HUD chief set to tour Merced tracts

MERCED -- U.S. Housing and Urban Development Secretary Shaun Donovan will tour the city's foreclosure-stricken neighborhoods today to see the devastation.

This will be the second San Joaquin Valley visit from a top federal leader in the past week. Interior Secretary Ken Salazar held a town-hall meeting Sunday in Fresno to discuss the valley's water shortage.

Donovan's visit comes at the request of Rep. Dennis Cardoza, D-Merced, who has been trying to focus federal aid efforts on the valley, which has some of the highest foreclosure and unemployment rates in the country.

Another round of foreclosures is expected soon. Cardoza said he's heard that up to 10 percent of his constituents may be vulnerable.

Cardoza's latest plan is to write legislation that would allow President Barack Obama to designate certain parts of the country as economic disasters.

Under legislation, which has yet to be introduced, those regions would be eligible for more Community Development Block Grant funding, which is controlled by Donovan's agency.

The program funnels upward of $5 billion annually to communities nationwide. The American Reinvestment and Recovery Act included a $1 billion boost for the current block grant program.

The money could be used for job training, economic development and housing.

A week and a half ago, Los Banos Mayor Tommy Jones testified before the House Financial Services Committee about how efforts to rejuvenate the valley's economy have fallen short.

For instance, last summer Congress approved the Neighborhood Stabilization Program, which directed $4 billion to areas with high foreclosure rates. Merced hasn't received the money.

One in 78 Merced County homes has fallen into foreclosure, the fifth-highest rate among the country's metropolitan areas, according to RealtyTrac. Stockton has the second-highest rate at one in 68 homes. Modesto is at No. 3 with one in 71 homes falling into foreclosure.

Donovan will tour two Merced neighborhoods, one in the southeast end of the city and one in the southwest.

Whether Donovan's visit results in more aid and more attention will be seen in the coming year.

"I do expect him to have fire in the belly when he leaves here," Cardoza said.