WASHINGTON, D.C. — Today, U.S. Sen. Sherrod Brown (D-OH) announced that $10,118,750 in Hardest Hit Funds (HHF) have been awarded to Cuyahoga County to demolish vacant and abandoned properties. In August 2013, the U.S. Department of the Treasury approved the Ohio Housing Finance Agency’s (OHFA) proposal to use $60 million of the state’s nearly $375 million remaining HHF to demolish vacant and abandoned properties. Part of the Neighborhood Initiative Program (NIP), these funds represent a portion of the $570 million in Ohio HHF that Brown helped secure in 2010 as a member of the Senate Committee on Banking, Housing, and Urban Affairs.

“These demolition funds are a critical step forward in rebuilding Northeast Ohio neighborhoods devastated by the housing crisis,” Brown said. “Our local communities need more resources to address the scourge of blighted properties that undermine surrounding property values, drain local resources, and threaten the safety and security of our neighborhoods. The Neighborhood Initiative Program will go a long way towards meeting that need and stabilizing local neighborhoods.”

NIP is available to Ohio counties with established land banks. The Cuyahoga County Land Reutilization Corporation is one of 11 land banks receiving first round funds through the program, including: 

  • City of Canton: $4,235,000
  • Central Ohio Community Improvement Corporation: $5,825,000
  • Cuyahoga County Land Reutilization Corporation: $10,118,750 
  • Lucas County Land Reutilization Corporation: $6,000,000 
  • Lorain County Port Authority: $3,005,000 
  • Mahoning County Land Reutilization Corporation: $4,266,250 
  • Montgomery County Land Reutilization Corporation: $5,055,000
  • The Port of Greater Cincinnati Development Authority: $5,065,000  
  • Richland County Land Reutilization Corporation: $773,750
  • Summit County Land Reutilization Corporation: $2,000,000 
  • Trumbull County Land Reutilization Corporation: $3,221,250

In August 2013, the Treasury Department approved OHFA’s proposed use of $60 million in HHF to be used towards demolitions. This decision came less than three weeks after Brown wrote to Treasury Secretary Jacob Lew urging the Treasury Department to provide Ohio communities with the resources necessary to address blighted properties. In his letter to Treasury Secretary Jacob Lew, Brown explained that, while foreclosures have fallen from more than 89,000 in 2009 to more than 70,000 in 2012, there are still 100,000 blighted properties that continue to threaten Ohio’s neighborhoods at the cost of local governments and entities. According to the Government Accountability Office (GAO), vacant properties reduce the value of a nearby home by 0.7 to 10.0 percent. 

HHF has provided OHFA with more than $570 million in funds that can be used in a flexible manner to address Ohio’s local housing issues. With the current allocation of NIP funds, almost $250 million will have been spent on a variety of programs that help Ohioans stay in their homes, including direct assistance to borrowers and help for local housing counselors to assist homeowners. Of the more than 10,000 Ohioans who have received assistance to date, the overwhelming majority have been able to remain in their homes. Less than one-half of one percent of participants has lost their homes through a sheriff’s sale.

In June 2013, Michigan was the first state to receive approval to dedicate a portion of its HHF to demolish vacant and abandoned properties. In June, Brown urged Governor Kasich to balance the important needs of housing counseling and foreclosure prevention resources with the need to demolish vacant and abandoned homes that have blighted communities. In 2012, Brown wrote to the Treasury Department and the Department of Housing and Urban Development (HUD) urging them to allow Ohio flexibility for demolition.

As a member of the Senate Committee on Banking, Housing, and Urban Affairs, Brown is a longtime champion of foreclosure mitigation efforts. When the Senate passed a housing bill in 2008, Brown successfully passed an amendment that provided an additional $80 million in mortgage counseling funds. When Ohio was not among the initial five states included in the Help for the Hardest-Hit Housing Markets (4HM) program when it was launched in February 2010, Brown made direct appeals to President Obama and then Treasury Secretary Geithner to dedicate additional funds for this program. At the behest of Brown, the 4HM program, which uses leftover funds from the Troubled Asset Relief Program (TARP) passed in 2008, was expanded in March 2010 to cover Ohio

Despite the success of HHF in Ohio, many communities have expressed the need for flexibility in how the funds are spent, including an allowance for demolition of vacant and abandoned homes. In 2009 and 2010, Brown helped secure more than $484 million in demolition funding through the three rounds of the Neighborhood Stabilization Program (NSP).

###