Gov. Gary Herbert is pumping another $8 million in federal stimulus money into Utah's housing market.

It is a reprise of the Home Run Program, backed by former Gov. Jon Huntsman Jr., that advocates say helped spur the sale of 1,625 new homes worth nearly $377 million.

The new grant program will be smaller -- $4,000 per new-home purchase versus $6,000 in the previous incarnation -- but will be spread among 1,950 homebuyers.

Herbert predicted it could save or create 9,000 jobs in Utah and generate $25 million in tax revenues for the state.

"The infusion of this money into the housing market," he said in a statement, "will allow us to leverage our federal stimulus funds to give us the greatest return on investment and promote economic development in the state."

The goal of the original Home Run Program was to fill up some of the new homes sitting empty, so builders could build more houses, hiring construction workers and buying supplies.

James Wood, a University of Utah economist specializing in housing, said the original program helped builders get homes off their balance sheets, but financing for new construction has been tough to get, so the anticipated jobs from the first Home Run Program have yet to be seen.

Through the first six months of 2009, new-home construction is down 29 percent statewide compared with the first six months of 2008, also a bad year.

"We're at levels you have

Curt Dowdle, executive officer of the Salt Lake Home Builders Association, said things are better for builders now, partly because of the first Home Run Program. He said banks are starting to lend again, so construction workers will be back on the job quicker because there are fewer vacant homes on the market.

"If you had $8 million and you wanted to stimulate the economy," Dowdle said, "I don't think there's a way to do it more effectively than the governor has."

Clark Ivory, CEO of Ivory Homes, Utah's largest home builder, said the first wave of the Home Run Program was successful and maintains "it will be successful the second time in getting our industry moving."

"This will kick-start some construction, as well as clear out some of our remaining inventory," he said. "We've got to get things moving, and this is exactly what stimulus is all about."

But Tim Funk, a low-income-housing advocate at Crossroads Urban Center, said the stimulus funds could be much better used to help some of the poorest residents. His group had asked Herbert to tap $2 million of stimulus money to help physically and mentally disabled people keep their housing. Herbert declined. Funk said that means those people will lose their apartments and some, he warned, will die.

"We can make a continuing case for people who have nothing needing it more than people who can afford to buy a home."

In late June, then-Lt. Gov. Herbert dubbed the Home Run Program a rousing success and suggested a second round might be warranted.

In a recent interview, he said he wanted the next round to be slightly different, and he would be reluctant to spend the money if the market already had bottomed out.

"We've got to be careful about that," he said. "We don't want to throw money at an area that is already recovering, and [it] doesn't have much impact."

"There are no signs of a rebound yet," Wood said. "We're getting near the bottom, but it's going to be a very slow recovery."

Herbert is a former president of the Utah Association of Realtors, which gave the governor $25,000 in campaign contributions last month. His largest donor, Orem-based Clyde Cos., the biggest construction-supply company in the state, gave Herbert $30,000.

gehrke@sltrib.com