SECRETARY DONOVAN ANNOUNCES $223 MILLION IN RECOVERY ACT
GRANTS IN MICHIGAN TO STABILIZE NEIGHBORHOODS, REBUILD ECONOMIES
Stabilization grants to help neighborhoods recover from the housing crisis

DETROIT, MI - U.S. Housing and Urban Development Secretary Shaun Donovan and Michigan Governor Jennifer M. Granholm today announced that HUD is awarding $223 million in Recovery Act funding to Michigan under HUD's Neighborhood Stabilization Program (NSP). The NSP grants announced today are part of $2 billion awarded
nationwide to local communities and nonprofit housing developers to combat the effects of vacant and abandoned homes while creating jobs. Michigan's award is the largest statewide grant under this round of Neighborhood Stabilization Program grants.

During a press conference at the Butzel Family Center in Detroit with Governor Granholm, Donovan announced that the $223 million award is going to the Michigan Housing Development Authority in a partnership agreement with 12 Michigan city governments including: City of Battle Creek, City of Benton Harbor, City of Detroit, City of Flint, City
of Grand Rapids, City of Hamtramck, City of Highland Park, City of Kalamazoo, City of Lansing, City of Pontiac, City
of Saginaw, City of Wyandotte, and eight land banks including: Calhoun County Land Bank, Berrien County Land
Bank, Michigan Land Bank Fast Track Authority, Genesee County Land Bank, Wayne County Land Bank Corporation, Kalamazoo County Land Bank, Ingham County Land Bank, and Saginaw County Land Bank.

"Vacant homes have a debilitating effect on neighborhoods and often lead to reduced property values, blight, and neighborhood decay," said Donovan. "This Recovery Act funding will help stabilize hard-hit communities in Michigan
by turning vacant homes from eyesores into community assets. The Neighborhood Stabilization program is a key
part of the Obama Administration's comprehensive approach to address the national housing and economic crisis."

"Michigan will now have the resources we need to help some of the state's hardest hit communities, thanks to
HUD's generous investment of Recovery Act dollars," said Governor Granholm. "We have demonstrated the scope of the challenge, and also our ability to tackle it. We're ready to put these dollars to good use shoring up Michigan communities and families, creating jobs, and boosting local economies."

Funded through the American Recovery and Reinvestment Act of 2009, this round of NSP grants is being awarded competitively to applicants who developed the most innovative ideas to address the impact the foreclosure crisis
has had on local communities, while demonstrating that they have the capacity to be responsible stewards of taxpayer dollars.

The Neighborhood Stabilization Program was created to address the foreclosure crisis, create jobs, and grow local economies by providing communities with the resources to purchase and rehabilitate foreclosed homes and convert them to affordable housing. Last year, HUD awarded nearly $4 billion in NSP formula funds to over 300 grantees nationwide to help state and local governments respond to rising foreclosures and falling home values.

In addition, on August 26, 2009, HUD awarded $50 million in technical assistance grants to help grantees more effectively manage the inventory of foreclosed homes they purchase under the Neighborhood Stabilization Program. HUD's NSP technical assistance grants are helping NSP recipients to implement sound underwriting, management,
and fiscal controls; measure outcomes created by public funds; build the capacity of public-private partnerships; develop strategies to serve low-income households; incorporate energy efficiency into NSP programs; provide
support, and training on the operation of 'land banks'; and train NSP recipients on HUD program rules and financial management requirements.

The additional $2 billion in NSP grants being awarded today will build on the work being done now to help state and local governments and non-profit developers collaborate to acquire land and property; to demolish or rehabilitate abandoned properties; and/or to offer downpayment and closing cost assistance to low- to middle-income homebuyers. Grantees can also create "land banks" to assemble, temporarily manage, and dispose of foreclosed homes.

The Neighborhood Stabilization Program will also help to prevent future foreclosures by requiring housing counseling
for families receiving homebuyer assistance funds through NSP. In addition, it will protect homebuyers by requiring grantees to ensure that new homebuyers under this program obtain a mortgage from a lender who agrees to comply with sound lending practices.

Secretary Donovan and HUD are committed to providing the highest level of transparency possible as Recovery Act funds are spent quickly and efficiently. It is crucial that the American people are fully aware of how their tax dollars are being spent and can hold their federal leaders accountable. Every dollar of Recovery Act funds HUD spends can
be reviewed and tracked at HUD's Recovery Act website. The full text of HUD's funding notices and tracking future performance of these grants is also available at HUD's Recovery Act website.

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HUD is the nation's housing agency committed to sustaining homeownership; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.

Michigan State Housing Development Authority Grant Summary
The Michigan State Housing Development Authority in a consortium agreement with 12 city governments: City of Battle Creek, City of Benton Harbor, City of Detroit, City of Flint, City of Grand Rapids, City of Hamtramck, City of Highland Park, City of Kalamazoo, City of Lansing, City of Pontiac, City of Saginaw, City of Wyandottee, and 8 land banks: Calhoun County Land Bank, Berrien County Land Bank, Michigan Land Bank Fast Track Authority, Genesee County Land Bank, Wayne County Land Bank Corporation, Kalamazoo County Land Bank, Ingham County Land Bank, and Saginaw County Land Bank has been awarded $223,875,399 in NSP2 funds to use in targeted areas, which
include 93 census tracts. In these targeted areas, home values have dropped by as much as 52 percent. The Michigan Consortium proposed to use NSP2 funds to acquire 6,250 (39 percent) of foreclosed, abandoned, vacant, and blighted properties in these targeted areas. A proposed Fifteen hundred (1500) of these homes will be rehabilitated, 2,500 demolished, and 4,650 land banked for future use. The rehabilitated homes will be available to households whose income does not exceed 120 percent of area median income, with 740 homes for households at
or below 50 percent area median income (28 percent of total funds). The consortium's goal is focusing on the
removal of blight and re-sizing neighborhoods to meet market demand. A key component of this approach is the innovative use of land banks to purchase and hold properties, thereby removing their negative effect without adding units to the surplus already on the market. The land banks will help create smaller neighborhoods with green spaces and improved neighborhood amenities while reserving buildable lots to be conveyed to developers as revitalization plans get implemented and the housing market demand grows.