[StBernard] Public Invited to Comment on State Plans for Soft Second Mortgage Program

[Westley Annis]

Public Invited to Comment on State Plans for Soft Second Mortgage Program

Action Plan Amendment Published for Review

BATON ROUGE, La. (June 4, 2008) - The state of Louisiana today published for public comment an action plan amendment that includes plans to allocate $75 million in Community Development Block Grant (CDBG) funds to create the Small Rental Soft Second Mortgage Program. The program is designed to provide homeownership opportunities for renters living in the areas affected by Hurricanes Katrina and Rita.

The Action Plan Amendment proposes setting aside $75 million from the Small Rental funds for a special initiative designed to promote homeownership and to expand housing opportunities for existing low and moderate income renter households, using the supply of properties sold to the state through the Road Home program and held by the Louisiana Land Trust (LLT). This initiative will also provide state and local leaders with much needed financial resources to rebuild a portion of the vacant damaged properties that are currently owned by the LLT. In this way it will promote the elimination of blight and the revitalization of key target areas. 

Under the program, qualified developers, including nonprofit and for-profit entities, will bid on selected LLT properties, which will be rehabilitated. Upon completion the properties will be sold at a "market price" set at the full cost of development, but the actual cost to the qualified first time homebuyers will be significantly less. The difference - or gap - will be provided in the form of a no interest, "soft second" mortgage to the purchaser.

*	Click here to read and submit comment on the Action Plan Amendment. <http://www.doa.louisiana.gov/cdbg/dractionplans.htm>  

The Louisiana Recovery Authority (LRA) Board of Directors is expected to consider preliminary approval of the action plan amendment at its next meeting, scheduled for June 10 in Baton Rouge.

Upon final approval by the LRA Board of Directors, the plan moves to the Governor and the Legislature for consideration, then onto the US Department of Housing and Urban Development for final approval.

Citizens, community leaders and elected officials can access the plan and submit comments online at www.doa.louisiana.gov/cdbg/dractionplans.htm <http://www.doa.louisiana.gov/cdbg/dractionplans.htm>  or request a copy by phone by calling (225) 219-9600.

Hurricanes Katrina and Rita devastated South Louisiana, claiming 1,464 lives, destroying more than 200,000 homes and 18,000 businesses. The Louisiana Recovery Authority (LRA) is the planning and coordinating body that was created in the aftermath of these storms to lead one of the most extensive rebuilding efforts in the world. The LRA is a 33-member body which is coordinating across jurisdictions, supporting community recovery and resurgence, ensuring integrity and effectiveness, and planning for the recovery and rebuilding of Louisiana. 

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