The U.S. Treasury Department on Friday that it will be providing $284 million to the state of California to help provide affordable housing for its lower income citizens who may be looking to consolidate debt.
With the funding, the Treasury has now awarded $3.1 billion in payments in lieu of tax credits to 45 states since the launching of the American Recovery and Reinvestment Act in May to work with state housing agencies to develop or renovate affordable housing units for low- and middle-income families.
"This innovative Recovery Act program allows the federal government to partner with states to support local developers and helps ensure that housing developers can access the financing necessary to build affordable housing," said Treasury Deputy Secretary Neal Wolin.
The additional funding is the second move by the Treasury this week to spur low-income housing purchases or rentals across the country. On Monday it announced plans to keep mortgage costs down with a program that will have Freddie Mac and Fannie Mae sell finance agency mortgage sales back to the Treasury in order to support lending and create liquidity in the market.
California governor Arnold Schwarzenegger applauded the Treasury’s plan, saying it would "breathe new life" into the state’s lending programs, according to Imperial Valley News.