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$4m for New Yorkers to transform vacant homes into affordable housing

Staff Writer | August 20, 2016
Attorney General Eric T. Schneiderman announced a new pilot program that will provide New York State land banks with $4 million in subsidies.
New York homes
Empire State   Neighbors for Neighborhoods
This will help New Yorkers to take over abandoned properties in their neighborhood at little or no cost and rehabilitate them into affordable rental housing.

Created with affordable housing and community development nonprofit Enterprise Community Partners (Enterprise), the program requires the new housing units to remain affordable for at least 20 years.

AG Schneiderman brought more than $95 billion to communities.
Funding for the program will come from the Attorney General’s 2014 and 2015 settlements with Citigroup and Bank of America over the banks’ conduct leading up to the 2008 housing crash.

Neighbors for Neighborhoods builds on the success of New York State’s non-profit land banks. Ten of these lands banks have, with support from the Office of the Attorney General, reclaimed over 1,600 abandoned properties across the state since 2013.

Recently, five new land banks have formed and received capacity-building grants from the Office of the Attorney General, and a sixth is in the process of getting certified.

The initiative was inspired by such successful land bank efforts as 13 Chambers Street in Newburgh.

The property, which was acquired by the Newburgh Community Land Bank in 2013, was renovated by a local architect and now provides three families with affordable rental housing.

Land banks that meet the requirements will then be able to submit requests for the subsidy on a project-by-project basis.

Money will come from the settlements with Citigroup and Bank of America.
Once selected, land banks will transfer ownership of the dilapidated properties at low or no cost to the identified community members; provide the new community-based property owners with a subsidy toward the costs of renovation (approximately $50,000 per unit); and dictate the terms and scope of the renovation.

Importantly, the renovations must also include exterior rehabs—to provide “curb appeal,” a critical part of boosting property values in neighborhoods plagued by vacant homes.

In exchange for the property and the renovation subsidy, the new property owners will convert the properties to affordable low- and moderate-income rental units for local families.

This $4 million investment is estimated to yield up to 80 affordable rental homes for working families in the cities and towns where land banks are active.

Funding for the initiative will be drawn from the $7 billion settlement agreement with Citigroup and the $16 billion settlement agreement with Bank of America that Attorney General Schneiderman, as co-chair of the federal-state working group on residential-mortgage-based securities, negotiated in July and August 2014, respectively.

Those two settlements together brought $982 million in cash and consumer relief to New York State alone.

Neighbors for Neighborhoods is but one component of Attorney General Schneiderman’s broad strategy to help New York families and communities recover from the housing crash.

He has led the fight for strong bank settlements that hold the banks accountable for their recklessness and responsible for mitigating the damage they caused. He has obtained settlements that brought more than $95 billion to communities across the country.