Federal money designed to buoy Twin Cities neighborhoods hit by foreclosures should start filtering down this spring.

Lewiston and Auburn each will receive money from the Neighborhood Stabilization Grant program, part of the Housing and Economic Recovery Act approved by Congress last summer. Auburn will get $1.2 million; Lewiston, $1.47 million. The programs will be run through the cities’ Community Development Block Grant Program.

Councilors from both cities approved the program at their meetings this week. Auburn on Monday; Lewiston on Tuesday.

“The intent here is to help free up capital on a local level,” said Auburn Community Development Administrator Reine Mynahan.

In both cities, the money can be used to buy foreclosed properties that are standing vacant, and to renovate them and put them back on the market. It can be used for either properties taken over by the city for unpaid property taxes or those owned by banks.

“It’s more about preserving the neighborhoods than bailing out a specific property,” Lewiston City Administrator Jim Bennett said Tuesday night. “The idea is to get those properties back to being used, to being occupied and hopefully help the market values.”

In Auburn, Mynahan said the budget is enough to purchase and rehab nine buildings and to demolish four.

“We’re looking at properties that have been on the market, that the banks have tried to sell but not had much luck,” Mynahan said.

The properties are salvageable, he said. “But we want to be able to sell them back at a reasonable price, so we don’t want to put too much in. If they’re too far gone, those might be better to demolish.”

So far, the city has identified two buildings that would be demolished under the program, an unoccupied house at 18 Western Promenade and an abandoned six-bay garage at 192 Winter St.

Mynahan said Auburn would begin taking applications from people to buy the renovated properties in April and May. Applicants will have their credit scores and job histories vetted by the city’s loan committee, and then put on a list.

Those with lower incomes, about 65 percent of the median income ($31,460 for a family of four), will get the highest priority. Those with incomes of up to 120 percent of the median income ($58,080 for a four-person family) will qualify as well, but will have a lower priority.

Lewiston’s program looks to purchase and demolish as many as 50 blighted structures through September 2010, purchase and rehabilitate 10 homes and provide financing to redevelop another 10.


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