|HUD No. 00-345|
|Further Information:||For Release|
|In the Washington, DC area: 202/708-0685||Thursday|
|Or contact your local HUD office||December 7, 2000|
CUOMO AND RIORDAN LAUNCH NEW HOMEOWNERSHIP INITIATIVE
LOS ANGELES - U.S. Housing and Urban Development Secretary Andrew Cuomo and Los Angeles Mayor Richard Riordan today launched a multi-million dollar program that will accelerate the rehabilitation and resale of HUD-owned homes to more than 500 low- and moderate-income families annually in the Boyle Heights, Canoga Park, Highland Park, Pacoima and South Central sections of Los Angeles.
At a press conference today at City Hall,
Cuomo, Riordan, Los Angeles Attorney James Hahn and Enterprise Foundation
Chairman Bart Harvey announced that HUD has approved Los Angeles as one
of just a handful of cities across the country to establish an Asset Control
Area (ACA). The City, in partnership with the Enterprise
Foundation, will purchase all HUD-foreclosed homes in selected zip codes
at discounts of up to 50 percent of the appraised value. The City and its
partners will then rehabilitate and sell the homes.Cuomo told that gathering that HUD is providing
a $1 million grant to "jump start" the program. Moreover, HUD
will provide the City with discounts worth about $30 million annually.
"As the Secretary of Homeownership, I am always excited to partner with local governments that place a premium on increasing home ownership opportunities for low and moderate-income families," Cuomo said. "Homeownership is the surest way to build strong neighborhoods and strong cities. Thanks to the Mayors leadership, both the public and private sectors in Los Angeles are committed to creating cost-effective ways to give citizens an opportunity to own a piece of the American dream.""We look at neighborhoods in the Valley, the Eastside and the South Central today and see the future, a brighter future, one that includes safe streets, decent and affordable housing," Riordan said. "I believe we all have a right for peaceful places to raise children and a sense of community that comes from building a neighborhood together.""This project is an excellent example of what can be accomplished when local and federal government works with a non-profit organization dedicated to affordable housing," Hahn said. "This project not only will benefit the families who end up living in the rehabilitated homes, but it will eliminate the blight that these properties currently are causing in the neighborhoods where they are located."Under the ACA program, the City will purchase an estimated 564 foreclosed Federal Housing Administration-insured homes at discounts ranging from 30 to 50 percent, depending on the condition of the property and the required repairs. Any excess proceeds generated through the sales are reinvested back into the ACA program in other forms, including municipal improvements.To be eligible to purchase a single-family home under the ACA program, a family must use the home as its principal residence, have a household income no greater than 115 percent of the areas median income and participate in a homeownership counseling program. The Los Angeles program will focus on families with 60 to 80 percent of median income. Three- or four-unit properties can be purchased only by not-for-profit, community-based organizations. The Los Angeles ACA zip codes are: 90001, 90002, 90003, 90007, 90008, 90011, 90018, 90023, 90033, 90037, 90042, 90043, 90044, 90047, 90058, 90059, 90061, 90062, 90063, 91303, 91304 and 91331. The 22 zip codes comprise about 25 percent of the land area of Los Angeles, and have approximately 50 percent of all of the FHA-foreclosed properties in the city.In addition to HUDs estimated $30 million commitment, the City of Los Angeles will provide $7 million in HOME funds to the ACA Program and the Enterprise Foundation will contribute some $32 million from its loan fund, comprised of contributions from Bank of America, Broadway Federal Savings Bank, the California Community Foundation, California Federal, Fannie Mae, the Ford Foundation, Mellon First Business Bank, Merrill Lynch and Washington Mutual.The Enterprise Home Ownership Partners will handle the day-to-day operations, including buying, rehabilitating and reselling the homes. EHOP is a 501c(3) nonprofit corporation comprised of representatives from the City, the Enterprise Foundation, local lenders and other foundations."We look at neighborhoods like Boyle Heights, Pacoima and Canoga Park, Watts and South Central Los Angeles today and see the future, a brighter future, one that includes safe streets, decent, affordable housing, peaceful places to raise children and a sense of community that comes from building a neighborhood together," Harvey said.The Enterprise Foundation was founded in 1982 by James and Patty Rouse as a national nonprofit community development organization. It has sparked more than
$3 billion in private investments in U.S. cities and spurred development of more than 100,000 homes. In addition to his work with the Foundation, Rouse is also known for his innovative urban revitalization work at, among others, Baltimores Inner Harbor and Bostons Faneuil Hall.
In addition to Los Angeles, HUD has approved
ACA programs in Miami, Cleveland, Rochester, Ft. Lauderdale, Chicago and