Transcript Slide 1

NeighborWorks®
America
Neighborhood
Stabilization
Program
Agenda
• Overview of the Neighborhood
Stabilization Program I (NSP I)
• NSP I Examples
• Summary of Neighborhood
Stabilization Program II (NSP II)
• Discussion
NSP I
Created by the Housing and Economic
Recovery Act (HERA) of 2008
• $3.92 billion in one-time grants to states,
cities and counties (nonprofits not eligible)
• Needs-based formula allocation
• Based on Community Development Block
Grant (CDBG) program: HUD administers it
NSP II
Additional $2 billion allocated in the
American Reinvestment and
Recovery Act (ARRA) of 2009
•
Will be a competitive application
process
•
Nonprofits can apply
•
HUD to release guidelines in May
NSP I Requirements
Intent is to help stabilize
neighborhoods affected by foreclosure.
 Jurisdictions had to target funds to
“areas of greatest need”.
 Minimum of 25% of funds must be used
to create housing for <50% AMI; all
housing to benefit < 120% AMI.

NSP I Requirements (Cont.)
No more than 10% for administration.
 Foreclosed properties must be purchased
at a discount (min. 5% up to 15%).

NSP I Eligible Uses
A.
B.
C.
D.
E.
Establish financing mechanisms for
purchase and redevelopment of foreclosed
homes.
Purchase and rehabilitate properties
that have been abandoned or foreclosed
upon.
Establish and operate land banks for
homes and residential properties that have
been foreclosed upon.
Demolish blighted structures.
Redevelop demolished or vacant
properties.
NSP I Timeline
 Jurisdictions
filed final Action Plans in
February, 2009.
 HUD approvals followed later in
February.
 Jurisdictions have 18 months after HUD
approval to obligate funds.
 Funds not obligated w/in 18 months may
be recaptured and re-allocated by HUD.
NSP I Examples
Caveats
 Jurisdictions
have just started to
implement their programs
 Few results available yet
 Consider these “emerging practices”
 All these jurisdictions have other
NSP programs besides those
featured here
NSP I- Example 1
San
Bernadino County, CA
Financing Mechanism:
Purpose- “rapid re-occupancy”

To help first-time homebuyers quickly
purchase and occupy foreclosed single
family homes before vandalism and blight
become acute.
 0% Downpayment: 3.5-5% of purchase
price
San Bernadino County, CA
(Cont.)
 Target
Population
oFirst-Time Homebuyers; and
oUp to 120% of AMI; and
oFHA creditworthy
 May be combined with the County’s
NSP-funded rehab program if
property needs repairs
San Bernadino County, CA
(Cont.)
Downpayment Assistance
Planned Production
NSP Funds:
$2.5 million
# of Units:
85
NSP Funds/Unit: $29,412/unit
NSP I: Example 2
Miami-Dade
County, FL
Purchase & Rehabilitation:
Purpose- “multi-family housing”

To purchase & rehab multi-family
properties for continued use as rental
property.
 Units to be purchased by the County; a
partner entitlement city; or nonprofit or
forprofit developers under contract with
the County
Miami-Dade County, FL
 The
County will conduct property
appraisals, & negotiate discounted
purchase prices
 30 year affordability restrictions
 Targeted to neighborhoods in top
two priority areas (identified by
“areas of greatest need” analysis)
Miami-Dade County, FL
Purchase & Rehab
Planned Production
NSP Funds:
# Units:
NSP Funds/Unit:
$21.57 million
172
$125,400
NSP I- Example 3
Tampa, FL
Redevelopment
Purpose- “new construction on cleared
lots”
 To create new housing on lots cleared by
NSP funds that Tampa allocated to
demolition of foreclosed properties
 0% deferred payment loan
Tampa, FL
Up to 40 lots will be cleared
Cleared lots may be landbanked up to 10
years
 Lots will be cleared in a handful of target
neighborhoods
 Tampa will issue RFQs to identify Housing
Partners to help with redevelopment
 RFQ will make creation of an
“interdisciplinary team” a competitive
criterion in the RFQ


Tampa, FL
Redevelopment
Planned Production
NSP Funds:
# Units:
NSP Funds/Unit:
$25.41 million
N/A*
N/A*
*SF or MF units to be constructed on up to
40 cleared lots
NSP I Example # 4
Genesee
County, MI
Landbanking
 Purpose- To demolish blighted structures
that are already owned by the Genesee
County Land Bank Authority.Vacant lots
may be held or redeveloped as housing.
Genesee County, MI




Planning Commission staff, &local inspectors
& assessors will help identify properties
Genesee County will subcontract to the
Genesee County Land Bank Authority to
oversee demolition
The County will work with banks and FHA to
acquire properties, help clear titles, etc.
Leverage from TIFs; Genesee County
downpayment assistance; private resources
Genesee County, MI
Landbanking
Planned Production
NSP Funds:
# Units:
NSP Funds/Unit:
$1,800,000 million
200
$9,000
NSP I Example #5
 North
NV
Las Vegas & Clark County,
Housing Counseling
 Purpose- HBE for households up to
120% of AMI seeking to purchase NSPassisted housing.
 HUD approved counseling agencies only.
North Las Vegas & Clark
County, NV





An RFP process will be used to allocate funds
Minimum of 8 hours counseling required
Assumes 10 households will be counseled for
every 1 that proceeds to purchase
Target areas include very distressed census tracts
where significant public investment has already
occurred, with more planned.
Leverage includes $93 million in MRB funding set
aside by the state housing finance agency
North Las Vegas & Clark
County, NV
Housing Counseling
Planned Production
NSP Funds:
# Units:
NSP Funds/Unit:
$525,000
200
$100
Paying for NSP Activities

NSP grantees may fund sales costs, closing
costs, & reasonable developer’s fees
related to housing rehab or new
construction activities.
HOWEVER

NSP regs prohibit NSP-assisted housing
to be sold at a profit.
Accurately analyze development
costs so they can be reimbursed
as fees.
(Work this out with
NSP jurisdiction)
NSP II
 Created
by the American Recovery &
Reinvestment Act (ARRA), February
2009
 $2 billion in funding for NSP
 Some changes are retroactive to NSP I
 Others apply only to NSP II
 Stay tuned for more details from HUD
Changes Affecting both NSP I
& II
Elimination of the Program Income Section
 Expansion of the Land Banking Eligible Use
 Redevelopment will be Restricted to
Housing Only- no non-residential uses
 NSP Grantees may not Refuse to Lease to
Section 8 Recipients
 Additional Tenant Protections for those with
Leases Signed Before Foreclosure

Changes Affecting NSP II Only
Competitive Allocation Process (states,
local gov’ts, nonprofits)
 Up to $200 million for Capacity Building
 Expenditure Timeline: Grantees must
spend 50% of allocated funds w/in 2 yrs.;
100% w/in 3 yrs.
 No NSP Funds may Demolish Public
Housing
 10% Cap on Demolition

Changes Affecting NSP II Only
(Cont.)
NSP
1.
2.
3.
4.
II Allocation Criteria:
Areas of Greatest Need
Capacity to Execute Projects
Leveraging Potential
Others TBD by HUD
Discussion