Merced County Congressman Questions HUD Plan
Posted on November 13, 2008
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At the end of last week, the Department of Housing and Urban Development (HUD) released its decision on how the $3.9 billion of home foreclosure relief will be spilt among states, counties, and cities across the nation. As part of the Housing and Economic Recovery Act, the federal government has released this as a means of helping millions of homeowners who are struggling to make their mortgage payments or are already in the throes of foreclosure proceedings.
The Recovery Act will allow local governments on all three levels to buy foreclosed homes. This should help relieve communities that are turning to blight and crime due to an abundance of deteriorating homes, many of which have been sitting unattended for long periods of time. This in turn becomes a problem for the community as a whole as it takes the property value down for entire neighborhoods. This is a growing problem as the housing epidemic gets worse and worse in every state.
Since the division of aid was announced, there have been many claims that California as a whole was not given its fair share of the money, and even more claims that Merced County especially was not treated fairly. The latest to vocally come out against the federal distribution of the money is California Congressman Dennis Cardoza. He does not believe his state was treated fairly in the divisions of aid and has urged HUD to review its decision on these divisions before they disburse the money.
Merced County was not included on the list of counties to receive immediate aid and will be forced to apply to the state for any aid it may be granted. Since this county faces a great degree of struggle due to recent foreclosures this does seem unfair. One of the reasons it may have been neglected is because HUD uses US foreclosure figures and compared to surrounding areas, Merced County doesn’t have as many homes sitting vacant for over 90 days. This is one way HUD determined which counties would be given a direct share of the money and which ones would have to apply to their state for help.
Cardoza has joined with fellow California Democrats to write HUD a letter asking for an explanation of why Merced County would be left off the list despite its status as one of the “foreclosure capitals” of the country. California as a whole carries a third of all the country’s foreclosures but will receive less of the financial help than other states with lower rates, such as Florida.
There was a special provision made for states that have additional problems due to hurricane destruction, and that is likely why Florida received more than California. As for Merced County, HUD determined it would have received less than $2 million of California’s aid, so that is why it must apply to the state to get its share.
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