A new agreement with Riverways Federal Credit Union for a loan program to improve properties in designated neighborhoods was approved by the board of aldermen Monday night.

Improvements can include weatherization and energy efficiency projects, exterior property maintenance and repairs, beautification of the property, sidewalk, curbing or driveway repairs or improvements, erosion control, interior safety improvements, utility upgrades and improvements to roofs, gutters and exterior painting.

The agreement requires a one-time payment of $20,000 by the city into a loan loss reserve to allow Riverways to leverage lending in Salem to maintain and improve affordable housing under Riverways Welcome Home Program.

The city and Riverways also agreed to establish a Welcome Home advisory board whose sole purpose to identify a neighborhood where improvements would take place for each round of the program as it moves forward.

Riverways also agreed to work with low-income households in the designated neighborhood that don’t meet loan requirements to help them accomplish weatherization improvements through South Central Community Action Agency weatherization and housing improvement programs.

Economic development director Sally Burbridge explained that a neighborhood will be chosen based on its youth population and incidence of homes with high utility bills where weatherization is needed.

“The other goal is to improve property values in the community,” she said. Individual home improvements might not increase property values if neighboring properties are in disrepair, she noted.

“But if you’re doing a neighborhood all at the same time, that whole street or block’s values improve,” she said. “So it’s not just the random scattergun effect. We have a chance at having some real impact on improving home values and long term wealth of some of our families if they have better home values.”

Alderman Kim Steelman voiced her support for the program and its effect on housing. “This is why I think this is so great, and I love to see community partners and just everybody working together,” she said. She commended Riverways and Burbridge for their work on the agreement.

The new agreement was voted down at the Nov. 18 meeting pending a review of both the old and new agreements by city attorney James Weber. At that time, alderman Rachel Hinderliter voted for it but both West Ward aldermen, Kenneth Nash and Kevin James voted no, saying a review was needed. Steelman was absent that night. The review was completed and Walden recommended approval Monday night.

For more details, see next week’s issue of The Salem News.