Let's break a deal

From toxic mold in the Villas de Fortuna subdivision to a rat infestation at the Eastside Wheatley Courts to upset Stone Oak residents protesting plans to bring low-income housing to their neighborhood, the San Antonio Housing Authority hasn’t had much luck burnishing its tarnished rep this past year. Since 2004, new SAHA leadership including CEO Henry Alvarez, has appointed task forces to identify housing drawbacks, filed lawsuits against developers, and handed over considerable amounts of money to public-relations guru Trish DeBerry for an image overhaul. Yet, despite these efforts, and the generally positive response to new apartment communities such as Rosemont at Highland Park, Midcrown Seniors Pavilion, and Primrose at Mission Hill, disenchanted citizens have once again reminded SAHA officials that it will take more than a few years to remake the agency’s reputation.

Some of the most recent complaints come from members of the Lavaca Neighborhood Association just south of downtown, who say that SAHA reneged on a deal made during the planning stages of the Victoria Commons redevelopment. Separated into three construction phases — Refugio, Artisan, and Durango — Victoria Commons was designed to integrate residents of different socioeconomic levels into the same housing community.

“The whole purpose `of Victoria Commons` is to eliminate the concentration of poverty that could typically be in a public-housing project like Victoria Courts,” said Gavino Ramos Jr., director of corporate relations for SAHA, referring to the troubled projects that once stood in Refugio’s footprint. “We wanted to get away from warehousing the way they did in the ’50s and ’60s, where they would put up one big block and throw everyone in.”

Unlike Stone Oak residents, who forced SAHA to rethink their campaign to build a public-housing development in the upscale Northside neighborhood, the Lavaca neighorhood initially seemed to welcome the idea of mixed-income housing.

Currently, Refugio Place is listed at 50-percent market-rate housing, 25-percent affordable housing, and 25-percent public housing. Phase two, Artisan Place, is scheduled to be 73-percent market-rate and 27-percent affordable housing. But the percentage of public and affordable housing that SAHA is proposing for the final phase of apartments, Durango Place, is not sitting well with citizens.

“For the Durango `Phase`, we talked about having 80-percent market-rate housing and 20 percent public and affordable housing. That was the clear understanding,” said R. Michael Berrier, past Lavaca Neighborhood Association president and current member. “Then SAHA did what they typically do. Everything’s going fine and then they’ll pull a rabbit out of their hat.”

SAHA says because of unexpected increases in construction and energy costs, the project came up $5 million short, requiring SAHA officials to rework the numbers, which resulted in an alternative mixed-income arrangement. According to SAHA asset manager Brad McMurray, SAHA came to the community in May with a proposal of 80-percent affordable housing and 20-percent public housing, which would free up more tax-credit equity to complete the development.

Public response was not favorable. The neighborhood association argued that eliminating market-rate housing would not only cause their property values to drop, but also slowly transform the area back into the ghetto it was when Victoria Courts were in operation. The following month, SAHA and the Design Review Committee identified an additional $2.8 million in other funding and returned to citizens with a new income-mix proposal: 50-percent market-rate, 30-percent affordable, and 20-percent public housing.

“Any further increase in the income mix above the proposed market-rate percentage would jeopardize the project, and would require significant alternative funding sources,” McMurray wrote in an email to concerned Lavaca neighbors.

The neighborhood association, however, still wants the original plan reinstated.

“All SAHA is doing is reducing their need to borrow money and find other funds to do the project,” said Berrier.

“`SAHA` was disingenuous in putting their proposals on the table,” Berrier added. “It was their intention to put a radical proposal in front of us like 100 percent `affordable and public housing` so they could back off to what they really wanted, which is 50-percent `market-rate`. They’re just playing games with us.”

McMurray says despite what the Lavaca Neighborhood Association thinks, there is a significant difference between affordable housing and public housing. This, he says, is one of the biggest misconceptions about the plan. “Well-intended, smart people are equating affordable housing as public housing, which are not the same thing.”

But Berrier says affordable housing is also designed to attract cash-strapped renters. “In public housing, you pay a percentage of your income. In affordable housing, you qualify based on your limited means for subsidized rent,” he said. “`Our` desire was to have a higher level of market rate to offset what would clearly be the stresses of impoverishment.”

SAHA argues that since the 50-percent market-rate Refugio Place was completed in 2004, property values in the area have risen by 206 percent, but one two-year resident of Refugio says she is already concerned about Victoria Commons’ future. Ada Muñoz, who asked the Current to change her name in case her comments offend any of her neighbors, lives in a market-rate apartment and considers herself upper-middle-class. She says she is fine with the economic mix, if SAHA can become better managers of their properties and ensure her and her family’s safety.

“While I think that it is important to give everyone the same opportunties, I also think that if I am paying top dollar to live here, I should not have to worry about crime,” Muñoz said. “In the two years I have lived here, I have seen the level of crime rise, while the level of management decreased. For those of us paying market value, it is a huge turn-off.”

Berrier, meanwhile, worries that SAHA is putting its private development partner, Carleton, ahead of the area’s residents. In the last five years alone, Carleton has developed more than 8,000 units of mixed-income housing in four states.

“`SAHA` is going to be making more money off of this plan because Carleton has clients and those clients are wealthy people that benefit from tax credits `for building affordable and public housing`,” Berrier said. “What benefits these clients is low-risk investment property.”

Not true, say officials at Carleton, which builds on average more than 1,000 units of market-rate housing per year, according to partner R. David Kelly. Although building public-housing units is emotionally rewarding, said Kelly, it is “undoubtedly more financially rewarding by all measures” to build market-rate. “It is also easier to build market-rate housing as the capital structure is simpler and the higher rental rates allow for a larger budget and easier choices.”

A final decision on the percentage of mixed-income housing for the Durango Phase should come by the end of the year. “There is still a lot of resistance,” McMurray said. “But we are open to all public input and are not making these decision unilaterally. We are trying to do things the right way.” 

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