Wednesday, May 28, 2008

Blinkered

Yesterday afternoon the Mayor and City Council held another cat-and-mouse work session with ARHA on the 16 James Bland housing units that are slated to be off-sited from our neighborhood.

And in the midst of the muddled meeting -- "Do staff really know what's going on here?" the Mayor at one point snapped at P&Z Director Faroll Hamer -- the Growler was able to put a finger on the real problems with these discussions as well as the drifting Braddock East Advisory Group deliberations.

1. The City has hamstrung ARHA by upholding Resolution 830 but is balking when it comes to putting ARHA on a sound financial basis for the long-term. Apparently the City realizes this could be a huge drain on its limited resources, and the Growler surmises this would be unpopular politically as well.

Yesterday staff attempted to thrust the burden back on ARHA itself by suggesting that the housing authority could once again assume indebtedness. Since this is what got the authority into trouble over Glebe Park in the first place (remember, HUD backed the $6 million mortgage and was preparing to foreclose), ARHA understandably rejected this option.

2. The issue of public housing unit ownership was a major point of contention in the discussions yesterday, with ARHA insisting on fee simple ownership while the City suggested 20-year ground leases and other non-ownership options in non-ARHA multi-family rental buildings that could be secured by long-term covenants. ARHA, however, fears that a sudden change in private building ownership will leave the authority without protected Resolution 830 units.

While the City Attorney and ARHA Vice Chair Connie Ring squared off on the legal issues regarding covenants and their enforceability, ARHA Chairman Melvin Miller pointed out that land ownership is the only asset ARHA has. Then ARHA board member Peter Lawson (son of former City Manager Vola Lawson) further nailed the housing authority's dilemma by noting that with each project like Chatham Square or Bland ARHA sells off its land assets and has fewer resources with which to leverage future redevelopment.

Do we smell a long-term crisis in the making? A sort of Ponzi scheme in which each looming ARHA financial crisis that is driven by deferred maintenance results in the authority selling off more land? That may solve the immediate problems but ultimately leaves ARHA with no further cushion to fall back on. ARHA representatives stated that the value of ARHA units at projects like Chatham Square aren't sufficient to leverage future redevelopment. Once the low-hanging fruit like the valuable Bland and Adkins properties are gone, what then?

3. Roy Priest, ARHA's CEO, noted that HUD formerly covered 100% of operating costs for public housing units but now only funds 80%. The remainder has to be made up by the local housing authority. If HUD funds continue to dry up, how will the authority sustain itself under Resolution 830 without help from the City?

4. Even more troubling, ARHA is moving into a new construct of public housing which involves home owner association (HOA) fees and special assessments. It's one thing to let maintenance slip on a complex that is 100% public housing. It's another to let ARHA's properties decay in a mixed-income project with high-end market-rate units.

If ARHA is cash-strapped in the future they won't be able to easily defer these payments without the prospect of the HOA going after them in court. At the same time, a failure to contribute to maintenance may cause market-rate units in these developments to lose value, dragging whole neighborhoods down.

Is the Council even remotely aware of the implications of condo ownership? Is the Quaker Hill model working and if so what if all of ARHA's properties eventually go this route? Where's the detailed financial analysis and modeling that will answer these questions? It should be part of a long-term strategic plan for ARHA, but that hasn't even gotten off the ground yet.

5. Finally, all of the planning under discussion is short-term. There appears to be no-one with the courage, sense of responsibility or vision to articulate and shape the debate about the long-term future of ARHA, although the Growler must give credit to Councilman Paul Smedberg for continuing to ask quietly but persistently about ARHA's "sustainability" and to Councilman Rob Krupicka for at least challenging some of the orthodoxies about how Resolution 830's requirements can be met.

Clearly the politicians are dodging the core issues because they anticipate being retired or elevated to higher elected office by the time all of this comes to crisis again. In the meantime, the average age of current ARHA Board members is in the 60 to 70 year range and several are stuck in a 1960s Great Society time-warp. But not all the blame should be placed on their shoulders. As Melvin Miller noted yesterday, the City created ARHA. Who does it ultimately belong to? And the Growler is going to give credit to the scrappy Mr. Miller for continuing to lob the ball back into the City's court.

So all that's under discussion right now is the 16 units for Bland, and in the Braddock East process the rezoning that the project will require. The Growler doubts there will even be a broader deconcentration plan or target numbers for off-siting in the final Braddock East document. That would require peering too far into the future for these blinkered individuals.