HUD Released Funds to Contain Repo Home in Georgia
More Neighborhood Stabilization Program grants were awarded by the U.S. Housing and Urban Development (HUD) to counties in Georgia to help officials create affordable houses by building, purchasing or rehabilitating repo home or to provide rental assistance.
In the case of Fulton County, local officials were able to receive $13.3 million in federal grants despite the fact that it will have to repay the HUD $3.2 million. The county’s housing department mismanaged the funds it received from the affordable housing program which was frozen due to the problem.
Because of this, Fulton County is required to repay the HUD and the agency continuously rejected the local government’s request that it release additional $3 million of affordable housing grants.
Official at HUD are concerned that the county’s housing department still lacks experienced employees to properly manage and spend federal grants from HOME program.
However, despite this issue, HUD still released funds to the county’s housing department under the Neighborhood Stabilization Program. The federal funds should be used to help areas severely affected by subprime lending and repo home crisis.
The program is designed as an entitlement which allocates funds to local housing departments, with the amount dependent on factors such as the number and percentage of repo home, subprime lending and loan delinquencies in the area.
HUD deputy regional director Patricia Hoban-Moore explained that the Neighborhood Stabilization Program is designed to address the repo home crisis, adding that Fulton County is one of those areas hardest hit by foreclosures.
She added that whatever issue Fulton may have over the way its housing department handled the HUD HOME Program money, the matter is separate from the stabilization program.
According to HUD auditors, Fulton County’s mismanagement of the HOME Program funds resulted in over $6 million questionable spending. Of particular concern to HUD auditors is Fulton’s investment of up to $525,000 and its failure to properly account five housing development projects that still remained unfinished.
County Manager Zachary Williams pointed out several changes made to Fulton’s housing department, including reorganization and hiring of people who has significant experience managing federal funds.
Nationwide, the total amount allocated by the HUD to 55 territories and states and 254 local governments to address the repo home crisis reached $3.92 billion.
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