Community Development Block Grant (CDBG) Program - Neighborhood Stabilization Program (NSP) | California Department of Housing and Community Development

The Housing Economic and Recovery Act of 2008 provided $3.9 billion nationwide for the Neighborhood Stabilization Program (NSP), which provided funds to state and local governments to purchase abandoned and foreclosed homes and residential property.

The goal was to stabilize falling home prices and rejuvenate neighborhoods and communities that were hardest hit by the foreclosure crisis. The 2008 funding became known as “NSP1;” the $1.9 billion provided under the American Reinvestment and Recovery Act of 2009 (ARRA) was known as “NSP2;” and “NSP3,” established as part of Section 1497 of the Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), provided additional assistance for the redevelopment of abandoned and foreclosed homes with an emphasis on rental activities.

Program Overview

Grant funds were made available for the purpose of providing affordable housing for very low-income and low-income households in the areas that continue to experience the impacts of the foreclosure crisis. A minimum of 25 percent of NSP1 and NSP3 funding will be used to assist households at or below 50 percent of the area median income (AMI), with the remaining funds assisting households at or below 80 percent of AMI.

Eligible Activities

Acquisition, rehabilitation, and either resale or rental of NSP3-eligible foreclosed or abandoned residential properties, including green and energy-efficiency retrofits where feasible, in order to rent or sell them to income-eligible households. Eligible properties contained up to four units. Income-eligible households earned 80 percent or less of the adjusted AMI.

Eligible Applicants

Cities and counties that do not receive NSP3 funding directly from HUD, and which meet the following HUD NSP criteria:

NSP3 Needs Scores of 18 or higher;
Unemployment numbers at or above 15 percent; and,
Number of units required to be impacted at or above four units per LOGRECNO (record number from HUD’s NSP3 Needs report).

Funds were divided between the eligible applicant jurisdictions, based on final scores.

Resources

Quarterly Performance Reports

Community Development Block Grant (CDBG) Program - Neighborhood Stabilization Program (NSP)

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Program Overview

Eligible Activities

Eligible Applicants

Resources

Quarterly Performance Reports

Contact

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