HUD accepts $125 million disaster recovery plan

DES MOINES - Another $125 million in Housing and Urban Development disaster recovery funds should be in the pipeline within a week to fund housing assistance, small business stimulus and public works projects in Iowa.

State officials hope the next announcement from HUD, expected in early April, will involve even larger numbers.

The $125 million, which brings to $282 million in Community Development Block Grant (CDBG) funds the state has received to help 2008 flood and tornado victims, will help fund what Iowa Department of Economic Development Mike Tramontina called "steady progress" in recovery efforts.

FYIAccording to the plan for the latest $125 million in Community Development Block Grant funds, Iowa will spend:

FYI

According to the plan for the latest $125 million in Community Development Block Grant funds, Iowa will spend:

• $30 million on housing rehabilitation

• $35 million on new housing production

• $10 million on non-FEMA housing buyouts

• $5 on small business stimulus

• $32 million on public facilities and services

• $5 million for floodplain mapping

• $1 million for green building training

• Up to $6.2 million will go to administration of the funds.

These funds are part of the $6.5 billion Congress approved in September for disaster recovery. Iowa leaders have been upset with the formula the Bush administration used to allocate the funds, saying too much of the CDBG money went to Texas and not enough to Iowa.

If Iowa's proposed formula for distributing the remainder of the $6.5 billion is accepted, Tramontina said the next round of funding could be as much or more than Iowa has received so far.

"There's a lot at stake," he said. "It should be bigger, but it's very hard to guess what we'll get."

Gov. Chet Culver, Sen. Tom Harkin, U.S. Rep. Dave Loebsack and others have met with HUD and White House officials to make Iowa's case.

Harkin was encouraged HUD accepted Iowa's plan for the $125 million.

"I'm encouraged that HUD worked out the details of allocating these funds and that these desperately needed funds were released to Iowa," Harkin said.

Tramontina pointed out this is the first batch of money to include assistance to landlord in providing much-needed rental housing. Landlords can get up to $24,999 per unit for projects of seven units or less plus up to $12,500 for other costs, Paula Hinzman Mitchell, Cedar Rapids community development housing program supervisor, said.

So far, the city has received 540 applications for 875 units, she said. Applications are being taken at www.corridorrecovery.com and her office at the city public works building, 1211 6th Ave. SW.

He sees signs the recovery effort is gaining momentum. So far, more than 1,500 applications for housing and commercial projects have been received. Nearly 40 percent are in Cedar Rapids, he said.

Like Cedar Rapids, more cities are demolishing flood-damaged homes and the first infrastructure grant will be awarded later this week, Tramontina said.

"It's been a long time coming," he said. "It's definitely a process, but I think this spring people will see the program happening. It's a 24- to 36-month process, but we're starting to see steady progress."

FYIHousing:

FYI

Housing:

• Cedar Rapids, nearly 40 percent or $11.9 million

• Cedar Falls, 4.64 percent or $1.4 million

• Iowa City, 3.43 percent or $1.03 million

• Waterloo, 3.42 percent or $1.03 million

Small business stimulus:

• Cedar Rapids, nearly 62 percent or $3.1 million

• Cedar Falls, 3.09 percent or $154,500

• Iowa City, 7.4 percent or $370,000

• Waterloo, 2.28 percent or $114,000