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HUD AWARDS $90.8 MILLION IN GRANTS AND LOAN GUARANTEES TO CREATE HOMEOWNERSHIP ZONES IN BALTIMORE, BUFFALO, CLEVELAND, LOUISVILLE, PHILADELPHIA AND SACRAMENTOWASHINGTON -- Housing Secretary Andrew Cuomo today announced $90.8 million in grants and loan guarantees to six cities under the Homeownership Zone program to help turn blighted inner city areas into thriving neighborhoods.
The Department of Housing and Urban Development assistance will help about 2,000 families become owners of newly built or rehabilitated single-family homes and will attract new job- creating businesses, Cuomo said.
Cuomo said the six Homeownership Zones -- the first receiving funding under the program -- will receive a total of $30 million in grants and $60.8 million in Section 108 loan guarantees from HUD. The zones are part of President Clinton's strategy to increase the nation's homeownership rate to a record 67.5 percent by the year 2000.
The Homeownership Zone aid will go to: Baltimore, MD -- $5.24 million in grants, $6.7 million in loan guarantees. Buffalo, NY -- $5 million in grants, $7.7 million in loan guarantees. Cleveland, OH -- $4.64 million in grants, $18 million in loan guarantees. Louisville, KY -- $4.6 million in grants, $5 million in loan guarantees. Philadelphia, PA -- $5.52 million in grants, $18 million in loan guarantees. Sacramento, CA -- $5 million in grants, $5.4 million in loan guarantees.
"Homeownership Zones will turn back the clock on urban decay, returning vitality to inner cities after decades of decline," Cuomo said. "We will help neighborhoods that prospered in the first half of the 20th Century to achieve a new prosperity in the first half of the 21st."
"HUD's investment will serve as seed money to launch a successful partnership with state and local governments, homebuilders, non-profit groups, and the business community," Cuomo said. "Our investment will leverage greater investment by our partners, transforming urban wastelands."
Groups working with HUD to make the Homeownership Zones succeed include: The National Association of Homebuilders, Habitat for Humanity, the Enterprise Foundation, the Local Initiatives Support Corp., the Corporation for National Service (Americorps), Fannie Mae, Freddie Mac and other national and local groups. Each of these groups will make a different contribution to make homeownership in the zones more affordable, such as volunteer labor, technical assistance, low-interest loans, and a variety of mortgage products.
The six Homeownership Zones were selected by HUD from applications by 97 cities and counties in a nationwide competition.
Expenses such as the purchase of land and infrastructure improvements can be funded with HUD's Homeownership Zone assistance. This will effectively cut costs for families buying homes and for retailers and other businesses setting up shop in the zones, increasing the attractiveness of the areas.
The Homeownership Zone program will implement concepts of the New Urbanism, a type of urban planning that makes the neighborhood the focal point of planning and development. The New Urbanism principles that will be promoted by HUD and its partners in the Homeownership Zones include: defined neighborhoods of limited size; flexible zoning standards to allow a mix of compatible uses, along with a mix of housing styles and levels of income; public parks and gathering space; historic preservation; mass transit connections; and pedestrian-friendly streets and walkways connecting the neighborhood to the surrounding area.
Here is how cities will use Homeownership Zone investments: