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1 APPLICATION ID # Mahoning River Cities Application for Funding US Department of Housing and Urban Development Neighborhood Stabilization Program II City of Youngstown, Ohio Youngstown Community Development Agency 9 W. Front St. (City Hall Annex, Suite 205) Youngstown, Ohio cityofyoungstownoh.com

2 Table of Contents Program Summary... 2 Narrative Statements Need/Extent of the Problem... 3 Target geography... 3 Market conditions and demand factors... 5 Demonstrated Capacity of the Applicant and Relevant Organizational Staff Past experience Management structure Soundness of Approach Proposed activities Project completion schedule Income targeting for 120 percent and 50 percent of median Continued affordability Consultation, outreach and communications Performance and monitoring Leveraging Other Funds or Removal of Substantive Negative Effects Energy Efficiency Improvement and Sustainable Development Neighborhood Transformation and Economic Opportunity Appendices Appendix A: Certifications Appendix B: Code of Conduct Appendix C: Definitions Appendix D: Calculation of Removal of Negative Effects HUD Rubric Appendix E: Foreclosure Index Scores/Areas of Emphasis Appendix F: Firm Commitment Letters Appendix G: Public Comments Appendix H: Request for Demolition Exception 1 The City of Youngstown: NSP2 Application

3 Program Summary Mahoning Valley Background Mahoning and Trumbull counties in Northeastern Ohio are located midway between Cleveland and Pittsburgh, New York and Chicago. Following the collapse of the American steel industry, the region has experienced a dramatic loss of population, severe reduction in both job and tax base, and no-growth sprawl into suburban communities. Largest urban centers are the cities of Youngstown (Mahoning County) and Warren (Trumbull County). In 2008, there were 1,837 foreclosure filings in Mahoning County. From January to June 2009 there were 847 foreclosure filings for the county. In 2008, there were a total of 1,469 foreclosure filings in Trumbull County. Between January 1 and March 31, 2009 there were 373 foreclosure filings, which equates to an estimated total of 1,492, an estimated increase of 1.6%. There were 633 Sheriff Sale properties in Mahoning County from January 2009 through June There were 728 foreclosed properties in Trumbull County up for bid during Sheriff Sales from January through June In 2008, there were a total of 1,023 properties up for bid. Mahoning River Cities Background The Mahoning River Corridor Mayors Association formed in 2007 to share ideas regarding revitalization. It includes the cities of Lowellville, Struthers, Campbell, Youngstown, Girard, McDonald, Niles, Warren and Newton Falls. The goal is to promote urban redevelopment through regional cooperation and collaboration. This is the first time that these nine municipalities in Mahoning and Trumbull counties have formally joined to pursue common goals. Lead Agency The City of Youngstown s Community Development Agency (Youngstown CDA) will operate as lead grantee in the preparation of this application for Neighborhood Stabilization funds. Youngstown CDA focuses on creating strong and vibrant neighborhoods by collaborating with public, nonprofit, and private organizations to provide economic opportunities and improved housing conditions. Youngstown CDA will enter into agreements with each of the eight other Mahoning River corridor cities, as well as other area public and private organizations to collectively implement this proposal. Activities to be Undertaken Youngstown CDA has consulted with mortgage credit industry practitioners, affordable housing specialists, foreclosure prevention specialists, and other industry experts to 2 The City of Youngstown: NSP2 Application

4 determine the Mahoning Valley s greatest need area and explore solutions to this housing crisis. Eligible activities that will have the greatest impact on communities are: the strategic demolition/deconstruction of blighted structures, the acquisition and rehabilitation of single family homes, the establishment of a countywide land banking system, the redevelopment of vacant land, and the generation of low-interest loans for eligible home purchases. Request Youngstown CDA formally requests $32.42 million to address the redevelopment needs of The City of Youngstown and the eight cities mentioned above, which will participate as sub-grantees. A number of public and nonprofit agencies will also be called upon to successfully implement this proposal. Program Goals/Results Stabilize neighborhoods in cities where significant infrastructure exists that is connected by public transit; integrate metropolitan planning and coordination Revitalize targeted neighborhoods, reconnecting them with the local housing market, regional economy and community social networks Leverage economic activity and job creation, providing long-term community benefits Eliminate destabilizing influences (including blighted properties) that hinder revitalization Arrest decline in home values in targeted project neighborhoods Reduce vacant and abandoned residential property rates in targeted project neighborhoods Increase sales of residential property in targeted project neighborhoods Increase median market value of real estate in targeted project neighborhoods Factor 1: Need/Extent of the Problem A. Target Geography There are 134 census tracts in Mahoning and Trumbull Counties, all of which were analyzed using foreclosure, vacancy and income data as provided by the U.S. Department of Housing and Urban Development (HUD). This data indicated a pattern of need surrounding the nine older urban centers located along the Mahoning River (and mapped below): Campbell, Girard, Lowellville, McDonald, Newton Falls, Niles, Struthers, Warren, and Youngstown. Map 1, below, identifies in red the census tracts that have a foreclosure score of 18 or higher and have at least 51 percent of persons at 120 percent of the area median income or below. There are 97 census tracts in the two counties that meet both the area income threshold requirement and the foreclosure need requirement of the NOFA. The 21 Census tracts in green represent areas that meet the income requirements but do not meet the foreclosure need score. Twelve census tracts are shown in yellow and meet the foreclosure score of 18 or higher but have less that 51 percent of persons at or below 120 percent of the AMI. Out of the 134 census tracts in the two counties, 106 are potentially eligible target areas for the neighborhood stabilization program. 3 The City of Youngstown: NSP2 Application

5 The distinct pattern of need (areas in red) centering on the urban cities along the Mahoning River determined where the focus should be. Within the nine cities there are a total of 74 census tracts, of which 66 are identified as the target area of this application. Map 1 Mahoning and Trumbull County Mapped Income and Foreclosure Data Source: HUD NSP 2 Dataset Of the 66 census tracts located within the nine-city target area, 65 tracts individually qualify as high-foreclosure risk areas, according to NSP2 guidelines. The average foreclosure risk score within the target areas is the only census tract with a foreclosure risk score below 18 was McDonald Village, with an estimated foreclosure risk of 17. Vacancy risk data was also considered for the target area; over 85 percent of the 66 census tracts received vacancy scores of 15 or higher, with an average vacancy risk score of In addition, 71 percent of the 190,961 residents within the target area earn below 120 percent of the area median income. 1 1 See Foreclosure, Vacancy and 120 percent Median Income data, Appendix E 4 The City of Youngstown: NSP2 Application

6 Map 2 Select NSP 2 Target Census Tracts Market Conditions and Demand Factors The problems associated with subprime lending, foreclosures, and the effects of vacant and blighted properties are widespread, with few areas that are not adversely affected. A depressed housing market, the shrinking availability of credit, and a lack of employment opportunity have created an atmosphere of decline and disinvestment throughout the Mahoning Valley. In addition, a large percentage of the housing stock within the target area has been vacated and abandoned, resulting in higher levels of vandalism and further neighborhood deterioration. It is the intent of Youngstown CDA to infuse funding into these target areas, in order to prevent further decline and stabilize neighborhoods. Market Conditions Utilizing data from sources including the Multiple Listing Service (MLS) and Mahoning and Trumbull County Auditors offices, Youngstown CDA analyzed current housing market conditions to determine the strengths and weaknesses of the local market. The data provides insight into the stability of Mahoning Valley neighborhoods, where the amount of available housing stock often far outpaces demand. In the past year, over 1,420 residential sales occurred 5 The City of Youngstown: NSP2 Application

7 within the nine target cities an average of only 118 sales per month (see Table 1.1). Where there appears to be a low demand for housing, the median sale prices is also far below that of the regional market. Table 1.1 Mahoning River Cities 12-Month Housing Sales Area 12 Month Sales Monthly Absorption Rate Youngstown N Youngstown E Youngstown S Youngstown W Warren NE Warren SE Warren NW Warren SW Struthers Campbell Lowellville 13 1 Girard Niles McDonald Newton Falls TOTAL 1, Source: Mahoning Trumbull MLS Though all sales prices lag behind those of the greater regional market, Youngstown s South and East sides and Warren s Southwest sides all have median home prices registering below $15,000 for the past year (see Table 1.2). Table 1.2 Mahoning River Cities Prior 12 Month Median Sales Prices Prior 7-12 Mo. Prior 6-4 Mo. Prior 3 Mo. Area Median Sales Price Median Sales Price Median Sales Price Youngstown N $22,000 $21,950 $20,000 Youngstown E $7,250 $4,500 $6,800 Youngstown S $10,000 $10,000 $16,250 Youngstown W $26,900 $16,500 $26,250 Warren NE $42,250 $42,950 $47,450 Warren SE $20,850 $22,100 $52,000 Warren NW $23,450 $18,950 $24,250 Warren SW $4,800 $7,000 $5,650 Struthers $54,500 $35,000 $58,500 Campbell $28,800 $25,250 $15,562 Lowellville $95,000 $30,000 $60,000 Girard $49,000 $41,250 25,100 Niles $55,000 $51,900 $44,900 McDonald $71,500 $53,100 $119,500 Newton Falls $78,800 $27,250 $60,950 6 The City of Youngstown: NSP2 Application

8 Sub-Prime Lending and Foreclosures Recently, Case Western Reserve University conducted a study in Cuyahoga County (OH) that concluded that a foreclosure resulted in a 44 percent average loss in property value for the property experiencing the foreclosure. This loss of value, in turn, had a significant negative effect on other housing values throughout the neighborhood. According to Home Mortgage Disclosure Act (HMDA) information provided by HUD and shown in Table 1.3, over 42 percent of mortgage loans made between 2004 and 2006 within the nine target area cities were considered subprime. Data ranged from 28.7 percent subprime lending in McDonald Village, to 54.9 percent of all loans made within the City of Youngstown the highest rate of subprime lending within the State of Ohio, and one of the highest in the nation. This disproportionate level of subprime lending in the Mahoning Valley has led to a significant level of foreclosure activity within the target areas. Since January 2008, there have been 2,684 new foreclosures filed in Mahoning County and 1,842 new foreclosures filed in Trumbull County. Estimated foreclosure rates for the City of Youngstown are nearing 15 percent That s more than double the rate of the State of Ohio (6.2 percent), two percentage points higher than the City of Cleveland. It s also one of the highest foreclosure rates in the nation. The Village of McDonald is the only participating jurisdiction in the target area that is currently experiencing a foreclosure rate below ten percent. Table 1.3: Mahoning River Cities Market Condition Data Municipality Estimated Foreclosure Rate (percent) Estimated 90-Day Vacancy Rate (percent) Est. High-Cost HMDA Loan Rate (percent) 7 The City of Youngstown: NSP2 Application BLS 2008 Unemployment Rate (percent) Campbell Girard Lowellville McDonald Newton Falls Niles Struthers Warren Youngstown Target Area Average Source: U.S. Department of Housing and Urban Development Coupled with subprime lending and foreclosure problems, rising unemployment levels have also exposed severe weaknesses within the local housing market. Though all cities within the target area are experiencing annual unemployment rates of over seven percent, the cities of Warren and Youngstown have been hit particularly hard by job loss and corporate downsizing as a result of the current economic crisis. The most recent BLS figures estimate that the Youngstown-Warren-

9 Boardman Metropolitan Statistical Area (MSA) is at 12.8 percent unemployment for May 2009, a figure that has doubled from 6.4 percent in May Vacancy and Abandonment Long-term disinvestment throughout the Mahoning Valley has led to economic segregation, resource depletion, and escalating levels of vacancy and abandonment. In January 2009, the Mahoning Valley Organizing Collaborative and Youngstown State University administered comprehensive vacant property surveys in the cities of Youngstown and Warren. In Youngstown, each of the 62,509 parcels was surveyed and all vacant lots and structures were identified utilizing a consistent methodology. The results were compelling: fully 44 percent of Youngstown parcels are vacant nearly three times the national average of 15.4 percent. Even more telling is the ratio of residents to vacant structures: in Youngstown, 61.8 vacant structures exist per 1,000 residents compared to the national average of 2.4 per 1,000 residents. 3 As evidenced in the following maps, properties were rated A (salvageable) through F (requiring demolition) and assigned a color code. In the City of Youngstown, of the 4,571 vacant structures surveyed, 23.3 percent were considered salvageable (rated A/B) and 40.3 percent were considered blighted to the extent that demolition was necessary (rated D/F). Unimproved vacant lots were documented throughout the Youngstown area, though a large concentration is located on the city s east side. In the City of Warren, vacant lots and structures were also found to populate a large portion of the urban area. 2 U.S. Bureau of Labor Statistics Unemployment Data: 3 Mahoning Valley Organizing Collaborative Vacancy Survey, January The City of Youngstown: NSP2 Application

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11 10 The City of Youngstown: NSP2 Application

12 Vacant and abandoned properties are vulnerable to vandalism, including the removal of copper plumbing and other items of value. Many of the vacant and abandoned properties within the target areas have been deteriorating for years. Each of the nine Mahoning River Cities has identified a specific number of abandoned structures that serve as a blighting influence in their neighborhoods, as evidenced in the table below. There are 1,603 blighted structures within the target area that require removal, or 18.9 percent of the total number of vacant and abandoned structures in the nine cities. The demolition and/or deconstruction of these structures will help to alleviate the current strain placed upon the local housing market by high vacancy rates. Rehabilitation initiatives will target the remaining structures that have been deemed salvageable. Table 1.4: Mahoning River Cities Vacant Structures and Proposed Removal Area Vacant Structures Proposed Removal Percent Removed Remaining Vacant Units Campbell Girard Lowellville McDonald Newton Falls Niles Struthers Warren 1, ,741 Youngstown 4,578 1, ,378 Total 8,463 1, ,860 Market Absorption and Affordability Currently, 8,463 vacant structures exist within the Mahoning River Cities target area. Allowing for a standard four percent vacancy rate and utilizing a housing market demand absorption rate of 118 units per month (as defined in the beginning of this section), it would take approximately 69 months or 5.7 years for the current real estate market to absorb the existing supply of vacant housing. Removing 18.9 percent of the supply of vacant structures through demolition and deconstruction could improve the market absorption rate to 56 months over one year less than the time period that would be required without this additional funding. If strategically and effectively implemented, the removal of blighted vacant structures in specific, targeted neighborhoods will improve the marketability of those neighborhoods in general, which will also increase monthly absorption rates within the target area. Unlike many cities in which developers over-saturated the housing markets over the last ten years, over-building and overvaluation are not contributing factors to the number of vacant and foreclosed properties in the Mahoning Valley. This region is considered one of the most affordable housing markets in the nation; as a result, programming should focus on the rehabilitation of existing housing units, rather than the construction of new housing units in a weak market. 11 The City of Youngstown: NSP2 Application

13 Other Factors Several other factors contribute to economic uncertainty within the region, especially within the urbanized target areas. In the City of Youngstown, households earn approximately half the income of their counterparts throughout the State of Ohio, and one-third of residents are living in poverty. 4 The other participating sub-grantee cities do not fare much better. As seen in the table below, only households in McDonald and Niles were earning an average income over $35,000, according to the last decennial census. Table 1.5: Mahoning River Cities - Median Household Income (1999) City Median Annual Income Median Monthly Mortgage Percent Median Monthly Housing Expense Campbell $29,803 $ Girard $32,672 $ Lowellville $29,565 $ McDonald $41,738 $ Newton Falls $32, 827 $ Niles $35,615 $ Struthers $30,720 $ Warren $30,147 $ Youngstown $24,201 $ Source: U.S. Census, 2000 As shown below, a significant number of residents are living at or below the poverty level within the nine-city target area. Decennial census data estimates that over 19 percent of the population is considered to be impoverished, seven percentage points higher than the national average of 12.3 percent. Additionally, more recent data suggests that figures for target urban areas are much higher estimates approach a full third of residents living at or below the poverty level. Table 1.6: Mahoning River Cities Population in Poverty Percent City Population in Poverty Persons in Poverty Campbell 9, ,732 Girard 10, ,363 Lowellville 1, McDonald 3, Niles 20, ,009 Newton Falls 5, Struthers 11, ,411 Warren 46, ,085 Youngstown 82, ,342 4 CFED, An Individual and Community Asset-Building Assessment of the Mahoning Valley, June The City of Youngstown: NSP2 Application

