Detroit getting $50 million to fight blight

The Detroit News

Detroit — Michigan is splitting $75 million in federal funding between 12 cities, including nearly $50 million for Detroit, in its latest battle to reduce blight in the state, the governor's office announced Tuesday.

The federal aid has been a key part of Detroit Mayor Mike Duggan's anti-blight effort as the city has worked toward exiting bankruptcy. The city has more than 40,000 vacant structures.

"This is another important step in Michigan's comeback, which has become a national example for what can be accomplished when federal, state and city partners work together with a shared vision to solve a problem," Gov. Rick Snyder said in a statement. "As a result of this collaboration, these cities will be better places to live, work, play and invest."

The effort is being funded under the U.S. Department of Treasury's Hardest Hit Fund program, which was originally intended to help homeowners hit hard by the national housing and foreclosure crisis. In October, the U.S. Treasury approved Michigan State Housing Development Authority's reallocation of $75 million of Michigan's original nearly $500 million allotment to its blight elimination program, according to the governor's office.

The second-round funding means Detroit will have received nearly $100 million of the repurposed federal mortgage aid to reduce blight, which is blamed in part for leading to the spread of abandoned structures and foreclosures in the state.

But about $11.7 million of Michigan's $75 million is going to distressed Wayne County communities, many of them surrounded by or near Detroit.

The Michigan cities were selected by the state through an evaluation system that included residential housing vacancy rates. Each had to submit blight-fighting plans, estimate project costs and provide a timeline for the work.

"This partnership demonstrates a commitment to revitalizing our cities and to addressing the damaging effects caused by vacant and blighted properties," U.S. Treasury Deputy Secretary Sarah Bloom Raskin said. "Removing blighted properties is an important step in stabilizing neighborhoods, and we look forward to continuing our efforts to assist hardest hit communities around the nation."

Detroit's current allotment of $50 million is comprised of $47.4 million in second-round funding combined with $2.6 million in reserves from the more than $50 millionin first-round funding. The second-round aid will cover 3,300 demolitions, Detroit Land Bank Authority spokesman Craig Fahle said last month.

The city has spent $57 million this year on nearly 3,700 demolitions in targeted neighborhoods, Fahle said, adding the new money will allow the city to expand into more neighborhoods.

"Residents of Detroit have seen a major difference already with the first round of anti-blight funding," Duggan said in a Tuesday statement. The additional money will help "improve the quality of life of thousands more Detroiters, right in the neighborhoods where they live."

Another $420 million — saved by the city through its historic bankruptcy — also will be used to raze vacant houses and clear lots.

The city's land bank is averaging 200 demolitions a week.

The communities included in Michigan's second-round funding of $75 millionare:

■Lansing, $6 million

■Jackson, $5.5 million

■Highland Park, $5 million

■Inkster, $2.25 million

■Ecorse, $2.19 million

■Muskegon Hts., $1.8 million

■River Rouge, $1.3 million

■Port Huron, $1 million

■Hamtramck, $952,000

■Ironwood, $675,000

■Adrian, $375,000

According to officials, each blight partner must spend 25 percent of funds in the first six months, 70 percent within 12 months and all within 18 months. U.S. Treasury requirements state any remaining money on Dec. 31, 2017, must be returned.

"Strategically allocating this additional funding will help extend the positive effect of our anti-blight efforts to new areas of the state," said Wayne Workman, acting executive director of MSHDA. "It will further stem the tide of foreclosures, stabilize property values and help revitalize these communities."

The Associated Press contributed.