U.S. Housing and Urban Development Secretary Steve Preston today allocated a total of $3.92 billion to all states and particularly hard-hit areas trying to respond to the effects of high foreclosures. HUD's new Neighborhood Stabilization Program (NSP) will provide targeted emergency assistance to state and local governments to acquire and redevelop foreclosed properties that might otherwise become sources of abandonment and blight within their communities. As part of the program, San Diego will receive $9,442,370 and San Diego County, $5,144,152. 

 

The funding is provided through HUD's Community Development Block Grant (CDBG) Program under the Housing and Economic Recovery Act of 2008.

 

These targeted funds will be used to purchase foreclosed homes at a discount and to rehabilitate or redevelop them in order to respond to rising foreclosures and falling home values. State and local governments can use their neighborhood stabilization grants to acquire land and property; to demolish or rehabilitate abandoned properties; and/or to offer downpayment and closing cost assistance to low- to moderate-income homebuyers (household incomes not exceed 120 percent of area median income). In addition, these grantees can create "land banks" to assemble, temporarily manage, and dispose of vacant land for the purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of urban property. HUD's press release can be viewed here.
 

 

Local governments must make funding commitments within 18 months and expend all funds within 5 years as part of the Neighborhood Stabilization Program (see above). Such a tight time frame makes it difficult for community development/housing agencies and their community development partners to develop effective plans and strategies on how to best use these funds to stabilize those neighborhoods under distress from foreclosures, property flipping and subprime lending. A free online chat, co-sponsored by the National Vacant Properties Campaign and KnowledgePlex, is scheduled Thursday, October 2 at 11 a.m. PDT. to discuss the range of eligbible uses. For information, click here.

 

In light of the ongoing and worsening circumstances in the capital markets, the California Tax Credit Allocation Committee (TCAC) has announced that some first round projects may have recently had prospective investors or syndicators withdraw their interest in reserved credits. Therefore, TCAC has extended the period during which first-round reservations may be returned without a negative point penalty. Effective immediately, any first-round 2008 reservation recipient may return their reservation without penalty through October 31, 2008. To read the full TCAC memo, click here.
 

The California Debt Limit Allocation Committee ("CDLAC") is in the process of preparing the schedule of 2009 reservations for the various CDLAC Program Pools.  While preparing the reservations, several factors will be taken into consideration such as CDLAC priorities, past year usage, and anticipated demand. Worksheets have been developed to assist with the collection of information from potential CDLAC applicants, project sponsors and other related parties.  Demand surveys should be emailed to the CDLAC website www.cdlac@treasurer.ca.gov no later than November 21, 2008.  The demand survey is available here.
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