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Topic: Flint, Genesee County and the Hardest Hit audit
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untanglingwebs
El Supremo

I left the housing portion of the Master Plan after several of my questions were answered in a manner that made it obvious the decisions were already made. In one question and answer publication a question about redevelopment was answered:

"While demolition of vacant homes is a top priority, Flint must diversify its housing stock to meet changing market needs. Currently 78 % of Flint residences are single family homes. This does not match well with the growing demand for apartments, townhomes, and mixed use options among young professionals, family and elderly."

In my opinion this dialogue sounds too close to the stated goals of the Sasaki Plans developed for the core of Flint. Nowhere in the master Plan is language for helping families save their homes from foreclosure. The Hardest Hit Fund was originally created for that purpose and even the Blight Elimination plan has the goal of stabilizing neighborhoods to prevent foreclosures.
Post Thu Apr 13, 2017 12:10 pm 
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untanglingwebs
El Supremo

The SIGTARP found a misuse of the funds in Indiana when the blight funds were used to move homeowners and demo the properties so a car dealership could relocate. This raises the possibility that there are instances in which adhering to the Master Plan for the selection of the homes to be demolished and the stated goals of the Master Plan are not going to be in sync with the purpose of the Hardest Hit Plan.


Could Buying a Home in Flint Actually Be a Smart Investment? | realtor ...
www.realtor.com/news/are-flint-homes-smart-investments/
Feb 11, 2016 - Housing prices in Flint, MI. may have nowhere to go but up—which could make it an opportune time to invest in the city's real estate market. ... has seen young families and seniors capitalize on the lower property prices to buy ...
Post Thu Apr 13, 2017 12:18 pm 
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untanglingwebs
El Supremo

Could Buying a Home in Flint Actually Be a Smart Investment?

REAL ESTATE NEWS
Could Buying a Home in Flint Actually Be a Smart Investment?
By Clare Trapasso | Feb 11, 2016
flint-water-plant
Brett Carlsen/Getty Images
Last year, longtime renter Belinda Bell achieved a longtime dream: She, her husband, and their 9-year-old twins moved into a nicely appointed, three-bedroom, 1.5 bath, brick house with two fireplaces that they had purchased for $34,000 in cash. The same home had sold for nearly $122,000 in 2003.

Unfortunately, the home was in Flint, MI.

Just a few months later, Michigan’s governor declared a state of emergency in the 200-year-old city, acknowledging that the foul-smelling, brown-tinted water Bell had observed in her home was contaminated by lead. And just like that, her modest dream became a nightmare.


Now the lifelong Flint resident feels trapped in a house whose value has plummeted and whose future sales prospects have become murkier then the water that bubbles from its kitchen sink. She knows that the chances of cutting bait and selling to recoup her investment right now are slim to none.

“Sometimes I get very emotional about this,” says Bell, who has her daughters brush their teeth with bottled water. “Our life has been altered.”



But Bell, like many other locals, is steadfastly optimistic that once clean water flows again through the municipality’s pipes, home prices will eventually stabilize—and even rise. And that thinking has led increasing numbers of people—current Flint homeowners and outside speculators alike—to posit that this could be an opportune time to invest in the city’s real estate market, as unlikely as that might seem.

Property values had plunged in Flint long before news of the poisoned water made headlines.The bustling, manufacturing city had become the poster child for economic collapse, as Flint’s largest employer, General Motors, laid off masses of workers in the 1980s. It led to a huge spike in unemployment and crime and an unwelcome starring role in Michael Moore’s 1989 post-Reaganomics economic collapse documentary,“Roger & Me.” Particularly hard-hit by the most recent housing crisis and recession, the place was just beginning to get back on its feet.

And then the water went bad. And so did everything else.

The crisis actually began in 2014, when the city, in an effort to cut cash, switched its water source from Detroit to the Flint River, a process that caused the aging pipes to corrode—leading to massive lead contamination. By the time the problem was brought to light as a national horror story, some 12,000 children had already been exposed to the tainted water. While corrective actions are finally being taken, it remains a public health threat on an epic scale.

