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Obama administration opposes cuts to anti-blight funds

David Shepardson
Detroit News Washington Bureau

Washington — Treasury Secretary Jack Lew said the Obama administration opposes a proposal to cut Hardest Hit Funds to pay for highway repairs.

The program has been used to fund blight removal in Detroit and other cities with lots of abandoned funds. Senators last week reversed a plan to eliminate the $1.7 billion Hardest Hit Fund mortgage program as part of a six-year highway bill.

Lew said the effort “has done an enormous amount of good work” and “we continue to believe implementing it fully is the right policy.”

The fund has helped demolish thousands of vacant buildings across Michigan and assisted more than 25,000 property owners in the state preserve “their piece of the American dream — their family home.”

As of March 31, Michigan had spent $43 million out of a total $175 million in Hardest Hit funds committed to demolish about 3,220 homes.

Detroit Mayor Mike Duggan has stressed how the program has allowed for the demolition of vacant or unsalvageable homes, making room for new families to move in and repair other properties in the city, which has received $107 million in the funds.

"The loss of this program would have been devastating to Detroit's neighborhoods," he said in a statement.

Separately, Lew said he didn’t know why no U.S. municipality has filed for bankruptcy since Detroit’s record setting Chapter 9 filing in July 2013. He said the administration was pressing Puerto Rico to have a longterm financial plan to get its fiscal house in order.

“We have been clear in our response that there isn’t any federal bailout — whether it is a city or state — that they can count on, but we have a huge amount of empathy for the people in the jurisdictions that are facing difficult circumstances,” Lew said.

He said the Obama administration worked to help Detroit get access to federal funds and technical support that it was entitled to.

“Frankly, some things that Detroit wasn’t taking advantage of that we helped them understand how to take advantage of — and the same kind of approach has been at work with Puerto Rico,” Lew said.

DShepardson@detroitnews.com