NEW: Elorza Unveils Plan to Clean Up, Sell Providence’s Vacant Properties in First Term
Tuesday, October 07, 2014
Standing in front of a backdrop of vacant and boarded up homes on Providence's North End, Democratic candidate for Mayor of Providence Jorge Elorza introduced his plan to address Providence's problem of vacant properties and create new affordable, safe and healthy homes in the city.
“We can clean up and sell the majority of vacant and abandoned homes in Providence within the first term of my administration – at no taxpayer expense,” said Elorza.
Cost of Redevelopment
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTElorza proposes funding this redevelopment initiative through the creation of a $5 million revolving loan pool, and working with local Community Development Corporations among other key stakeholders to ensure that state and federal resources for affordable housing are leveraged to their full potential.
"We will go to market with a municipal bond offering to create a $5 million revolving loan pool so that redevelopment projects can move forward quickly. The benefit of this model of borrowing is that there is no annual debt service. The bonds will be repaid from the earnings generated from the sale of redeveloped homes," said Elorza.
Elorza estimates that cleaning up and rehabilitating Providence's abandoned properties will require six months per property and cost an average of $100,000.00 per property, and he expects his administration to process about 100 homes annually.
"With an average redevelopment cost of $100,000, the City can have around 50 projects under construction at any given time with a $5 million loan pool. Based on the duration of recent projects using the receivership process, it is estimated that homes can be redeveloped and sold within six months," said Elorza.
To incentive and expedite developers and owners to work with the city on this initiative, Elorza proposes offering tax abatements, allowing developers to add a five percent fee to the purchase price of homes, and charging a 10% abandoned property penalty on all properties vacant for one year or more.
Housing First Strategy
Elorza did not answer directly when asked if he plans to create a new position in City Hall to oversee this initiative, while indicting that he would employ the Housing Board and also the Superior Court to select receivers
"Using existing state law in a novel way, the city will employ the Housing Board and also the Superior Court to select receivers and clear titles to put these properties back to productive use," said Elorza.
According to Elorza, the Improving Neighborhoods and Boosting Homeownership Plan is central to his "Housing First Strategy" of creating safe, healthy and affordable housing.
"Ultimately, we aim to do nothing less than eliminate the blight caused by foreclosed and abandoned properties in our city – without cost to Providence’s taxpayers," said Elorza.
Related Slideshow: Questions Jorge Elorza Must Answer to be Providence’s Next Mayor
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