14 Total 191, ,726 Source: U.S. Census, 2000 The performance of local school districts also speaks to the health of the local housing market. Seven of nine cities included in the target area have relatively healthy school systems. However, the cities of Warren and Youngstown the region s two largest urban centers and weakest housing markets have school districts that are currently under Academic Watch as defined by the Ohio Department of Education. Table 1.7: Mahoning River Cities: School Districts District School District Designation Graduation Rate (percent) Campbell Effective Girard Excellent 99.1 Lowellville Excellent McDonald Excellent Newton Falls Excellent 95.8 Niles Effective 90.9 Struthers Excellent 91.9 Warren Acad. Watch 87.3 Youngstown Acad. Watch 70.7 Source: Ohio Department of Education Unemployment, poverty, and low levels of educational attainment have challenged the stability of the local housing market. In a vicious market cycle, the presence of additional vacant and abandoned homes often attracts increased criminal activity. This, in turn, deters some prospective home buyers from considering urban (rather than suburban) housing purchases. B. Activities Most Likely to Stabilize Neighborhoods Considering the market factors that have been described in the preceding pages, Youngstown CDA will focus on the following activities to stabilize neighborhoods: Demolition/Deconstruction: High vacancy rates, widespread levels of abandonment, and the overwhelming availability of affordable housing stock make demolition the activity most likely to stabilize target areas within the Mahoning Valley. This activity will arrest the negative impact of blighted and abandoned structures in strategically targeted neighborhoods. Acquisition/Rehabilitation: Once blighted structures have been removed, participating jurisdictions will engage in targeted acquisition and rehabilitation activities. These activities will make direct investments into the housing stock of strategically targeted neighborhoods, further stabilizing these areas. 13 The City of Youngstown: NSP2 Application

15 Land Banking: By preserving well-kept structures and vacant parcels in a sophisticated, regional land bank, these undervalued assets will be kept for future use and development. Factor 2: Demonstrated Capacity of the Applicant and Relevant Organizational Staff A. Past Experience of the Applicant City and Regional Planning On a regional level, the Mahoning River Cities have collaborated to further economic and community development along the Mahoning River corridor. These cities work with the urban, suburban, and unincorporated communities in Mahoning and Trumbull Counties to promote urban redevelopment, issues of public policy, and equitable funding. Grantee Youngstown CDA will be the grantee for this NSP2 application. Youngstown CDA tailors all of its grant programs and city planning around the city s Youngstown 2010 plan. The plan has been awarded both the Ohio and the American Planning Association awards for public participation and was featured in the New York Times Magazine s Sixth Annual Year in Ideas edition. Youngstown 2010 targets sustainable development through stabilizing neighborhoods, promoting business, and reutilizing abandoned and undeveloped land. Sub-grantees The City of Warren has recently completed the City of Warren Revitalization Strategy. This plan outlines strategies for neighborhood revitalization, land bank operation, housing redevelopment, transportation planning, and economic development. Several municipalities, including the cities of Niles and Girard, take advantage of the planning services offered by the Trumbull County Planning Commission lead administrator for the NSP program in Trumbull County. Planning Commission staff members serve as planners, grant writers and administrators, carrying out all necessary demolition and residential development activities that are being undertaken with the county s $3.4 million NSP allocation. The Trumbull County Planning Commission has been presented with several Governors Awards of Excellence, and is experienced in every aspect of community and economic development. The Staff works closely with the City of Warren on a wide variety of projects and issues including the Continuum of Care, transportation planning, bike trail planning and development, and the implementation of HOME funds through the HOME Consortium. Acquisition and Disposition of Foreclosed Real Estate Two municipalities in the target area have existing land reutilization programs (land banks). The cities of Youngstown and Warren have both been operating land banks for several years. Additionally, several local public and nonprofit partners in Mahoning and Trumbull counties are also participating in land reutilization activities. Grantee 14 The City of Youngstown: NSP2 Application

16 Youngstown CDA has operated a land bank since The program is housed in the city s Planning Department and currently has 679 parcels available, 97 percent of which are vacant lots. The property acquired its property through delinquent tax foreclosures, deed-in-lieu of foreclosures, and gifts at a rate of approximately 100 parcels per year. The majority of lots are transferred to residents, although some have been transferred to businesses. The following table outlines the total land sales for the City of Youngstown s land bank in 2007, 2008, and the first half of Table 2.1: City of Youngstown Land Bank Sales Properties Year Acquired Properties Sold Proven Two-year Capacity for Acquisition: 141 Proven Two-year Capacity for Selling: 86 Sub-grantees The City of Youngstown s land banking resources will be supplemented by those of its subgrantees. The following public and nonprofit organizations have already had substantial experience acquiring properties. Table 2.2: Sub-grantee Agencies Land Bank Capacity Proven Two-Year Partner Agency Capacity (properties) City of Warren 31 Lien Forward Ohio 129 Commonwealth 47 Habitat Trumbull 7 TMHA 3 Total 217 Rehabilitation of Housing The two largest municipalities in the target area that receive HOME funding have experience with housing rehabilitation. In addition, several local public and nonprofit partners in Mahoning and Trumbull Counties can be called upon to augment the experience of these agencies. Grantee Youngstown CDA, which has 22 approved general contractors and 15 lead abatement contractors, has been proven capable of handling volume rehabilitation projects. In 2007, Youngstown CDA completed 42 HOME unit rehabilitations; the agency completed an additional 48 HOME rehabilitations in Project capacity has been traditionally underutilized due to funding limitations; Youngstown CDA is capable of at least double its current production level. 15 The City of Youngstown: NSP2 Application

