Florida Realtors®: Spend $100M of Banks' Settlement Money On Workforce Housing

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May 09, 2012, 02:46 ET

ORLANDO, Fla., May 9, 2012 /PRNewswire-USNewswire/ -- As a strong advocate for affordable housing, Florida Realtors® urges Florida Attorney General Pam Bondi to put the Sadowski Housing Trust Fund at the top of the state's list to receive some of an expected $300-plus million due from the recent foreclosure legal settlement with five of the nation's largest banks.

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Florida Realtors and other groups belonging to the Sadowski Housing Coalition say that at least $100 million of that money should go into the trust fund, which receives a portion of the state's documentary stamp tax revenues. That funding supports affordable housing efforts across Florida, including the State Housing Initiative Program (SHIP) and State Apartment Incentive Loan program (SAIL).

"Using pre-existing programs to administer the [settlement] money, rather than creating new programs, is the most cost-effective and expeditious way to implement the funds," Florida Realtors President Summer J. Greene said in a recent letter to Florida Attorney General Pam Bondi, urging proceeds be placed into the Sadowski Trust Fund. "These programs have a high standard of excellence in the housing community and are used as models for programs around the country by various state and local governments."

In recent years, the cash-strapped Florida Legislature has swept money out of the Sadowski Trust Fund and added it to general revenue. Coalition members point out that transferring some of the settlement money would help ease the devastating impact those cuts have had on housing programs -- and it fits the stated goals for the money. Under the bank settlement, funds should be used "to avoid preventable foreclosures" and "ameliorate the effects of the foreclosure crisis."

"The SHIP and SAIL programs fund several activities that directly address these purposes," Florida Realtors President Greene pointed out in her letter to Bondi. "SHIP dollars can be used for downpayment and closing cost assistance, as well as the rehabilitation of foreclosed homes ... SAIL dollars are made available for construction or rehabilitation of multifamily units ... ensuring that those who have lost their homes in the foreclosure crisis have a place to live."

Five leading banks -- Bank of America, JP Morgan Chase, Wells Fargo, Citigroup and Ally Financial -- reached a nationwide $25 billion joint state-federal mortgage servicing settlement, of which Florida receives about $8.4 billion. Most of the money will go directly to homeowners in the form of a principal reduction or cash payment following a foreclosure. However, about $300 million is earmarked for the Florida Attorney General's office to spend at its discretion to help distressed homeowners.

Florida Realtors®, formerly known as the Florida Association of Realtors®, serves as the voice for real estate in Florida. It provides programs, services, continuing education, research and legislative representation to its 115,000 members in 63 boards/associations. Florida Realtors® Media Center website is available at http://media.floridarealtors.org.

SOURCE Florida Realtors