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City seeks funds to rehab foreclosed properties

By Mark Wineka
mwineka@salisburypost.com
The city of Salisbury will apply for up to $5 million in federal funds designated to help communities buy and redevelop foreclosed properties.
Salisbury City Council approved Tuesday making an application for a Neighborhood Stabilization Grant, part of a $3.92 billion program authorized last year by the Housing and Economic Recovery Act.
North Carolina will receive $52.3 million of the money, and Rowan County has been identified as one of 23 “greatest needs” counties in the state.
The greatest-needs counties were identified based on a statewide analysis of foreclosures, subprime lending activity and delinquencies.
Rowan County fell into a needs category where 1,000 to 2,999 foreclosure starts were made between January 2007 and June 2008.
Cabarrus, Iredell and Davidson fell into the same category and are included in the 23 greatest-need counties.
Any local government in one of the 23 targeted areas is eligible to apply for the grant money.
City officials think they stand a decent chance to receive one of the grants, expected to range between $2 million and $5 million.
Councilman Mark Lewis said the city has the structure in place to hit the ground running if a grant application were approved. He said it would represent a jobs program, helping a local real estate industry that has been hit hard.
“This is big for Salisbury,” Lewis said.
Mayor Susan Kluttz said with the combination of Senior City Planner Janet Gapen, the Salisbury Community Development Corp. and citizens who are supportive of efforts to provide better housing, “the potential is really exciting.”
Projects funded by the Neighborhood Stabilization Grants must be sold to individuals and households whose incomes do not exceed 120 percent of area median income, and 30 percent of all funds must help households whose incomes do not exceed 50 percent of area median income.
Gapen said the median income in Salisbury for a household of four is $75,000.
The city would partner with the non-profit Salisbury Community Development Corp., which routinely purchases and rehabilitates houses and builds new homes in targeted areas for first-time homebuyers.
The CDC also helps in down-payment assistance and homebuyer education and, since the Pillowtex closings in 2003, the CDC has been providing counseling for laid-off workers in efforts to help families avoid foreclosures.
City Manager David Treme said work done previously by the city in developing a comprehensive housing plan and housing-related efforts by the Community Appearance Commission and the CDC will help the city in a competitive application process.
Kluttz said it’s why the city does a lot of planning sometimes, even though the money isn’t immediately available.
Gapen said probably eight to 15 local agencies will be selected for the grants. The deadline for applications is Feb. 3, with awards expected to be announced by Feb. 16.
Gapen will attend a N.C. Division of Community Assistance workshop later this month that will include information on how to apply for the grants.
Neighborhood Stabilization Grants are seen as an adjunct to the Community Development Block Grant Program from which the city receives annual funding. The new grants are considered emergency assistance to local governments for buying and redeveloping foreclosed properties that might otherwise fall victim to abandonment and blight, Gapen said.
The money also could be used for demolition of blighted structures and redevelopment on vacant sites.
Council held the first of two public hearings on the program Tuesday.
William Peoples of North Fulton Street expressed his support for the grant application. He said he has helped the city in the past target areas for redevelopment. The grant could be a great opportunity to help people who have run into misfortune, he said.
Lou Manning, who has long been active in the Park Avenue Redevelopment Corp., said the program would be tailor-made for that neighborhood. Many properties have been turned around in the Park Avenue area, but others are in danger of being foreclosed on, Manning said.
He added that he hated to see houses “given away” at foreclosure sales and hopes properties that fall victim to foreclosure could be rehabilitated and sold to people who will live in the homes.
Barbara Perry, who has headed the Community Appearance Commission, noted that since 2006 the Neighborhood Alliance (an offshoot of the commission) has focused on deteriorating housing and sees addressing it as the city’s greatest need.
The grant could make “a huge dent” in addressing homes left vacant through foreclosures, Perry said.
Bill Safrit, a member of both the Community Appearance Commission and Neighborhood Alliance, said the extra grant money “is something that is really needed.”
Safrit said he and former Mayor Sonny Allen recently took an all-day tour of Salisbury’s neighborhoods. They were amazed at the number of abandoned houses in the city, Safrit said.
Councilman William “Pete” Kennedy, who operates a real estate business, said Congress should be thanked for putting some money back into communities, not companies. He also commended the CDC for its work in helping people avoid foreclosures.
Contact Mark Wineka at 704-797-4263.

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