Some indirect federal help is on the way for those Illinois homeowners and municipalities who've become collateral damage in the foreclosure crisis. An additional $170 million worth of federal aid is headed for 13 Chicago-area cities and counties to help local authorities and moderate-income folks to buy up or repair a glut of foreclosed properties that have become a drag on local property values.
The money, which was approved in July through the Housing and Economic Recovery Act, will be divvied up in the form of grants for rehabbing or buying abandoned and foreclosed properties in the following areas. Here's the list:
Aurora, $3 million
Chicago, $55.2 million
Cicero, $2.1 million
Cook County, $28.2 million
DuPage County, $5.2 million
Elgin, $2.2 million
Joliet, $3.5 million
Kane County, $2.6 million
Lake County, $4.6 million
McHenry County, $3.1 million
Rockford, $2.3 million
St. Clair County, $2.3 million
Will County, $5.2 million
Some may remember that it was this program that led GOP Rep. Peter Roskam to ask: Do you want Rod Blagojevich to be your landlord?" In response to Roskam's fear-mongering about the bill, Adam explained that the governor would have little control over the funds doled out to each of these municipalities:
Essentially, once a state decides it wants to participate in the program, it solicits applications from local government authorities. State officials then decide how to distribute funds among communities in non-entitlement areas and ensure that recipient communities comply with applicable state and federal laws and requirements, but they have no hand in running the programs. That responsibility rests on local officials, who must "consider local needs ... and carry out the funded community development activities." While the state can accept some administrative and technical assistance expenses, they may not exceed three percent of the total allocation.
As we noted yesterday, property values have become a growing concern among homeowners across the region, who in many cases, are watching the worth of their largest asset plummet. Based on some alarming figures released by the Chicago-based Woodstock Institute (WI), it's no wonder why they have the jitters.
During the first half of 2008 alone, the number of lender-owned properties, 10,000, in the Chicago area nearly matched a year-end total for 2007, which amounted to $2.5 billion dollars in actionable assets, WI reports. The numbers illustrate how the heighten fears of a foreclosure-initiated ripple effect of blight and crime, which are brewing in the region, aren't exactly alarmist.
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