Federal Legislation

President-Elect Obama to Create Office of Urban Policy

The President-elect’s transition co-chair, Valerie Jarrett, has confirmed the new administration’s commitment to creating an Office of Urban Policy, designed to coordinate the federal government’s policies affecting U.S. cities. Obama had originally announced his plans for the new office on the campaign trail in June before the U.S. Conference of Mayors. Additionally, President-elect Obama has promised to take other measures to assist U.S. cities, including increasing Community Development Block Grant funds. The new administration has not yet selected a Chief of Urban Policy, but the mayor of Miami, Manny Diaz, has indicated that he is under consideration for the post.

Brownfield Tax Incentives Renewed in Financial Rescue Package

The federal Emergency Economic Stabilization Act of 2008, passed in early October, reauthorizes two key programs that encourage redevelopment, the Brownfields Tax Incentive and the New Markets Tax Credits (NMTC). The Brownfields Tax Incentive program, which, until now, was effective only from 1997 to 2007, allows property owners to immediately and fully deduct the costs of environmental cleanup on contaminated sites, encouraging investment in degraded areas. The program’s reauthorization will retroactively cover eligible cleanup costs from 2008, as well as future costs. The New Market Tax Credits program provides capital to private entities or individuals that invest in low-income areas. Both the NMTC and the Brownfields Tax Incentive program have been renewed through 2009. For more information, view the Council of Development Finance Agencies’article on the rescue package programs.

HUD Allocates Funds for Neighborhood Stabilization Program

As part of the newly created Neighborhood Stabilization Program (NSP), the Department of Housing and Urban Development (HUD) has distributed a total of $3.92 billion to states to counter the effects of housing foreclosures. The program, created under the Housing and Economic Recovery Act of 2008, specially allocates Community Development Block Grant (CDBG) funds–ordinarily used for general neighborhood revitalization and economic development projects–to states and localities so that they may purchase, demolish, redevelop, or rehabilitate foreclosed or vacant properties. States and localities may also use the funds to assist low- to moderate- income homebuyers with down payments or closing costs. The funds were allocated according to need, determined based on the ratio and number of foreclosed, sub-prime financed, or abandoned homes in each state or locality. For more information on the NSP, see the Citizens’ Housing and Planning Association summary.