The Neighborhood Stabilization Program (NSP) provides funding to help revitalize neighborhoods affected by the foreclosure crisis by rehabilitating, redeveloping, and reusing abandoned and foreclosed properties.
In close collaboration with dedicated advocates, practitioners and other experts from across the country, NHC convenes the National Foreclosure Prevention and Neighborhood Stabilization Task Force, which has successfully advocated for nearly $7 billion in funding for NSP. The task force has also guided critical changes to improve the implementation of the program.
This task force held our monthly meeting on August 4. This meeting included a discussion with Stan Gimont, HUD’s Director for the Office of Block Grant Assistance. Here is a quick update from that meeting on how the Neighborhood Stabilization Program (NSP) is doing currently:
- NSP 1: The 18th month deadline for when all NSP1 funds must be obligated is quickly approaching. The NSP1 obligation rate is currently at approximately 76.6% and 70 grantees have obligated 100% of their funds. HUD’s plan for the recapture is to work on a case-by-case basis to see how and when the funds will be redistributed. Many grantees are very close to using all their funds and may just need some additional technical assistance to get them to the end.
- NSP 2: The second round of NSP funding is just starting to be used with 4.4% of NSP2 funds being obligated currently. While HUD and grantees are still working on some issues with program design, additional attention is expected to be paid to this round of funding after the NSP1 deadline, including more technical assistance to grantees.
- NSP 3: The Dodd-Frank Financial Reform bill was signed into law on July 21. This legislation includes $1 billion in funding for NSP3. This round of funding will be comparable to NSP1 given that it will be using a similar formula allocation. We should see the formula by August 23; (30 days from the President signing the legislation) however, the money will not be available till October 1 for distribution. The legislation also includes a critical, NHC-supported correction that will allow vacant properties to count towards the required 25% of funds set aside for very low-income households. HUD recently released guidance on this change, which affects all three rounds of funding.
For additional NSP related resources definitely look at HUD’s Resource Exchange website, especially the What’s New section. It is regularly being updated and has new information, webinars, and resources related to NSP.
For more information about the Taskforce please contact Clare Duncan, NHC’s policy associate.
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