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Aid For Housing Surprises Officials

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By KEVIN WIATROWSKI

kwiatrowski@tampatrib.com

Published: October 18, 2008

With thousands of foreclosed houses littering its landscape, Pasco County is eligible for nearly $20 million in federal aid - the fifth-highest grant in Florida.

The $19.5 million grant is part of the Neighborhood Stabilization Program, a $4 billion fund created this year by the federal government. The program, administered by the Department of Housing and Urban Development, aims to help local governments deal with their declining housing stocks.

Elsewhere in the Tampa Bay area, Hillsborough County will get $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.

The size of Pasco's grant shocked county officials.

"We knew foreclosures were a problem," said George Romagnoli, head of the county's Community Development office. "We expected to get about $4 million."

Romagnoli's office disburses federal and state housing money and helps low-income people qualify for mortgages.

The grant was allocated based on the number of foreclosures, vacant properties, delinquent and subprime mortgages in a given area. Pasco now has up to 5,000 homes in foreclosure and more than 1,500 more in default, Romagnoli said.

County commissioners will consider signing on with the grant program when they meet at 10 a.m. Tuesday at the West Pasco Government Center in New Port Richey. Romagnoli will present commissioners with an outline of how the county will spend the money.

Pasco could begin spending its grant early next year after federal officials approve the spending plan, Romagnoli said.

Under federal rules, the county has 18 months to commit the funding to projects and four years to spend the money.

The list of potential uses for the grant includes buying, rehabilitating and reselling foreclosed homes; helping potential homebuyers with down payments; demolishing eyesore properties when needed; and providing housing for handicapped people and others with special needs.

"We want to make sure this money moves," Romagnoli said during a recent interview.

The county will up the ante by adding $6 million of its own money to the federal funding.

Strings attached to the federal aid dictate that, among other things:

•Aid recipients can make up to 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 under 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.
Romagnoli said his office will work with real estate agents and nonprofit groups in the area to find, buy and rehab foreclosed or abandoned houses. He has set his sights on houses that cost less than $60,000 and those in such bad shape that they're unsellable through conventional means.

He expects to spend the bulk of the funding in west Pasco communities such as Embassy Hills and Regency Park, where subprime-related foreclosures have hit the hardest. Other hard-hit areas, such as Holiday and Wesley Chapel, also could see funding.

"We want to target the worst of the worst," Romagnoli said.

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

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