Colorado will receive $34 million to buy up distressed properties. Of that, Denver will get about $6 million.
This isn't right, This isn't even wrong.
Look at the path the money follows to get here:
The state of Colorado will allocate the HUD funds, and community development groups, with the help of elected officials, will use the money. NSP money can be combined with HUD's Community Development Block Grant (CDBG) Program funds as well as other funding resources.
This doesn't even include all the administrative costs; some of the $6 million will go to those, as well. The fingers in the pie include: the IRS, HUD, the state of Colorado, community development groups, local elected officials, who will rely on local bureaucrats, all of whom have incentives to maximize their respective cuts, none of whom have incentives to actually improve neighborhoods. I'd love to see the cost accounting at the federal, state, and local levels for this cash, but none will be forthcoming, I'm sure.
Worse still, $6 million isn't even worth the effort. According to the City Assessor's Office, we can roughly value all the residential real estate, both real property and condos, at about $40 billion. Six million isn't enough to arrest a trend of declining home prices; it is, however, enough to pick favorites and reward allies.
If there are distressed properties for improvement at a profit, there are plenty of investors willing to risk their own money, without having to make the round trip through three different bureaucracies.
Maybe they could even hire some of those paper-pushers to do the framing.