HUD funding to support housing, small business, and infrastructure programs
WASHINGTON – September 24, 2008 – (RealEstateRama) — U.S. Housing and Urban Development Secretary Steve Preston today accepted an $85 million disaster plan from the State of Iowa to recover from severe storms, tornadoes and flooding earlier this year. Iowa intends to use the funding provided through HUD’s Community Development Block Grant (CDBG) funding to restore damaged and destroyed housing, to stimulate small business recovery, and to repair public infrastructure.
“These funds will help stimulate Iowa’s housing market and small business community which are trying to recover from these terrible storms,” said Preston. “I want to assure all Iowans that HUD will work very closely with Governor Culver and his recovery staff to expedite this long-term recovery process as much as humanly possible.”
Last month, HUD allocated $85 million in supplemental CDBG funds to Iowa to support the State’s long-term disaster recovery and critical infrastructure needs. The State of Iowa’s recovery plan will target this CDBG funding to the following activities:
Housing repair/rehabilitation, homebuyer assistance and interim mortgage assistance – Iowa will commit $35 million to homeowners to make needed repairs to their damaged properties. Households whose homes were destroyed or damaged beyond reasonable repair will be offered downpayment assistance for replacement homes under this program. Homeowners facing default or foreclosure may also be eligible for mortgage assistance if they are eligible for buyout assistance.
Housing buyouts – Iowa will devote $20 million in CDBG funding to meet the Federal Emergency Management Agency (FEMA) 15 percent local match for home buyouts in flood-prone areas.
New housing production – $5 million will be allocated to developers of new affordable rental and owner-occupied housing in disaster-declared counties. This assistance may also be used for streets, sewer and water extensions linked to development of replacement housing.
Small business stimulus – $10 million will be offered to small business owners in the form of forgivable loans up to $50,000. These loans will provide working capital to help ensure businesses re-open within 12 months of receipt of this assistance.
Public infrastructure – The State of Iowa plans to allocate $10.75 million in public infrastructure projects that FEMA or other sources cannot fund, but are nevertheless critical to the State’s recovery. These projects may include repairing damaged water and sewer systems, storm drainage, levees, roads and bridges.
HUD is currently waiting to receive the disaster recovery plans from Indiana and Wisconsin and will review them as quickly as possible. In addition, HUD will shortly make $200 million in additional allocations to Midwestern States when the Department completes a more thorough study of each state’s unmet needs.
HUD is the nation’s housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation’s fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.