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Georgia’s Neighborhood Stabilization Program Grants

Georgia’s Neighborhood Stabilization Program Grants . Process, Procedures and Timelines. Law and Regulations. Title III, Section 2301 of the Housing and Economic Recovery Act of 2008 (HERA) Federal Register Notice – 10/6/2008

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Georgia’s Neighborhood Stabilization Program Grants

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  1. Georgia’s Neighborhood Stabilization Program Grants Process, Procedures and Timelines

  2. Law and Regulations • Title III, Section 2301 of the Housing and Economic Recovery Act of 2008 (HERA) • Federal Register Notice – 10/6/2008 • www.hud.gov/offices/cpd/communitydevelopment/programs/neighborhoodspg/

  3. Eligible Activities • Establish financing mechanisms for purchase and redevelopment of foreclosed upon homes and residential properties, including such mechanisms as soft-seconds, loan loss reserves, and shared-equity loans for LMI homebuyers; • 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; • Establish land banks for homes that have been foreclosed upon; • Demolish blighted structures; and • Redevelop demolished or vacant properties.

  4. HUD’s National Allocation Formula • Georgia -- Entitlements allocation of $75.9MM; State Non-Entitlement allocation of $77MM • State and Entitlements are Drafting “Action Plans” for submission to HUD • 18 months for states and locals to “use” the funds • Allocated to states & local governments with modified “entitlement” and “non-entitlement” definitions

  5. Allocation Amounts • ATLANTA $12,316,082 • AUGUSTA $2,473,064 • CLAYTON COUNTY $9,732,126 • COBB COUNTY $6,889,134 • COLUMBUS-MUSCOGEE $3,117,039 • DE KALB COUNTY $18,545,013 • FULTON COUNTY $10,333,410 • GWINNETT COUNTY $10,507,827 • SAVANNAH $2,038,631 • GEORGIA STATE PROGRAM $77,085,125

  6. State Action Plan Requirements • An amendment to State’s FFY 2008 Consolidated Plan • Must be submitted to HUD no later than 12/1/2008 (requires mid November publishing for public comment) • Submitted using DRGR System

  7. State Distribution Formula Requirements • Priority emphasis and consideration to ALL jurisdictions including those metropolitan areas, cities, urban areas, rural areas, low- and moderate-income areas, and other 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 as likely to face a significant rise in the rate of home foreclosures.

  8. DCA to Determine Need by Actual Data and Ranks

  9. State Formula Private Data Sources • Foreclosure Data by County Activity Data • Notices of Foreclosure Sales* • Number and % of Households • Real Estate Owned Property • Number of Households • www.RealtyTrac.Com * Noted as “Trust Sales” in RealtyTrac data source

  10. State Formula Public Data Sources • Home Mortgage Disclosure Act (Federal Financial Institutions Examination Council) • % of conventional home mortgages by subprime lenders by County (2005) • Conventional home purchase mortgage loans by subprime lenders by County (2005) • http://beta.dataplace.org * Noted as “Trust Sales” in RealtyTrac data source

  11. Need Determined by Actual Data and Ranks • Formula to be used to measure need and determine possible allocations down to minimum grant size • After minimum grant size is no longer allocated, funds will be placed in a “flexible pool” administered by GHFA for competition among those who desire funding but had insufficient need for a formula allocation

  12. Survey and NOFA Processes • Survey mailed to all local governments 10/8/08...Response needed for State’s Action Plan ASAP • Action Plan published for comment … 11/15/2008 +/- with submission to HUD by 12/1/2008 • Concurrent with a DCA NOFA Process and Receipt of Local RFPs

  13. Threshold Criteria for All Local Proposals • Documentation of capacity • Identified low- and moderate income areas of need • Identified need, project and LMMI activities • Including how recipient will meet the requirement to insure 25% of their grant will benefit persons at or below 50% of Area Median Income • Readiness to proceed • Efficiency (# of units) • Understanding of applicable law/regulation, and • Agreements in place

  14. State Action Plan Priorities • State must describe specifics on activities to be undertaken: • Establish financing mechanisms for purchase and redevelopment of foreclosed properties; • Purchase and rehab residential properties that have been abandoned or foreclosed upon, in order to sell, rent, or redevelop such properties; • Establish land banks for homes that have been foreclosed upon; • Demolish blighted structures; and • Redevelop demolished or vacant properties.

  15. State Action Plan Priorities • Priority within Low-, Moderate- and Middle-Income Areas (see map) • Each Recipient must use at least 25% of their funds to assist those at or below 50% of Area Median Income (AMI)…(rental) • Applicant to know which specific properties are to be addressed and be ready to implement (options, etc) • Properties must be purchased at an overall discount of 15% as verified by an appraisal made within 60 days of purchase.

  16. State Action Plan Priorities • Continued Affordability – DCA proposes to adopt the HOME program standards at 24 CFR 92.252(a), (c), (e) and (f), and 92.254 to be in compliance with HUD’s affordability standard • Program income to be managed with existing CDBG Revolving Loan Fund (RLF) policies and local reporting procedures

  17. Timelines • Action Plan to be published by 11/15/2008 • NOFAs and Applications to be distributed to Local Governments late November • Formula Amount; or • Flexible Pool Competitor • DCA expects HUD approval of its Plan in December • DCA hopes to approve its allocations shortly thereafter

  18. Performance will be key • 18 months to obligate and spend funds • Local governments should be identifying potential REO residential units • www.occ.treas.gov/cdd/ServicerContactInformation.pdf • www.occ.treas.gov/cdd/MortgageElectronicRegistrationSystems.pdf • www.mers-servicerid.org • Quarterly reports and monitoring • Slow projects to be subject to reallocation by DCA

  19. Questions • Brian Williamson, Assistant Commissioner, 404.679.1587, bwilliam@dca.state.ga.us • Glenn Misner, Director, Office of Field Services, 404-679-3138, gmisner@dca.state.ga.us • Steed Robinson, Director, Office of Community Development, (404) 679-3168, srobinso@dca.state.ga.us

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