17 The following table illustrates the capacity of the agency. Table 2.3: Youngstown CDA Rehabilitation Capacity Rehabilitated Year Properties Proven Two-year Capacity: 90 Sub-grantees In addition to the experience of the lead agency, the City of Warren, the Trumbull Metropolitan Housing Authority, and Habitat for Humanity Trumbull County also have experience in housing rehabilitation, as illustrated in the table below. Table 2.4: Sub-grantee Agencies Rehabilitation Capacity Proven Two-Year Agency Capacity (units) Warren 198 TMHA 3 Habitat Trumbull 7 Total 208 Redevelopment of Vacant Property The cities of Youngstown and Warren, as well as public and nonprofit agencies in Mahoning and Trumbull Counties, have experience redeveloping vacant property for both residential and business use. Grantee The City of Youngstown is practiced in redeveloping vacant property. The City partnered with CHOICE Homes to create two 40-unit elderly rental projects in Arlington Heights, for a total of 80 units. The City has also partnered with the Youngstown Metropolitan Housing Authority (YMHA) in a HOPE VI-sponsored redevelopment just north of the central business district that consisted of 30 new homes for ownership and 75 new units for rent. Table 2.5: Youngstown Capacity for Redevelopment Housing Proven Capacity Agency (units built) CDA/CHOICE 80 CDA/YMHA (rent) 75 CDA/YMHA (own) 30 Total The City of Youngstown: NSP2 Application

18 The City of Youngstown has also created business parks from vacant and abandoned steel mill property. The city acquired property, implemented environmental cleanup and infrastructure improvements, and offered incentives to businesses. The resulting jobs created will strengthen the economy, providing a healthier environment for a stable housing market. Table 2.5: Youngstown Capacity for Redevelopment Business Total Jobs Development Created Salt Springs Business Park 1,370 Ohio Works Business Park 850 Performance Place Business Park 1,856 Sub-grantees Like the City of Youngstown, the City of Warren has proven capability in redeveloping vacant land for housing purposes. Additionally, Commonwealth, Inc. a local community development corporation is capable of providing 27 units for redevelopment to low-and moderate-income residents in a two-year period. Table 2:6: Sub-grantee Agencies Capacity for Redevelopment Housing Proven Two-year Agency Capacity (units) City of Warren 96 Commonwealth, Inc. 27 Total 123 Program Marketing and Management of Waiting Lists The cities of Youngstown and Warren, as well as public and nonprofit agencies in Mahoning and Trumbull counties, have experience redeveloping vacant property for both residential and business use. Grantee The City of Youngstown has considerable experience managing waiting lists for potential residents. Under the land bank program, Planning Department staff manages an extensive database of persons interested in the purchase of foreclosed properties. In order to market these available properties to interested parties and the general public, the Planning Department has utilized a wide network of community agencies and organizations to publicize available land. Notices are also sent out through the mail to residents living adjacent to available pieces of property. The Planning Department has recently renewed its marketing initiatives in order to return increased numbers of parcels to productive use. 17 The City of Youngstown: NSP2 Application

19 Sub-grantees The City of Warren and several public and nonprofit agencies associated with this application have extensive experience with program marketing and waiting list management. In the past two years, the City of Warren has assisted 47 homebuyers with the purchase of single-family units, Lien Forward Ohio has helped clients obtain titles to 129 properties, Buy Into Youngstown has helped 110 individuals purchase single-family homes, TMHA has helped two homebuyers and managed 1,378 rentals, and Commonwealth, Inc. has managed 540 rental units. Accessing and Operating Investment Capital The cities of Youngstown and Warren, as well as public and nonprofit agencies in Mahoning and Trumbull Counties, have experience redeveloping vacant property for both residential and business use. Grantee As lead agency for this NSP2 application, the Youngstown CDA brings extensive experience implementing and monitoring local, state, and federal grants and programs. Six of its employees are registered in the DRGR Grants Management System. Annually, Youngstown CDA receives and administers $6 million in federal grants, including Community Development Block Grant funding ($4 million), HOME Investment Partnership funding ($775,000), and Emergency Shelter Grant funding ($174,000). The agency is also currently administering a $2.7 million NSP grant. Sub-grantees The City of Warren also receives and administers CDBG and HOME program funding, as well as other local, state, and federal grant resources. Warren also received over $2 million from the initial round of NSP funding. Additionally, the Trumbull County Planning Commission is working with the cities of Warren, Niles, and Girard through the county s 2008 NSP plan. As sub-recipients, Girard and Niles received $350,000 and $550,000, respectively. Working Productively with Other Organizations The Mahoning River Cities have already begun to work together for the benefit of the Mahoning Valley region. In addition, each municipality has a history of cooperation with other local public, private, and nonprofit agencies. Grantee Youngstown CDA will oversee The Mahoning River Cities, as well as other public and nonprofit organizations in order to carry out the NSP2 plan. Youngstown CDA makes it a point to partner whenever possible with associated organizations when carrying out a housing project. Those organizations include (but are not limited to): Mahoning County Healthy Homes and Lead Hazard Control Program Mahoning Valley LEAP Program Mahoning-Youngstown Community Action Partnership: Weatherization Program Youngstown Metropolitan Housing Authority In addition to working with the aforementioned organizations, Youngstown CDA also assists other organizations with rehabilitation programs. These include (but are not limited to): 18 The City of Youngstown: NSP2 Application

