But on its blog, HUD hit back against reporter Debbie Cenziper's overall conclusion, arguing that the HOME program has been largely successful and failures are a hard-to-avoid consequence of a down economy and the level of trust required in awarding block grants.

Sadly, the Post failed to recognize that, in spite of examples of incompetence and outright mismanagement by certain local governments, overall the HOME Program works. For more than a year, HUD provided data and context to Ms. Cenziper and for all this, she failed to recognize the obvious. Yes, there are problems when local communities pick bad developers and it’s no wonder that projects stall or even fail as a consequence. But to lead readers to believe the whole HOME Program is a failure and that HUD is “looking the other way” is just plain wrong.

Let’s put this into context; these delayed projects that the Post cites are a small fraction (approximately 2.5 percent) of 28,000 active developments. Many of these open projects are newly constructed single-family homes that remain on the market because we’re in the middle of a housing crisis in this country, a reality that is largely unrecognized in Ms. Cenziper’s reporting. Given complex financing, zoning and environmental requirements, it’s not uncommon for larger multi-family construction projects to take 3-4 years to fully complete. Large-scale rehab projects can easily take two years to finish.

Still, there’s more work to do and we’re doing it. We’ve cut the number of these ‘open activities’ by nearly 60 percent since 2005. In the past two months alone, we’ve cancelled nearly 2,000 stalled projects totaling $290 million! We’re providing technical assistance to local communities as never before. AND we’re forcing repayment of misspent money.

Ms. Cenziper was told time and again that despite the limitations of HUD’s legal authority, we always force repayment of HOME funds when a project isn’t completed. Always. Not sometimes but one hundred percent of the time.

In other words, when projects don't work out, it's the fault of local jurisdictions, not the federal overseers.

In the next installment, Cenziper does a deep dive on $3.5 million that HUD loaned to East of the River Community Development Corporation to rehab three apartment buildings. Enthusiastically backed by the Fenty administration, the non-profit bought them at absurdly inflated prices from speculators with criminal backgrounds, and then went bankrupt in 2009 when they couldn't secure enough private financing to finish the renovations. The CDC blames the economy for killing the deal, the District blames the non-profit for trusting an inflated appraisal, and HUD blames the District for picking an inadequate developer (and then allowing East of the River to pay off its debt with the HUD loan, which is a big no-no). Ultimately, big-time developer William C. Smith stepped in to finish the job.

It's a similar phenomenon to the one that I've discovered looking at the District's Home Again program, which disposed vacant properties to developers who cherry picked the best ones and let the rest languish, and the troubled renovation of Mayfair Mansions, which was too much for Marshall Heights Community Development Organization. Obviously, it's a case for going only with the most reputable developers with the greatest capacity and the longest track records—not the politically connected community organizations that the District just wants to help stay alive. Because at the end of the day, wasted money is everybody's fault.

As luck would have it, I'm interviewing new DHCD director and former HUD official John Hall this morning—if you've got questions for him, please send them my way! ldepillis@washingtoncitypaper.com.

One proposed design alternative for Potomac Gardens. (U Penn)

My column this week deals with the fence around Potomac Gardens, which doesn't seem to fit in an neighborhood where crime is nothing compared to what it was in the 1990s. But I didn't have space to go into the larger anachronism: The existence of a huge, solid block of concentrated poverty in the middle of a much higher-income area.

The vogue in public housing these days is mixed-income communities, and the District's properties are gradually being redeveloped in that vein. Over the last decade, the Arthur Capper, Stanton Dwellings, and Frederick Douglass complexes have been and replaced through HOPE VI funding, while Northwest One, Park Morton, Barry Farms, and Lincoln Heights/Richardson Dwellings are being redeveloped under the District's New Communities initiative. The Housing Authority just missed out on another HOPE VI grant for Highland Additions, but is hoping to land one in the next round of funding. Kenilworth is in the running for a federal Choice Neighborhoods grant, having already been designated a Promise Neighborhood.

Last year, students at the University of Pennsylvania's graduate school of city planning put together a report on Potomac Gardens and the nearby Hopkins complex, exploring how it might be funded either through a Choice Neighborhoods grant or other sources, like a Community Development Block Grant. They also drew up a couple of scenarios for redevelopment, one focused on integrating it seamlessly into the surrounding neighborhood, and another focused on creating high-quality public spaces.

