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Of little use to Buffalo

Mike Clarke, one of region's bright lights on housing issues, reports some disappointing news related to the bill just passed by the Senate and House that provides, among other things, $4 billion to urban areas stressed by housing foreclosures.

Here's a story by Politico.com and an analysis by Dealbreaker.

Passage of the bill had raised hope in some quarters that Buffalo could be in line for a decent amount of coin to help with its housing vacancy problem. Sen. Chuck Schumer said he expects to use the bill to help push for an additional $10 million for Buffalo to help with vacant housing, according to this report from a WGRZ-TV.

Clarke said he learned that the bill isn't designed to help cities with plain old vacancy problems, however.

Here's what Clarke, executive director of the Buffalo office of the Local Initiatives Support Corp., had to say:

"I just went through an exercise with our Federal policy people on the new legislation that passed the House, Senate and will get the president's signature. I asked about what the formula was for distribution of the money. They told me that HUD must devise a formula to be based off the criteria listed below: 

CRITERIA -- The funding formula required under paragraph (1) shall ensure that any amounts appropriated or otherwise made available under this section are allocated to States and units of general local government with the greatest need, as such need is determined in the discretion of the Secretary based on:
(A) the number and percentage of home foreclosures in each State or unit of general local government;
(B) the number and percentage of homes financed by a subprime mortgage related loan in each State or unit of general local government; and
(C) the number and percentage of homes in default or delinquency in each State or unit of general local government.

"I then asked if I read this correctly and that foreclosures and defaults will be what gives weight to the distributions. If so, it is possible that a city like Buffalo, where foreclosure has been a relatively smaller problem (so far anyway) than the large and increasing numbers of vacant houses, will see less than they would have hoped for.
"The answer was yes, unfortunately. Vacancy didn't make it into the formula."
To repeat: "Vacancy didn't make it into the formula."
Here is LISC's analysis of the bill.

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Housing
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