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Hernando Today

LETTER TO THE EDITOR

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The Tampa Tribune

Published: February 22, 2009

Adkins: CPR Gives County A Fighting Chance
We have two major issues in Hernando County that are hindering the road to economic recovery: home foreclosures and rising unemployment. We can all debate until we are blue in the face whose fault it is. Unscrupulous lenders, overdevelopment, Wall Street, borrowers in over their head, a culture of over reliance of credit.

We are all to blame. At the end of the day, we have to deal with the reality of the boom and the bust. We must find a way to deal with the aftereffects of a nation drunk on get rich quick schemes. In Hernando, we must find a way to get vacant foreclosed homes off the market and at the same time, offer a solution to the rising unemployment problem. The Comprehensive Plan for Recovery (CPR) is attempting to resolve these problems.

I have enlisted Blaise Ingoglia to help draft the program. Critics are saying that this is a self-serving "solution" on his behalf because he is in real estate. Yes, it is true that he makes his living in the real estate industry, but who better to offer a solution than someone who fully understands real estate and its relevance to our economy?

If we were having an economic crisis in manufacturing, wouldn't it be wise to enlist a manufacturing expert? If you were trying to stop abusing alcohol, who would you turn to a person who has never had a drink or a recovering alcoholic? The fact of the matter is real estate got us into this mess and a comprehensive understanding of real estate, finance and business principles will help get us out.

CPR will offer an incentive for potential homebuyers to buy up existing foreclosure inventory by offering economic stimulus grants (ESG) of up to $5,000. It will be restricted to homesteaded properties and, possibly, second homes.

No investor purchases qualify and selling the home within two years will trigger repayment of the grant. Special incentives will be given to first-time homebuyers. ESG money will be used for a variety of reasons, but most likely will be used to rehab the property. According to HUD, the biggest hurdle to homeownership is down payment. In this economic environment, it will be hard enough for people to save the down payment, let alone the cash and/or credit needed to repair a home in disarray. ESG money gives the purchaser, especially the first-time homebuyer, much needed money to accomplish this.

The goal is to have the grant money spent inside Hernando County. We can accomplish this by giving the grant in the form of a debit card. These debit cards have a 24-month expiration date. As a condition of the grant, we can ensure that all money is spent inside our county.

The program will allow home inventory to be absorbed by the free market quicker, spark an increase in rehab activity and increase sales for local businesses not only selling home improvement items, but all businesses. It will help alleviate the problems that are plaguing our county. In short, CPR will do more for Hernando than that boondoggle of a stimulus package coming out of Washington, using far less tax money that we do not have to print or borrow from China!

This program will actually help government revenues. This program stabilizes the home market, which helps stop falling home values, which then helps stop falling government revenues. CPR will also have the potential to increase government revenues. When a foreclosed property is valued (and assessed) it is much lower than if that same property is rehabbed. Purchasing these properties and the subsequent rehab work will raise the value of the home and, thus, increase revenues thereby putting less pressure on government to raise user fees.

I have estimated that, post rehab, with a modest average increase in value of 12 percent, the county will see an increase of tax revenues from property taxes of $215,900 every year. This revenue, along with recapture of sales tax and the goodwill that shows our residents that we care about them will more than pay for itself over time.

This program will help everyone from government to the busboys at your favorite local restaurant.

I am asking for this program to be budgeted for $2.5 million. Half will be released into the program with a 12-month review, so there is an option to discontinue. This program will be very easy to administer. In order to accomplish this, we are not raising taxes.

We are using money sitting there in reserves, not doing anything for the taxpayers of Hernando County. The county filled its coffers in the boom time. Now it is time for the county to put the overages to good use. As a fiscal conservative, I do not like using taxpayer money. I would have preferred the county not collect all this money in the first place.

We can sit around and do nothing or we can choose to be leaders and show the residents of this county that we are not willing to just sit back while our family, friends and neighbors continue to lose their jobs at an alarming rate. CPR gives our county a fighting chance at economic recovery.

This proposal of the program is an outline. CPR gives us a map for the road to recovery. It is not finished yet. There is still a lot of work to be done. Citizen input is not only welcomed, but needed.

James Adkins

County Commissioner

District 5

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