Now sellers, who had begun to see home prices creep up, are struggling to find buyers willing to pay more than a fraction of what they had originally paid for their properties.

Flint home sales by the numbers

But however grim the current housing market is, real estate agents seem confident that prices have nowhere to go but up. “Once the water crisis has been resolved and state and federal steps have been taken to improve Flint’s infrastructure, home values will begin to improve,” says real estate agent Paul Raymond, of Paul Raymond Associates at RE/MAX Select. He owns 58 single-family homes in Flint, which he rents out.

Raymond estimates it will take 18 to 24 months for the local market to show signs of growth once the water problem is remedied—but it’s still not clear how long that will take.

In 2015, 805 single-family homes were sold in Flint, with an average sale price of $22,775, according to data Raymond pulled from the East Central Association of Realtors®. The average sale price is not even half of what it was—$57,067—in 2003.

There were 367 Flint homes for sale, ranging from $1,500 to $225,000 as of Feb. 5, according to association data. The average list price was $26,500.

“The fact that you can purchase a home to own for a lifetime for less than what it would cost you to rent it for three years is amazing,” Raymond says.

Flint's home price cuts

There are already signs that prices are poised to rise, says Jonathan Smoke, chief economist at realtor.com.

The city could benefit from its close proximity to Detroit, which has been undergoing its own resurgence, as companies and workers look for lower-cost property in Flint, Smoke says.

“From a pure price perspective, it looks like an attractive buying opportunity,” he adds. “Absent the crisis, you would expect things to be improving.”

Before the state of emergency was declared, Flint’s property values had been rising annually between 5% and 10%, he said.

But in light of the water crisis—combined with skyrocketing crime rates and plunging population—the market now has a glut of home inventory.

“The question is: Are the homes on the market worth the risk?” Smoke says.

Robert Edelstein, a real estate professor at the Haas School of Business, at the University of California, Berkeley, doesn’t think so. He believes the water crisis will prompt even more employers to flee the already economically depressed city—further perpetuating the cycle of decline.

Buying a home in Flint “would be a bad investment,” he said. “The outlook for economic [and] demographic growth is poor to dismal.”

But, even mid-crisis, there are still buyers on the market—eager to take their chances, and advantage of the rock-bottom home prices.

Flint resident Vernon Johnson, 51, and his wife expect to close on their new, $15,000, three-bedroom city residence this week. “It’s affordable for me right now,” says Johnson, a soda bottling plant technician, who added that he drinks only bottled water and has installed water filters on faucets throughout his current home.

Why is he remaining in the city? “I like to stay close to my job,” he says. “I have faith to believe that it’s all going to turn around.”

Flint real estate broker Grant Hamady, at Weichert Realtors® Grant Hamady, has seen young families and seniors capitalize on the lower property prices to buy in better parts of the city. And he’s seen a recent influx of investors from states like California, buying up houses to rent them out.

Some sellers are even throwing in water-filtration systems to sweeten the deal, he says.

Local investor Bill Clark, president of Vash Investment Group, is also betting that housing prices will rise as time softens the stigma stamped upon his hometown.

“It’s the best time ever to invest in Flint, because of the rock-bottom prices,” contends Clark, whose company owns about 30 homes in the city. “We [were] at the lowest of the low pricing, and [then] the water crisis came in and knocked the value down.”

His company buys up local real estate, renovates the properties and then sells them to buyers with poor credit by providing financing (typically at a high 8.9%) or through lease-to-own options.

His latest purchase was a three-bedroom, two-bath home with a one-car garage and partially renovated basement in Flint for $25,000 in December. During the peak of the housing market, the home would have sold for about $90,000, he says. But, needless to say, this is not the peak.

