The money is about to start flowing for a multimillion-dollar effort to stabilize neighborhoods in Fresno County.
Fresno city officials have awarded more than $7 million in contracts to four groups to buy and fix up bank-owned houses.
Fresno County, meanwhile, is joining forces with Kerman to get another $7 million in federal funds into the marketplace.
The plans are part of President Barack Obama's Neighborhood Stabilization Program, which allocates billions of dollars nationwide to preserve communities wracked by foreclosures.
The unprecedented effort could expand with a second round of funds for which local governments would have to compete.
"This is the first time anything like this has been tried on this scale," said Eileen Neely, chief operations officer of Fresno Housing Authorities. The Fresno City Council awarded that agency $5 million in stimulus money.
More than 200 houses are likely to be bought and preserved throughout Fresno County with stimulus money. That's a small percentage of the houses going into foreclosure, Neely acknowledged, but she said it could help neighborhoods most at risk.
"We really hope it primes the pump and we see more individuals coming in and investing," she said.
It's all happening even as the number of bank-owned properties has dwindled in the marketplace. Foreclosed properties are harder to find because of moratoriums that slowed down the foreclosure process and because of demand from buyers.
But more foreclosures are expected soon as the moratoriums expire and rising unemployment takes its toll.
"There is lots of backlog in the system," Neely said.
The Fresno Housing Authorities received the largest chunk of money. The remainder will be split among the non-profit Coalition for Urban Renewal (CURE), which is getting $800,000; the city's Redevelopment Agency, $800,000; and 2M Development Corp of Clovis, $500,000.
The $4 billion federal Neighborhood Stabilization Program provides $11 million to Fresno and $7 million to Fresno County.
Most of the money will be used to buy bank-owned properties, renovate them and sell or rent them to low-and moderate-income families. The rest will be used to buy properties that could be sold or rented to families earning 50% or less of the median income.
The Fresno Housing Authorities will add $2 million to their $5 million share to create collateral for two lines of credit totaling $18 million. The agency will use that money to buy foreclosures, rehabilitate them and sell them to families earning less than 120% of the median income, which is about $66,950 for a family of four, Neely said.
The Housing Authorities agency anticipates buying about 120 houses in Fresno neighborhoods that have many foreclosures. The city is targeting neighborhoods south of Ashlan Avenue, with a strong presence in the Lowell and Jefferson communities near downtown.
CURE will help 11 families buy homes, targeting the Lowell and Jefferson neighborhoods. Executive Director Nathan Magsig also wants to help the area west of Highway 99 where, he said, "you have clusters of houses that went back to the bank."
CURE will use the $800,000 to create a line of credit worth $1 million.
The nonprofit agency, which recently sold its 100th home, has experience buying foreclosures. Over 18 months, it has bought and renovated seven bank-owned houses, including one on Dorothy Avenue in southwest Fresno that is for sale for $69,000, Magsig said.
The Fresno Redevelopment Agency also will seek out properties in Lowell and Jefferson, as well as the Fresno High School area.
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