R2004-105 AUTHORIZING FUND REALLOCATION

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.Y � CITY OF DECATUR, ILLINOIS � HOME COMPETITNE REALLOCATION I SELECTION CRITERION 3: POLICIES � INTRODUCTION In Decatur, Illinois, housing for low income residents is a high priority. The City of Decatur ' has responded not only through policy but with commitment of significant financial resources. A community of 81,8601ocated in the central Illinois prairie, Decatur faces problems typical of older manufacturing centers throughout the Midwest. Although it is surrounded by a thriving agricultural area and is itself a major agribusiness center, Decatur has undergone significant economic and population decline in the last two decades. Major retail establishments have fled to outlying communities, leaving a declining central core. Loss of manufacturing jobs has led to a high unemployment rate: 9.2% in September 2003, compared to 7.1% for the State of Illinois and 6.1% for the nation. Income levels and housing conditions reflect Decatur's challenges. The median family income in 2000 was $42,379, considerably below that of Illinois ($55,545) or the nation as a whole ($50,046).2 The older, inner city area includes thirteen Census tracts with family incomes well below the City median, and with over 20% of the population living below the poverty level. These tracts hold the highest concentration of minority population and of rental housing units. They also conta.in the oldest housing stock: over 50% of the housing units in these Census tracts were built before 1950, and many are in substandard condition. Housing for very low income families is Decatur's highest priority need, according to the City's FY2000-2004 Consolidated Plan Housing and Homeless Needs Assessment. The need is particularly acute for medium to large families,the elderly, and African-American populations. "These households suffer,from high housing costs, substandard housing units, and overcrowded dwellings" (p.10). The study identified 1,522 very low income families, and 1,411 African- American families,with an immediate housing need. It also identified barriers to affordable housing, including credit overuse, landlord barriers, Realtor steering, lack of financial education, cost and availability of new construction, land use regulations, and building code regulations. The Plan stated, "The City of Decatur is committed to identifying, addressing, and working to overcome the barriers to affordable housing in our community" (p. 34). To address this priority need,the City allocates approximately 90%of its CDBG project funds and all of its HOME entitlement funds to the creation and preservation of affordable housing. A. MAKING EXISTING HOUSING MORE AFFORDABLE Recognizing the need to make existing housing more affordable,Decatur has implemented several successful initiatives to assist low-income homeowners and renters. Homeownership assistance. Increasing homeownership opportunities is Priority lA in the City's FY2000-2004 Consolidated Plan. To accomplish this, the City set a goal of assisting l O51ow 2 Citations in this paragraph are from the 2000 US Census. PAGE 5