(Washington, DC)—Today, Congressman Emanuel Cleaver, II and the U.S. Housing and Urban Development announced that the City of Kansas City will receive $7.323 million to help respond to the effects of sub-prime foreclosure disaster. The money comes as part of the new Neighborhood Stabilization Program authorized by Congress and championed by Congressman Cleaver.

The funding is provided as Community Development Block Grants (CDBG) Program under the Housing and Economic Recovery Act of 2008. Kansas City will be able to use the funds to purchase foreclosed homes at a discount and to rehabilitate or redevelop them in order to stabilize property values, keep neighborhoods safe, and help more people afford a place to call home.

"Thousands of families in our community have lost their homes and the current crisis is affecting them in a very real way that is easy to understand. But block after block of empty houses affect our entire community in ways that are more complicated. Vacant houses breed crime, surrounding home values fall and entire neighborhoods are lost,” said Cleaver.

“Kansas City has been working hard to position itself to efficiently distribute the $7.3 million which is greatly needed in our community. We are doing everything we can to reduce the numbers of foreclosures and appreciate the efforts of Congress to help the everyday citizen struggling in this economy.” said Kansas City Councilwoman Cindy Circo, Chair of the Housing Committee.

“When I was Mayor, I came to believe deeply in the value of providing affordable housing options. Perhaps that comes from growing up in public housing. In the 90’s we invested millions of dollars in housing in Kansas City. The result was close to 7,000 new, renovated or refurbished affordable homes in some of our poorest neighborhoods. Now all of that progress is slipping away because of foreclosures. My hope in fighting for this money is that it can be put to use quickly to stop the bleeding and begin to heal our neighborhoods.”

Other communities in Missouri’s Fifth District will be eligible for neighborhood stabilization grants as part of a $42 million allocation to Missouri to assist smaller cities.

Specifically this money can be used by Kansas City, and other area grantees, to acquire land and property; to demolish or rehabilitate abandoned properties; and/or to offer downpayment and closing cost assistance to low- to moderate-income homebuyers (household incomes may not exceed 120 percent of area median income). The program will also seek to prevent future foreclosures by requiring housing counseling for families receiving homebuyer assistance. In addition "land banks" can be created to assemble, temporarily manage, and dispose of vacant land for the purpose of stabilizing neighborhoods and encouraging re-use or redevelopment of urban property.

“Based on recommendations from Councilwoman Circo, and her colleagues on the Housing Committee, I insisted the funds be targeted to communities based on the number of foreclosures, subprime mortgages and mortgage defaults and delinquencies. This increased Kansas City’s share of the allocation,” said Cleaver

Additionally, HUD will issue specific rules that will assist communities in the administration of this new program to ensure, as Congress directed, that these grant funds be obligated for specific activities within 18 months. “I realize this will be a challenge for communities to develop programs on such a tight time frame, but time is of the essence. People need help now. Our neighborhoods are collapsing now. This money needs to be put to use now,” said Cleaver.

Emanuel Cleaver, II is the U.S. Representative for Missouri’s Fifth Congressional District, which includes Kansas City, Independence, Lee's Summit, Raytown, Grandview, Sugar Creek, Belton, Raymore and Peculiar, Missouri. He is a member of the exclusive House Financial Services Committee and the Speaker’s Select Committee on Energy Independence and Global Warming. Congressman Cleaver also serves as a Regional Whip of the Democratic Caucus and Second Vice-Chair of the Congressional Black Caucus.