HUD announces nearly $47 million in Recovery monies to New Jersey to stabilize neighborhoods

HUD announces nearly $47 million in Recovery monies to New Jersey to stabilize neighborhoods

NEWARK, NJ – January 14, 2010 – (RealEstateRama) — U.S. Housing and Urban Development Secretary Shaun Donovan today announced that HUD is awarding $46,826,965 in Recovery Act funding to the Camden Redevelopment Agency, the City of Newark and the Camden Housing Authority 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.”

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.

Secretary Donovan and HUD are committed to providing the highest level of transparency possible as Recovery Act funds are spent quickly and efficiently. It is crucial that the American people are fully aware of how their tax dollars are being spent and can hold their federal leaders accountable. Every dollar of Recovery Act funds HUD spends can be reviewed and tracked at HUD’s Recovery Act website. The full text of HUD’s funding notices and tracking future performance of these grants is also available at HUD’s Recovery Act website.

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.

NSP2 New Jersey Grantees

Camden Redevelopment Agency — $11,926,887
The Camden Redevelopment Agency in a consortium agreement with Camden Lutheran Housing, Volunteers of America, Saint Joseph’s Carpenter Society, and the Cramer Hill Community Development Corporation has been awarded $11,926,887 in NSP2 funds. These funds will be used in targeted areas across 7 census tracts to build off of prior committed investments to create stabilization and increase property values. The Consortium proposed to provide financial resources, in the form of settlement grants, for the purchase and rehabilitation of 146 abandoned or foreclosed properties, demolish 66 blighted structures, and establish land banks to support the redevelopment of vacant land. These activities will benefit households whose income is at or below 120 percent of area median income, with 25 percent of the funds for households at or below 50 percent of area median income. These funds will help stabilize the targeted neighborhoods and create long-term affordability in the housing market.

City of Newark — $20,759,155
The City of Newark in a consortium agreement with the County of Essex, the City of East Orange, the City of Irvington, the City of Montclair, the Township of Orange, Brand New Day, Don Pedro Development Corporation, Episcopal Community Development Corporation, Housing and Neighborhood Development Services, HOMECorp, Ironbound Community Corporation, Make It Right Foundation, Unified Vailsburg Service Organization, and the Community Loan Fund of New Jersey and, in a for-profit partnership with Fairmount Heights Development Corporation, Michaels Development Corporation, and RPM Development Corporation, has been awarded $20,759,155 in NSP2 funds. The funds will be used to target specific neighborhoods across 24 census tracts that have been severely affected by the rise and collapse of the sub-prime lending market, high housing cost burdens, and low socio-economic status of residents. The Consortium has selected target areas that have sufficient existing or planned investments to support ongoing neighborhood development and the presence of active community development organizations to ensure that the NSP2 activities will be a part of a larger collaboration to achieve stabilization. The Consortium proposed to acquire 203 specific foreclosed or abandoned properties that will be rehabilitated or redeveloped to create 654 units of affordable housing. In addition, 6 blighted structures are proposed for demolition and up to 10 percent of the funds will be used for loan loss reserve. These activities will help stabilize the neighborhood across income levels by providing affordable housing to households earning at or below 120 percent of area median income, with 25 percent of the funds going to those earning less than 50 percent area median income. The Consortium will also leverage $19,044,000 in other funds to help ensure neighborhood stabilization of the targeted areas.

Housing Authority of the City of Camden – $14,140,923
The Housing Authority of the City of Camden, in a consortium agreement with The Heart of Camden, Inc. and with for-profit partners Michaels Development and Pennrose Properties, has been awarded $14,140,923 in NSP2 funds to use in targeted neighborhoods across three census tracts. The Consortium proposed to use awarded funds to address problems associated with foreclosed and abandoned homes and to work towards stabilizing the targeted areas. The Consortium proposed to purchase and rehabilitate 100 homes that have been abandoned or foreclosed, demolish 23 blighted structures that are in a one block radius with no potential for absorption, and redevelop 70 demolished or vacant properties. The rehabilitated houses will be sold to meet affordable housing needs within the target area for households whose income does not exceed 120 percent of area median income, with at least 25 percent of the funds benefiting households at or below 50 percent of area median income. These funds, along with the leveraging of $1,306,563 in other funds, will further stabilize the revitalization efforts currently underway in the targeted neighborhoods, including new schools, streetscapes and rehabilitated housing, and will simulate subsequent investment to further improve the economic, social, and environmental sustainability of these areas.

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U.S. Department of Housing and Urban Development (HUD) is the nation’s housing agency committed to increasing homeownership, particularly among minorities; 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.

Contact:

Brian Sullivan
(202) 708-0685

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