“We’ve always dealt with crisis,” Clark says. “We will come back.”
Clare Trapasso is the senior news editor of realtor.com and an adjunct journalism professor. She previously wrote for a Financial Times publication and the New York Daily News. Contact her at clare.trapasso@move.com. Follow @claretrap
Post Thu Apr 13, 2017 12:38 pm 
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untanglingwebs
El Supremo

So is it the best time to buy or are the majority of individuals moving into Flint enters?
Post Thu Apr 13, 2017 12:43 pm 
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untanglingwebs
El Supremo

Genesee County Land Bank - Funded Demolitions
www.thelandbank.org/blightfree.asp

Since 2014, the Genesee County Land Bank Authority (GCLBA) has received a total of $67.4 million in Hardest Hit Fund (HHF) dollars for demolition in Flint and ...




This site explains the Genesee County Land Bank Demolition plan and lists sites to be demolished.

Note: Their costs are lower than those indicated by SIGTARP in their most recent audit that included 3 Michigan cities.
Post Fri Apr 14, 2017 4:13 pm 
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untanglingwebs
El Supremo

Genesee County Land Bank facing federal audit over demolition...
nbc25news.com/news/local/genesee-county-land-bank-facing-fed...

Mar 27, 2017 ... After SIGTARP did a complete review of the program nationwide, it is now auditing each city which uses the funds. Genesee County Land Bank ...
Post Sun Apr 16, 2017 10:01 am 
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untanglingwebs
El Supremo

Feds subpoena state housing agency
Joe Guillen , Detroit Free Press Published 3:01 p.m. ET Feb. 2, 2017 |



A federal watchdog agency subpoenaed the Michigan Homeowner Assistance Nonprofit Housing Corp. last year for data about applicants seeking federal funding.

The MHA, in collaboration with the Michigan State Housing Development Authority, evaluates requests from municipal demolition programs for federal reimbursements from the Hardest Hit Fund, from which more than $250 million has been allocated to Detroit.

It processes requests for two types of federal assistance — money for blight demolition and mortgage relief for struggling homeowners. Last week, the agency demanded Detroit's demolition program pay back $7.3 million for improper reimbursements for blight demolition.
ADVERTISING

Although the two subpoenas came from SIGTARP — the federal agency investigating Detroit's demolition program — officials say the subpoenas are unrelated to the city's program.

MHA Vice President Mary Townley said the subpoenas came after the MHA would not provide SIGTARP with the data because it contained personal information. After the MHA declined to hand over the data voluntarily, SIGTARP delivered a subpoena, Townley said.

Read more:

Michigan finds $7M wrongly reimbursed demolition costs

Michigan reviewing payments for Detroit demolition consultant

"We've received only two subpoenas ever, and they're not on the Detroit program at all," Townley told the Free Press on Jan. 19. "They are from SIGTARP, asking for specific data for the entire Hardest Hit program."

SIGTARP is a watchdog and law enforcement agency responsible for monitoring the Hardest Hit Fund. As part of its criminal investigation into Detroit's demolition program, it subpoenaed the Detroit Land Bank Authority and the Detroit Building Authority in May.

The Free Press obtained the two subpoenas to the MHA under the Freedom of Information Act.

Katie Bach, a spokeswoman for the Michigan State Housing Development Authority, said in a statement Thursday that it is not unusual for SIGTARP to conduct reviews and audits of the national program for its quarterly reports.

"My understanding is the two subpoenas were requested as a direct result of issues involving other participating states, and not related to the Detroit demolition investigation," Bach said.

The subpoenas request data files of "raw Hardest Hit Fund (HHF) application level data." The subpoena in September seeks data as of the second quarter of last year and the December subpoena requests data as of the third quarter. Both also demand "current policies and procedures applicable to the HHF Applicant Data File such as applicant intake management and eligibility criteria for HHF programs."

There are significant differences between SIGTARP's subpoenas to the MHA and the Detroit agencies.