The plans have a couple things in common: One, they involve complete demolition of the old buildings, which the authors decided were too far gone for effective rehabilitation. And two, they envision significantly higher density–going from 352 units to between 627 and 667 units–to accommodate higher-income residents while avoiding displacement. The lower density option would cost $154 million, and the higher-density option would cost $172 million.

What does the Housing Authority think about this? Something in between "we're exploring possibilities" and "it's never gonna happen." DCHA swiftly batted down the Marines' proposal to locate its new barracks facility at Potomac Gardens, saying that it was a good candidate for eventual redevelopment, and it's on a list of several sites for which director Adrienne Todman has requested reports on their funding prospects. But according to spokeswoman Dena Michaelson, "it's not quite ready to be geared up for a HOPE VI." And even if it were, the fundamental configuration of those 21 chunky buildings is unlikely to change. "It's not coming down," Michaelson says. "It's a strongly built development."

The "seamless integration" design proposal. (U Penn)

If they could at least get several hundred million dollars to upgrade building systems at Potomac Gardens–where some units are boarded up, and ground-floor spaces barred off–that would improve the lives of current residents. But eventually, that land should be put to better use, in a manner that allows everyone to return.

Basement, getting redone. (Lydia DePillis)

Here's the lesson of Gibson Plaza, the 10-story Shaw behemoth housing mostly Section 8 tenants: If you suffer through bad conditions long enough, you might just be there when a fantastic upgrade comes around.

The 217-unit building hadn't had a major renovation since it was built, back in 1974, by the development arm of First Rising Mt. Zion Baptist Church. Management tried five times to get financing for a rehab, but again and again banks turned down their applications, in part–according to Deacon Harold Gilliard–because of the property's nonprofit ownership. Finally, the Department of Housing and Urban Development committed $22 million, the D.C. Housing Authority kicked in another $6.8 million, and the District Department of the Environment gave $1 million for green upgrades.

Brand new kitchen.

The process began back in July, and re-skinning of the outside is moving quickly. But the biggest changes are inside, where every unit is getting being completely redone, from floors to appliances to lighting to internal systems like HVAC and electricity. They're installing trash chutes and water on each floor–before, maintenance staff had to go down to the basement and bring water upstairs to mop. A third elevator will serve 33 units newly outfitted for handicapped use; many residents have been there since the building opened nearly 40 years ago, and now may continue to age in place.

Construction is moving from the top floors down. The basement, though, represents quite a bit of gained space. They'll add a fitness room and more storage units, as well as a computer-equipped learning center that management hopes will teach Chinese, Spanish, and English language classes (the resident population is 64 percent African American, 34 percent Asian, and 4 percent Hispanic).

Residents have had to move around the building during the renovations, while some have lived with relatives elsewhere and others have stayed in hotels paid for by management. But everyone will have the ability to return, Gilliard promises, and won't

View from the top floor. (Martin Moulton)

pay higher rents when they do: Energy efficiency retrofits make the building less expensive to run.

All in all, a nice reward for sticking around.

An old hallway.

A new hallway (Martin Moulton)

]]> http://www.washingtoncitypaper.com/blogs/housingcomplex/2011/02/11/construction-watch-gibson-plaza-made-over-inside-and-out/feed/ 3 http://www.washingtoncitypaper.com/blogs/housingcomplex/2010/10/26/warped-area-median-income-to-stay-put/ http://www.washingtoncitypaper.com/blogs/housingcomplex/2010/10/26/warped-area-median-income-to-stay-put/#comments Tue, 26 Oct 2010 16:09:15 +0000 Lydia DePillis http://www.washingtoncitypaper.com/blogs/housingcomplex/?p=16106

The Washington Metropolitan Statistical Area. It's huge!

Okay, we all know what area median income is, right? For the purposes of this blog, it's the measure by which we set rent levels at affordable housing projects. The area median income for the Washington Metropolitan Statistical Area is a little over $100,000, so if the city works out a deal to build housing that will be affordable for people making 60 percent of area median income–$60,000–rents will amount to no more than 30 percent of that, which is the federal Department of Housing and Urban Development's standard of affordability.

