HLB Commits $250 Million in
CLP Funding to Support Disaster Relief Efforts
July 2006 |
Current FEMA Designated Areas
New York: Broome, Chenango, Delaware, Herkimer, Montgomery, Oneida, Orange, Otsego, Schoharie, Sullivan, Tioga, and Ulster Counties
New Jersey: Hunterdon, Mercer, Sussex, and Warren Counties
Additional counties designated by FEMA will also qualify for CLP disaster recovery funding.
A series of floods hit our region in late June and affected several communities served by our members. Twelve New York counties and four New Jersey counties experienced tremendous flood devastation. Although the damage is still being assessed by government officials, the need for immediate monetary aid is urgent.
As community lending partners, we are especially empathetic to the financial needs of the affected areas as they begin to restore and rebuild infrastructure, homes, and the lives of those in need. In a recent press release, Alfred DelliBovi, President of the Federal Home Loan Bank of New York and no stranger to disaster recovery, stated that “flexibility and speed are crucial in the initial stages of recovery from disaster.”
The HLB has set aside $250 million through the Community Lending Programs (“CLP”) for immediate gap financing to assist in the restoration efforts. Members who need funding for restoration in the designated FEMA disaster areas can borrow under these programs to obtain the lowest priced HLB advances available. All funding needs in the specified areas qualify under the CLP, regardless of income status. The $250 million CLP commitment can specifically be used for housing, small businesses, and economic development lending.
Usually, CLP advances are limited to terms of one year or greater. However, the HLB has reduced the minimum term requirement to 30 days in anticipation of the need for shorter-term financing. This should assist members during the initial stages of disaster recovery, prior to the payout of insurance settlements.
In addition, to expedite the lending process, we will temporarily allow members to simply submit a request letter informing us of how the funds are going to be used. The low-cost short-, medium-, and long-term funding can be used in various ways to help meet the needs of the affected communities. Members can also take advantage of our Program-Specific lending to offer a larger line of credit for their service areas. Some examples of eligible uses of CLP funds are: for the acquisition, construction, refinancing, or restoration of branches, housing, and small businesses; economic development; and members’ liquidity needs as retail customers withdraw their funds for the recovery efforts.
For more information about the CLP disaster recovery commitment, please contact your Calling Officer at 212-441-6700 or Joseph Gallo, Community Investment Officer, at 212-441-6851.
Housing and Community Lending Corner
RDA Success Story: HSBC Bank Uses RDA Funding
for Home Ownership Center in Norwich, New York
Member lender HSBC Bank USA used a $165,000 RDA advance to provide mortgage financing for the Quaranta Home Ownership & Housing Services Center. The center is owned and operated by Opportunities for Chenango, Inc. (“OFC”), a non-profit agency chartered as the Community Action Agency for Chenango County, New York...more
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