Current Senate Bill Slashes HOME Investment Partnerships Program (HOME) Funding By More Than 90% From Fiscal Year 2015 Levels – Decimating Critical Funding Streams For Rochester
Cuts Put First Time Homeownership & Rehabilitation Programs, Neighborhood Revitalization Efforts, Public Facility Upgrades & Economic Development Projects All In Jeopardy
Schumer: Cuts Would Be Devastating For Rochester
WASHINGTON, D.C. – September 9, 2015 – (RealEstateRama) — Standing on Post Avenue in Rochester, U.S. Senator Charles E. Schumer today launched his push to fight steep funding cuts that have been proposed in the Senate Transportation, Housing and Urban Development (THUD) Appropriations bill that would negatively impact Rochester and Finger Lakes Region communities. Schumer explained that this cut would effectively decimate critical funding that Rochester relies on for home rehabilitation and ownership programs, neighborhood revitalization efforts and more. Schumer explained that the FY 2016 THUD bill, which was passed out of the Appropriations Committee, includes a drastic cut of over 90 percent to the U.S. Department of Housing and Urban Development’s (HUD) HOME Investment Partnerships Program (HOME). Specifically, this bill slashes HOME funding by more than $800 million. Schumer said these cuts could be devastating for Rochester and surrounding communities that depend on the HOME program as a pillar of local revitalization efforts.
“These cuts in Rochester would be incredibly damaging; they have the potential to devastate invaluable programs in vulnerable neighborhoods across the Rochester- Finger Lakes Region,” said Schumer. “That is why I am fighting these proposed cuts tooth and nail to make sure the HOME program remains fully funded. We need to make sure our local governments and communities have the resources they need to provide families and their children with safe and affordable housing options and can continue the neighborhood revitalization efforts that are critical to local economic development.”
Schumer explained that the City of Rochester uses HOME funding for first-time homebuyer incentive programs, affordable housing initiatives and neighborhood development efforts. The City of Rochester works with local organizations like the Greater Rochester Housing Partnership in order to administer its HOME Rochester program. Schumer said the non-profit organization, since 2002, has repaired and resold over 630 houses in the Rochester area thanks to HOME. Schumer said this federal funding is critical to communities like Rochester and devastating cuts could force them to scale back or even put an end to critical investments, housing projects, revitalization efforts and more that benefit low- and moderate- income families as well as create and retain local jobs.
During his visit, Schumer stood at 675 Post Avenue in Rochester, a former dilapidated house that was rehabbed by HOME Rochester and is currently being purchased by first-time homebuyer Shannon Singleton. Schumer explained this home was once run-down; its peeling paint and rotting wood left the home in a deteriorating condition and it was bringing down property values. After sitting vacant, it was purchased by HOME Rochester and local contractors were hired to repair and rehab the home. Schumer explained that, because houses like the Post Avenue residence are often in unsafe condition and need lead and asbestos remediation, along with new roofs, furnaces and other critical repairs, the high costs of rehabilitation often make it unaffordable to a potential buyer. However, the federal HOME program has provided the funding needed by HOME Rochester to help the organization pay to repair the 50 to 60 houses it rehabs each year and keep the purchase price affordable. According to the Greater Rochester Housing Partnership, if these funds are cut and no longer able to help fund significant portions of rebuilding costs and keep prices affordable, construction and rehabilitation efforts, like the one on Post Avenue, could be in jeopardy in the future. Therefore, Schumer said these types of programs would not be possible without the necessary federal funding.
The steep funding cuts to the HOME program would have a devastating effect on the low- and moderate- income families in the City of Rochester and across the Rochester- Finger Lakes Region who rely on them. Specifically, the proposed FY2016 THUD bill would reduce HOME program spending from its current level of $900 million for FY 2015 to just $66 million in FY 2016, an $834 million cut. Schumer said this reduction of more than 92 percent would effectively decimate the program. Schumer said this could mean even less will receive the critical funds many municipalities depend upon for neighborhood housing and development programs.
Schumer said that these cuts would effectively prevent state and local governments from building and rehabilitating affordable housing units. Schumer argued that reducing funding for vital low-income housing programs would dramatically reduce or potentially even eliminate the availability of many units. Because state and local governments rely on this HOME funding to offer and keep units affordable, the proposed cuts would put greater financial strain on the families who need these housing options the most, and potentially leave some of them without any safe housing options at all. Schumer said, if enacted, the HOME cuts would diminish much of the progress that has been made in the Rochester area to revitalize low- and moderate- income neighborhoods.
