Courtney to Malloy: Use HUD funds to help fix crumbling foundations

CT Department of Consumer Protection

A cracking foundation

Washington – President Donald Trump’s budget would eliminate a housing grant program that pays for projects in nearly two dozen Connecticut towns – and Rep. Joe Courtney wants the Malloy administration to also use it to help residents with crumbling foundations before the money disappears.

The Community Development Block Grant (CDBG) program, run by the Department of Housing and Urban Development, is on the chopping block as part of a $6 billion cut to HUD programs, according to leaked reports first obtained by the Washington Post of Trump’s 2018 budget, which is expected to be released Thursday.

Courtney says some of the CDBG money Connecticut receives from two HUD programs, a total of about $17 million a year, could be used by towns to help their residents repair crumbling foundations that used concrete containing pyrrhotite, a mineral that corrodes when exposed to water.

Gov. Dannel Malloy has said damage caused by the faulty foundations in Connecticut could cost anywhere from $100 million to $1 billion to repair, depending on the number of homes and commercial buildings affected. He has said at least 582 Connecticut homes have suffered damage.

The state already has tapped about $1 million of its CDBG money to pay for a program that tests foundations for pyrrhotite.

Connecticut is slated to receive its 2017 allocation of CDBG money in a few months. It won’t be nearly enough to cover the estimated cost of fixing all the crumbling foundations in Connecticut, but Courtney said he wants it to be an option.

“We’ve been having a sort of back and forth with the (Connecticut) Department of  Housing,” Courtney said. “They have to see this as a tool.”

Courtney asked HUD if CDGB money could be used to help homeowners with crumbling foundations and says he was given a green light.

Connecticut receives about $12 million form the CDBG small cities program. Daniel Arsenault, spokesman for the state Department of Housing, said 144 Connecticut towns are eligible for this aid and 21 received grants this year, including Killingly which received $800,000 to replace kitchen cabinets, countertops, sinks, refrigerators and closet doors in all 43 affordable housing units at Maple Court. Ashford  was awarded $56,847 for a food bank program and Ansonia $400,000 to help 10 low-and-moderate-income homeowners rehabilitate their homes.

Connecticut receives about $5 million a year from a second CDBG grant program that is rolled into a Department of Housing competitive grant program that gives money to organizations that run homeless shelters and to urban renewal programs, among other things.

“The state Department of Housing had been very reluctant to do what HUD has told them they can do,” Courtney said.

Arsenault said, “The state will explore all potential options that are available to assist homeowners with crumbling foundations in northeastern Connecticut.”

“But, we will do this with a clear understanding of the impact associated with each of those potential options and make an informed decision with all 169 municipalities in mind,” he said.

There’s another HUD program that could be tapped by the state to help homeowners with crumbling foundations, Courtney said. That’s a loan guarantee program that could provide the state with $60 million, but unlike the grants, would have to be paid back.

Malloy has tried to secure federal funds to help Connecticut’s homeowners, applying twice to the Federal Emergency Management Agency, and he has been rebuffed twice.

Courtney said the state could continue to seek other ways to help those homeowners – and use the HUD money, too.

“It’s not like it’s an exclusive remedy,” he said.

The deep cuts to HUD and the zeroing out of the CDBG grants are likely to be reversed by Congress, with will have the final say over Trump’s plans to  sharply reduce a number of federal agencies, including the State Department and the Environmental Protection Agency.

Trump is proposing these budget reductions to be able to pay for his priorities – including a boost in defense spending and the building of a border wall between the United States and Mexico.

Cuts to the Department of Homeland Security Budget include a 14 percent reduction in the Coast Guard’s budget, “which would obviously affect the Coast Guard’s abilities to police our ports,” Courtney said.

Even though Congress may reject some or most of Trump’s budget cuts, Courtney said, it’s prudent for the Malloy administration to act on HUD funding now.

“(The proposed cuts) are a reminder to the folks in Hartford that they don’t have a lot of time,” Courtney said.

CT Department of Consumer Protection

Towns where deteriorating foundations have been reported to the state Department of Consumer Protection.

 

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