The Dodd-Frank Wall Street Reform and Consumer Protection Act signed into law by President Obama Wednesday provides an additional $1 billion for HUD's ""Neighborhood Stabilization Program"":http://hud.gov/offices/cpd/communitydevelopment/programs/neighborhoodspg/ (NSP) Ã¢â‚¬" a nationwide[IMAGE]
initiative aimed at alleviating the effects of the foreclosure crisis on communities that have been hit hard by the housing downturn and are riddled with abandoned properties.
A piece airing on National Public Radio (NPR) this morning focused on Washington's landmark financial reform legislation and its potential impact on the sluggish economic recovery, but invariably, any such discussion always circles back to housing woes.
The reporter, calling in to the station from Memphis, Tennessee, said that even though the unemployment rate there is well above the national average, the true tell-tale sign of the city's struggles is seen when you drive down a street and see three or more homes that have been boarded up, with the lawn overgrown, and in some cases commandeered by squatters and turned into havens for criminal activity.
It's a scene that's still being played out in cities across the country. The federal government's NSP initiative was launched to address this very issue. NSP provides emergency assistance to states and local governments to acquire and redevelop foreclosed, vacant, and abandoned properties that lead to blighted neighborhoods and declining property values.[COLUMN_BREAK]
The Housing and Economic Recovery Act of 2008 earmarked $3.92 billion in federal funding for NSP. The American Recovery and Reinvestment Act of 2009 secured an additional $2 billion for the program. The latest round of $1 billion in funding under the Dodd-Frank Reform Act brings the total NSP funding to $7 billion.
The Act signed into law Wednesday also permits the purchase and redevelopment of vacant properties to be counted toward the requirement that 25 percent of funds be spent on families with very low incomes.
According to the National Foreclosure Prevention and Neighborhood Stabilization Task Force, which has been instrumental in securing federal funding for the program since its beginnings, says this change will make it easier to leverage NSP funds with private dollars, reduce the per-unit cost to rehabilitate and sell low-income homes, and return more vacant properties to productive neighborhood assets.
""Given the magnitude of the foreclosure crisis, these additional funds are desperately needed,"" said U.S. Representative Maxine Waters (D-California), chairwoman of the House Financial Services Housing and Community Opportunity Subcommittee. ""The additional NSP funds will help address the enormous supply of foreclosed properties plaguing nearly every corner of our country.""
The Foreclosure Task Force notes that in the first six months of 2010 alone, nearly 528,000 homes were taken over by lenders. This rate is on track to eclipse the unprecedented 900,000 homes repossessed in 2009, according to data released earlier this month by ""RealtyTrac"":http://www.realtytrac.com.
The National Foreclosure Prevention and Neighborhood Stabilization Task Force brings together advocates, practitioners, and other experts from across the country to exchange critical information on foreclosure prevention and neighborhood stabilization efforts.
The Task Force is led by the ""National Housing Conference"":http://www.nhc.org, ""Enterprise Community Partners"":http://www.enterprisecommunity.org, and ""NeighborWorks America"":http://www.nw.org.