“Bail out the People, not the banks!”

In two days, on November 20th, Detroiters will have their last chance to comment on how the City of Detroit will spend $47.1 million from HUD. “What?!” you say, that’s right because on November 21 it goes to City Council for a vote, then it’s off to HUD for a December 1 Action Plan submission.

So, here’s our quick review of this:

In July 2008, Congress passed the Housing and Economic Recovery Act to address the impact of foreclosures in communities hardest hit by the crisis. Later that month, new HUD Secretary Preston announced in Detroit, “the epicenter of the foreclosure crisis,” that the federal government was launching an aggressive foreclosure prevention assistance program to buy bad loans from lenders. The following month, the Detroit Economic Growth Association hired staff and opened the Office of Foreclosure Prevention to ready itself for these funds. [We can’t find its website or location!]

Meanwhile, the Detroit Planning and Development Dept, developed a Neighborhood Stabilization Plan (NSP) partly based upon HUD’s guidelines but with an emphasis on demolishing homes. The NSP Executive Summary states:

It is important to note the strong focus on demolition activity in the plan, which accounts for approximately 50% of the total award amount. Due to the number of vacant properties, duration of vacancy and the market conditions, eliminating blighted structures in the target neighborhoods for future development or alternative land uses will have a tremendous stabilizing impact. Priorities for demolition will include structures adjacent to development projects nearing completion, and concentrations of blighted, vacant properties.

We agree that dangerous and abandoned homes in Detroit need to be cleared for neighborhood safety and quality of life matters. But the NSP, along with demolition businesses, banks, and others want to clear huge parcels of land for new development with new residents. Nowhere do they mention the option of creating Detroit jobs that will lead to home stabilization and neighborhood security.

Many of the homes they propose to tear down are good homes in need of repair. The residents who moved out were hard working men and women who lost their jobs, lost their pensions, died in debt from medical and utility bills. In the effort to save their home, they often took out loans from unscrupulous predatory lenders, got involved in foreclosure rescue scams, and lost their homes in reverse mortgages. Rather than tear down these homes, hire Detroiters to fix them, paint them, landscape them, furnish them, thereby providing every manner of work and community pride!

Councilmember Joann Watson’s Housing Task Force met on November 6 with Moratorium Now members who condemned the NSP and demanded that these federal funds be used as designed–to assist families in foreclosure, fix up vacated homes, and resettle families in them! The Michigan Citizen reports this in a November 15 story, “Demolition or Repair?”

MWRO also calls for these federal foreclosure assistance funds to be used as intended: to protect against more Detroit families losing their home, to safeguard and rehabilitate existing low-income housing; and not to be used at the pleasure of banks, developers, and officials looking for more easy money at taxpayer expense!

Read the City’s Neighborhood Stabilization Plan Executive Report (and full report), along with a map of the Detroit Target Communities that are selected for assistance. Submit your comments by November 20…call 313-224-6380 or email NSP@detroitmi.gov

(Image from Flickr Creative Commons)

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