Part of the 14th Street NW area devastated by the 1968 riots and a former Maryland "new town" are scheduled to receive new housing subsidies to spur rehabilitation and revitalization, the U.S. Department of Housing and Urban development announced yesterday.
Under the new Neighborhood Strategy Area program, a property owner, in exchange for agreeing to rehabilitate and rent his property to low- and moderate-income families, will receive subsidies to make up the difference between what each tenant can afford and the "contract" - or normal - rent for each apartment.
The owner must find other sources - private or government - to finance the rehabilitation work itself.
HUD Secretary Patricia Roberts Harris announced at a press conference that 117 neighborhoods nationally have been approved for the program and another 38 have received conditional approval. Over the next five years, Harris said, 37,688 housing units will be rehabilitated and rented to poor families. The program is estimated to cost roughly $160 million a year, a HUD spokesman said.
Once property owners have applied for and received the subsidy commitments from HUD, they will be in a much better position to get rehabilitation financing from lending institutions and displacement of poor families will be minimal, U.S. and local housing officials contend.
Harris said the program, which allows local governments to target neighborhoods where assistance can be expected to produce significant revitalization within five years, fulfills a promise she made "to more fully involve mayors and other local officials in the revitalization effort."
HUD approved an application for Greenbelt Homes, Inc. in Greenbelt, a former "new town" built by the federal government in the 1930s and later bought by the residents and turned into a cooperative corporation. Also approved was a District of Columbia application for the area bounded roughly by Fairmont Street NW on the south, 15th and 16th Streets on the west, Oak Street on the north, and 13th Street on the east.
Among the 18 proposals rejected by HUD were four in the Washington area - for Jefferson Village and Lacey Park Gardens in Fairfax County, and neighborhoods, a HUD spokesman said. The area HUD office will work with these applicants to see if other HUD programs can be used to help them, he added.
In the District of Columbia, about $10 million in rehabilitation work is needed for 13 city-owned and privately-owned buildings, according to a city housing official. The private owners of 377 vacant units in the 14th Street area already have declared their intention to use the new HUD program, the official said.
"It's difficult to get financing for low- and moderate-income rental housing." Leland noted. "Lenders just aren't making loans for properties of this kind, partly because of the cloud of rent control and because this is such a transitional neighborhood."
In Greenbelt, the owners of 325 cooperative housing units will receive subsidies for 40 years, according to John Shanley, project planner for the Prince George's County community development program.
Greenbelt Homes, located in the northeast section of Prince George's County, is an economically mixed community of 4,000 people, Shanley said. Shanley estimated that $7 million in rehabilitation is needed there and he said those funds may come either from low-interest loans through the state of Maryland or from private banks.