Fla. AG reaches deal over $300 million settlement
Updated On: Nov 02 2012 03:33:02 PM EDT
After a months-long feud, Florida's attorney general and the state Legislature reached a deal Friday intended to clear the way for $300 million in mortgage settlement money to finally start flowing to homeowners and communities hurt by the foreclosure crisis.
The money is the state's direct share of a massive $25 billion national settlement with five of the nation's largest mortgage lenders.
Attorney General Pam Bondi relented to the idea that state legislators will get to vote on where the money winds up. The new deal also calls for $74 million to go straight into the state's main budget account where lawmakers can use it anyway they want.
Bondi said in a joint statement with the two incoming leaders of the Legislature that it will grant "much-needed assistance" and "and ensures that the settlement funds are spent with the transparency, accountability and flexibility that comes from the legislative process."
Florida received $334 million directly as part of the national settlement reached between lenders and 49 states. The settlement represents money that is in addition to roughly $7.5 billion anticipated to come directly to homeowners in Florida.
The settlement was announced last spring, but legislators for months had quietly insisted that the state constitution prevented Bondi from spending the money independently without legislative approval.
Instead, Bondi will ask a legislative budget panel to sign off on spending the first $60 million between now and the end of the year. That money will be used to help with down payment assistance, foreclosure related assistance as well as helping state courts deal with a foreclosure backlog.
Then another $200 million will be approved by the full Legislature when it convenes in March 2013. Bondi and legislative leaders said possible uses of these funds include foreclosure prevention, neighborhood revitalization, affordable housing, homebuyer or renter assistance, legal assistance, counseling and other housing-related programs.
"The framework that has been outlined today will enable the Legislature to fulfill its important duty as appropriators," incoming House Speaker Will Weatherford, R-Wesley Chapel, said in a statement.
Other states have already been spending settlement money on everything from demolishing vacant foreclosed homes to paying for mediation programs to help borrowers stay in their homes. Some states, however, have used some of the money to plug budget gaps.
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