Proposal would help 12 major cities rebuild communities; HUD decision could come by Dec. 1

LANSING, MI – Federal authorities are considering a $290 million proposal by the Michigan State Housing Development Authority (MSHDA) to launch the “New Michigan Urban Neighborhood” plan, an unprecedented effort to remove blight and revitalize neighborhoods in 12 of the state’s largest municipalities ­– Detroit, Highland Park, Hamtramck, Wyandotte, Flint, Saginaw, Pontiac, Lansing, Battle Creek, Kalamazoo, Grand Rapids, and Benton Harbor.

The U.S. Dept. of Housing and Urban Development (HUD) may announce a decision on MSHDA’s request by Dec. 1, 2009.  Michigan is among hundreds of agencies nationally competing for nearly $2 billion in federal funds to combat the effects of home foreclosures, vacancy and abandonment. The “New Michigan Urban Neighborhood” plan marks the first time in its 43-year history that MSHDA has sought HUD funding through a coalition that includes city government partners and eight of the state’s most progressive land banks. MSHDA would allocate the funds to acquire and redevelop more than 6,000 foreclosed, abandoned and vacant properties in Michigan, demolish 2,500 structures and rehabilitate or build 1,500 homes.

“The 21st century demands regional collaboration on an unprecedented scale,” said MSHDA Executive Director Keith Molin. “Our proposal shows we are working together to overcome division because we understand that all Michigan communities have a shared stake in developing the assets of our urban centers.” 

The “New Michigan Urban Neighborhood” plan includes funding to:

• Battle Creek and the Calhoun County Land Bank Authority ($10 million)
• Benton Harbor and the Berrien County Land Bank Authority ($18 million)
• Detroit and the Michigan State Land Bank Fast Track Authority ($52.85 million)
• Flint and the Genesee County Land Bank Authority ($32.5 million)
• Grand Rapids and the Michigan State Land Bank Fast Track Authority ($20.15 million)
• Hamtramck and the Wayne County Land Bank Authority ($18 million)
• Highland Park and the Wayne County Land Bank Authority ($18 million)
• Kalamazoo and the Kalamazoo County Land Bank Authority (($18.5 million)
• Lansing and the Ingham County Land Bank Authority ($22.5 million)
• Pontiac and the Michigan State Land Bank Fast Track Authority ($18 million)
• Saginaw and the Saginaw County Land Bank Authority ($22.5 million)
• Wyandotte and the Wayne County Land Bank Authority ($10 million)

The plan calls for the Michigan Land Bank Fast Track Authority to provide land bank services in three areas of the state until local land banks are established or defined, including the City of Detroit and the new Detroit Land Bank, Pontiac and Oakland County, and Grand Rapids and Kent County.

“Michigan is recognized nationally as among the leaders of successful land bank development efforts,” said Dan Kildee, chairman of the Genesee County Land Bank. “This coordinated proposal between municipalities and land banks is an innovative response to the challenges currently facing Michigan. We can restore hope and prosperity to communities hardest hit by the recession if we focus the unique resources of our cities and counties on strategically important neighborhoods.”

MSHDA is among hundreds of applicants across the United States vying for up to $1.93 billion in funding through HUD’s Neighborhood Stabilization Program 2 (NSP2), which was authorized under the American Recovery and Revitalization Act (ARRA) of 2009. NSP2 continues the efforts initiated under the Housing and Economic Recovery Act (HERA) of 2008. The major difference is that rather than being allocated on a formula basis to states and cities, NSP2 funds will be awarded through a national competition of states, local governments and nonprofits.

Michigan received one of the nation’s largest single allocations of HUD funds under NSP1. Local government officials and state leaders participating in the New Michigan Urban Neighborhood coalition said they hope to duplicate the accomplishments that came from NSP1 projects. To learn more about NSP1 projects in Michigan, go to http://www.michigan.gov/mshda/0,1607,7-141--217713--,00.html.

“Michigan citizens are changing how they do business and find work during the economic recovery,” said Michigan Land Bank Fast Track Authority Executive Director Carrie Lewand-Monroe, . “This plan shows that Michigan’s government and civic leaders are teaming with MSHDA to change the role of neighborhoods and support the new Michigan economy.”

The Michigan State Housing Development Authority is dedicated to building a thriving and vibrant future for Michigan. MSHDA provides tools and resources to improve people’s lives through programs across the state. These programs assist with housing, build strong neighborhoods, and help create places where people want to live and work. MSHDA’s programs work in four areas: affordable rental housing; supporting homeownership; ending homelessness; and creating vibrant cites and neighborhoods.*

*MSHDA’s loan and operating expenses are financed through the sale of tax-exempt and taxable bonds as well as notes to private investors, not from state tax revenues. Proceeds are loaned at below-market interest rates to developers of rental housing, and help fund mortgages and home improvement loans. MSHDA also administers several federal housing programs.

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