20 YMHA Youthbuild YWCA CHOICE Homes Commonwealth, Inc. Interfaith Home Maintenance Crandall Creek Conservancy Corporation B. Management Structure (1) Youngstown s Community Development Agency will manage the implementation of the plan outlined in the proposal and allocate funds to sub-grantees. As stated previously in this document, the City of Youngstown, as lead agency, will distribute funds to eight other municipalities: the City of Campbell, the City of Girard, Lowellville Village, McDonald Village, Newton Falls Village, the City of Niles, the City of Struthers, and the City of Warren. Several other public and nonprofit agencies will also be called upon to complete the structure of this NSP2 application. Youngstown CDA will be in charge of a steering committee for program direction and fund disbursement. Youngstown CDA will manage the implementation of the plan as outlined in this proposal and allocate all funds to sub-grantees. It is the mission of Youngstown CDA to positively impact the quality of life of the residents of the City of Youngstown. The agency remains sensitive to the needs and concerns of city residents and efficiently and effectively administers resources to help eliminate slum and blight in city neighborhoods, fosters suitable and positive living environments, and expands economic opportunities throughout the community. Youngstown CDA multiplies these resources by partnering with organizations whose activities contribute to its mission and recognizes that it exists to provide quality of life services to the citizens of the City of Youngstown. The agency provides those services in a manner that is fair, consistent, compliant, and professional, while continually affording city residents the dignity and respect that they deserve. As evidenced by the extensive public involvement process utilized during the Youngstown 2010 plan development, Youngstown CDA is proven capable of engaging and managing large-scale collaborative projects involving project stakeholders and the general population. All annual applications and year end reports are submitted to HUD for approval. Grant reporting is performed via the Integrated Disbursement Information System (IDIS) and the Disaster Relief Grant Reporting (DRGR). These systems track performance measurements and specific outcomes for various activities that are being undertaken with federal funds. Youngstown CDA is in good standing with HUD for all spending, reporting and accomplishment requirements of the various grants being administered. 19 The City of Youngstown: NSP2 Application

21 Below is the agency s organizational structure: ADMINISTRATION CDA Director Secretary HOUSING Housing Director Intake Estimator Inspector (2) FINANCE Budget Director Housing Finance Finance Assistant COMPLIANCE Compliance Director Asst Comp Dir Environmental Review References U.S. Congressman Tim Ryan Ohio District 17 pat.lowry@mail.house.gov Federal Office District Office 1421 Longworth House Office Building 241 Federal Plaza West Washington, DC Youngstown, OH P: P: F: F: John Getchey Director, Eastgate Regional Council of Governments jgetchey@eastgatecog.org 100 Federal Plaza East, Ste Youngstown, OH P: F: Martin R. Kubic Regional Director State of Ohio Auditor Voinovich Government Center 242 Federal Plaza West, Room 302 Youngstown, Ohio mrkubic@auditor.state.oh.us P: The City of Youngstown: NSP2 Application

22 Jorgelle Lawson U.S. Department of Housing & Urban Development Ohio State (Columbus) Office Office of Community Planning & Development 200 North High Street Columbus, OH P: Factor 3: Soundness of Approach Overview of Approach The goal of Youngstown CDA and the Mahoning River Cities is to stabilize neighborhoods throughout the Mahoning Valley that are pressured and distressed by abandoned/foreclosed properties and to utilize NSP2 funds as leverage for the reinvestment of private, public and philanthropic funds into the neighborhoods of the Mahoning Valley. This approach has seven major components which have been aligned with ongoing NSP programs and related community development efforts throughout the Mahoning Valley. The seven components are as follows: 1. Demolition/Deconstruction of Foreclosed/Abandoned Properties To combat the supply of thousands of excess units in the Mahoning Valley, demolition and/or deconstruction will be utilized to remove blighted, foreclosed properties and rebalance the supply and demand of the regional housing market. Demolition and/or deconstruction will be used strategically to remove 1,603 excess blighted housing units. This application does not propose the demolition or conversion of any low-and moderate-income dwelling units as a result of NSP2-assisted activities. The market conditions in the target geography warrant an exception to the limitation that no more than 10 percent of NSP2 funds may assist demolition activities. The exception is to increase the 10 percent limit to 24.4 percent. All other required minimum and maximum dollar limits will be met. Refer to the Request for Demolition Exception in Appendix H. 2. Acquisition and Rehabilitation of Foreclosed/Abandoned Properties (120 percent AMI) To restore viable abandoned/foreclosed properties to the market, acquisition and rehabilitation will be utilized to reinvest in neighborhoods. These activities will increase homeownership and serve as a catalyst for neighborhood stabilization. Acquisition and rehabilitation will be used to strategically rehabilitate 70 single family housing units for sale to residents meeting the 120 percent AMI or less requirement. 3. Acquisition and Rehabilitation of Foreclosed/Abandoned Properties (50 percent AMI) To restore viable abandoned and/or foreclosed properties return to the market, acquisition and rehabilitation will be utilized to reinvest in neighborhoods. This activity will also ensure continued affordable housing options throughout the region. Acquisition and rehabilitation will be used to strategically rehabilitate 70 rental or for sale housing units for residents meeting the 50 percent AMI or less requirement. 21 The City of Youngstown: NSP2 Application

