WASHINGTON, DC – January 14, 2010 – (RealEstateRama) — U.S. Housing and Urban Development Secretary Shaun Donovan today announced that HUD is awarding $20,995,000 in Recovery Act funding to the Housing Authority of the City of Reno in consortium with the City of Reno Credit Counseling Services and Nevada Rural Housing Authority with for-profit partners Reno Reality, Inc. and Charles Schwab Bank 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 Housing Authority of the City of Reno in a consortium agreement with City of Reno Consumer Credit Counseling Services and Nevada Rural Housing Authority and with for-profit partners Reno Reality Inc. and Charles Schwab Bank has been awarded $20,995,000 in NSP2 funds. These funds will be used in targeted areas across 6 census tracts that have been heavily impacted by foreclosures, declining prices, and distressed properties. The Consortium will purchase and rehabilitate 200 vacant or foreclosed properties and provide counseling services to homebuyers. 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 $1,000,000 in other funds, will remove the negative effects caused by vacant and foreclosed properties and stabilize market values and real estate prices within the targeted areas.
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 ad 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.