Aurora begins spending funds to fight foreclosures

The countdown to September is ticking as Aurora begins spending the nearly $3.1 million in federal funds the city received last March to assist in purchasing and rehabilitating foreclosed homes in the city's hardest-hit areas.

The city received the money from HUD in March to alleviate pressures from the more than 3,000 foreclosures facing the city at that time. As part of the program, the city is required to spend at least 25 percent of the funds on developing rental properties.

Aldermen agreed, at Tuesday's committee of the whole meeting, to begin the process by signing agreements with a builder, a consultant and the Community Housing Association of DuPage.

Associate Planner Gwenn San Filippo said staff members have begun identifying homes currently in the foreclosure process and identifying those in neighborhoods with high levels of foreclosures or risky loans. Of those, she said the city intends to purchase about approximately 15 homes at a reduced price and begin bringing them back up to code. Between five and seven of those will be rehabilitated and made available for renters, she said.

But what isn't spent by Sept. 18 will have to be returned.

"One of the objectives is to be able to recycle the funding," said Neighborhood Development Director Karen Christensen. "So what we're able to obligate by September of this year, as we're able to get projects moving forward and then bring the money back, we'll have a pool of money that we can continue to use to address foreclosures in the community."

Part of the program approved Tuesday also calls for those who purchase the rehabbed homes to participate in a homebuyer class at the Joseph Corp.

She and several aldermen said they believe there is incentive for the builders to build high quality homes that will sell for more than the purchase price so that the city can continue to replenish the fund, thus providing more work for the builders.

"As you might imagine, we don't want this to be a slap and dash kind of thing. It's really important that whatever money we're investing in rehab goes toward really good quality rehabs," Christensen said. "We're making sure that the quality of the rehabs make these properties that will shine on the street because part of the whole point of this project is that this could be a catalyst on the block."