23 4. Development of a Regional Land Bank To assemble and hold the thousands of abandoned and foreclosed properties throughout the Mahoning Valley, a regional land bank will be developed and resourced. The regional land bank will utilize the existing legal land bank infrastructure and provide the opportunity to take land banking activities to scale. A regional land bank will enable the jurisdictions participating in Youngstown CDA s proposal to control and manage abandoned and/or foreclosed properties as assets and not simply liabilities. The regional land bank will assemble a minimum of 995 properties in the nine participating jurisdictions. 5. Redevelopment of Foreclosed/Abandoned Properties To further ensure the continued affordability of housing, redevelopment activities will be utilized to create new affordable housing units. This activity will redevelop abandoned and/or foreclosed properties to new affordable housing units. Redevelopment activities will result in the creation of 30 affordable housing units for residents meeting the 50 percent AMI or less requirement. Twelve units will be for sale and the remaining 18 will be rental units. 6. Housing Finance Mechanisms To foster increased homeownership rates and neighborhood stability throughout the Mahoning Valley, downpayment assistance programs will be utilized throughout the target geography. These programs will create at least 237 new homebuyers, of which at least 62 will meet the 50 percent AMI or less requirement, while the remaining 175 homeowners will meet the 120 percent AMI or less requirement. 7. Program Administration To ensure effective program implementation, planning and compliance, 10 percent of the funds will be used for administration of the NSP2 program. A. Proposed Activities Eligible Activity 1: Demolition/Deconstruction Activity Name: Demolish blighted structures Eligible NSP Activity: Demolish blighted structures CDBG Eligible Activity: Clearance activities (see 24 CFR (d)) Activity Description: Demolish and/or deconstruct 1,603 blighted structures within the target census tracts. Total Budget: $7,931,000 Responsible Organization(s): Each of the nine Mahoning River Cities will operate their own demolition program. Additional Information: A title search will be obtained and notice will be issued to owner(s) of record including lien holders. The notice will give the owner/lien holder thirty (30) days to repair or raze the structure and a right to appeal the order. If the owner fails to correct the violation or 22 The City of Youngstown: NSP2 Application

24 appeal the order it will be processed for demolition. The process will include completing an environmental review, and bidding for demolition. A lien for the cost of demolition and/or deconstruction will be placed on property. Table 3.1: Demolition/Deconstruction Budget Activity User Funds Projected Outcomes Campbell $160, Girard $100, Lowellville $16,000 4 McDonald $16,000 4 Newton Falls $35,000 5 Niles $300, Struthers $120, Warren $1,100, Youngstown $6,084,000 1,200 Total $7,931,000 1,603 Eligible Activity 2 - Acquisition and Rehabilitation (120 Percent AMI) Activity Name: Acquisition and Rehabilitation of abandoned and/or foreclosed single family homes for sale to individuals at 120 percent AMI or less Eligible NSP Activity: Purchase and rehabilitation of abandoned and/or foreclosed homes for sale to eligible buyers. CDBG Eligible Activity: Acquisition (see 24 CFR (a)) and rehabilitation (see ) Activity Description: An RFP will be issued to the five major community development and housing organizations in the Mahoning Valley. The organizations will be allocated funds on a competitive basis based on the results of the proposals. Acquisition and rehabilitation of abandoned and/or foreclosed properties will be focused in targeted census tracts where the activity will leverage additional neighborhood reinvestment and revitalization activities. The properties will be acquired at the required discount or through donation and will be rehabilitated. Proceeds from the sale of these properties will be recycled for additional acquisition and rehabilitation. This activity will return a minimum of 70 single family homes to the market. Total Budget: $6,000,000 Responsible Organization(s): Non-Profit Housing Development Agencies, including Sunshine, Inc., Commonwealth, Inc., CHOICE Homes, Wick Neighbors, Inc. and the Youngstown Neighborhood Development Corporation. 23 The City of Youngstown: NSP2 Application

25 Table 3.2: Acquisition and Rehabilitation (120 Percent AMI) Budget Projected Outcomes User Activity Funds (sales-120 percent AMI) Non-Profit Housing Developers $6,000, Total $6,000, Eligible Activity 3 Acquisition and Rehabilitation (50 Percent AMI) Activity Name: Acquisition and Rehabilitation of abandoned/foreclosed properties for rental housing to individuals at 50 percent AMI or less Eligible NSP Activity: Purchase and rehabilitation of abandoned/foreclosed homes for rental to eligible renters. CDBG Eligible Activity: Acquisition (see 24 CFR (a)) and rehabilitation (see ) Activity Description: The Youngstown and Trumbull Metropolitan Housing Authorities will acquire and rehabilitate abandoned/foreclosed properties to create a minimum of 70 rental units. The housing authorities will also manage the rental housing. All 70 rental units will be rented to individuals meeting the 50 percent AMI or less requirement. Total Budget: $4,550,000 Responsible Organization(s): Youngstown Metropolitan Housing Authority (YMHA) and Trumbull Metropolitan Housing Authority (TMHA) Additional Information: The Youngstown Metropolitan Housing Authority will acquire and rehabilitate properties adjacent to one of Youngstown s most successful neighborhood revitalization projects. These funds will continue the stabilization of the areas adjacent to the Arlington Heights HOPE VI area. Table 3.3: Acquisition and Rehabilitation (50 Percent AMI) Budget Projected Outcomes User Activity Funds (rent-50 percent AMI) YMHA $2,550, TMHA $2,000, Total $4,550, Eligible Activity 4 Land Banking Activity Name: Development of a regional land bank to assemble and hold property. Eligible NSP Activity: Establish land banks for homes and residential properties that have been foreclosed upon. CDBG Eligible Activity: Acquisition and Disposition (see 24 CFR (a) and (b)) 24 The City of Youngstown: NSP2 Application

