Third round of Neighborhood Stabilization Program announced

HUD has announced the third round of Neighborhood Stabilization Program, continuing to focus on foreclosed properties.  This round will have $1 billion available to states and communities.

The funding announced today is provided under the Dodd-Frank Wall Street Reform and Consumer Protection Act. To date, there have been two other rounds of NSP funding: the Housing and Economic Recovery Act of 2008 (HERA) provided $3.92 billion and the American Recovery and Reinvestment Act of 2009 (Recovery Act) appropriated an additional $2 billion. Like those earlier rounds of NSP grants, these targeted funds will be used to purchase foreclosed homes at a discount and to rehabilitate or redevelop them in order to respond to rising foreclosures and falling home values.

Previously, HUD Secretary Donovan announced the "First Look" program and the third round of NSP funding is designed to work with this program.

First Look gives NSP grantees an exclusive 12-14 day window to evaluate and bid on properties before others can do so. By giving every NSP grantee the first crack at buying foreclosed and abandoned properties in these targeted neighborhoods, First Look will maximize the impact of NSP dollars in the hardest-hit neighborhoods – making it more likely the properties communities want to buy are strategically chosen and cutting in half the traditional 75-to-85 day process it takes to re-sell foreclosed properties.

The City of Milwaukee received $2,687,949 with the rest of the state receiving $5,000,000 for a total of $7,687,949.  Looking at the rest of the states, it looks like every state, territory & D.C. received a minimum of $5 million, which doesn't really make sense-does sparsely populated states like Alaska, Wyoming, the Dakotas, and Vermont really need $5 million each?  Probably a bit of politics in this distribution.

California ($149,308,651) and Florida ($208,437,144) are the big winners-or rather, the losers-in this round.

Snapshots on how communities are doing in their previous NSP grants can be found here.