Neighborhood Stabilization Program
Total Stimulus Appropriation: $2,000,000,000
New Jersey’s Portion: Unknown; funds will be distributed on a competitive basis.
Allocation Method: Competitive grant method that is open to the State, units of local government, non-profit entities, or consortia of non-profit entities which may partner with for-profit entities.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Program Overview
The Neighborhood Stabilization Program provides funding to reduce neighborhood blight and create affordable housing. The funds can be used to purchase, rehabilitate, resell or rent foreclosed and abandoned properties. Funds can also be used to establish financing mechanisms or establish land banks, demolish blighted structures, or redevelop demolished or vacant properties. Funds must be used to assist households with incomes at or below 120% of the area median Income with 25% of the funds used for households with incomes at or below 50% of the area Median Income. The criteria for a competitive NSP grant will include grantee capacity, leveraging potential, concentration of investment to achieve neighborhood stabilization and additional factors determined by the Secretary of Housing and Urban Development. Grantees have to expend at least 50% of allocated funds within 2 years of the date funds become available to the grantee for obligation and 100% of funds within 3 years of such date.
Federal Requirements and Restrictions
Provision of Title I of the Housing and Community Development Act of 1974 as amended apply, except for unalterable requirements related to fair housing, nondiscrimination, labor standards and the environment including lead-based paint, in accordance with the terms of section 2301 of the Housing and Economic Recovery Act of 2008.
Program Eligibility
The HUD Secretary will establish criteria for grant competition within 75 days after the date of enactment (May 3, 2009). Applications are due to HUD within 150 days after the date of enactment (July 17, 2009). Applicants will have to demonstrate capacity, ability to leverage investment, and ability to achieve neighborhood stabilization. Grants must be given to areas with the highest foreclosure numbers and rates and where the funding can be used within the established timeline.
Important Program Dates
May 2009- HUD announces criteria for competitive grants

July  2009- HUD deadline for submission of competitive applications

Frequently Asked Questions:
Q: How will this help New Jersey?
A: If New Jersey applicants are awarded new NSP funds, the ARRA will provide much needed assistance in stabilizing blighted neighborhoods and creating affordable homes by financing the acquisition, rehabilitation, and resale of properties in areas most affected by the recession.

Q: How much money will New Jersey receive through the Stimulus?
A: To be determined – competitive process with applications due to HUD by July 17, 2009.

Q: What can the NSP money be used for? 
A: NSP funds can be used to purchase, rehabilitate, resell or rent foreclosed and abandoned properties. Funds also can be used to establish financing mechanisms and land banks, demolish blighted structures, and redevelop demolished and vacant properties. All funds must be used to assist households with incomes at or below 120% of the area of median income and 25% of the funds used for households with incomes less than 50% of the area’s median income.

Q: Who is eligible to apply for NSP funds?
A: Any unit of local government, non-profit entities and consortia of non-profits entities may apply directly to HUD for an award through a competitive process.

Q: What are the time frames for expending NSP funds?
A: Grantees must expend at least 50% of the new NSP funding within 2 years of the date funds become available to the grantee for obligation, and 100% of the funds within 3 years of that date.


For more information on the NSP, please visit the U.S. Department of Housing and Urban Development’s website at: http://www.hud.gov/recovery/