Michigan to Spend $100M of Housing Grant to De-Blight Detroit

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Michigan to Spend $100M of Housing Grant to De-Blight Detroit

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Abandoned home in Detroit. (Photo courtesy of flickr.com/photos/memoriesbymike.)

To appreciate Detroit, you have to understand her many incarnations. From river fortress to auto industry princess and now, unfortunately, to queen of urban blight. Since Mayor Dave Bing took office in 2009, progress has been made in that area -- about 6,700 abandoned structures have been torn down. But that's only about 15 percent of the 40,000 that stand endangering and demoralizing locals, says the Detroit Free Press. Here's happy news: According to Crain's Detroit Business, much more blight will be soon eradicated, thanks to $100 million in federal funding.

TARP Grant

Money came from the federal Hardest Hit Fund grant, says the Detroit Free Press. The U.S. Department of Treasury approved $100 million from the $498.6 million in grant money Michigan was awarded from the TARP (Troubled Asset Relief Program) Hardest Hit Fund. TARP monies were granted to MSHDA's (Michigan State Housing Development Authority) Michigan Homeowner Assistance Nonprofit Housing Corporation (MHA). Using their StepForward Program, MHA created forgivable loan programs: mortgage payment assistance for homeowners who receive unemployment compensation, rescue funds for homeowners who are behind through no personal fault (and who've overcome this obstacle). Principal reductions are available for homeowners who can't afford mortgages due to lost income. The 4-year-old TARP, put in place under the Emergency Economic Stabilization Act of 2008, is winding down as the economy is improving.

Blight Funds

Along with keeping people housed, MSHDA wants to keep them safe from nearby abandoned homes. Defunct homes are way more than eyesores. They're hazards. Utilities may be shut off, and houses may have faulty wiring, gas leaks, burst water pipes. Derelict homes are attractive nuisances, luring crime, vagrancy, illegal activities, animals, and pests. Children may enter and be injured. Children must walk past 33,000 blighted buildings to get to school, says the Detroit Free Press. MSHDA requested $100,000 of the grant to start clearing unusable, burned, damaged, and defunct homes. Monies would be used in Detroit, Lansing, Flint, Saginaw, and Grand Rapids. Michigan is one of the first states approved to use federal housing money for demolition.

Grant Money Usage

According to Treasury Department reports, $7.6 billion in Hardest Hit Funds was awarded nationwide in 2010 and 2011; only $2 billion was spent. Only $94 million of $500 million dispersed to Michigan has been distributed, reports MSHDA.

Demolition Issues

Erin M. Long, formerly of Ann Arbor, Michigan, outside Detroit, wondered if $100 million would be enough to cover the cost. "It seems like there are endless and endless blocks of vacant homes. Whatever they can do to better these areas, I agree [with the plan]."

Bill Pulte of Pulte Homes says the money could remove a large amount of blight. Pulte started the nonprofit Detroit Blight Authority and demolished ruined homes around Detroit Eastern Market, says Crain's Detroit Business. The Blight Authority cleared 218 homes for $5,000 each -- about half what publicly funded efforts would cost. This is part of Pulte's larger plan to demolish 400 buildings (hopefully with part of the federal $100 million). Pulte vowed to keep the focus off acquisition.

A teacher and Michigan native, Marilisa Sachteleben has a soft spot for Detroit and writes about issues in her state's most pivotal city.
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