Butler County may get more money to fight blight

Category: Prevent Foreclosure Published: Friday, 15 January 2016 Written by Super User

A new infusion of federal funding could mean more eyesores will be erased countywide through the Butler County land bank.

The county land bank has already spent almost $7 million in federal, state and local funding to demolish about 600 unsightly structures in Middletown and Hamilton -- the county's two biggest cities. US Sen. Sherrod Brown (D-OH) has ensured more federal Hardest Hit Funds -- $2 billion worth for the entire country -- will come home to Ohio.

As part of the year-end omnibus spending bill, Congress directed the US Treasury Department to transfer $2 billion from the Making Home Affordable program to the Hardest Hit Fund (HHF), which has been used by land banks like the one in Butler County, to bust blight.

"This is a major win for Ohio communities and homeowners that are still recovering from the housing crisis," said Brown, ranking member of the US Senate Committee on Banking, Housing, and Urban Affairs. "It's critical that we continue to preserve and strengthen a fund that has provided over half a billion dollars to address the housing crisis in Ohio and to redevelop blighted neighborhoods by demolishing vacant properties."

With $2.7 million it received in Moving Ohio Forward grants from the state, Butler County formed a land bank four years ago to deal with blighted buildings. The cities of Hamilton and Middletown each gave $1.1 million to the land bank fund as well. The two cities are currently working through $2 million in HHF money, removing as many as 120 eyesores.

Butler County commissioners agreed to siphon one percent of delinquent tax and assessment collection funds (DTAC) to bolster the land bank and open up services for the entire county. DTAC funds are late payment penalties on real estate taxes.

Including Hamilton and Middletown, there are now eight member communities in the land bank. Fairfield, Hanover, Liberty, Ross and Wayne townships and the city of Trenton have all joined the land bank. Oxford and Madison townships are expected to have their memorandum of understanding approved at the land bank meeting Monday.

Carlie Boos, compliance manager with the Neighborhood Initiative at the Ohio Housing Finance Agency, the entity that administers the HHF, said the treasury department is in charge of deciding distribution details. A spokeswoman for the Treasury said since the bill just passed they haven't worked out the particulars yet.

There are no matching fund requirements for HHF and any allotment the county will receive can be doled out county-wide, but she said the goal of the program could mean only Hamilton and Middletown would receive funding, unless the county amends the target areas they established for the HHF. Boos said it will be up to the land bank board to decide.

"The primary goal is to prevent foreclosure," she said. "DTAC is an absolute, great resource for a lot of counties. especially Butler, to do those more spot clean-ups. This particular program we want to see it very strategically implemented with that goal in mind."

Jim Rokakis, vice president of Western Reserve Land Conservancy and director of the Thriving Communities Institute, who was instrumental in getting Ohio's land banks established and funding flowing, said studies show if you beat back blight it staves off foreclosures.

If people are "underwater" on their mortgage already and they see ratty, vacant houses dotting their neighborhoods, he said they are more likely to ditch their own domain, than try to save it.

"The study proved where there was demolition activity, where you were taking the blighting influences out of the neighborhood, people were more likely to keep paying their mortgages and less likely to walk away," he said.

Rokakis said initially they identified about 100,000 blighted properties throughout the state and they have only downed about 22,000 so far, so additional funding was obviously needed. Kathy Dudley, who handles the land bank for Hamilton, said "oh yes" when asked if Hamilton has more blight to tackle.

She said much -- 33 and counting -- of the leveled land has or will be turned over to neighbors as side lots, Habitat for Humanity built a house on two lots, a house in the middle of the business district on Main Street will be turned into a parking lot and several parcels were retained by the city for future projects like South Hamilton Crossing.

Middletown did not take ownership of the properties they razed under the state grant so none of them have been re-purposed. Under the HHF program they are required to take over the properties, but City Manager Doug Adkins said they are too early in the demolition process to have outlined plans for future use. He agreed the new money will be used.

"The first round of Hardest Hit funds were directed at 'tipping point" neighborhoods. Between the first round of Hardest Hit funds and the Ohio Attorney General's Moving Ohio Forward demolition program, Middletown is close to having most blight removed from those tipping point neighborhoods," he replied in an email. "One of the changes we hope to see in the execution of the additional new funds is the ability to expand the use of those funds into more neighborhoods, specifically for Middletown, the most distressed neighborhoods, where some blight still remains."

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