The subpoenas to the MHA came from SIGTARP's general counsel, B. Chad Bungard, and they cited the need for information for an audit. The subpoenas to the Detroit demolition agencies referenced an "ongoing investigation" and were delivered by a "criminal investigator/special agent" whose name was redacted under a FOIA exemption.

Contact Joe Guillen: 313-222-6678 or jguillen@freepress.com. Follow him on Twitter @joeguillen.


Last edited by untanglingwebs on Sun Apr 16, 2017 10:24 am; edited 1 time in total
Post Sun Apr 16, 2017 10:10 am 
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untanglingwebs
El Supremo

Each of the three Michigan Cities audited in 2015-2016 are getting a second audit. First and ongoing Detroit and now Flint. Lansing will be last. What I find interesting is the FHA , in this instance MSHDA, which received one of two subpoenas. Michigan leads in demolitions, but the state has a dismal record in helping homeowners save their homes. The HHF could have helped with mortgages and taxes for qualifying homeowners.
Post Sun Apr 16, 2017 10:23 am 
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untanglingwebs
El Supremo

Audit Reports - SIGTARP
www.sigtarp.gov/pages/audit.aspx

Waste and Abuse in the Hardest Hit Fund in Nevada. Audit (September 9, 2016) · Engagement Memo (February 2, 2016). Treasury's HHF Blight Elimination ...


Go to the reports and audits link
on pages 150 to 154 of the January 2017 Report to Congress addresses some of the issues that might be addressed in the upcoming Flint Audit
Post Tue Apr 18, 2017 5:57 pm 
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untanglingwebs
El Supremo

Sally Haywood
56 mins · Flint, MI ·
I have spent days reading reports and audits from Special Inspector General Troubled Assets Relief Program (SIGTARP) and they are scary awesome.! They released a 298 page report to Congress on January 27,2017 and included a portion on Michigan. Flint turned down 84% of homeowners earning less than $30,000 and the records for those decisions were missing or incomplete.
The Michigan State Housing Development Authority (MSHDA) has been hit hard by the HUD Office of Inspector General (OIG) for releasing funds improperly, such as giving Boji over $500,000 for the property on Clio and Pierson when it was a State contract and not a Flint contract. The OIG demanded repayment.
Also, Where are the programs for minority and female owned businesses. The County list I saw has to be nearly 20 years old. Why do many of these companies have to leave this county to be employed?
This is not the first SIGTARP audit involving Flint or the State of Michigan. Also other agencies are looking at the SIGTARP issues and MSHDA was forced to work with Treasury to create rules statewide.
Will they find the Land Banks bidding process lacking as it bears some resemblance to the troubling Detroit process. Also is any of the "Greening" money accounted for when properties are sold before the 5 year contract period or are all Land bank properties mowed with these funds?
Then there are potential conflicts-of-interest existing within the Flint and Genesee government and the "shadow government" that is controlling development for both. SIGTARP has uncovered similar misuses in other states. The Bankruptcy Court was furious with bias within Flint West Village and Kettering.
LET THE SUNSHINE AND TRANSPARENCY BEGIN!
Post Wed Apr 19, 2017 7:13 am 
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untanglingwebs
El Supremo

People get confused when I say Flint is being reinvented only for the "better class of poor". What were the reasons that 84% of those earning $30,000 or less were rejected from a program designed to help them. Was the goal to use the HHF money to demolish homes in areas desirable for future redevelopment. Were any of these people denied former GM workers who lost their jobs? We will never know because there was lax record keeping.

I once referred a young couple to Kildee's office because the wee denied help. They fit the criteria because their financial problems resulted from efforts to save their young daughter who was dying. Kildee was able to get them help, but their situation was exactly why the program was created. How many others were wrongly denied and SIGTARP asks if the state and local entities created standards that were too stringent.

SIGTARP also asks if contractor relationships are too cozy and if the criteria for bidding is overly restrictive. SIGTARP will look at where and how the homes to be demolished will be selected and the level of minority and female contractors involved in the demolition process.
Post Wed Apr 19, 2017 7:31 am 
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