Hernando County is preparing a spending plan for a federal windfall of housing aid that correctly resists temptations to appease special interests and instead focuses on battling neighborhood blight from unoccupied houses.
The county is developing a proposal for investing $5.6-million expected from the federal government in two separate allocations, part of the $91-million made available to Florida communities that did not receive earlier grants to address residential foreclosures. This week, commissioners indicated no desire to go into the housing business by buying up homes, fixing and reselling them. That is understandable given the shrinking size of county government.
However, it would be imprudent to simply squander this aid in some sort of misguided real estate agent relief act by funneling too much of the money into a down payment assistance program. In other locales, Realtors have championed this approach as a better way of moving buyers into foreclosed homes. Left unsaid is the ability also to collect more commissions as well.
Pasco County's attempt to follow such a recommendation met resistance from HUD, which kicked that county's plan back for a rewrite. Hernando County already is learning from that mistake. At a Tallahassee briefing this week, the state Department of Community Affairs detailed what is and is not allowable.
Since Hernando County doesn't have the wherewithal to go into the housing business on its own, it should look for a non-profit agency with which it can partner. Habitat for Humanity or the county or city of Brooksville housing authorities are likely candidates because the rules require five years of experience in housing programs. Tapping that expertise also is imperative because of tight time constraints — the money must be put to use within 10 months.
Under the scenario, nonprofit agencies acquire abandoned or blighting housing, the county oversees rehabilitation work and the redeveloped home is sold to qualifying homeowners of moderate income levels. The benefits are numerous. Nonprofits gain from the higher resale price or an administrative fee. Local contractors and tradesmen are put to work on the remodeling jobs — something commissioners should be eager to endorse in light of the county's high jobless rate and the commission's stated interest in stimulating local employment. Meanwhile, abandoned or foreclosed housing stock is improved and families that had been renters are eligible to become homeowners.
Hernando staffers are expected to deliver recommendations to commissioners by late January or early February. The overall state plan still must pass muster with HUD. Federal officials are expected to scrutinize how the state devised its allocations.
Under the state plan, for instance, Hernando's allocation is nearly twice as large as the federal allotment for Fort Myers, which had a local foreclosure rate of 12.4 percent —1.5 times the statewide average. Hernando, however, has significant problems of its own. On a percentage basis, its year-to-date foreclosure filings, 1 of every 16 households, are the highest in the Tampa Bay metropolitan area, according to the real estate service RealtyTrac.
There is much work to be done in a short amount of time. County staffers plan to meet in the coming days with real estate agents, builders and lenders to devise its plan while also identifying suitable vacant properties. If the commission concurs, the county will need to partner with a nonprofit and allow it to hire outside contractors at reasonable prices to do rehabilitation work and market the properties to qualified buyers meeting income guidelines.
The tasks are many, but the investment is worthwhile and will benefit local neighborhoods and families needing affordable housing.