Neighborhood Stabilization Program

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The Neighborhood Stabilization Program (NSP) is a federal program providing funding to states and cities to help rehabilitate neighborhoods hit by the housing crisis. Chicanos Por La Causa was the lead applicant for a national consortium for non-profit affordable housing developers, and was awarded 137 million for the second round of NSP funding to revitalize neighborhoods in eight states and the District of Columbia. David Adame, Chief Financial Officer for Chicanos Por La Causa, talks about the how the program works.

José Cardenas: The federal Neighborhood Stabilization program known as NSP provides funding to states and cities to buy and rehabilitate vacant and abandoned properties. La Causa was awarded $137 million in funding for Round 2 of NSP from the U.S. Department of Housing and Urban Development. With me to talk about the neighborhood stabilization program is David Adame. Welcome back to "Horizonte." You've been a guest in the past, and we've talked about a number of CPLP programs. This one is particularly remarkable because of the size of the grant.

David Adame: Absolutely. We were told by the Secretary of HUD that this was, in history, the largest ever given to a national consortium of Latino organizations across the country, so we're very proud of it. Not only was it the largest award. We're actually the lead in the nation in this program, really demonstrating that nonprofit consortia can be a good economic generation and make this program successful.
José Cardenas: You were, as we noted in the introduction, the lead for this proposal. How was it that that came about?

David Adame: Well, we're part of a national association called the National Association of Latino Community Asset Builders, and we were asked to be the lead agency, because we're one of the largest members of the membership in the country with a capacity to really manage this size of grant, not only managing the dollars coming through but also managing the compliance to make sure everything is going according to plan and to rules and regulation. We also set up different innovations to make sure we could efficiently manage and demonstrate this program. Part of it was creating a web-based portal to make sure that folks across the country could call us if there was any questions or problems associated with any part of this whole process. Again, we're buying foreclosed properties, abandoned properties, doing a scope of work, rehabilitating them, and putting them with families so they'll have a nice place to live.

José Cardenas: How do you make sure that happens? There's been a lot of ink in the press lately about investors coming in and almost a repeat of what happened a few years ago, buying up houses and making it difficult for the people to get into the housing market.

David Adame: Our outreach, we do home buyer fair expos to make sure we educate the community. This is about getting homes in the hands of families. One of the things we really do is to make sure that we have a counseling component of our program, so all the families go through an eight-hour counseling session. We're a HUD-certified counseling agency as well as the members of the consortium across the country. We make sure this is going to be their primary residence and a place they can call home for their family.

José Cardenas: The program covers a number of states, as we noted, and the District of Columbia.

David Adame: Everything is different. Every market's different. As far as the chance to buy homes, the investor issue has been throughout the country, and we've been able to make sure that our agencies reach out to all the partners in the different markets to make sure that we are a good clearinghouse for that. Again, because we've been number 1 in the country, we're getting support from other major lenders, city, community development in particular being very supportive of us. Home Depot, Lowe's, companies like that that have come in to enhance the program and give us other tools to make this program really work.

José Cardenas: Are you talking specifically about CPLC?

David Adame: Yes. Absolutely. Again, we're the lead agency. We manage all the dollars, and we've had clean audits, clean reviews, clean monitoring to make sure we're doing this well. We're very proud of that, because the Secretary of HUD actually made this program available to nongovernment agencies such as ourselves to demonstrate how efficient a nongovernment agency would really make this program work. We're number 1 in the country. Habitat for Humanity is number 2 in the country. We think we've demonstrated that we can make this a market-driven type of program working through the non-profit.

José Cardenas: Number 1 in the country as measured by what?

David Adame: By getting the dollars out in a timely manner, meeting your goals. And I think the most important factor is how do you leverage the dollars from a recycling standpoint? The award was 137 million, but you're allowed to recycle these dollars. For example, we buy a house. We rehab it. We sell it to a family. The dollars we recruit, we could then go get another house. We clearly have demonstrated that we have the ability and efficiencies to recycle. We could double the amount depending on how well we're doing. There's been three rounds of this program. There was a first round. We got a three-year head start and up. We're actually ranked number 3 in the country as far as recycling. We've recycled about 25 million of these dollars already in this program.

José Cardenas: Does that include the opportunities that are available because of your existence?

David Adame: I'm glad you asked that, because that's a big part of the Obama administration's excitement about this program and why this program is being proposed in the Jobs Act and some of the new legislation going through. We've been able to create jobs with this. We've created about 850 jobs. Indirectly, we've created about 2300 jobs. Exterminating, realtors, construction jobs created with this, and we're very proud of that fact. We're proud that about $30 million have gone to small businesses throughout the country with the 13 other nonprofits who are working in this program.

José Cardenas: All of this was the subject of a conference recently. Was it here in Phoenix?

David Adame: Yes, it was.

José Cardenas: In these circles, it was kind of star-studded in terms of the dignitaries you had here to talk about this.

David Adame: Absolutely. We had one of the assistant secretaries from HUD. She's overseeing the program. She doesn't come out to every conference you want to have. She came out because she wanted to congratulate us. It was a conference to talk about where we're at and to make sure we want to make ourself accountable and do even better, but it was also a conference to celebrate where we're at so far, and the Secretary came out to acknowledge our great work and to encourage us to continue and to really pay homage to us as far as what impact we're making -- historic impact we're making not only from a Latino perspective but from a nonprofit perspective that this is a good model to make impact in our communities.

José Cardenas: Tell us what will happen in future in terms of the development of the program and your role.

David Adame: We're getting notoriety. The Secretary mentions us in many conferences, and we get attention from that. Last week we were invited to Chicago to participate in former president Bill Clinton's global initiatives program, another initiative that will go out and raise $400 million to continue to do similar work, to create jobs, to create housing opportunities. We're also hoping that the next round of this funding will be approved. It was part of the Jobs Act that didn't get any traction, but it's getting attention from both sides of the aisle because of jobs impact.

José Cardenas: So bigger things to come.

David Adame: Absolutely.

José Cardenas: Thank you so much for joining us on "Horizonte" to talk about it, and congratulations on the success today.
David Adame: Thank you for the opportunity.

José Cardenas: That's our show this Thursday night. From all of us here at Horizonte, I'm José Cardenas. Have a good evening.

David Adame:Chief Financial Officer, Chicanos Por La Causa;

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