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HUD to give Cleveland $16 million, Cuyahoga County $11 million to deal with abandoned, foreclosed homes

U.S. money to help rehab, raze homes

Stephen Koff and Gabriel Baird
Plain Dealer Reporters
Saturday, September 27, 2008

Washington- Ohio will get more than $258 million, the fourth most of any state, to stabilize neighborhoods by selling, renovating or demolishing abandoned, foreclosed houses, federal authorities announced Friday.

The Department of Housing and Urban Development hopes the money, which includes $16.1 million for Cleveland and $11.2 million more for Cuyahoga County, will help neighborhoods hit hard by the foreclosure crisis. Cities or agencies can use the money to buy abandoned homes, renovate them, demolish them or create "land banks" for other development.

They also can use the money to help low- and moderate-income buyers acquire foreclosed homes.

Cleveland says the program is inadequate, considering the city's needs. HUD lists the city's foreclosure rate at 12.7 percent.

"We welcome this money, and we're going to use it wisely, but it needs to be part of a long-term commitment by the federal government," said Chris Warren, Mayor Frank Jackson's chief of regional development.

He said the $3.9 billion national program pales in comparison with the $700 billion that Congress and the White House are considering for a Wall Street bailout.

The one-time payout will not be enough to fix the problem left by the foreclosure crisis, Warren said, adding that Jackson has called on the federal government to make this sort of commitment for each of the next five years.

Jackson's administration expects to allocate the federal money to its existing two-pronged approach to the foreclosure crisis: either fixing up or tearing down foreclosed structures.

The money, approved as part of a large and controversial foreclosure bill this year, was targeted to cities that have not only a high number of foreclosed houses, but also a large amount of abandoned property. HUD's formula included foreclosure rates, the number of subprime mortgages in a market, and data used by the Postal Service to track abandoned addresses.

Florida got the most money, at $541 million, followed by California with $530 million and Michigan with $263.5 million.

Of Ohio's $258 million, a statewide program will get the largest portion, $116.8 million. Besides Cleveland and Cuyahoga County, other Northeast Ohio communities that qualify are Akron ($8.5 million); Elyria ($2.4 million); Euclid ($2.5 million); Lorain ($3 million); and Lake ($3.4 million) and Summit ($3.7 million) counties, according to lists distributed by U.S. Sens. Sherrod Brown and George Voinovich.

To reach these Plain Dealer Reporters:
[e-mail], 216-999-4212
[e-mail], 216-999-5833

© 2008 Cleveland Live, Inc.

http://www.cleveland.com/news/plaindealer/index.ssf?/base/news/122250446715100.xml&coll=2

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