Lima, Ohio

Lima, like many cities in Ohio, has seen major manufacturing companies leave or close down over the past decade. Housing vacancies became a fact of life well before the current foreclosure crisis because of the loss of jobs in the auto industry and from the elimination of a military defense contractor, the loss of population, and the aging housing stock (most houses built prior to 1950). The city’s current challenges with blight began in 2002, when investment clubs of individuals began to use subprime mortgage products to buy and flip houses in neighborhoods across the city. Many of these properties eventually fell into foreclosure.


A significant challenge for Lima in its efforts to stabilize neighborhoods is the apparent unwillingness or inability of banks, realtors, Fannie Mae and Freddie Mac to sell or donate REO property at discounted prices. Private investors are able to purchase REO property more quickly than the city and with cash, and they are converting many single-family dwellings into multi-family rental properties, but not keeping properties up to code. Another challenge the city’s Department of Development has had to grapple with in implementing NSP is capacity, recent budget shortfalls have led to staff cuts in the city’s Department of Community Development.

LimaFor Lima, neighborhood stabilization entails “right sizing,” developing neighborhoods to suit the needs of fewer residents, with amenities like larger yards or park space. The city plans to use a large portion of its NSP funds for demolition of substandard units to improve the value of surrounding properties. With these lots and with the city’s assembling of a significant number of parcels along a commercial state route for mixed future use, including business expansion, Lima would also like to use some of its NSP allocation for down payment assistance or for the rehab of homes. Unfortunately, eligible properties under NSP requirements are hard to find, as is financing for affordable housing development deals, because of a shortage of Low Income Housing Tax Credits and a general tightening of credit by lenders.

Promising approaches

Lima is using two specific tactics to forge ahead with its stabilization plans. First, the city is employing its existing land bank to manage properties intended for demolition with NSP funds. By using its existing land bank rather than creating one with NSP funds, the city can circumvent NSP restrictions on the end-use of demolished properties and instead hold the land until they have enough lots and the financing to proceed with development plans. It is also planning to form a city-sponsored community development corporation (CDC), which will have more flexibility and better access to private funds for demolition and redevelopment.

More information


Amy Odum
Director, Lima department of Community Development
Lima, OH