Pasco seeks more housing aid

Pasco County has found it difficult to spend the $19.5 million in federal grant money for buying foreclosed homes, but that hasn't stopped the county from applying for an additional $29 million.

County officials were stunned last year to learn Pasco had qualified for the fifth-largest grant in Florida from the federal Neighborhood Stabilization Program. The funding is based on a county's foreclosures, vacancies and subprime loans. Pasco's foreclosures are climbing faster than the county's community development office can spend the money.

"We've spent $1.5 million so far, which is about $1.5 million more than anyone else in Florida," said George Romagnoli, community development director. "We have 10 nonprofits who are buying property."

The county recently submitted a joint application with Pinellas County for a combined $50 million for the second round of funding.

"Every census tract in the county, except for three, qualified for the funding," Romagnoli said. "In Pinellas, it was closer to 50 percent."

But spending the money has proved to be a challenge. In October, county commissioners restructured the spending plan to allocate $6.5 million toward homebuyer assistance - up from a staff recommendation of $4 million.

The original proposal would have spent the bulk of the money to buy and renovate foreclosed properties to make them sellable.

Commissioner Michael Cox led the charge to restructure the plan with an emphasis on down payment help. A certified financial planner, Cox estimated the $16 million originally planned for buying homes could be turned into $436 million in home sales if shifted toward down payments.

But Romagnoli said the county's efforts to direct the money to homebuyer assistance has been futile, primarily because banks aren't approving loans to the same "at-risk" borrowers who would qualify for the county's assistance. So far, only three homebuyers have received loans from the $6.5 million pool.

The county has until March 2013 to spend the money.

Commissioners agreed to re-evaluate the program after 10 months, and Romagnoli said the issue will be on the board's agenda in August. He wants to reallocate a portion of the money for buying foreclosed properties. The county and its nonprofit partners have bought about 35 foreclosed homes.

The county also plans to buy as many as 120 units at Sunset Bay Club, a retiree community in New Port Richey. The complex offered seniors the same type of living arrangements popular among college students - apartments where each tenant has a private bedroom and bathroom, but shares the living room, kitchen and dining area.

The county wants to lease the towers to nonprofit agencies to provide housing for their clients with special needs.

Finding foreclosed homes in east and central Pasco also has proved challenging because Zephyrhills, Dade City and much of Wesley Chapel was excluded.

East Pasco Habitat for Humanity is renovating a house near Dade City and has an offer on another house north of the city, executive director John Finnerty said.

"The lines were drawn using census tract data," Finnerty said. "We tried to buy a house, but it was one block outside of the census tract, so it didn't qualify."

That won't be the case when the second round of funding becomes available because most of the county is included in the grant application. The next round of grants will be announced in September.