Chicago Mayor Announces Foreclosure Stabilization Program
Chicago Mayor Rahm Emanuel Wednesday announced a new foreclosure initiative that relies on community groups to identify abandoned properties.
Standing in front of a rehabbed bungalow home in the Auburn-Gresham neighborhood, Emanuel laid out details for what the city calls the Micro-Market Recovery Program.
The MacArthur Foundation will provide up to $20 million in loans with the idea of leveraging millions more from the private sector. The goal is to collect a total pool of $50 million. The city will select neighborhood groups to find foreclosed properties. Those groups will use the funds to purchase and then rehab the homes, thus making them market-ready.
"It needs a comprehensive, integrated approach rather than home by home because the system is too big and too complicated for that alone. So we are targeting our resources, both public and private and nonprofit," Emanuel said.
The mayor said the program should get about 2,000 homes back on line within three to five years.
Housing and Economic Development Commissioner Andrew Mooney said local groups can purchase the foreclosed properties by using the pooled startup money.
"The idea is straight forward. If we're really going to address the problem, we have to focus on local markets rather than one building at a time. We need to target our resources to help stabilize values, regenerate market forces and reoccupy foreclosed properties," Mooney said.
The city will start the program in nine neighborhoods: Humboldt Park, Chatham, Chicago Lawn, West Woodlawn, Auburn Gresham, West Pullman, Belmont Cragin, Englewood and Grand Boulevard.
Stan Smith, president of the nonprofit New Pisgah Community Service Organization, was on hand for Mayor Emanuel's announcement. Smith said his group hired local construction workers to rehab the bungalow that hosted the mayor, his staff and the press.
Smith said he'd like to participate in the new foreclosure program because in the past he received federal dollars to do rehab work, but that work was only piecemeal.
"We need to do a whole area, capture an area to focus in on it so you don't end up doing one house here and you have 12 more abandoned houses on the block," Smith said.