For Ohio’s two U.S. senators, the federal Hardest Hit Fund hasn’t hit Ohio hard enough.
Both U.S. Sens. Sherrod Brown, a Democrat, and Rob Portman, a Republican, requested Republican Gov. John Kasich seek an agreement with the U.S. Department of the Treasury to use a portion of the $570 million in federal money the state received from the Hardest Hit Fund to demolish vacant and abandoned homes.
The Ohio Housing Finance Agency, which oversees the program for the state, already asked Treasury a few months ago to use $60 million of the state’s Hardest Hit Fund for demolition, said Douglas Garver, the agency’s executive director. Treasury said no last week.
Treasury approved a plan from the Michigan State Housing Development Authority on June 6 to use up to $100 million from its $500 million Hardest Hit Fund to demolish blighted structures in five cities.
Ohio will file another proposal soon for at least $60 million, probably more, using Michigan’s successful application as a guide, and is discussing the matter with Michigan’s HDA, the Ohio Attorney General’s Office, local land banks and others before applying, Garver said.
“Treasury opened the door for demo” by approving the Michigan proposal, he said.
The $7.6 billion Hardest Hit Fund, created in 2010, provides money to those losing their homes to foreclosure. Less than $2 billion has been spent nationally.
Of the $570 million awarded in September 2010 to Ohio, about $200 million has been spent. All of the money must be spent by Dec. 31, 2017, and Garver said even if none of the money goes toward demolition, Ohio’s $570 million allocation will be spent probably by 2016.
Portman introduced a bill last week, called the Neighborhood Safety Act, to enact a law permitting local governments and land banks to have access to money in the fund through the Ohio HFA for demolition and bypass getting permission from Treasury
“The legislative fix would make it easier,” Portman said.
The Portman proposal was warmly met by Youngstown Mayor Charles Sammarone and Warren Mayor Doug Franklin, both Democrats. There are about 4,000 to 5,000 vacant structures in Youngstown and about 1,000 in Warren.
On the conservative side, it would cost about $30 million to demolish all the vacant structures in Youngstown.
Portman and Brown stepped up their efforts Tuesday pointing to the Treasury’s approval of the Michigan request.
Brown is asking for “roughly 25 percent” of the unspent Hardest Hit money to go toward demolitions. Portman wants Kasich “to request as large of an amount as possible to be used for demolition purposes.”
But there is opposition.
The Coalition on Homelessness and Housing and the Foreclosures in Ohio Cost US [FOCUS] organizations object to the proposals. Bill Faith of the coalition points out that less than 25 percent of the $75 million demolition fund created last year by the Ohio Attorney General’s Office, created by the national mortgage settlement, has been spent for its intended purpose.
“It makes no sense to take money that’s working to stop unnecessary foreclosures and pour it into demolition when there’s already money available elsewhere for that,” Faith said.