HUD Community Development/Economic Revitalization - Issue Summary
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| What is the fundamental issue? |
H.R. 3221, the Housing and Economic Recovery Act (HERA) included a provision to establish a Neighborhood Stabilization Program (NSP). The bill also provided nearly $4 billion in grants for states and localities to purchase and redevelop foreclosed properties. The grants were distributed through the Community Development Block Grant program (CDBG). The goal of the program is to allow states and localities to purchase bulk tracks of homes which have been foreclosed or abandoned and avoid the problems that can be created when whole neighborhoods are decimated by foreclosures. The funds can be used to purchase, manage, repair and resell foreclosed and abandoned properties. They can also be used to establish financing mechanisms for purchase and redevelopment of foreclosed homes. After purchase the homes must be used to assist individuals and families with incomes at or below 120% of area median income. Twenty-five percent of funds must be used for households with incomes at or below 50% of area median income. Funds must be committed within 18 months of receipt (expected to be March 2009).
The American Recovery and Reinvestment Act, signed into law on February 17, 2009 includes an additional $2 billion for the NSP. The money will be distributed based on the same formula as the original allocation. |
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| I'm a Realtor®. What does this mean to my business? |
| States and localities have limited time to spend this money, and will need local expertise to make it happen. Communities can use the money to purchase foreclosed homes, rehabilitate homes, demolish homes, redevelop demolished or blighted areas, establish land banks, or assist low-moderate income homeowners with home financing. |
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| NAR Policy: |
| NAR supports federal programs to help with foreclosure mitigation and neighborhood revitalization. |
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| Legislative/Regulatory Status/Outlook: |
States and localities had until December 1, 2008 to submit plans to HUD outlining how they planned to spend their allocated monies. HUD is reviewing these plans. Recipients will receive funds in March of 2009 and will have 18 months to allocate them. Any unspent funds will be returned to HUD.
REALTORS who wish to be involved with this program should contact the local CDBG administrator in your community. A list of the appropriate agency can be found on HUD's website at: http://www.hud.gov/offices/cpd/communitydevelopment/programs/neighborhoodspg/statelinks.cfm.
In addition, the links below include how to find out how much your state/locality received, and additional information and details about the program. Once you have identified the appropriate agency, ask them for a copy of the plan they submitted to HUD. This will help determine how your community plans to spend the funds, and what role REALTORS can play. |
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| Related Information: |
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 Link to Thomas
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