Like many cities across the nation, Hartford, Connecticut suffers from urban blight. Schools have deteriorated so much that the school system was taken over by the state. Faced with the choice of putting their children in private school and living with rising crime rates, many professionals chose to bail out to the suburbs taking their tax dollars with them. That left the inner city underfunded and with equity leaching out of homes with every passing year.

But things are turning around, thanks to a variety of programs by the state and city governments, as well as local housing authorities. Working synergistially, these programs provide assistance to low income families. There are plenty of programs throughout the nation like that, but what makes Hartford's unusual is that they have a home improvement program for the middle income who normally wouldn't qualify for housing assistance of any kind.

Subsidies for well-to-do yuppies? Don't knock it. These urban pioneers are taking a substantial financial risk. They are moving into areas that have been ravaged by gangs and neglect, and investing in older dilapidated homes that are money pits.

Hartford is one of the oldest communities on the East Coast, with many inner city homes of well over 100 years of age. Crippled by a less than 25 percent owner occupancy rate, homes have failed to build equity from the city's all time pricing highs of the late eighties. Most people who own inner city homes are upside down in their loans, with no equity for home improvements. Properties are becoming run down, or worse, abandoned.

Many opportunists believe that is the time to buy or improve. The state is pitching in with an up to 30 percent tax credit on home improvements for owner-occupied homes which are in designated historical districts, the heart of most urban blight. The cities are pitching in by designating blocks of homes as historical districts so that home owners can qualify for the improvement tax credits. Hartford is also rehabilitating its downtown district, so that homeowners can be near jobs. The city is also going one step further with home improvements that don't have to be secured by equity, enabling upside-down residents and new occupants the opportunity to improve their homes. In short, buy a home in an historic district for $20,000, put $100,000 in improvements, get back $30,000 in tax credits, and give up commuting.

The South Hartford Initiative is a not-for-profit home improvement program funded by the Department of Economic and Community Development. It's mission is the economic and housing development of South Hartford, and is designed to appeal to people who don't necessarily need the loan but could use an incentive. Interest rates are attractive at five to seven percent. But the coummunity-sponsored program wants its money to show - fifty percent of home improvements must be on the exterior, so that the neighborhoods can benefit.

"Most of the existing home improvement programs operated by city governments are restricted to low to moderate income level. Our program was originally going to be that way, but we also wanted to encourage a diversity of income levels in the inner city," explains Rex Fowler, director of the South Hartford Initiative. "Our state legislature increased the income cap of income, but 80% of median income is typical for these city programs. Our program goes to 250% of area median income. In Hartford, that equates to a four-family household. If you earn up to $150,000 and you are an owner-occupant, you are still eligible for this home improvement program."

Fowler explains that property values peaked in the late 1980s. "We have a lot of people who have not built equity in their homes or they are in negative equity positions. This program provides loans despite the fact that there is no equity," he says. "It's a unique situation.

And that's where many like-minded communities are missing the boat. Fowler says he researched housing authority loan programs in numerous cities, with the most comparable being offered by the city of Cleveland, Ohio. " Urban properties just dont skyrocket like the suburbs. Cleveland has a program through the banks that will loan on similar properties, but only if there is equity in the property," says Fowler. "To us, that defeats the purpose because not many people would qualify."

"We hope this will draw young professionals away from the suburbs," says Fowler. "There is a large downtown initiative in public and private investments in Hartford. We think it will be a much more attractive place to live."

Fowler says that he is glad to help any other interested communities to do the same thing. Call 860- 722- 9878 for more information.

Published: August 30, 2000

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