5.3. SR 04-05-2010 - Laserfiche WebLink

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Item # 5.3. city E 1-uver MEMORANDUM TO: Mayor and City Council FROM: Annie Deckert, Economic Development Assistant DATE: April 5, 2010 SUBJECT: Neighborhood Stabilization Program Fund Update Attachments • NSP Targeted Neighborhood Map • NSP Funding Chart • Foreclosure Initiatives and Housing Rehab Pamphlet Background In response to the drastic increase in foreclosures and the impact of the subprime lending situation on housing, Congress authorized the Neighborhood Stabilization Program under the Housing and Economic Recovery Act (HERA) signed by the President in July 2008. NSP provides emergency assistance fox the redevelopment of abandoned and foreclosed homes that might otherwise become sources of abandonment and blight. Minnesota Housing is a grantee for the state in the amount of $38.8 million and will administer the use of these funds in highly impacted communities in greater Minnesota. ($20 million has also been allocated specifically to metro area jurisdictions). In February, the Elk River Housing Redevelopment Authority (HRA) was awarded $593,820 to provide targeted assistance to address foreclosed properties in specific neighborhoods within the City that may otherwise become sources of abandonment, blight, or crime. The funds can be used for down payment assistance, purchase rehabilitation, and acquisition rehabilitation. The HRA contracted with Tri-CAP, anon-profit community agency to assist in the administration of the funds. The purpose of these funds is to assist buyers in becoming successful homeowners in the long term and to decrease the negative effects of foreclosures on communities. In order for a property to be eligible for NSP funds, the home must be foreclosed and located in one of the targeted neighborhoods. Program is not limited to first time homebuyers. Funds are provided as deferred grants/loans with occupancy requirements. The following neighborhoods are eligible for the funds: o Country Crossing o Elk River Station