The problem is, incomes in the Washington MSA–which is one of the wealthiest in the country, including bits of Maryland, Virginia, and West Virginia–actually have not much to do with incomes in the District proper, where the number was $58,553 in 2008. That means that housing tagged as "affordable" is actually out of reach for most families.

Over the last few months, Councilmember Michael A. Brown has talked about fixing this problem. "We have to create a situation where we change what affordable housing means in this city," he told Kojo Nnamdi back in July, saying he'd be introducing legislation to do just that.

Well, there's a hearing on the "Increase in Affordability Act of 2010" tomorrow, but it's not changing the definition of AMI. According to Housing and Workforce Development committee clerk Drew Hubbard, HUD–which sends down quite a bit of money for affordable housing projects–grumbled that creating an AMI level local to D.C. wouldn't work with the guidelines set out by each program. To get around that, the new bill would delineate how much money must go towards each level of affordability: 40 percent to households making between zero and 30 percent of AMI, 40 percent to households making between 31 and 50 percent of AMI, and 20 percent to households making between 51 and 80 percent of AMI. Currently, most projects are in the 60 percent range. So this would be an alternative way to achieve the same goal without running afoul of federal standard operating procedure.

What's DHCD going to do with the money? A lot of things. The main goal: "Anchor the existing residents of Historic Anacostia, which will not be affordable in another decade unless direct, explicit and significant actions and investments are made to ensure a continued supply of affordable housing." Specific actions include home purchase and renovation assistance, acquisition of vacant and abandoned properties for resale, small business startup help, and rehabilitation of commercial buildings. Also in there: A branding and community engagement campaign, which seems to have already started, as well as the rebirth of either the Historic Anacostia Main Street program or a new Business Improvement District.

So, all of a sudden the quiet purchase of buildings along Martin Luther King Avenue starts to make sense, and Duane Gautier's vision for brightened storefronts up and down the commercial avenues even closer to reality. And the streetcar will make it eventually, TIGER or no TIGER.

Photo by Darrow Montgomery.

Thanks HUD.

The District of Columbia Housing Authority announced this morning that it had recieved a $2,529,288 competitive grant from HUD to find permanent supportive housing units for the homeless. That's great news, especially since the Department of Human Services–which usually secures such apartments–just had its budget cut by $11 million for fiscal year 2011, which was the second biggest reduction of any D.C. agency (Child and Family Services took the biggest hit, at $13 million). The federal cash will house 200 non-elderly people with disabilities. The question, as Kathryn Baer points out, is whether the District will be able to do that by the time the cold sets in.

The houses at Highland Dwellings, slated for a makeover. (Darrow Montgomery)

On a Friday evening in late July, a small group of residents gathered around a white sheet taped to the side of Ferebee-Hope Elementary School in Washington Highlands, straining to hear the faint soundtrack of a film projected from a laptop. The audience’s intense concentration didn’t just come from the low volume, however. The balmy night’s feature was also supposed to teach a lesson.

Chocolate City, a documentary about the removal of low-income people from the Arthur Capper/Carrollsburg public housing complex near the Navy Yard, has been shown sporadically among activists since its release in 2008. Slow-motion footage of construction equipment destroying brick walls and spoken word performances about gentrification are interwoven with residents telling the story of their displacement.

Very recently, the stories started to seem relevant for the residents of Highland Dwellings, a 208-unit public housing complex in Ward 8 slated for a $19.5 million renovation. In mid-May, the approximately 150 people who responded to a letter in the mail about an important meeting were told that they would need to move temporarily while their homes were renovated. Some wouldn’t be able to return because appropriately-sized units wouldn’t be available; those who have lived there longest will be first in line.

Advisory Neighborhood Commissioner Kay Armstead, who arranged the screening, has become the residents’ de facto leader, pulling together a high-powered legal team to advise them and trying to forge a unified front—something that isn’t easy in a place that hasn’t needed to unify for much of anything before.

“Look at that!” she says, wondering at the masses of Hispanic immigrants marching in one section of Chocolate City. “They’re organized!”

When the film ended, the audience launched into a discussion of their own situation, and confusion reigned. A community representative from Mayor Adrian Fenty’s office had shown up, and residents pelted him with their concerns—some people had been given as little as three days’ notice before they had to move, and little choice in their interim destinations, separating children from their schools and the elderly from familiar surroundings. The reaction doesn’t bode well for a smooth relocation process.

