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Kresge issues $4.5 million guarantee to ensure housing nonprofit is ready to help Detroiters facing eviction

COVID-19, Detroit, Social Investment Practice

United Community Housing Coalition is equipped, but state logjam keeping millions at bay

TROY, Mich — The federal government allocated more than $600 million through the CARES Act to Michigan to help renters facing eviction. And Michiganders need the help. Estimates show that just in Detroit, tens of thousands of people face eviction or housing instability due to COVID-19.

But those dollars are tied up, as state of Michigan leaders can’t come to an agreement – the Michigan House, Senate and governor’s office have each released unique plans to allocate CARES Act dollars.

Meanwhile, the clock is ticking, and the Troy-based Kresge Foundation has stepped in to provide support to United Community Housing Coalition (UCHC), to ensure the nonprofit housing organization has the funds it needs to serve residents sooner rather than later.

When a state plan is approved, rental assistance dollars will first flow to Michigan State Housing Development Authority (MSHDA). From there, MSHDA will disseminate funds through local housing development corporations. Detroit is expected to receive up to $94 million in funds, with a little less than half of that expected to move through UCHC, which has a growing database of renters who need help to avoid eviction and possible homelessness.

Backed by a $4.5 million unfunded guarantee, UCHC is expected to access $5 million from a lending partner. These dollars will ensure UCHC has the liquidity needed to move quickly and responsibly to help as many metro Detroit families as possible, as soon as the state of Michigan approves a plan.

“This is a good example of philanthropy’s ability to respond quickly and flexibly in times of crisis,” said Rip Rapson, Kresge’s president. “Everyone agrees on the need, on the solution, and on the urgency of resolving the situation. But the political stars have not yet aligned. Foundations like Kresge can step forward to construct a bridge to the time vitally important dollars flow into the hands of Detroit residents who deserve and need help.”

A deadline of Sept. 30 looms, wherein 65% of the federal funds to Michigan must be expended or the federal government could recoup unspent dollars or any not earmarked for a specific use.

“The money for rental assistance is there, just waiting to be appropriated,” said Aaron Seybert, Kresge’s managing director, Social Investment Practice. “It’s unfortunate that our guarantee is necessary, but the citizens of Detroit cannot wait. Michigan is at risk of losing millions of unallocated dollars in rental assistance that people desperately need, and we can’t afford to wait.”

“We hope this guarantee signals to all Michigan leaders that organizations are ready on the ground to respond efficiently and responsibly,” said Wendy Lewis Jackson, managing director, Detroit Program “If we move together quickly, we can thwart a housing crisis in Detroit and across Michigan that would take years to repair.”

Kresge’s Detroit Program also contributed a grant of $159,000 to UCHC to support the organization’s staff, outreach and other expenses.

Kresge staff is working remotely, and our offices are closed until further notice.  See our promise to partners during COVID-19.
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