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Pasco OKs Housing Help

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By KEVIN WIATROWSKI

kwiatrowski@tampatrib.com

Published: November 26, 2008

DADE CITY - Pasco County will put $9 million into buying and rehabilitating homes in areas hard-hit by the banking and foreclosure crisis during the next four years. Another $6.5 million will go toward down payment help.
County commissioners approved a revised plan Tuesday for spending $19.5 million in federal housing funds earmarked for Pasco based on the amount of foreclosures and subprime loans in the county. Pasco received the 17th-largest allocation in the country.

Elsewhere in the Tampa Bay area, Hillsborough County qualified for $19.1 million, and Tampa will get $13.6 million. Pinellas County and St. Petersburg got a combined $17.5 million.

Florida, which ranked second in the nation in the number of foreclosure filings in August, is expected to receive $541 million through the program, according to state officials.
Pasco County has nearly 9,000 homes for sale. About 20 percent of them are in foreclosure.

Regions of the county targeted for help include much of the U.S. 19 corridor south of State Road 52, the 33545 ZIP code in Wesley Chapel and most of eastern Pasco County. Money won't be available for the cities of Port Richey, Dade City and Zephyrhills because they don't participate in the county's Community Development Block Grant program.

Beyond rehabilitation and down payment help, the money will be used to rent housing to special-needs individuals, to build low-income housing and to demolish blighted homes.

The spending plan, which still must be approved by the U.S. Department of Housing and Urban Development, represents a shift from county commissioners' demand last month that 90 percent of the money go into down payment help. HUD refused to support that approach, George Romagnoli, head of the county's Community Development Division, told commissioners.

The new plan allocates 46 percent of the funds for fixing foreclosed, abandoned and distressed houses. Romagnoli has said the money will target "the worst of the worst" houses, leaving the real estate market to handle the rest.

The money will be loaned to nonprofit agencies to buy and rehabilitate targeted homes, which will then be sold - potentially to people using down payment help from the same program.

It's still not clear if the revised proposal will pass muster with HUD, Romagnoli said. More changes are possible after the proposal goes to the government Monday, he said.

The aid does come with strings:

•Aid recipients can make as much as 120 percent of the local median income. In Pasco, that means a family of four making as much as $67,800 could qualify for help.

•At least a quarter of the money must be spent helping people who make less than 50 percent of the median household income - $28,250 for a family of four.

•Houses must be bought at a 15 percent discount from their appraised value.

The revised proposal didn't sit well with the county's real estate agents. They pressed commissioners to allocate more for down payment help and to appoint a committee to oversee how the money is spent. Commissioners declined to consider either option.

"They ignored everything that we requested today," Greg Armstrong, president of the West Pasco Board of Realtors, said after the vote.

Armstrong questioned the government's ability to manage the housing money as efficiently as the free-market could. He derided the county's existing rehabilitation program as too slow to stanch the tide of foreclosures.

He said his group will continue to press commissioners to shift more money toward down payment help as the program evolves.
Romagnoli said he chose to put the largest portion of the $19.5 million into the county's housing rehabilitation program - Pasco Opportunity Program, or POP - because of its track record.

"I know the POP program produces," Romagnoli said after the vote.

Reporter Kevin Wiatrowski can be reached at (813) 948-4201.

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