New Hampshire, through CDFA, has been awarded two Neighborhood Stabilization Program (NSP) awards from the U.S. Department of Housing and Urban Development (HUD). In March 2009 CDFA received an award of $19.6 million (NSP 1) and an additional $5 million (NSP 3) in April 2011. The program is designed to address the effects of abandoned and foreclosed properties in certain communities and neighborhoods in order to put them back into service for the benefit of rehabilitation and extended affordability. It is a component of the CDBG program and generally follows its requirements. The program is authorized under Title III of the Housing and Economic Recovery Act of 2008 and the Dodd-Frank Act, signed into law in July of 2010.

CDFA conducted an extensive community input process, combined with consultation with in-state housing expertise and HUD guidance, to assure that its structure for implementing the Neighborhood Stabilization Program will be optimally effective.

NSP 3

Having already administered more than $19 million in the first round of NSP, HUD announced in September 2010 that NH and CDFA would receive an additional allocation of $5 million in the third round of NSP funding. This required CDFA to file an Action Plan by March 1, 2011, describing how funds will be used. This plan will update the original Action Plan from 2008 to incorporate changes in the NSP program as mandated by HUD.

Eligible Activities for Use of Funds

New Hampshire’s NSP allocation can be used for the following activities:

Establish financing mechanisms for purchase and redevelopment of foreclosed upon homes and residential properties, including such mechanisms as soft seconds, loan loss reserves, and shared-equity loans for low- and moderate-income homebuyers;

Purchase and rehabilitate homes and residential properties that have been abandoned or foreclosed upon, in order to sell, rent, or redevelop such homes and properties;

Demolish blighted structures; and/or

Redevelop demolished or vacant properties.

Full activity descriptions can be found in the Action Plan.

Application/Timing

Under NSP 3, HUD has designated 48 census tracts in New Hampshire that are eligible for potential funding. Communities that include one of these census tracts must submit a letter of intent to apply for funding by January 31, 2011. That letter must include a map of the eligible census tract(s). To be eligible, a tract must have an NSP Need Score of at least 13 alone or in combination with other contiguous (bordering) tracts. Click here for Letter of Intent to Apply requirements.

NSP 1

In June 2009, CDFA awarded $18.5 million to five awardees: the City of Berlin; Harbor Homes, Inc.; the City of Manchester; the City of Nashua; and the City of Rochester. As these five awardees sell rehabilitated and newly constructed properties to low-, moderate-, and middle-income homebuyers, earning up to 120% of Area Median Income, CDFA will collect these earnings and issue additional awards.

Recycled program funds from “Tier 1” applicants will be available to “Tier 2” communities in mid 2011 or 2012. Tier 2 communities include Barnstead, Claremont, Farmington, Franklin, Hillsborough, Laconia, Newport, Ossipee, Pittsfield, Raymond, Wakefield, and Whitefield. All NSP 1 awardees must complete their projects and draw their award funds by March 9, 2013.

Last updated February 7, 2011