It has gnawed at flood victims who have received Jumpstart housing funds for months: That the money has come in the form of forgivable loans, which take 10 years to forgive, while Jumpstart funds for businesses are forgiven in five years.
This week, though, the Iowa Legislature passed a new law and sent it to Gov. Chet Culver that will make the term of the Jumpstart housing loans now in place and to come five years instead of ten years, Sen. Rob Hogg, D-Cedar Rapids, confirmed Friday.
Hogg, who credited Sen. Wally Horn, D-Cedar Rapids, with managing the bill through the state senate, said the measure was somewhat controversial simply because of the work required to change the terms of a large number of loans. But he said the Iowa Department of Economic Development has said it was committed to taking the work on.
Hogg noted that some Jumpstart housing awards were made with state dollars and some with federal Community Development Block Grant funds, and he said the state will have to amend its CDBG arrangement with the federal government so that both sources of forgivable loans are treated consistently.
Jon Galvin, a flood victim and Jumpstart recipient as well as vice president of the Northwest Neighbors Association, on Friday said shortening the time period on the forgivable loan from 10 years to five years puts the homeowner on the same level as the business owner.
Galvin, a retiree, says who knows how long he and his wife might live.
“At our age, our kids would be or could be still paying off these liens at the 10-year rate,” he said. Now, he said he might get out of debt again “before I leave this world.”