Neighborhood Stabilization Program

Overview

The Neighborhood Stabilization Program (NSP) is authorized under Title III of the Housing and Economic Recovery Act of 2008 and administered by the U.S. Department of Housing and Urban Development (HUD).  HUD has awarded Washington State Department of Commerce (Commerce), formerly Community, Trade and Economic Development, a total of $28,159,293 to establish and implement the NSP program in Washington State.  Commerce distributed funds to CDBG entitlement jurisdictions based on the greatest percentage of home foreclosures, highest percentage of homes financed by a subprime mortgage related loan, and most likely to face a significant rise in the rate of home foreclosures.  Based on this information, Snohomish County will receive $2,313,822.   Snohomish County has awarded $2,198,131 to three projects listed below.  Five percent of the funds ($115,691) will be used to administer the program.

Eligible housing activities include:

• Create financing mechanisms to purchase and redevelop abandoned and foreclosed properties through soft-second loans, loan loss reserves and shared-equity loans;
• Purchase and rehabilitation of abandoned and foreclosed homes and residential properties to re-sell, rent or redevelop
• Establish and operate land trusts;
• Demolish blighted structures; and 
• Redevelop demolished or vacant properties (as housing).

The intended beneficiaries of the NSP funds are low- to middle-income households up to 120% of the area median income who reside in Snohomish County outside the Cities of Bothell and Everett, including tribal members and non-tribal households living on tribal land.  The City of Everett will receive its own share of NSP funds from CTED and the City of Bothell is part of the King County CDBG Consortium.  Approximately twenty-six percent of the funds ($608,901) must benefit households at or below 50% of the area median income.

Snohomish County submitted a Neighborhood Stabilization Program Plan (80 kb) to Commerce for the use of the NSP funds in April 2009.  Snohomish County conducted a Request for Proposal process with applications due June 12, 2009.  The County received 8 applications requesting a total of $7.25 million.  The NSP Advisory Committee made up of representatives from local jurisdictions, housing authority, financial institution and housing developers met on July 29th to review applications, hear applicant presentations and make funding recommendations.  The Executive and County Council approved the recommendations in early August.  Contracts will be executed with agencies in the fall.  Funds must be obligated to specific activities within 18 months (by September 20, 2010) and expended in four years (March 20, 2013); unobligated funds are subject to be returned to HUD for reallocation.  Tracking of program income and monitoring of projects will continue through July 30, 2013.

2009 NSP Awards

• Housing Authority of Snohomish County
  Marysville Multi-Family New Construction:  $992,348.
  To acquire two foreclosed properties in the City of Marysville.  HASCO will use other funds to construct 19 units of affordable rental housing for low-income families up to 80% of the area median income.

• Home for Good
  Post Foreclosure and Rapid Re-housing:  $632,905.
  To acquire four to five foreclosed single-family homes located in Snohomish County outside the Cities of Everett and Bothell.  The homes will be used as affordable rental housing for low-income families up to 80% of the area median income with a priority for families who have been foreclosed upon.  Home for Good plans to work with the families to stabilize their income and work towards lease-to-own in three to five years.

• Washington Home of Your Own
  In-Home Community Living:  $572,878.
  To acquire two foreclosed single-family homes located in unincorporated south Snohomish County.  The homes will be used as affordable rental housing for up to 6 very low-income persons with mental, physical and developmental disabilities with incomes at or below 50% of the area median income.  In-home support services will be provided to the residents by Sunrise Community Services.

For Additional Information:

Email Dean Weitenhagen, or call (425) 388-3267

Email Jacqueline Toma, or call (425) 388-3259

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