Tag: GAO

A call for examination of federal real estate programs

The following post originally appeared on the National Low Income Housing Coalition blog.

The home mortgage interest deduction turns 100 years old this year. Is it still doing the most it can for American families and taxpayers?

Smart Growth America recently examined the federal government’s involvement in the real estate market and its impact on homeowners, renters and communities across the country. The new report, Federal Involvement in Real Estate: A call for examination, surveys 50 federal real estate programs to better understand where this money goes and how it influences development in the United States. The spending examined in the report’s analysis includes tax expenditures, loan guarantees, and low-interest loans and grants – totaling $2.23 billion in federal spending over the five year study period.

This involvement has an enormous impact on the U.S. real estate market, and even a cursory analysis reveals this impact is uneven. Outdated programs and lack of coordination across agencies contribute to this imbalance, the report explains. As a result, many federal programs are not targeted to those most in need, are not targeted to strengthen existing communities and are not targeted to create more places with economic opportunities.

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New report from GAO details bus rapid transit’s contributions to local economic development


An summary of bus rapid transit features. Image from the Government Accountability Office.

In a new report released this week, the Government Accountability Office explores bus rapid transit (BRT) as a less costly way for communities to meet their transit needs and spur economic development.

“Bus Rapid Transit Projects Improve Transit Service and Can Contribute to Economic Development” surveyed 20 BRT projects regarding their features, design, performance, ridership, cost, and effect on the community. Faster than regular bus service and cheaper to create than street cars or subways, BRT can improve transportation choices at a relatively low cost.

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The high cost of vacant homes: a new report from GAO

In 2010, there were 10.3 million vacant homes in America. Many are vacant as a result of foreclosure, and they’re costing municipalities at a time when public budgets are already strained to the breaking point.

A new report from the Government Accountability Office (GAO) examines trends in the number of vacant properties, how they relate to the recent increase in foreclosures, the cost of maintaining and administering these properties and strategies for coping with the crises. GAO analyzed Census Bureau vacancy data and data on property maintenance costs from the Federal Housing Administration and two housing-related government-sponsored enterprises. The Office conducted case studies in nine cities selected to provide a range of local economic and housing conditions, rates of foreclosure, and geographic locations.

For many cities, vacant and foreclosed properties are more than just another costly expense. Tending to these properties costs money, but neglecting them can cost far more, and the report from GAO makes clear the scope of this problem. The Huffington Post explained the dilemma vacant properties pose:

While the upkeep and maintenance of a vacant home is technically the responsibility of either the homeowner or the mortgage owner, in practice it often falls to the town, which has to pay for basic services – like cutting the grass, boarding up windows and draining swimming pools – to keep the property from falling into total disrepair. Alternatively, the town can have the vacant property demolished [but] either way, the tab for cities and towns is often high. Detroit, for example, has paid $20 million to demolish 4,000 properties in the past two and a half years, the GAO found.

Communities incur costs in other ways as well. The GAO noted that vacant homes are often associated with crime and accidental fires, which require the attention of police and fire departments, thus tying up city resources. And cities often see their property taxes fall as vacant homes drive down the value of homes around them.

While vacant properties pose serious challenges to the communities faced with them, cities and states are already using great strategies to turn these properties into assets. Land banks are public authorities created to acquire, hold, manage and develop vacant properties. Land banks aim to convert vacant properties that have been neglected by the open market into productive use, and are already in use in Ohio and New York. Land banks are a great way for municipalities to deal with the high cost of vacant homes and support their local economy in the process.

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