arrest declining housing values, and reconnect targeted neighborhoods with the economy, housing market, and social networks of the community and metropolitan area as a whole.
Los Angeles Neighborhood Housing Services, Inc.-
Los Angeles Neighborhood Housing Services in a consortium agreement with Asian American Drug Abuse Program, ANR Industries, Budget Finance Company, City of Carson, City of Compton, City of Inglewood, GRID Alternatives, Major Properties, Vermont Village Community Development Corporation, Search to Involve Pilipino Americans, Vermont Slauson Economic Development Corporation, and Watts Century Latino Organization has been awarded $60,000,000 in NSP2 funds. These funds will be used in targeted areas across 37 census tracts that have been most severely impacted by foreclosures. The consortium will provide financing assistance in the form of down payment assistance for at least 400 homes, most of which are foreclosed properties, and will provide up to 700 units of affordable housing through the acquisition and rehabilitation of foreclosed or vacant properties. These activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent of area median income. These funds, and the leveraging of $2,600,000 in other funds, will allow the Consortium to expand on existing local efforts and make a significant contribution to neighborhood stabilization within the targeted areas.
Alameda County-
Alameda County in a consortium agreement with City of Dublin, City of Emeryville, City of Hayward, City of Fremont, City of Livermore, City of Pleasanton, City of Newark, City of San Leandro, and City of Union has been awarded $11,000,000 in NSP2 funds. These funds will be used in targeted areas across 45 census tracts to reverse the effects of foreclosures and declining property values. The consortium will purchase and rehabilitate 28 foreclosed homes to become low income rental housing and will acquire and redevelop 72 demolished or vacant properties. These activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent of area median income. These funds, and the leveraging of $10,000,000 in other funds, will help restore the housing market and lead to neighborhood stabilization in the targeted areas.
Neighborhood Housing Services of Orange County-
Neighborhood Housing Services of Orange County in a consortium agreement with Orange County Community Housing Corporation, Mary Ericson Community Housing, Habitat for Humanity of Orange County, Affordable Housing Clearinghouse, Irvine Community Land Trust, and Community Housing Resources has been awarded $7,500,000 in NSP2 funds. These funds will be used in targeted areas across 129 census tracts affected by high foreclosure and vacancy risk scores. The consortium will acquire and rehabilitate 68 foreclosed or abandoned properties for resale and rental and provide financing mechanisms, in the form of homebuyer assistance, for 45 households to purchase and rehabilitate foreclosed homes. These activities will benefit households whose income is at or below 120percent of area median income, with 25percent of the funds for households at or below 50percent of area median income. These funds, and the leveraging of $2,500,000 in other funds, will rapidly arrest the decline of the housing market and provide continued affordability in the targeted geography.
HUD is the nation’s housing agency committed to sustaining homeownership; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation’s fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.