Housing matters still sitting before county

March 22, 2009
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While the director of Kent County’s Community Development Department is waiting for $3.9 million in neighborhood stabilization funds to arrive from the federal government, Linda Likely is ready to apply for a second round of grants that also can be used to buy, rehab and sell foreclosed homes and demolish those that are beyond repair.

The first set of grants, which are expected to be distributed within a week or so, totaled $3.92 billion and came from a housing recovery bill Congress passed last summer. The second set will be worth $2 billion and comes from the stimulus bill Congress signed last month.

Likely told members of the county’s Finance Committee last week she would ask for funds from the second federal offering, but added that she hasn’t received details on when applications are due and how much the county can request.

“The need is probably greater now,” said Likely.

County commissioners will decide this week whether to let Likely’s office enter into an agreement with Lighthouse Communities Inc. The contract would give Lighthouse $40,000 toward providing affordable housing for eligible households in the county.

The money comes from the Department of Housing and Urban Development’s HOME Investment Partnership Program and is part of the county department’s budget. The dollars can be used to buy computers, hire staff, or for any other administrative function that is not tied to a specific project.

But HUD designates the areas where Lighthouse can rehab homes, and for this contract those houses can’t be located in Grand Rapids or Wyoming. The county contract would give Lighthouse two years to renovate three houses.

“We don’t want new construction,” said Likely.

With all the homes on the market and the foreclosure list, County Commissioner Dean Agee pointed out that a shortage of housing stock wasn’t an issue. Likely said just as housing got more affordable, many county residents lost their jobs — which created a different problem.

“Without HUD help, I don’t know how we get people in homes,” said Likely. “The housing is there and people can’t get in them. This money addresses that.”

Lighthouse was formed in 2000 and is considered a Community Housing Development Organization, a title that qualifies it for federal funding. The Inner City Christian Federation and Habitat for Humanity are also CHDOs.

Lighthouse has a $5 million budget this year and has invested over $20 million in housing and commercial development in the Southtown neighborhood of Grand Rapids. The firm is working with the city’s Community Development Department on the foreclosure problem in Southtown, one of the city’s hardest hit areas where mortgage defaults have topped 15 percent of all the houses in the neighborhood.

“There is an industry out there that is buying homes, fixing them up and selling them,” said County Commissioner Harold Voorhees.

Likely said the federal government has given the county plenty of latitude on how it can use the grant funds. She said the county can write off the repaired homes, which would reduce costs for buyers and renters.

In addition to the commission meeting Thursday, the county’s Finance Committee will hold a special meeting to review a funding request from Foreclosure Response for $50,000. Kim Spring, the group’s director, said the money would be used to update foreclosure statistics and develop a countywide plan to address the problem.

“It’s time to look for systemic change,” Spring told county commissioners. “We’re not going to do this on a piece-by-piece basis. We need to have a plan that is particular to Kent County.”

The Community Research Institute at Grand Valley State University reported that 5.5 percent of all homes in the county, more than 10,000, had been through the foreclosure process as of last June.

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