26 Activity Description: Lien Forward Ohio will act as the regional land banking authority for all nine municipalities. Lien Forward Ohio will plan and coordinate the acquisition and holding of foreclosed property throughout the nine municipalities in the target area and utilize the existing land bank infrastructure including the City of Youngstown, Warren, Struthers and Campbell s land banks. The land bank will assemble, hold and plan for the reuse of a minimum of 995 properties in the target census tracts. Total Budget: $3,189,000 Responsible Organization(s): Regional Land Bank Authority/Lien Forward Ohio, Mahoning and Trumbull Counties Additional Information: The land bank funds will fund the hard costs of foreclosure filing (title search, advertising, etc) to both Mahoning and Trumbull counties. Typically, these cost $1,200 per action with Lien Forward Ohio acting as the regional land bank authority. Youngstown, Warren, Struthers and Campbell all have land banks created under Ohio Revised Code, Section 5727; however, none have a dedicated staff. The regional land bank authority will strategically assemble properties critical to implementation of neighborhood stabilization plans on behalf of all nine cities within the two counties. Table 3.4: Land Banking Budget Activity User Funds Mahoning County $800,000 Trumbull County $569,000 Projected Outcomes (parcels banked) Regional Land Bank Authority $1,820, Total $3,189, Eligible Activity 5 Redevelopment (50 Percent AMI) Activity Name: Redevelopment of abandoned/foreclosed properties for affordable housing at 50 percent AMI or less Eligible NSP Activity: Redevelop demolished or vacant properties CDBG Eligible Activity: 24 CFR (c) Activity Description: The Youngstown and Trumbull Metropolitan Housing Authorities and Habitat for Humanity of Mahoning and Trumbull Counties will redevelop abandoned and/or foreclosed properties to create affordable units. The Youngstown and Trumbull Metropolitan Housing Authorities will construct nine rental units for individuals at 50 percent AMI or less. Habitat for Humanity of Mahoning and Trumbull Counties will each construct six new housing units. The Habitat units will be sold to qualified homebuyers meeting the 50 percent AMI or less requirement. Total Budget: $3,800, The City of Youngstown: NSP2 Application

27 Responsible Organization(s): Youngstown Metropolitan Housing Authority (YMHA), Trumbull Metropolitan Housing Authority (TMHA), Habitat for Humanity of Mahoning County, and Habitat for Humanity of Trumbull County Table 3.5: Redevelopment Budget User Activity Funds Projected Outcomes (units rehabbed) YMHA $1,300,000 9 Rental, 50 percent AMI TMHA $1,300,000 9 Rental, 50 percent AMI Habitat for Humanity Mahoning County $600,000 6 Sale, 50 percent AMI Habitat for Humanity Trumbull County $600,000 6 Sale, 50 percent AMI Total $3,800, Rental, 12 Sale Eligible Activity 6 Housing Finance Mechanisms Activity Name: Financing Mechanisms: Homebuyer Down payment Assistance Eligible NSP Activity: Establish financing mechanisms for purchase and redevelopment of foreclosed upon homes CDBG Eligible Activity: 24 CFR Activity Description: The City of Warren and Buy Into Youngstown will provide down payment assistance to 237 homebuyers. Clients will also participate in homeownership workshops and appropriate financial counseling. Total Budget: $3,750,000 Responsible Organization(s): City of Warren and Buy Into Youngstown Table 3.6: Housing Finance Budget Activity User Funds City of Warren $1,500,000 Buy Into Youngstown $2,250,000 Total $3,750,000 Projected Outcomes (Homebuyers) 22 at 50 percent AMI 75 at 120 percent AMI 40 at 50 percent AMI 100 at 120 percent AMI 62 at 50 percent AMI 175 at 120 percent AMI 26 The City of Youngstown: NSP2 Application

28 The projected outcome of 62 homebuyers at 50 percent AMI is achievable. A family of four at 50 percent AMI can earn $27,150 per year, or $2,262 per month. Since up to 35 percent of one s monthly income is reasonable housing expenses, the family can afford to spend $770 on housing expenses per month. According to Table 1.2 found on page 6, the median home sales price in Youngstown, Warren, Campbell and Girard is under $30,000. The affordability of many houses in the target areas makes homeownership obtainable for families at 50 percent of the AMI. Eligible Activity 7 Administration Activity Name: Administration Eligible NSP Activity: General administration and planning activities CDBG Eligible Activity: General administration, planning activities 24 CFR and 206 Activity Description: The requested amount $3,200,000 is the maximum amount that can be made available for administration over five years. Administrative funds will be prorated proportionately to all sub-recipients of NSP activity funds. Administrative costs such as personnel, professional services, and supplies will be eligible. Total Budget: $3,200,000 Responsible Organization(s): City of Youngstown Table 3.7: Administration Budget User Activity Funds Mahoning River Cities $3,200,000 Total $3,200,000 Leverage: All commitments from the cities involved are projects that use state or general funding. Table 3.8: Total Budget NSP2 Activity NSP2 Budget Request Demolition $7,931,000 Acquisition and Rehab (120 AMI) $6,000,000 Acquisition and Rehab (50 AMI) $4,550,000 Land Bank $3,189,000 Redevelopment $3,800,000 Finance Mechanisms $3,750,000 Admin $3,200,000 Total $32, 420, The City of Youngstown: NSP2 Application