The owners of three Columbia apartment buildings have agreed to rent15 additional units to moderate-income tenants as a condition for refinancing the developments with tax-free bonds.
According to a compromise aired before the County Council on Monday, Sherwood Crossing apartments will make seven more of its 634 units available for moderate-income tenants, and Trammell Crow, owner of Chase Eden and Chase Glen apartments, will reserve eight more of its 406 units for moderate-income tenants.
If, as expected, the council approves the compromise, it would raise the number of units for moderate-income tenants at Sherwood Crossing to 139 and at the two Chase apartment complexes to 89.
The county Housing and Community Development Board wanted more restrictions imposed on the bond refinancing. The three owners wanted less.
As a condition for tax-exempt financing in 1985, Sherwood Crossing had agreed to set aside 127 units for moderate-income tenants who receive 80 percent or less of the median income in the Baltimore area. That now amounts to $32,400 for a family of four. After receiving its financing, Sherwood Crossing later set aside five more units for moderate-income tenants.
Chase Eden set aside 46 of its 232 units as a condition for its tax-free financing, and Chase Glen initially reserved 35 of its 174 units as a condition of its tax-free loan.
Housing and Community Development Board Chairman James C. Landerkin told the council that few low-income families have been served by the apartmentsand that his board had sought to impose refinancing restrictions that would require the owners to accept low-income tenants by means of the federally assisted Section 8 program.
The Section 8 requirements were not part of the original agreement, but Landerkin and other housing board members wanted them added. Some low-income renters had been served, Landerkin said, but despite a 5 percent vacancy rate, none of the 1,040 apartments in the three complexes have ever been rented to Section 8 tenants. The implication, he said, was that the landlords would rather keep apartments vacant than accept the lower rents Section 8 tenants would pay.
Section 8 renters receive federal certificates guaranteeing rent payments at a certain level above what they can afford. They are having difficulty finding housing in Howard County because most rents are above the so-called fair market rate guaranteed by the federal government.
Landerkin said his board reluctantly compromised on the Section 8 restriction because Sherwood Crossing is in default and Chase Eden and Chase Glen are not making a profit.
The housing board was told that the resale value of apartmentsgoes down if any of the tenants are Section 8 users, Landerkin said.He said he would like to change that situation in Howard County by imposing a Section 8 clause as a condition of any future tax-free bondrefinancing. The clause would bar discrimination against Section 8 tenants.
Kirk Fancher, who helped forge the compromise on behalf ofthe Office of Economic Development, said he resented the implicationthat Sherwood Crossing, Chase Eden and Chase Glen have discriminatedagainst Section 8 tenants.
"We asked (the housing board) to provide the evidence," he told the council. "None was provided."
J. Joseph Clarke, a partner in Trammell Crow, told the council the Section 8 question was "moot" because the Chase rents are above the "fair market rate" guaranteed by the federal government.
Landerkin told thecouncil that by mentioning the Section 8 problem, he was merely "putting a stake in the ground for future reference."
Affordable housing activist May Ruth Seidel of Columbia supported the Section 8 clause, telling the council there are 800 households awaiting affordable housing here now and that 700 of those are single parents with children. Those 700 will need Section 8 help for a limited time, she said.
In addition to agreeing to increase the number of units as a condition of refinancing, Trammell Crow agreed to maintain the moderate-income units five years longer than federal law requires. Sherwood Crossing agreed to make them available six years longer. Federal law requires that they be made available for half the life of a tax-free loan.
The council is expected to approve the compromise at its May 6 legislative session.