CLEVELAND -- Mayor Justin Bibb wants to spend $15 million on two newly detailed proposals aimed at improving housing throughout the city.
The largest of the two proposals would establish a $10 million fund to help homeowners and landlords pay for improvements on their homes. Officials also proposed spending an additional $5 million to create a revolving loan fund to repair 100 vacant and abandoned homes throughout the city. Both requests would be funded entirely by the American Rescue Plan Act.
The $15 million in new housing proposals are in addition to $53 million in separate ARPA-funded housing proposals city council has already approved. Those proposals include $35 million to incentivize public/private housing and nearly $18 million in an ARPA-funded Housing and Urban Development Grant to address homelessness with non-aggregate shelters and to provide affordable housing.
Home repairs
The $10 million housing repair fund aims to provide money to renovate 800 homes. Of those, the city aims to provide an average funding of $15,000 for 600 of the homes and average funding of $25,000 for the remaining 200 homes. Given those numbers, the city would be on the hook for $14 million.
However, councilmembers Kris Harsh, Jenny Spencer and Kerry McCormack voiced support for increasing funding for the initiative during a Tuesday committee meeting.
“The highest and best use of ARPA funding is housing,” Spencer said.
What’s more, the city plans to get others to chip in.
Alyssa Hernandez, the city’s director of community development, said she plans to “leverage” the city’s ARPA dollars to get private investment for this and other housing programs. City residents in neglected parts of the city often struggle to get home repair loans from banks because the loans are considered financially risky, Hernandez said. The city’s ARPA money, she said, can help defray some of that risk.
“We’re going to help cover some of that risk to help areas that have, quite frankly, been neglected by our financial institutions,” Hernandez said.
“The common thread you’ll find through most of our community development pieces is we are pushing financial institutions to do more than they’ve done,” Hernandez said.
While the program is aimed at helping affordable housing, it also is aimed at those who make too much money to qualify for government aid.
Middle-class families, defined as 300% of the average median income or $84,000 annual household income for a family of four, would be eligible for at least some of the grants or loans, city officials said.
“Probably 90% of this city would qualify for these type of home repairs,” said Michiel Wackers, Cleveland’s assistant director of community development.
City officials expect grants to be available, but also loans...
Funding home repairs can help keep Cleveland families in their homes. When homes fall into disrepair they can end up in sheriff sales, where they can fall prey to “predatory investors” who often use out-of-state cash to snap up low-cost homes, but refuse to do maintenance, pay taxes, and rack up code violations.
While the legislation currently would allow “small landlords” to receive taxpayer money for repairs, the legislation does not yet define all the rules, and city officials are still trying to find ways to write the bill so it doesn’t enrich predatory landlords.
“This is not to subsidize those who have been bad actors or those who have had the means to take care of their properties and have chosen not to,” Hernandez said.
Home restoration
The $5 million in ARPA money would create a revolving fund that would pay for third parties to renovate vacant and abandoned buildings. The goal is to renovate 100 such structures using the money.
Officials are still working on the bill, and questions remain as to how the financing would work, how much developers would have to contribute financially, how the money would be distributed and more. Both pieces of legislation passed the Development, Planning and Sustainability Committee.
While Bibb has mentioned both requests in previous announcements, a Tuesday committee meeting was the first time the legislation was discussed at length in public.