HUD SECRETARY DONOVAN ANNOUNCES $68.8 MILLION IN RECOVERY ACT GRANTS TO STABLIZE NEIGHBORHOODS, REBUILD ECONOMIES IN PENNSYLVANIA
Neighborhood stabilization grants to Philadelphia and Reading hard hit by the housing crisis

WASHINGTON - U.S. Housing and Urban Development Secretary Shaun Donovan today announced that HUD is awarding $68.8 million in Recovery Act funding to the Chicanos Por La Causa, Inc., the City of Philadelphia, the City
of Reading and the Community Builders, Inc., 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.

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 housing crisis has
had on local communities, while demonstrating that they have the capacity to be responsible stewards of taxpayer dollars.

"Vacant homes have a debilitating effect on neighborhoods and often lead to reduced property values, blight, and neighborhood decay," said Donovan. "This additional $2 billion in Recovery Act funding will help stabilize hard hit communities 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."

The City of Philadelphia Office of Housing and Community Development has been awarded $43,942,532 in NSP2
funds. These funds will be used in targeted areas across 55 census tracts in Philadelphia where subprime lending,
loss of employment, and worsening economic conditions have caused numerous residential foreclosures. The City proposed to use awarded funds to purchase and rehabilitate 100 vacant or foreclosed homes, redevelop 100 vacant or demolished properties, demolish 50 blighted structures, and provide financing mechanisms in the form of 200
second loans, with flexible repayment conditions and financing assistance for the redevelopment of 100 foreclosed multi-family properties. These activities will help stabilize the neighborhood across income levels by providing affordable housing to households earning at or below 120 percent of area median income, with 25 percent of the funds going to those earning less than 50 percent of area median income. The goal of these activities is to reduce
the number of abandoned and vacant residential properties, increase housing values, decrease crime rates, attract new investment from the private sector, and increase market rate housing sales. The City will also leverage $5,000,000 in other fund to help achieve neighborhood stabilization. The City of Philadelphia has ensured that its
NSP2 target geography is in areas with accessible public transportation. The city is committed to integrating redevelopment with transit accessibility which creates a unique connection between infrastructure emerging from foreclosures and sustainability emerging from a transit oriented approach to development.

Community Builders, Inc. has been awarded $78,617,631 in NSP2 funds. These funds will be used in targeted areas across 15 states including Pennsylvania and 9 census tracts to address a crisis in multifamily housing where the location and proportion of rental housing relative to the single-family inventory is critical to the viability of the real estate market. Community Builders proposed to acquire and rehabilitate or redevelop multifamily properties that are foreclosed, blighted, or vacant. Their strategy will build on existing stabilization efforts and continue after the NSP2 program. Within an allotted 3 year time frame, Community Builders proposed the creation of a minimum of 1,300 units of affordable housing, with at least 50 percent for households whose income is at or below 50 percent of area
median income and the remain for households at or below 120 percent of area median income. Community Builders is taking a unique approach by using their NSP2 funds for the development of affordable multifamily housing to rent as apartments, townhomes, and residential complexes with families of mixed incomes. For instance in East Chicago, IN, Community Builder's will work with the local housing authority and a non-profit, Hispanic Housing Development Corporation, to develop 75 rental townhouses for families under 60 percent of area median income , with half
targeted to family's under 50percent area median income and around 15 percent for public housing families.

Chicanos Por la Causa in a consortium agreement with Affordable Homes of South Texas, Community Development Corporation of Brownsville, El Paso HOAP, Tierra del Sol Housing Development Corporation, YES Housing, Inc.,
CHISPA, Inc., New Economics for Women, Colorado Rural Housing Development Corporation, Del Norte/Northeast Denver Housing Center, Mi Casa, Inc., Norris Square Civic Association (in Philadelphia), and The Resurrection Project has been awarded $137,107,133 in NSP2 funds. These funds will be used in targeted areas across 332 census tracts in 8 States and the District of Columbia to address foreclosure and abandonment in the housing market and to create affordable housing for Latino communities. The Consortium proposed to use the awarded funds to demolish 165 blighted properties, land bank 203 foreclosed homes, and produce 1,998 affordable housing units through the
purchase and rehabilitation of foreclosed or abandoned homes, financing mechanisms, and redevelopment of vacant
or abandoned properties. These activities will benefit households whose income is at or below 120 percent of area median income, with 25 percent of the funds for households at or below 50 percent of area median income. These funds, and the leveraging of $12,012,000 in other funds, will lead to neighborhood stabilization by improving the housing market through the creation of affordable housing in the targeted communities.

The City of Reading in a consortium agreement with the City of Reading Housing Authority and Our City Reading Inc. has been awarded $5,000,000 in NSP2 funds. These funds will be used in targeted areas across 5 census tracts affected by high foreclosure and vacancy risk scores. The Consortium proposed to purchase and rehabilitate 151 abandoned or foreclosed homes and provide homebuyer counseling. These activities will benefit households whose income is at or below 120 percent of area median income, with 25 percent of the funds for households at or below
50 percent of area median income. These funds, and the leveraging of $226,500 in other funds, will encourage
private investments in the area and provide affordable housing to help stabilize the targeted neighborhoods.

The Neighborhood Stabilization Program was created to confront the effects of the housing crisis, create jobs, and grow local economies by providing communities with the resources to purchase and rehabilitate vacant 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 the housing crisis and falling home values.

On August 26, 2009, HUD also awarded $50 million in technical assistance grants to help grantees more effectively manage the inventory of abandoned 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 in the use of 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.