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Hernando Today

Stimulus Plan For Hernando County

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By MICHAEL D. BATES

Hernando Today

Published: February 11, 2009

BROOKSVILLE - President Obama this week is pitching his $827 billion economic stimulus package to the masses.

But today, Hernando County Commissioner Jim Adkins will tout a stimulus plan of his own before his colleagues on the board. Only this one is tailored to meet the specific needs of Hernando County, he said.

"I think government needs to step in and do what it can to help out the economy," Adkins added.

To that end, Adkins said he enlisted the help of civic activist and local homebuilder Blaise Ingoglia to craft a three-pronged "Comprehensive Plan for Recovery," to be formally unveiled at today's land use hearing, which begins at 9 a.m. at the Hernando County Government Center, 20 North Main St. in downtown Brooksville.

The plan focuses on three areas: reducing the number of foreclosures on the market, assisting first-time homebuyers and stimulating local business.

Adkins said he recruited Ingoglia to write it because of his knowledge in the building and construction trades and contacts in the finance world.

Adkins said this recovery plan is a work in progress and believes the final shape will change after lengthy debate among staff members, board members and the public.

Adkins said he has run the plan by builders and Realtors and the majority are on board with it.

Cost: $2.5 Million

The Adkins-Ingoglia plan would require the county to take $2.5 million out of the general fund reserves. The first phase lasts 12 months and sets aside $1.25 million to issue grants to potential homebuyers as an incentive to buy foreclosed properties.

After the purchase, the homebuyers would submit the paperwork to the county for an "Economic Stimulus Grant" (ESG). To qualify for an ESG, they would have to meet these criteria:

•Purchase a foreclosed property within county limits.

•The purchase price must be no more than $180,000.

•The property must be owner-occupied or a second home (no investors).

•The homebuyer must sign an affidavit not to sell the property within one year of purchase and sign a statement of good faith to spend the ESG money inside the county. The county would track that by issuing ESGs in the form of pre-paid debit or gift cards and not checks.

•The applicant cannot accept any money from the State Housing Initiatives Program (SHIP), Neighborhood Stabilization program (NSB) or any other down-payment assistance from non-profit organizations.

Nuts And Bolts

Once the county determines that eligibility requirements are met, it would issue the ESG to the homebuyer for whatever is lesser: 4 percent of the purchase price or $4,000.

For example, if the home costs $180,000, the ESG grant would be the lesser of $7,200 or $4,000 - so the latter number would apply.

For an $80,000 home, the ESG would be the lesser of $3,200 or $4,000 so the percentage amount applies.

When the amount of unused funds approaches $200,000, the plan calls for the county to issue press releases and notify the local board of Realtors and start an "ESG Funds Reservation Policy" so the remaining money is appropriated on a first-come, first-served basis to limit any potential duplication of funds.

The plan also allows the county to issue ESGs to first-time homebuyers who purchase a foreclosed home valued at $120,000 or less. The only difference is that the ESG for those applicants would be the lesser of 5 percent or $5,000.

Ingoglia said if the entire budget of $2.5 million is used under the ESG program - using an average grant of $3,500 to $4,500 - Hernando County "will potentially" be able to reduce the number of foreclosures on the market by 555 to 710 homes in one to two years.

The program also has the potential for reducing home inventory levels by about 21 percent and reducing foreclosure inventory levels by 42 percent, he said.

Ingoglia said he wrote the plan and ran it by Adkins. He also said he bounced the ideas in the plan by local business owners, builders, Realtors and county officials, including County Administrator David Hamilton and County Attorney Garth Coller.

"The great part about this plan is we're not waiting for the state and federal government to pull us out of recession," Ingoglia said. "We're doing it ourselves."

Ingoglia said the plan is broad-based to include all segments of the local economy.

Ingoglia said he didn't want to make the mistake of the federal government by issuing stimulus checks that were just deposited in local banks.

This plan forces people to spend the money, hopefully at local businesses, Ingoglia said.

"By giving the economic stimulus plan in the form of a debit card with a two-year expiration date, it forces people to go out and spend the money and the challenge is to get them to spend it locally," Ingoglia said.

This is where restaurants, doctors' offices and other local business will have to get creative and promote discounts for ESG recipients, Ingoglia said.

For example, a restaurant owner could offer to buy one meal and get the second free, or an orthodontist could cut the price of braces for ESG holders, he said.

Reaction

"I think it's a very interesting plan and it has some possibilities to put some of the trades to work and fixing up some of these foreclosures," said Dudley Hampton, president of the Hernando Builders Association.

Hampton said the plan shows "creative thinking."

Commissioner Rose Rocco called the plan "basically good" but believes phase one might have to start lower than the $1.25 million.

Rocco also wants to make sure this plan doesn't duplicate other stimulus plans available to county residents.

Reporter Michael D. Bates can be reached at 352-544-5290 or mbates@hernandotoday.com.

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