OBAMA ADMINISTRATION AWARDS ADDITIONAL $5 MILLION TO STABILIZE WASHINGTON STATE NEIGHBORHOODS HARD-HIT BY BLIGHT & FORECLOSURE
Washington has used earlier NSP funds to reclaim & re-sell more than 170 houses in 28 communities

SEATTLE - U.S. Housing and Urban Development Secretary Shaun Donovan and HUD Northwest Regional
Administrator Mary McBride today announced the award of an additional $5 million in funding to Washington state communities struggling to reverse the effects of the foreclosure crisis. The grants announced today represent a
third round of funding through HUD's Neighborhood Stabilization Program (NSP) and will provide targeted emergency assistance to help local communities in Washington state acquire, redevelop or demolish foreclosed properties.

The $5 million in NSP III funds awarded today are a result of the Wall Street Reform & Consumer Protection Act of 2010 sponsored by U.S. Senator Christopher Dodd and U.S. Representative Barney Frank and is over and above the $28 million in NSP I funds awarded to Washington state Department of Commerce under the Housing & Economic Recovery Act of 2008. To date, using NSP I funds the Department and its sub-grantees have purchased 171
blighted or foreclosed homes for rehabilitation and re-sale in 28 communities including, for example, Aberdeen, Hoquiam, Kelso, Pasco, Seattle, Spokane, Tacoma, Toppenish, Vancouver, Yakima and King, Pierce and Snohomish counties.

"These grants will build on local efforts to reverse the effects these foreclosed properties have on their surrounding neighborhoods," said Donovan. "We wanted to make certain that we targeted these funds to those places with especially high foreclosure activity so we can help turn the tide in our battle against abandonment and blight. This investment will reduce blight, bolster neighboring home values, create jobs and produce affordable housing."

"A foreclosed house, blighted apartment building or weed-strewn, vacant lot in an otherwise vibrant neighborhood
can all too quickly change the quality of life for those who call it home," said HUD Regional Administrator McBride.
"Our NSP funds are giving Washington communities the resources to move effectively to halt the downward trend
in its tracks and to keep their neighborhoods strong."

"Washington has used its existing allocation of NSP funds to recover over $30 million of lost property value. These additional NSP funds will enable us to do even more," said Karen Larkin, Assistant Director, Washington State Department of Commerce. "Several jurisdictions have projects that are currently underfunded. These additional NSP funds will help them complete these projects and help stimulate local housing markets in areas hardest hit by the housing crisis."

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) appropriated $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, abandoned homes, and falling home values. Today, 92 cents of every dollar from the first round of
NSP funding is obligated - and is in use by communities, buying up and renovating homes, and creating jobs.

State and local governments can use their neighborhood stabilization grants to acquire land and property; to
demolish or rehabilitate abandoned properties; and/or to offer downpayment and closing cost assistance to low-
to moderate-income homebuyers (household incomes not exceed 120 percent of area median income). In addition, these grantees can create "land banks" to assemble, temporarily manage, and dispose of vacant land for the
purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of urban property. HUD will issue an NSP3 guidance notice in the next few weeks to assist grantees in designing their programs and applying for funds.

HUD's NSP Program also seeks to prevent future foreclosures by requiring housing counseling for families receiving homebuyer assistance. The Agency seeks to protect future homebuyers by requiring States and local grantees to ensure that new homebuyers under this program receive homeownership counseling and obtain a mortgage loan
from a lender who agrees to comply with sound lending practices.

In determining the allocations announced today, and similar to NSP1, HUD followed key indicators for the distribution formula outlined by Congress. HUD is using the latest data to implement the Congressional formula. The formula
weighs several factors to match funding to need in the 20 percent most distressed neighborhoods as determined based on the number and percentage of home foreclosures, the number and percentage of homes financed by a subprime mortgage related loan, and the number and percentage of homes in delinquency. To estimate the
statutory factors to the neighborhood level, HUD uses a model that takes into account causes of foreclosures and delinquencies, which include housing price declines from peak levels, and increases in unemployment, and rate of
high cost and highly leveraged loans. HUD also considers vacancy problems in neighborhoods with severe foreclosure related problems.

In addition to a third round of NSP funding, Dodd-Frank Wall Street Reform and Consumer Protection Act creates
a $1 billion Emergency Homeowners Loan Program to be administered by HUD. This loan program will provide up to
24 months in mortgage assistance to homeowners who are at risk of foreclosure and have experienced a substantial reduction in income due to involuntary unemployment, underemployment, or a medical condition. HUD will announce additional details, including the targeted communities and other program specifics when the program is officially launched in the coming weeks.

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HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.