News Release

HUD ANNOUNCES NEARLY $25 MILLION IN ‘SWEAT EQUITY’ GRANTS TO HELP FAMILIES BUILD THEIR OWN AMERICAN DREAM
More than 1,500 affordable homes to be built with SHOP grants

NEW ORLEANS - More than 1,500 families will realize their American Dream with a little elbow grease and $24.8 million in grants announced today by Housing and Urban Development Assistant Secretary Pamela Patenaude. HUD is awarding these so-called "sweat equity grants" to four national and regional organizations through the Department's Self-Help Homeownership Opportunity Program (SHOP).

Patenaude made the announcement as she joined Habitat for Humanity volunteers constructing 15 affordable homes in Covington, Louisiana. First constructed in Rockefeller Center in New York, Jackson, Mississippi, and as far away as Los Angeles, these homes are being reassembled throughout the Gulf Coast region and will eventually provide affordable homes for hurricane evacuees.

"This funding not only helps families to purchase their first home, but taps into their own sweat equity to make them feel more invested in their new neighborhood," said Patenaude. "With a little investment and elbow grease, great things can happen and our SHOP program is proof of that."

The following nonprofit organizations were awarded SHOP grants (see attached for more detailed summary):

SHOP grants are provided to national and regional nonprofit organizations that have experience in providing self-help housing. These funds are used to purchase land and make improvements on infrastructure, which together may not exceed an average investment of $15,000 per dwelling. These non-profit organizations propose to distribute SHOP funds to several hundred local affiliates that will acquire the land, select homebuyers, coordinate the homebuyer and volunteer efforts for sweat equity, and assist in the arrangement of interim and permanent financing for the homebuyers.

Homebuyers contribute a minimum of 100 hours of sweat equity on the construction of their homes and/or the homes of other homebuyers participating in the local self-help housing program. Self-help housing or sweat equity involves the homebuyer's participation in the construction of the housing, which can include, but is not limited to, assisting in the painting, carpentry, trim work, drywall, roofing and siding for the housing.

Labor contributed by volunteers also helps buyers who are unable to perform their sweat equity tasks due to disabilities or other reasons. Frequently persons with disabilities are able to substitute tasks by performing administrative tasks. The sweat equity and labor contributions by the homebuyers and volunteers significantly reduce the cost of the housing.

HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low- and moderate-income Americans; and supporting the housing needs of the homeless, elderly, and of people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.

Fiscal Year 2005 SHOP Awards

Habitat for Humanity International (HFHI) is awarded a SHOP grant in the amount of $10,773,000. HFHI is a national nonprofit organization that will use SHOP funds in rural, metropolitan, and urban areas to facilitate and encourage innovative homeownership opportunities through the provision of self-help housing. SHOP funds will be used to purchase land and make necessary infrastructure improvements, primarily in support of new construction. A portion of the SHOP award will be used for administration, planning, and construction. Local affiliates will compete for SHOP funding from HFHI on a national basis. Completed properties will be transferred to homebuyers who contribute a significant amount of sweat equity, in addition to other volunteer labor, toward the construction of the unit. HFHI will produce a minimum of 672 housing units. Contact: Mr. Paul F. Rogers, (202) 628-9171, ext. 4912.

Housing Assistance Council (HAC) is awarded a SHOP grant in the amount of $9,000,000. HAC is a national nonprofit organization that will use SHOP funds in primarily rural areas for land acquisition and infrastructure improvements that support new construction. A portion of the SHOP award will be used for administration, planning and management development. Local organizations developing self-help housing will compete for SHOP funding from HAC on a regional basis in order to achieve a national distribution of funds. Each local organization is permitted to custom design how it will use the funds in compliance with SHOP requirements. Completed properties are sold to homebuyers who contribute a significant amount of sweat equity toward the construction of the unit, in addition to other volunteer labor. HAC will produce a minimum of 540 housing units. Contact: Mr. Moises Loza, (202) 842-8600.

Community Frameworks is awarded a SHOP grant in the amount of $4,500,000. Community Frameworks is a regional nonprofit organization serving primarily the states of Washington, Idaho, Oregon, and Montana. Community Frameworks and 26 local participating affiliates will use SHOP funding to buy land and make necessary infrastructure improvements that support new construction and rehabilitation. A portion of this SHOP award will be used for administration, planning and management development. Each local organization is permitted to custom design how it will use the funds in compliance with SHOP requirements. Completed properties are sold to low-income homebuyers who contribute a significant amount of sweat equity toward the construction of the unit, in addition to other volunteer labor. Community Frameworks will produce a minimum of 270 housing units. Contact: Ms. Linda Hugo, (360) 377-7738.

ACORN Housing Corporation (ACORN) is awarded a SHOP grant in the amount of $572,000. ACORN is a national nonprofit organization that will use SHOP funds in Chicago, IL; Houston, TX; New York, NY; Phoenix, AZ; New Orleans, LA; and, other cities to be identified. SHOP funds will be used for land acquisition and infrastructure improvements that support new construction and rehabilitation. Some SHOP funds will be used for administration, planning and management development. Completed properties will be sold to low- and very-low income homebuyers who contribute a significant amount of sweat equity toward the construction of the unit, in addition to other volunteer labor. ACORN will produce a minimum of 30 units. Contact: Mr. Martin Shalloo, (312) 939-1611, x 153.

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