Two years ago, we in the housing and community development field, began to notice the negative impacts of a sharp rise in foreclosures and vacancies in neighborhoods. To confront this problem, Enterprise, in partnership with Neighborworks, NHC, and other organizations, led the Save America’s Neighborhoods Coalition and worked with Congress to create the Neighborhood Stabilization Program (NSP). We were among the first to sound the alarm about the foreclosure crisis, and the past two years have sadly proven us correct. Foreclosures continue to ravage America’s neighborhoods, and the NSP funds are more important than ever.
Over its short history, NSP has undergone several modifications. We are proud to say that most of these changes, including an additional $2 billion for NSP2, resulted from an effective feedback mechanism by which practitioners on the ground communicate with advocates in Washington who work with staff at the U.S. Department of Housing and Urban Development (HUD) and in Congress. The result has been a much more workable and effective NSP.
However, NSP must still be improved. Redevelopment or rehabilitation of vacant properties cannot count toward the requirement that 25% of funds be spent on very low-income families. A simple legislative fix would allow localities to assist their very low-income populations with creative leveraging mechanisms such as LIHTC and other multifamily solutions. Similarly, HUD needs to permit the drawdown of sufficient funds to facilitate the use of loan loss reserve pools to better leverage NSP.
Therefore, as we implement NSP1, await the award of NSP2 and advocate for NSP3, we will continue to work with HUD and Congress to ensure that NSP is the most effective program possible. Our neighborhoods deserve nothing less.
Ali Solis is the senior vice president for public policy and corporate affairs for Enterprise Community Partners, a Housing Leadership Support partner of NHC. At Enterprise, Ali oversees the areas of public policy, communications, marketing and resource development.