County housing project unlikely

HUD restrictions keep grant from being used

no area funds available

`A rock and a hard place'

Howard County

September 21, 2001|By Jamie Smith Hopkins | Jamie Smith Hopkins,SUN STAFF

What seemed to be a perfect opportunity for Howard County to provide affordable housing in Elkridge now appears headed for failure because officials can't use a federal grant they were counting on to buy the land, and there's no readily available local money to cover the cost.

Although County Executive James N. Robey has often spoken of his support for lower-priced houses, housing administrator Leonard S. Vaughan said he doesn't think another source of money can be found in time for this project. The contract on the land is scheduled to close a week from today.

County officials had intended to build houses on the site and sell them below cost to families with moderate incomes -- which in Howard County means about $53,000 or less.

"We're sort of caught between a rock and a hard place," said Vaughan, who had characterized the land deal as a bargain. "I'm an eternal optimist, but the possibilities right now are not great."

The unexpected situation shines light on a larger problem in the county's attempts to build subsidized houses for homeownership.

Even if officials win a difficult victory over developers and rising real estate prices by finding a landowner willing to sell at a great price, no local money has been set aside to buy land for houses. Money in the county's land-banking fund can be used only for rental projects; county officials look to grants for homeownership initiatives.

Robey said yesterday that he has not given up on the Elkridge land, a 7.2-acre parcel off Old Washington Boulevard that is priced at $310,000 and zoned for as many as 20 single-family homes. He said he believes there are "other options available" -- ones he declined to name -- and hopes to come up with an alternative by next week.

"I'm still very interested in the parcel," he said. "I'm interested in putting those moderately priced homes there. Trying to achieve that goal has been very difficult for us, and when an opportunity is presented, we sure as heck want to take advantage of it."

Money not designated

Acknowledging that county funds are not in place for this type of purchase, Robey said Howard County could set aside money in the future. But whether he would request such a fund "depends on the economy," he said.

Vaughan said he learned Tuesday that the Housing Commission, the county's equivalent of a housing authority, can't buy the Elkridge land, as expected, with a community development block grant administered by the U.S. Department of Housing and Urban Development.

Locally, Robey allocates the block grants. But Vaughan said federal rules require that agencies complete an environmental assessment on potential sites before they commit to use one of the grants -- even if the "commitment" is simply a promise to use the grant money to repay a loan from a bank. He said such an assessment cannot be finished before the contract's closing date.

Vaughan is unsure whether the landowner, whom he declined to name, would agree to delay closing because the person wants to sell quickly.

County Council Chairman Guy J. Guzzone, a North Laurel-Savage Democrat, said he couldn't imagine that county money could be reallocated in time to meet the closing date.

With such a tight timeline, "that is a real extreme case," he said.

State Del. Elizabeth Bobo, a former Howard County executive, thought the land's price tag was "marvelous" when she read about it this week. She seemed frustrated by the turn of events.

"If there's this good a deal -- a good price and rare land -- there must be some way that we can make this work," she said. "I haven't been asked by the county to get involved, but I think I might."

`They can do it'

Barbara Miller, executive director of the National Affordable Housing Network, a grass-roots group with headquarters in Montana, said it is not unusual for land deals to hit snags. But, she said, local governments have a plethora of options available, from working with nonprofit agencies or developers to borrowing from themselves.

"They just have to move quick, but they can do it," she said of Howard County. "I think somebody should stay with it until they find a partner. ... The only thing that can go wrong that's not solvable is bad land."

Vaughan said he spent Tuesday on the telephone with HUD officials to plead for help but could not get anyone to approve an exception to the grant restrictions.

"They don't understand our need to compete," he said. "We don't have time to wait until we can achieve typical government-type funding."

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