“They’re being sneaky about it,” said Aaron William, a wizened old man who had been living in Highland Dwellings for 20 years. “I’m not trying to go anywhere.”

In the abstract, the renovation is great news for living conditions in a complex that looks quite the worse for wear. But the speed at which it’s moving, and the little notice residents were given, are making an already disruptive process even more unsettling. And organizers are tying the renovation of Highland Dwellings into the broader context of gentrification and displacement, on a city and a national level—warning that, not too far off in the future, similar fates may await many public housing residents in the District and around the nation.

Blame some of the confusion on last year’s economic stimulus plan, and the haphazard way Congress designed it. The American Recovery and Reinvestment Act, which is kicking in $7.3 million for environmental upgrades at Highland Dwellings, is a mixed blessing. Yes, it’s a needed source of federal money for cash-strapped municipalities. But lawmakers want to see shovels in the ground as soon as possible after the checks go out, which means that the D.C. Housing Authority has to get people out of the complex fast.

Sometimes, that means skipping a few steps along the way. In this case, it was working with the resident council, the democratically elected body that’s supposed to serve as a liaison between DCHA and residents. Highland Dwellings hasn’t had a proper resident council in several years—instead, it’s represented by the resident council of neighboring Highland Additions, which previously had been governed separately. But since she isn’t among those who have to move, resident council president Sarojah Spruill wasn’t notified about the initial meeting. Impaired by severe arthritis, she’s had trouble making it to subsequent meetings, and now can only watch as people disappear.

“My neighbors and my friends are being uprooted. They’re doing it illegally,” Spruill says. “We’re on the end of a chair. You never know when something’s gonna happen.”

Had DCHA decided to just do the environmental upgrades with the stimulus money, they would have been able to start earlier and work around the residents, and no one would have had to move. Instead, the Housing Authority decided to do a more comprehensive renovation. But without enough money to make it happen, officials decided to try something new—borrowing against the fair market value of 83 units to raise $8 million in private debt financing, and “selling” them to a wholly-owned subsidiary of DCHA. Officially, they will be converted from traditional public housing into private buildings owned by the subsidiary. Residents will pay for them with the help of “project-based vouchers”—a form of Section 8 voucher—that cover the difference between the unit’s rent and an amount equal to 30 percent of the resident’s income.

It’s the first time the D.C. Housing Authority has tried financing renovations by “project basing” its own buildings. And DCHA promises that it’s just a financing strategy—Highland Dwellings residents won’t know the difference between the old and the new form of housing.

Still, a more extreme form of this strategy has already spread around the country over the last decade, as funding for public housing declined during the Bush years and super-blocks of low-income units went out of fashion. Some cities, like San Diego and Atlanta, have sold off or torn down all of their public housing and put the money into vouchers instead, which means that residents deal with a private landlord instead of a housing authority.

And that might be just the tip of the iceberg. This year, the U.S. Department of Housing and Urban Development proposed a plan that would dramatically accelerate that process, encouraging housing authorities to leverage private financing to pay for renovations and make wider use of contracts with private owners to house tenants. Low-income housing advocates were leery of making public housing so dependent on the vicissitudes of the private market, even as they recognized desperately-needed dollars probably wouldn’t be coming from the taxpayers. Most housing authorities were skeptical as well—but D.C.’s interim director, Adrienne Todman, stood as a notable exception, saying the proposal could be “a wonderful tool for all of us.” Ultimately, Congress sent HUD back to the drawing board, but Secretary Shaun Donovan is still working hard to push through something similar.

A couple weeks ago, the local organizing group Empower DC held a forum on the HUD proposal (called Preservation, Enhancement, and Transformation of Rental Assistance, or PETRA) headlined “Privatization of Public Housing: Opportunity or Elimination.” The title sort of gives away the answer the group was getting at. The National Low Income Housing Coalition’s Linda Couch explained that even after gathering residents’ input, HUD mostly ignores their findings under the new system. “It was really quite shocking,” she tells an audience of mostly public housing residents. “If you’re a tenant, it’s a whole new ballgame.”

