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Loans to affordable housing nonprofits appear likely despite tenant fears

Submitted by News Desk on Mon, 03/16/2009 - 12:49pm
Source: 


OAKLAND — Low-income residents, fearing they will be displaced if the city approves loaning almost $10 million to nonprofits poised to take over the buildings those residents call home, asked Tuesday that City Council members cancel those loans.

Their request came as four council members held a meeting of the city's Community and Economic Development Agency, considering what to do with more than 600 affordable housing units left with an uncertain future after the unexpected collapse of the nonprofit that owns them.

City housing manager Marge Gladman asked the council members to approve about $9.5 million in loans so a handful of other affordable housing nonprofits could preserve and rehabilitate eight buildings she said have fallen into disrepair. Those buildings total 354 affordable rental units, she said.

Several residents and tenant activists countered that the work is likely to require them to move, at least temporarily. Because affordable housing tenants include the elderly, the handicapped and other disadvantaged people, the moves would be too serious a hardship to allow, they argued.

"The only way for us to properly rehabilitate these properties is for the city to take over," tenant attorney John Murcko said. "We gave millions of dollars to Oakland Community Housing, Inc. for the California Hotel and it didn't work. Giving money to private corporations is not the way to go."

Margaret Gordon said she believes she'll
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face her second such move in four years if the loans go through.

"We're talking about moving all our things into storage, moving into a motel. You have to take off from work, redirect your children, take your vacation time. It's too much."

Councilmembers Ignacio De La Fuente, Jane Brunner, Larry Reid and Patricia Kernighan, who make up the CEDA committee, voted unanimously to approve the loans. They asked Sean Rogan, deputy director of the city's Housing and Community Development division, to include tenants in the early stages of any plans that could include temporary moves.

"This is a rehabilitation," De La Fuente said. "It's to make it better in these buildings. All the nonprofits here have good reputations for working with tenants, and I'm sure they'll live up to that and involve those tenants. If not, I'm sure we'll hear from them."

Rogan blamed tenants' mistrust of nonprofits on the poor decisions of the buildings' previous owner.

Oakland Community Housing Inc. is a nonprofit organization responsible for 639 units of affordable rental housing. The nonprofit came under fire last summer when, after taking millions of dollars in city, state and federal loans to finance its purchase of the California Hotel on San Pablo Avenue, spokespeople said the nonprofit was broke and needed to evict the hotel's tenants.

The nonprofit has since collapsed without notifying anyone, Rogan said.

"Over the course of a few months, they just closed their doors and walked away," Rogan said. "They didn't declare bankruptcy and they didn't tell anyone."

The publicly listed phone number for Oakland Community Housing Inc. has been disconnected, according to phone operators.

Of the proposed loans, $4.3 million would go to East Bay Asian Local Development Corporation; $3.7 million would go to Resources For Community Development; $1.1 million would to go Affordable Housing Associates; and about $500,000 would go to The Unity Council. The issue is scheduled for a public hearing Tuesday .
Properties affected
# by loan decision Drachma House at 1428 8th St.
# Effie's House (Ivy Hill) Project at 829 East 19th Ave.
# Eldridge Gonaway Commons Project at 1165 Third Ave.
# Marin Way Court Apartments Project at 2000 International Blvd.
# Oaks Hotel Project at 587 15th St.
# Hugh Taylor House Project at 1935 Seminary Ave.
# Slim Jenkins Court Project at 700 Willow St.
# Posada De Colores Apartments project at 2221 Fruitvale Ave.