![]() Frayser, a community in northern Memphis, has suffered more foreclosures and bankruptcies than any other place in Tennessee, according to Lockwood. ![]() Panelist Steve Lockwood, executive director of the Frayser Community Development Corporation (FCDC) in Memphis, Tennessee, described the nonprofit’s success targeting “tipping point” neighborhoods - areas threatened by blight but which still have many healthy properties. In addition to its negative effects on crime rates and property values, blight causes social problems and environmental health issues.īlight’s wide-ranging effects are complicated to address, but stakeholders across the nation are developing and implementing strategies to combat it. “Vacant and blighted properties make people feel less safe and less proud of their neighborhoods,” Graziani reported. Graziani highlighted two recent CCP studies on the effects of blight in Atlanta, Georgia, and Toledo, Ohio, which found that blight costs hundreds of millions of dollars in reduced property values and lost tax revenue and requires millions in safety-related spending. Because lenders rarely approve a mortgage for more than a property’s appraised value, the appraisal gap phenomenon results in market conditions that are more attractive to investors than to owner occupiers, hampering market recovery and replicating ownership circumstances that are more likely to result in abandonment and disrepair. Underappraisal, or an appraisal gap, happens when the market price of a property is higher than its appraised value because of a lack of recent comparable sales in the area. Buyers have difficulty obtaining mortgages for homes in neighborhoods with blighted properties and low sales because of underappraisal. The vacancies, in turn, reduce tax revenue for local governments, which respond by reducing public services and functions such as code enforcement, making the area less attractive and fueling further population loss. Economic disinvestment and the withdrawal of industry increase unemployment and worker migration, which lead to vacancy and deterioration, explained Graziani. On November 2, 2017, the Federal Reserve System presented “ Solutions for Mitigating Neighborhood Blight: Innovations and Policy Strategies,” a webinar in which panelists discussed current research and described successful programs to mitigate the impact of blight and promote neighborhood revitalization.īlight affects all types of communities - rural, urban, and suburban, said panelist Kim Graziani, vice president and director of national technical assistance at the nonprofit Center for Community Progress (CCP). Blighted properties decrease surrounding property values, erode the health of local housing markets, pose safety hazards, and reduce local tax revenue. Neighborhood blight and the presence of vacant and abandoned properties have profound negative impacts on afflicted communities. The City of Toledo’s CRA program works to promote investment to properties located within neighborhoods that have experienced decline as a result of disinvestment.In the “Solutions for Mitigating Neighborhood Blight: Innovations and Policy Strategies” webinar, panelists discussed the impact of blight on communities and presented strategies to promote neighborhood revitalization. The Community Reinvestment Area (CRA) program provides property tax abatement for new construction or for the rehabilitation of residential, commercial or industrial structures within pre-designated areas. The minimum reimbursement is $25,000 and the maximum is $75,000. The grant reimburses 70% of the eligible interior renovation expenses required to meet current state and local building code, fire safety code, and accessibility requirements. The White Box Grant is designed to incentivize property owners to bring vacant commercial first-floor spaces up to current codes to create a functional "white box" space ready for customization and occupancy by a business. The minimum reimbursement is $10,000 and the maximum is $40,000. A facade is defined as the principal face(s) of a building that is on a public street. The grant reimburses 50% of eligible expenses incurred during a comprehensive facade improvement. The Facade Improvement Grant (FIG) program helps property owners transform the facade of commercial, industrial, and mixed-use buildings. The Vibrancy Initiative is designed to enhance the city’s vitality by supporting revitalization efforts that will create jobs, reduce blight, and preserve and improve structures in our community.
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