Building new Minneapolis neighborhoods

The city plans to use about one-third of the federal money to buy and rehabilitate foreclosed properties; another third to hold on to vacant lots and properties until the market recovers and the final portion to tear down blighted homes.

Earlier this week, northside resident Lenny Chisholm told city council members they should make sure that money spent to rebuild the northside should go to local businesses that hire local workers.

"We have to use this as an economic stimulus package," Chisholm said. "Failure to do so will once again show that the black people and the impoverished people of north Minneapolis can only be used to generate funds for people who live outside the community."

Chisholm's complaint is a common one in black communities, especially in parts of north Minneapolis where unemployment numbers are disproportionately high.

"We know that those areas hardest hit by foreclosure are largely populated by people of color and lower-income people, so there will be a definite prioritization of the funds for those neighborhoods and zip codes."

That's where residents see the work of rebuilding the homes and roads in their neighborhoods being done by mostly white workers who live in the suburbs.

Community members also worry that once northside homes are rebuilt and resold, that low-income people won't be able to afford to live in them.

City housing director Tom Streitz says the city is sensitive to those concerns. He says the city is required to use at least one quarter of the federal money to help low-income people buy their own homes.

Streitz says the money can also be used to rehab rental property and that funds will go to where they're needed most.

"We know that in those areas hardest hit by foreclosure, they're largely populated by people of color and lower-income people," Steitz said. "So there will be a definite prioritization of the funds for those neighborhoods and zip codes."

Streitz says it's also important that local and minority contractors take part in rebuilding the northside and other parts of the city decimated by the foreclosure crisis.

He says the city does business with non-profit developers like the Greater Metropolitan Housing Corporation and the corporation has been particularly good at hiring local and minority-owned companies.

Housing corporation officials say five of the seven construction businesses it uses for Minneapolis rehabs are owned by minorities.

At a four-bedroom northside home with original hardwood flooring, general contractor Anderson Mitchell shows off the rehab job he's doing for GMHC.

The corporation bought the 93-year-old, two- story, northside home last April for $65,000 and hired Mitchell for an extensive rehab -- close to $100,000 worth of work.

Mitchell has replaced the roof, the boiler, the windows and he's redone the kitchen and added a two-car garage. And there's still more work to do.

Mitchell is an African-American who lives in north Minneapolis. He says there's lots of work out there and he's spreading the workload around to minority sub-contractors.

"I'm proud of the fact that, as far as either women or minority-owned companies, this particular project is probably 85 percent either women or minority-owned," Mitchell said. "The next project I'm doing in St. Paul, is 100 percent."

GMHC officials say they'll probably lose money on the house when they resell it, which is not unusual for them. And Mitchell has put some of his own money into the house for extras like heated floors in the bathrooms and fancy-looking architectural shingles on the exterior. But Mitchell says those touches are important.

"This house deserves it," said Mitchell. "The people who live over here deserve it. You have little touches of luxury in your home and what not. Why not?"

Minneapolis city officials say more foreclosure relief dollars may be on the way next year.

The state of Minnesota was recently allocated nearly $40 million from the federal government. The city is in process of applying for state grants to further its efforts to recover from the foreclosure crisis.

Meanwhile, the city will send its plan to the Department of Housing and Urban Development for approval by the end of the month.

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