#7 Substantial Plan Amendment NSP _A_ Cover
NEIGHBORHOOD SERVICES MEMORANDUM
May 21, 2009
TO: Community Development Authority
FROM: Jennifer Petruzzello, Neighborhood Services Director
SUBJECT: Agenda Item 7: Public Hearing and Action on a 2008 Substantial Plan
Amendment for the Neighborhood Stabilization Program.
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ACKGROUND
The Housing and Economic Recovery Act (HERA) of 2008 created the Neighborhood
Stabilization Program (NSP), under which states, cities and counties will receive a total
of $3.92 billion to acquire, rehabilitate, demolish, and redevelop foreclosed and
abandoned residential properties. NSP funds are considered Community Development
Block Grant (CDBG) funds.
The U.S. Department of Housing and Urban Development (HUD) has made a total of
$38,779,123 available to the State of Wisconsin and $9,187,465 to the City of
Milwaukee.
HERA directs the State’s implementation of the NSP Program to give priority emphasis
in targeting funds to areas with the greatest need, including those:
a. With the greatest percentage of home foreclosures;
b. With the highest percentage of homes financed by a subprime Mortgage related
loan; and
c. Identified by the State or unit of general local government as likely to face a
significant rise in the rate of home foreclosures.
The State’s proposal includes: $5,807,600 for Wisconsin Housing and Economic
Development Authority (WHEDA) Foreclosed Home Purchase Program, $9,000,000 for
CDBG Entitlement Communities (not receiving a direct allocation), $18,093,611 in
Statewide Regional Allocations, $2,000,000 in incentive allocations, and $3,877,912 for
administration.
The City of Janesville is anticipating receiving $987,146 in NSP funding through the
State of Wisconsin’s allocation. The City of Janesville has entered into a Mutual
Cooperative Agreement with the City of Beloit, and the County of Rock for the
administration of the Neighborhood Stabilization Program. We are currently awaiting the
official contract from the State.
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This substantial amendment has been prepared to explain how the City of Janesville
intends to utilize NSP funds to stabilize the neighborhoods most impacted by the recent
foreclosure crisis.
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UMMARY OF PROPOSED ACTIVITIES AND BUDGET
The City of Janesville is proposing to utilize NSP funds for four activities (proposed
budget):
?Acquisition/Rehab/Resale ($675,276),
?Land Banking ($200,000),
?Demolition of Blighted Structures ($48,000), and
?Administration ($68,870).
With this funding, the City anticipates rehabilitating 3 single-family and 3 multi-family
units, and demolishing a minimum of 4 properties.
The attached Substantial Amendment and Appendix One further details the proposed
budget, identifies the number of households assisted by income level, estimates
program income, and identifies funding leverage.
Recommendation:
Following the public hearing, staff recommends that the CDA approve the 2008
Substantial Plan Amendment for the Neighborhood Stabilization Program. This
information will be used for future reporting to the State of Wisconsin and HUD.
C:\Documents and Settings\petruzzelloj\Local Settings\Temporary Internet Files\Content.Outlook\JZ7WACAH\Item #7 Substantial
Plan Amendment -NSP.doc
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