Returns on Investment

YAKIMA, WASHINGTON - Next time you eat an apple or drink a beer you may want to say "thanks, Yakima." A city of just under 100,000 across the Cascades and 145 miles southeast of Seattle, Yakima is surrounded by vineyards and orchards and fields, fields, in fact, that produce 75 percent of the world's hops. Not exactly the kind of place you'd expect to be been hit hard by the Great Recession.

But it was. Swing by the corner of North Third and East T streets about ten blocks north of downtown. A couple of years ago you would have seen a collection of boarded-up and empty houses, forlorn and foreclosed upon because their owners fell behind in their property taxes. And they weren't adding much to the neighborhood. Just as dandelions and crabgrass can wreck a perfectly good yard, abandoned and foreclosed homes wreck a vibrant neighborhood.

Thanks to the Recovery Act passed by the Congress and signed by President Obama, Yakima received a grant under HUD's Neighborhood Stabilization Program intended to provide communities across the country with resources to combat the devastating effects of foreclosed and abandoned homes. Yakima was happy to receive the funds.

"What we are doing is we are revitalizing the neighborhood," Yakima's Director of Neighborhood Development Archie Mathews told KIMA-TV, "where you take a burned-down home or a shell of a home or a weedy lot and put another home there. You're invigorating the neighborhood." A neighborhood, he observed to The Yakima Herald, "where wouldn't build because he wouldn't make a profit."

The City might not be making a profit either. But it's certainly getting a good return on its investment. In collaboration with Opportunities Industrialization Center and Habitat for Humanity, the City is putting about $420,000 in NSP funds and $200,000 in CDBG and $340,000 in HOME funds also from HUD into building 11 new, affordable homes on the site. More than half of the new homes are finished and three have already sold to first-time homebuyers with incomes at 80 percent of area median or about $44,000 for a family of four. It's also using NSP funds to fix up - and re-sell - three homes in another part of town.

"As the homes sell," Matthews told The Herald, "we revolve that money back into the program" to help more first-time buyers. And that's not the only "return" from the project, he noted, adding that with an average sales price of $130,000, KIMA-TV reported, each home built will "generate nearly $1,500 in property tax dollars a year."

But the best return on investment may be what the new homes will mean for the neighborhood. "It just makes the whole neighborhood better," said one resident. Rebuilt homes, observed another, are "a lot better than somebody who's got a rundown house."

"What the City and its partners have done is impressive." said HUD Northwest Regional Administrator Mary McBride after a recent visit to Yakima. "They're putting 15 new, energy-efficient, affordable homes back on the tax rolls. But, most importantly, they've bringing new families, new energy and new vitality to neighborhood. Two or three years ago, some may have said it had seen its best days. But, thanks to these investments, its best days clearly are once again ahead of it."

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