Of course, HUD’s struggle with Congress isn’t really about the specifics of what happens at Highland Dwellings—at least, not directly. But when news about the broader policy shifts trickle down, it all blends together to freak residents out. Next door, Highland Additions was passed over for a federal HOPE VI grant this year, but DCHA is reapplying—something that Empower DC, Kay Armstead, and Sarojah Spruill all oppose. HOPE VI funding, they say, drives out poor residents to create mixed-income neighborhoods like the one now developing at Arthur Capper/Carrollsburg, or the city’s New Communities projects at Park Morton and Northwest One.

“New Communities, PETRA, they’re pretty much in the same category,” Spruill says. “They’re just trying to dress up names.”

Except they’re actually not the same, at least in theory. HOPE VI grants aim to build market-rate housing to subsidize some public units in a mixed-income complex; New Communities does the same thing, with city money and local developers instead of federal cash. What DCHA is trying to do at Highland Dwellings, in contrast, is supposed to be just a renovation. New units won’t be constructed, and new residents aren’t likely to move in.

The effect, though, can still be dislocating to residents. After all the moving around, not everybody wants to come back to Highland Dwellings. Evelyn Bassil says this will be her fourth move, and she’s sick of Southeast anyway—the violence, the lack of resources. She’ll try to make it to Northwest, but knows her chances aren’t good.

“It’s moving us like cattle,” Bassil says, sitting outside on her porch last Saturday. “When you’re poor, you don’t have nothing to say.”    CP

Visit the Housing Complex blog every day at washingtoncitypaper.com/blogs/housingcomplex. Got a real-estate tip? Send suggestions to ldepillis@washingtoncitypaper.com. Or call (202) 332-2100, x 224.

The future Gibson Plaza.

In the last few months, it's seemed that the ice floes have started to crack and shift for development in Shaw: Project after project has broken financing deadlocks and will see shovels in the ground this year. Add another to the list: Gibson Plaza, the 10-story public affordable housing behemoth on 7th and O Street NW, which will be getting a massive gut retrofit to upgrade its 217 affordable units, starting July 28th. The $31 million in improvements, paid for by the federal department of Housing and Urban Development, cover a complete facade upgrade, all new green appliances, plumbing and electrical systems, new windows, and "cultured marble vanity tops" in bathrooms.

The complex opened in 1974–a few years after the founding of its non-profit owner, First Rising Mt. Zion Baptist Church Housing Corporation, Inc. The church has promised that no tenants will be permanently displaced during construction, and those who remain throughout won't be bothered too much.

Meanwhile, the Council passed a resolution in its avalanche of lawmaking yesterday that would help along one of the last remaining massive stalled development in Shaw: Kelsey Gardens, which was supposed to have broken ground months ago now. At the end of May, Councilmember Jack Evans told the Convention Center Community Association that he didn't see much hope in the near term for the project moving forward. His bill allows the developer, which already has zoning approval for an eight-story mixed-use complex and an $18 million tax abatement subject to the acquisition of a HUD mortgage, to use a commercial mortgage instead if one should come along. "Due to improvements in the financial climate, the project now hopes to obtain private sector financing this summer," the resolution reads.

In March, DCMud discovered that owner Metropolitan Development was working with Ideal Realty Group to either sell the whole shebang or bring on an investment partner with $6.3 million to get construction moving. All the details are on their website–and even more in a "Secure War Room," which you can access only under the terms of never ever disclosing the information. Metropolitan isn't answering phone calls, and IRG didn't have a whole lot to say when Housing Complex called to check in.

"We're in discussions with several very qualified investors," said IRG Vice President Craig London. "'I'd say we've had about equal interest in both alternatives. We're just trying to figure out what's going to be the best option."

Aerial view from Ideal Realty Group.

The money will be disseminated to projects across the city:

• Capper Carrollsburg HOPE VI near Nationals Park in Southeast.
• Mathews Memorial and Sheridan Terrace HOPE VI near Barry Farm in Southeast.
• Highland Dwellings in Washington Highlands.
• Scattered sites in Ward 1.
• Kentucky Courts Park and Garden by Lincoln Park on Capitol Hill.
• The 2905 11th Street Assisted Living Facility in Columbia Heights.

