Georgia leaders bypass metro Atlanta with their allocation of $99 million in federal foreclosure funds.
"Known as the National Mortgage Settlement or NMS, the agreement calls for the big banks to provide an estimated ‘$25 billion in relief to distressed borrowers and direct payments to states and the federal government.’
According to language in the settlement, the direct payments to states should ‘fund housing counselors, provide legal aid, and other similar purposes determined by state attorneys general.’
However, NMS does not contain any enforcement mechanisms, allowing some states the leeway to use the money for things entirely unrelated to housing and the foreclosure crisis.
Georgia’s share of the settlement totaled nearly $99.4 million.
According to Georgia’s Attorney General Sam Olens, the state’s Constitution requires such funds to be deposited in the general fund with the General Assembly responsible for determining how to allocate the money.
Gov. Nathan Deal and the General Assembly decided in the waning days of the 2012 session to divide the money between the Regional Economic Business Assistance (REBA) and the OneGeorgia Authority.
That means that none of the funds will go to address foreclosures, even though Georgia has consistently ranked in the top five of states across the country with the highest rates of foreclosure."
Georgia isn't the only state doing this. Shafted! Why are Homeowners Still Left to Struggle Against Big Banks Alone?. "However, more than a dozen states across the country are doing their best to undermine the settlement by diverting the funds to other areas of their budgets. Arizona recently became the latest state to do so, taking $50 million meant to aid homeowners and instead plowing it into the state’s general fund (after scrapping an earlier plan to use the money to pay for prison construction)."
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