February 27, 2009

City gets $1.3 million in stimulus funds from HUD

Racine will receive $1.3 million in stimulus funds from the U.S. department of Housing and Urban Development -- money to create jobs, probably highway improvements, and money to help homeowners fend off foreclosure.

All of the funds allocated today are based on federal formulas relating to the city's low-income housing pool, said Mayor Tom Friedel; "mathematical formulas that consider population size and other community characteristics," according to the city's press release. The HUD money was expected -- although nobody knew exactly how much there would be -- and it has little or nothing to do with the $72 million "wish-list" the city prepared a couple of weeks ago.

According to city officials, Racine will receive:
  • $534,384 under the Community Development Block Grant program. The funds can be used for a wide range of activities related to housing and economic opportunities for persons of low and moderate income. The Recovery Act requires that priority be given to projects that can be started within 120 days of a grant agreement.
  • $817,554 under the Homeless Prevention Grant program. The funds can be used for activities that keep individuals, both home-owners and renters, from losing their current housing.
"I hope we can use these funds to address foreclosures," Friedel said. "Other programs exist to deal with buildings after foreclosure. We need help reducing the number of foreclosures and keeping people in their homes."

Friedel said it appears the foreclosure money is targeted to agencies that help homeowners forestall or prevent foreclosures with counseling to help them buy time. "That's our first take on it," he said, adding, "But it seems to us that's maybe a lot of money for that purpose."

The CDBG money is an increase over what the city normally receives -- about $3 million. "Eighty-five percent of that goes to bricks and mortar," Friedel said, the rest into programs. He expects most to go to Public Works, roads. "It all has to be allocated by Labor Day," he said. "If they're road and street projects, then it's easy."

Nothing will be allocated or spent until the grant goes through the City Council, after review by the city's Community Development Committee. "Every year, we get about double the amount of requests than the amount we can fund," he said.

"What's really disappointing to me is that there's nothing in here to put the average guy to work. There are jobs for road crews and public works, but nothing for the guy who just lost his job," Friedel said.

As for the city's wish-list, headed by a $36 million library... "We keep mining," Friedel said. "That's the buzzword; you 'mine' the bill, drill down to see what we can find." He's still wishing for a new library.

Is this $1.3 million just a small piece of what the city actually will receive from the American Recovery and reinvestment Act? "I hope so," he said. "But after this, it's more competitive."

I asked Friedel about a story I'd seen yesterday noting that Madison has a full-time lobbyist in Washington to deal with matters of this sort. Is that something we should have? "No," he said, "But I think where we missed it was not having someone there at the U.S. Conference of Mayors meeting with Obama, while the bill was being written. If we missed anything, that's where we missed it. " Former Mayor Gary Becker -- who had been scheduled to attend the Washington meeting -- was instead dealing with his sordid arrest...
"It is remarkable that the Department of Housing and Urban Development is able to provide this notification less than 10 days after the law was signed," Fridel said in the city's press release. "It shows how quickly the department is responding to the economy's ills. The city promises to keep pace with HUD in this effort.

"I want to thank the Obama administration for its faith in cities like Racine to use these funds effectively. We will live up to that faith," said Friedel. "And I want to thank our representatives in Congress, especially Sen. Kohl and Sen. Feingold for keeping this funding in the Recovery Act.

"Additional funding is available to the city under other provisions of the Recovery Act. Some of it will be awarded based on grant applications -- not formulas like the HUD funding. City departments are preparing application materials now, so we can submit them as soon as the federal agencies allow," said Friedel. "I am optimistic that we will win additional funding for the city."


  1. Who exactly will keep track of the number of jobs created through these funds?

    All too often CDBG funds are awarded to programs cut through municipal budgeting - i.e. police overtime. I'm not quite certian how that creates jobs, but I welcome pork when it comes. Racine may as well enjoy the bacon.

  2. But I do not think we will enjoy paying the TRILLION in Taxes.