YOUNGSTOWN — The city selected the 717 Credit Union to administer three programs, funded through $13 million in American Rescue Plan funds, to improve Youngstown’s housing stock.

The largest program is $8 million for the new construction and / or rehabilitation of quality affordable housing with the other efforts being $3 million to provide up to $10,000 in low-interest loans to qualified homeowners to improve and update the exterior of their houses and $2 million in a revolving loan fund for landlords to make renovations, repairs and / or address housing code violations.

The city sought lending institutions for the three programs and after receiving four proposals decided to choose 717 for all of them, said Nikki Posterli, director of the city’s community planning and economic development department and the mayor’s chief of staff.

“It’s a $13 million housing package that 717 will administer,” Posterli said.

City council approved the $8 million ARP allocation for affordable housing development projects on Nov. 1, 2023. It approved the two other programs at its Dec. 15, 2023, meeting.

John Demmler, 717’s president and CEO, said at Tuesday’s council community planning and economic committee meeting that the $8 million program, called Youngstown Affordable Loan Program, would be parlayed into $35 million worth of discounted mortgage financing.

Those participating would get a 2% rate reduction and not have to pay closing costs, with 717 would pay those fees, Demmler said.

Through the program, based on current rates, the principal and interest payment on a $100,000 loan would be less than $500 a month, he said.

“The dream of home ownership is increasingly out of reach for many individuals,” Dammler said. “The Youngstown Affordable Loan Program will make that dream achievable for many Youngstown families.”

To begin development, 717 would create a $5 million revolving commercial development fund to be used to rehabilitate vacant downtown buildings into residential condos, build homes on vacant lots and develop neighborhoods. After renovation or construction, the units would be sold to individual buyers and the funds recuperated to be invested in additional projects.

The $3 million program, called the Residential Facade Program, would provide 1% interest loans of up to $10,000 for five years or a dollar-for-dollar match up to $10,000 to qualifying homeowners in the city to improve and update the exterior of their homes and address any cited or potential code violations.

The intent of the program is to stabilize and increase the value of homes in Youngstown.

Eligible improvements include house painting, installation or replacement of shutters or awnings, window replacements, sidewalk or driveway replacements, siding replacement, step replacement or repairs, and garage repairs.

The $2 million Landlord Revolving Loan Fund will allow property owners to borrow up to $50,000 per single-family property and up to $100,000 for multi-unit houses at 2% interest for up to five years.

The money would allow landlords to make renovations, repairs or address housing code violations.

The program requires landlords to maintain the property for five years and not increase rent to current tenants during the same time frame. A sale would require the landlord to repay the loan immediately.

“Helping Youngstown residents achieve the dream of home ownership represents a major step forward for so many in our community,” said Mayor Jamael Tito Brown.

The Youngstown Affordable Loan Program funds would be available in the spring with funding from the two other programs available earlier than that.

“Homes are going to be repaired and homes are going to be built,” said Councilman Julius Oliver, D-1st Ward.

Oliver said some city residents are worried they’re going to be pushed out of their homes by the potential gentrification of their neighborhoods through these programs. He asked how city officials can convince them that won’t happen.

“There needs to be education that new housing, new homes, infill, rehabilitation does not equal gentrification,” Posterli said. “It means we are raising expectations that our residents deserve and have deserved for a very, very long time. This isn’t just about plopping a house and changing a neighborhood or a certain population. It’s for the population that’s there to understand that we deserve better.”