City, county to receive federal funding to fight foreclosure
| Wednesday, Sep 08 2010 05:10 PM
Last Updated Wednesday, Sep 08 2010 05:10 PM
Allocations by the U.S. Department of Housing and Urban Development in the third round of Neighborhood Stabilization Program funding:
Bakersfield: $3.3 million
Kern County: $5.2 million
California: $149.3 million
Nation: $970 million
Bakersfield and Kern County government will receive millions of dollars in federal funding to address problems stemming from foreclosure, the U.S. Department of Housing and Urban Development announced Wednesday.
The city of Bakersfield was allocated about $3.3 million through the Neighborhood Stabilization Program, while Kern County will get about $5.2 million.
Nearly $1 billion, including $149 million for California, will be distributed nationwide to help local governments acquire, redevelop or demolish abandoned properties.
The grants are meant to improve real estate value in areas suffering from rampant foreclosure, HUD spokeswoman Donna White said.
The money can also be used to assist low- to moderate-income buyers in making down payments.
"The funding tries to reverse the negative effects of having foreclosed homes in the neighborhood," White said.
The grants are allocated based on an assessment of rates of foreclosure, subprime mortgage loans and delinquencies in a particular area.
Some causes of foreclosure -- unemployment, declining home prices and high-cost loans -- are also considered in distributing money to the "20 percent most distressed neighborhoods," according to a HUD news release.
"These communities have been targeted to receive this emergency assistance," White said.
Both the city and county received NSP assistance two years ago through the Housing and Economic Recovery Act. Bakersfield was given approximately $8.9 million, while Kern County accepted about $11.2 million.
But there's definitely still a need for the forthcoming aid, county housing programs manager David Press said.
"Foreclosure is still a big problem in Kern County as a whole," he said. "I don't think we'll have any trouble at all putting this money to use."
Press said the county has already obligated all of the money it was allocated in 2008, most of it being used on two separate housing projects.
About $3.2 million has allowed Golden Empire Affordable Housing Inc. to develop 14 properties into low-cost rental residences, Press said, some of which are expected to be made available in the next 60 days.
The second endeavor allocated $7.5 million to begin converting condominiums into a 94-unit affordable housing complex near the intersection of Fairfax Road and Eucalyptus Drive.
The county will seek public input regarding the forthcoming grant money once an action plan is written, Press said.
Officials at the city's Economic and Community Development Department could not be reached for comment Wednesday.
