Grant money going to fight foreclosures

Times-Herald Newspapers


HEIGHTS — City officials are finalizing plans for $1.8 million in grant money recently awarded through the U.S. Department of Housing and Urban Development’s Neighborhood Stabilization Program in an effort to curb the effects of foreclosures.


The fact that there are plans and funding for them represents a polar departure from a few months ago, when HUD rolled out the $3.94 billion initiative. Initially Dearborn Heights didn’t meet the qualifications outlined in the legislation, as the city is in marginally better shape than many surrounding communities in terms of foreclosures.


The department determines eligibility for the program through the number of subprime mortgages in a community, the number of foreclosures and the number of household in danger of slipping into delinquency.


Using the formula to determine how the money should proportionally be doled out, communities that exceeded $2 million were given the green light to start submitting their plans to HUD. Communities under that threshold were directed to get their funds through their respective states, with the states reporting to HUD.


But a second wave of funds was allocated, and the city, along with 16 other Michigan municipalities, was awarded the money. The $1.8 million represents the largest sum granted among the 17 communities that were secondary recipients.


HUD specifies that the money must be spent within 12 months and used in one of six ways: financing mechanisms; redevelopment of abandoned and foreclosed properties; demolition of blighted structures; redevelopment of demolished or vacant properties; displacement prevention for foreclosed households; and land banks.


City officials chose the first four of those options, and pending state approval will spend the money as follows:
•$390,000 to acquire and rehabilitate abandoned or foreclosed properties.
•$130,000 to demolish blighted structures.
•$150,000 for homebuyer assistance.
•$350,000 toward acquiring vacant properties in Ecorse Creek flood plain with the intent to provide easements for the upcoming drainage overhaul.
•$150,000 to acquire abandoned or foreclosed properties in the Joy and Telegraph area with the intent on building a community center.
•$450,000 to fund low-cost, independent housing such as the Vista Maria Village of Hope housing project.
•$180,000 in administrative and planning costs.


While the money provides the city with a good start to stabilizing some of the hardest-hit neighborhoods, city officials maintain that it is just one component of several that will go toward revitalizing the city’s ailing housing stock.


“The NSP is just the first wave of stimulus, with more to follow,” said Hassane Jamal, community and economic development director. “But the hope with the first step is to have some impact in reducing the effects of foreclosure and vacant properties — in particular, (by) trying to help communities try to help low- and middle-income households.”