New NSP funds to become available

U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan announced that the Obama Administration will work with Congress to find ways to help state and local governments more effectively combat the ongoing effects of the housing crisis and home foreclosures through additional funding for the Department’s Neighborhood Stabilization Program (NSP) and foreclosure prevention counseling. 
 
The Administration also announced plans to reallocate funds awarded through NSP1 that have not yet been committed to specific projects, in order to drive more funding to hardest hit communities. HUD has already awarded nearly $6 billion in NSP grants to help state and local governments respond to rising foreclosures and falling home values: $4 billion funded NSP1 through the Housing and Economic Recovery Act of 2008 (HERA); and, an additional $2 billion funded NSP2 through the American Recovery and Reinvestment Act of 2009 (Recovery Act). The initial NSP1 funds provided each state government with a “base allocation” of $19.6 million, without regard to varying degrees of need. Eighteen months later, the Department will recapture money from communities that have not yet committed NSP1 funding, and reallocate it to city and county governments with very high foreclosure and/or vacancy rates and their jurisdiction, based on more recent data.
 
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