Title
Neighborhood Stabilization Program 2 Grant Application (NB)
This item involves a request for the City Commission to approve the submission of a $5,000,000 grant application to the U. S. Department of Housing & Urban Development for the NSP 2 Program by the Department of Neighborhood Improvement.
Explanation
The Department of Neighborhood Improvement is proposing to apply for funding from the Neighborhood Stabilization Program 2 (NSP-2) under the American Recovery and Reinvestment Act (ARRA), 2009. Under NSP2, HUD allocated $1.93 billion on a competitive basis to states, local governments, and non profit organizations. The long-term outcomes for the program are increased residential sales and increased median market sales. The short-term outcomes are to arrest decline in home values in target geography and reduce or eliminate vacant and abandoned property in target geography.
As required by HUD, the amount of NSP2 funds requested must be of sufficient size to contribute toward significant and measurable neighborhood stabilization in the target geography. To meet this requirement, the grant request must be no less than $5,000,000 and must have the effect of either returning a minimum of 100 abandoned or foreclosed homes back to productive use or otherwise eliminating or mitigating their negative effect on the stability of the target geography. This is a competitive grant program and the purpose of these funds is to assist in the redevelopment of abandoned and foreclosed homes. The City will submit an application for funding under the NSP-2 program to the United States Department of Housing and Urban Development (HUD) by the submission deadline of July 17, 2009.
The NSP2 funds will be utilized in accordance with program requirements in order to arrest decline in home values in targeted neighborhoods and the reduction or elimination of vacant and abandoned residential property in targeted neighborhoods. All NSP-2 funds must provide benefit to persons whose income does not exceed 120 percent of the area median income. Additionally, 25 percent of the grant must be used for the purchase and redevelopment of abandoned or foreclosed upon homes or residential properties that will be used to house individuals or families whole incomes do not exceed 50 percent of the area median income. Targeted neighborhoods are those Census Tracts that meet the threshold score of 18 or higher as mandated by HUD based on the estimated number and percentage of foreclosures and another that combines the estimated foreclosure rate and the vacancy rate. HUD grants are available only for the high risk areas. As a result, three Census Tracts were identified by HUD within the City of Gainesville that meet the mandated threshold as follows: 1) Tract 4.00, Highland Court Manor Neighborhood; 2) Tract 7.00, Lincoln Estates Neighborhood; and 3) Tract 18.03, Northwest Gainesville (i.e., Northwood Pines, Appletree, and Landing neighborhoods).
As such, the grant application proposes to apply for $5,000,000 in NSP-2 funding to be utilized in the following eligible categories: 1) Purchase and rehabilitate homes and residential properties that have been abandoned or foreclosed upon, in order to sell, rent, or redevelop such homes and properties, and establish and operate a land bank for homes and residential properties that have been foreclosed upon (propose to impact a minimum of 100 properties); 2) Redevelop demolished or vacant properties as housing; 3) Demolition of blighted structures; and 4) Program administration (10% of grant amount).
Fiscal Note
No specific matching funds are required.
Recommendation
The City Commission: 1) approve the submission of the NSP 2 grant application to the U. S. Department of HUD; 2) authorize the City Manager or his designee to execute and submit a $5,000,000 grant application along with the appropriate HUD application forms related to the NSP 2 Program on or before July 17, 2009; 3) and authorize the City Manager or his designee to execute all necessary documents including agreements, assurances and certifications pertinent to said grant, subject to approval by the City Attorney as to form and legality.