In the spring, DCHA also received a $27 million, non-competitive grant with funds from the Recovery and Reinvestment Act. The grants are administered through the Department of Housing and Urban Development (HUD). More details below about much money each development received:

Capper Carrollsburg HOPE VI: Townhomes component, Phase 2

HUD Funding: $9,584,843 Amount to be leveraged: $30,836,063 Total Project: $40,420,906

* Funds the public infrastructure which, in turn, permits the vertical construction to move forward for Phase 2.
* Units: 163 total units – 47 public housing units, 34 workforce homeownership units, five Section 8 Mortgage Subsidy home ownership units, and 77 market-rate homeownership units.
* Development Team: DCHA, Forest City, Urban Atlantic, EYA

Mathews Memorial

HUD Funding: $6,847,689 Amount to be leveraged: $16,277,093 Total Project: $23,124,782

* Replacement housing for the redevelopment of Barry Farms into a New Communities project.
* Units: 99 rental units – 35 public housing units, all units for households under 60% of AMI
* Development Team: DCHA, Community Builders and Mathews Memorial Baptist Church

Sheridan Terrace HOPE VI

HUD Funding: $5,827,882 Amount to be leveraged: $15,649,971 Total Project: $21,477,853

* New construction of a former public housing site into a green, transit-oriented, mixed use, mixed finance development.
* Units: 344 total units – 110 public housing units, 69 affordable rental units, 80 workforce homeownership units, and 85 market-rate homeownership
* Development Team: DCHA, WC Smith Company

Highland Dwellings

HUD Funding: $7,308,570 Amount to be leveraged: $4,202,032 Total Project: $11,510,602

* Provides funds for the rehabilitation of the 208-unit Highland Dwellings development.
* Rehabilitation will focus on improving energy efficiency, ecological sustainability, and healthfulness of the property. This will include new heating and cooling systems and insulation to provide better tenant comfort with less fuel use; replacement of flooring, paint, and other interior furnishings with nontoxic materials.
* Site improvements to include more shade trees and better site drainage will also be included.

Scattered Sites (5 grants with very similar provisions for different groups of scattered sites)

HUD Funding: $1,927,406 Amount to be leveraged: $ 192,741 Total Project: $2,120,147

* Five grants provide funds for the gut rehabilitation of a total of 26 scattered site units throughout Washington DC.
* These units will be renewed from varying states of repair and disrepair, from structural repairs to the complete replacement of building systems. These units will go from being energy and water wasters to being models of resource and cost efficiency.
* All materials used in the rehabilitation and repairs will be as healthful, nontoxic, and sustainable-sourced as possible

Kentucky Courts Park and Garden

HUD Funding: $651,481 Amount to be leveraged: $125,000, plus $37,665 worth of contributed goods and services Total Project: $814,146

* Funds the completion of a park and garden on an unused corner of the Kentucky Courts Senior property.
* Includes outdoor meeting space, handicap-accessible gardening facilities, and a water feature.

2905 11th Street Assisted Living Facility

HUD Funding: $ 2,258,750 Amount to be leveraged: $ 500,000 Total Project: $2,758,750

* Converts a vacant 14-units building into a 15-unit assisted living/independent living facility.
* DCHA is collaborating with a local assisted living facility operator to create a program of services both house and through local service providers.

Ever wonder just how much the foreclosure crisis is impacting your neighborhood? Well now, you'll be able to say "Meh, not so much" or "Holy crap—That explains the $60,000 property value drop!" with definitive authority.

The Department of Housing and Urban Development has created a map, which examines census tracts and provides two "scores" regarding the volume of vacancy properties and foreclosures problems in the area.*

Let's take, for example, census tract 88.02, otherwise known as "most of Trinidad." It has a foreclosure score of 17 and a vacancy score of 18. Another example: Census tract 67.00, an area south of Lincoln Park on Capitol Hill, which has a foreclosure score of 7 and a vacancy score of 7.

This map is tied to the Neighborhood Stabilization Program, which will provide stimulus funds for rehabbing abandoned and foreclosure properties in intensely affected neighborhoods. The Department of Housing and Community Development intends to apply for grant money.

*The "foreclosure" risk score is based on rank census tracts by two measures: (i) percent of foreclosure problems and (ii) number of foreclosure problems. Each tract receives the higher rank (from 1 to 20) from those two rankings. The "vacancy" risk score is based on an algorithm that combines 90-day vacancy rates with foreclosure problem rates and then ranks census tracts from 1 to 20 on this estimate. For more information on how these estimates were developed, see the methodology.