Schumer highlighted the fact that HOME program services could be in put on the chopping block and projects in Rochester halted if these funds were to be cut through the federal appropriation process. Schumer explained that, over the past five fiscal years (2010-2014), the HOME Rochester program has received $12,329,566 in federal HOME funds, including $1,707,050 in 2015 alone, for these kinds of projects. This $12 million investment has leveraged more than $370 million in additional investments – through mortgages, bank loans, private equity, etc. – to fix up houses, build new affordable housing units and educate first-time homebuyers. During the past five years, with the assistance of HOME funds, 720 new rental units were developed and another 609 affordable units were preserved. Schumer said if cuts are more than 92 percent on a national scale, this could be disastrous for localities that depend on this funding; the City of Rochester would receive just $125,416 in federal HOME funding under these cuts. Schumer said this vital Rochester area program would no longer be able to provide nearly as much funding to organizations like the Greater Rochester Housing Partnership to aid housing projects like the rebuilding of Shannon Singleton’s future home.
What’s more, Schumer said, is HOME Rochester program has many other projects that could suffer at the hands of a slashed HOME program. For instance, on the buyer’s end of the deal, HOME funding helps first-time homebuyers, like Shannon Singleton, purchase their first home through financial guidance and incentive programs. Since the HOME Rochester programs inception, 1,225 homebuyers have been assisted with down payment and closing cost assistance. In Rochester, the federal HOME funding supports buyer education programs run by local organizations like NeighborWorks, Urban League, Pathstone, and others, where prospective buyers receive help repairing their credit, if needed, and learn the ins and outs of home ownership to make them better long-term homeowners. Qualified buyers can also receive up to $6,000 in down payment assistance. Schumer said these critical programs would likely no longer be possible under these steep cuts.
Additionally, beyond the over 630 homes rehabbed by HOME Rochester since 2002, federal HOME funding has enabled the construction of thousands of new affordable housing units. Some examples include Rochester’s Pinnacle Apartments, Voters Block, Carriage Factory and Corpus Christi apartments – all of which are units that have benefited from HOME funding. HOME funding is also responsible for the redevelopment of Eastman Gardens; the project to renovate this historic building and create nearly 50 units of rental housing for low-income seniors is already underway. Schumer said the HOME program has been helpful in providing the funding to make these kinds of projects possible.
Finally, in addition to increasing property values through revitalization efforts – sometimes to the tune of $15,000 – Schumer said the HOME Rochester program helps generate further economic development by hiring local contractors. A study the organization did in 2010 revealed that $33.5 million was awarded to local contractors to do work. This created good-paying jobs for the local contractors, all of whom were based in Monroe County, and many of whom are minority- or women- owned small businesses. In fact, in 2010, 64 percent of construction contracts were awarded to minority- or women- owned firms in Rochester.
Schumer was joined by first-time homebuyer Shannon Singleton; HOME Rochester homeowners Franlyn Herrera, Sharon Brown, Alexander Morato and Daniel Diaz; Jean Lowe, President of Greater Rochester Housing Partnership; City of Rochester Housing Manager Carol Wheeler; City of Rochester Mayor Lovely Warren, and other local officials.
Jean Lowe President of Greater Rochester Housing Partnership which runs the HOME Rochester program said, “This staggering reduction in funding for one of the most critical sources of community development funding available to local government would have a dramatic and destructive impact on the development of affordable housing in Rochester and throughout the country. Since 2002 HOME funding has allowed us to rehabilitate over 630 vacant houses in the City of Rochester, get them back on the tax rolls, and sell them to new homebuyers. I appreciate Senator Schumer’s efforts to prevent this proposed reduction in HOME Funds.”
“I am grateful to Senator Schumer for fighting to prevent the proposed reduction in federal HOME funds,” said City of Rochester Mayor Lovely Warren. “Rochester’s poverty problem is well-documented, and these funds are crucial to our neighborhood revitalization and community development efforts. Such a drastic funding reduction will have a significant negative impact on our efforts to bring safer, more vibrant neighborhoods, more jobs and better educational opportunities to our city”.
HOME funds are distributed to villages, towns, cities and counties across the U.S. to fund housing and development projects. According to HUD, the HOME program provides grants to states and localities that communities use, often in partnership with local nonprofit groups like Greater Rochester Housing Partnership of Monroe County. These communities and organizations then fund activities such as building, buying and rehabilitating affordable housing units for rent or homeownership. HOME is the largest federal block grant provided to state and local governments designed exclusively to create affordable housing.
