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Milwaukee will use $15 million in federal funding to rebuild and resell foreclosed homes

Department of City Development Commissioner Lafayette Crump holds a plaque for the City of Milwaukee and local developers. The city allocated federal funds to give to developers who will rehabilitate and sell up to 150 homes in the inner city. (Staff photo by Ethan Duran.)

Milwaukee officials on Wednesday announced the start of the Homes MKE initiative, a partnership between the city and local developers to rehabilitate foreclosed homes and sell them to new homeowners.

The city partnered with 15 developers to renovate up to 150 foreclosed city-owned houses inside Milwaukee, Alderman Russell Stamper II of the 15th District told The Daily Reporter. The Common Council allocated $15 million in American Rescue Plan Act (ARPA) funds for the Department of City Development with the goal to create more homeowners and give local developers construction experience, city officials said.

The program will provide construction jobs, help strengthen neighborhoods and promote home ownership, DCD Commissioner Lafayette Crump said at a news conference.

“The neighborhoods that are the cleanest, safest and healthiest are the neighborhoods that have the most homeowners,” Stamper said at the news conference. The city purposefully recruited local developers who had some experience to help them grow their portfolio, he added.

The city allocated around $394 million in ARPA funds from 2021, according to the city website. The Common Council discussed how much funding would go to housing and redevelopment for two years, but officials said the need for more homeowners has been around for longer.

The work will start in Summer of 2023, Alderman Robert Bauman, who represents the 4th District, told The Daily Reporter. The city identified properties, developed scopes of work, put together scopes of works and requested proposals from developers. Now, the city if finally in a position to transfer houses to the development teams and get work done, he added.

“It’s taken some time. To a certain degree, some time is necessary to do it right. You don’t want to throw money out there without accountability, control and planning. But we’re now moving. I expect the money to be flowing this summer and you’re going to see a lot of work taking place,” Bauman said.

The developers will renovate home interiors, exteriors, heating systems and electrical systems, as well as replace lead sewer lines and sewer laterals in partnership with the Milwaukee Metropolitan Sewerage District, Bauman said at the conference.

Alderman Michael Murphy, who served as chair of the task force to allocate the ARPA funds, said the homes would serve as a way for residents to grow generational wealth.

“These homes are now going to serve as places for people to generate real wealth. Most Americans’ largest asset is a home. In our city, too many people have been left out of that equation. Too many people have not had the opportunity to own a home because of many discriminatory practices, intentionally and unintentionally. The city is making a commitment to help people in this neighborhood to get a home and have long term wealth for their family and generational families,” Murphy said at the news conference.

Milwaukee was also left reeling from the 2008-09 financial crisis, which hit the heart of many cities, Murphy added. The federal money helped kickstart the program to rehouse many Milwaukeeans, he said.

“I’m very appreciative and grateful of the Biden Administration and the United States Congress that made available these federal dollars to allow us to do this. We would not be able to be here if it wasn’t for the federal government stepping in with ARPA funding,” Murphy noted.

“I voted for the American Rescue Plan Act not only to help Wisconsin through the COVID-19 pandemic, but also to help our state build back stronger for the next generation. I’m proud the City of Milwaukee is using these resources to deliver more affordable housing opportunities to its residents, transforming properties into future homes. This investment will create good-paying jobs in the trades, expand high quality affordable housing inventory and help create a stronger Milwaukee,” U.S. Senator Tammy Baldwin said in a statement.

Congresswoman Gwen Moore echoed Baldwin’s words and added the initiative will expand access to affordable housing.

“The American Rescue Plan Act was a meaningful investment in our communities, and gave cities and municipalities the flexibility to use these funds to address vital needs. I was so proud to vote to pass this legislation in the House, and am thrilled that this funding will deliver on this promise, thanks to our amazing local leaders. The Homes MKE initiative will expand access to affordable housing, create jobs, and help make homeownership a reality for more of my constituents,” Moore said in a statement. 

The Community Development Alliance, an affiliation of community development funders and practitioners, sent out a request for proposal on April 13 inviting homebuilders to develop and sell around 50 single-family homes specifically for early childhood education professionals in different parts of Milwaukee. The CDA has raised a total of $4.5 million for the project and all proposals are due by May 8, according to the request.

The initiative would offer youth opportunities to take on different trades and become leaders in their community, Leonard Langdon of LCL Property Management LLC told The Daily Reporter.

“It’s going to be a major impact, because now we get to show our youth different outlets and different strategies to make money and create avenues to feed their families in the near future,” Langdon noted.

In September of 2022, the city selected 15 development firms through a competitive request for proposal process to work with the DCD and community partners to renovate vacant homes. Developers included T.A.S Solutions, LLC, Walnut Way Conservation Corp., Ezekiel Community Development Corporation and Rico Love Foundation LLC.

About Ethan Duran

Ethan Duran is the construction and development reporter at The Daily Reporter. He can be reached at (414) 551-7505 or [email protected]

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