Housing authorities partner for pooled bond financing plan

March 17, 2003|By Amanda J. Crawford | Amanda J. Crawford,SUN STAFF

Faced with dwindling federal aid and an aging housing stock, several Baltimore-area housing authorities are pursuing a unique partnership that would allow them to issue $60 million in bonds to make sorely needed improvements at public housing neighborhoods.

Roofs would be replaced, central air conditioning installed and housing units made accessible to the disabled with revenue from the bond package, which officials hope to issue this spring.

The housing authorities of Baltimore City, Annapolis, Anne Arundel County and Howard County are among the local agencies that hope to partner with the state Department of Housing and Community Development.

The partnership - being worked out with the U.S. Department of Housing and Urban Development, which oversees local public housing agencies - would be the first of its kind, officials said.

It would enable the agencies to pool their resources with the state housing department to borrow against future federal funding to obtain money for physical improvements now.

"I think it is one of the most exciting innovations out there," Victor Hoskins, secretary of the state Department of Housing and Community Development, said of the plan.

Hoskins predicted that the initiative would be watched closely by housing agencies nationwide. Often housing authorities don't have enough money to make necessary improvements all at once and have to do things piecemeal, which can be more costly, Hoskins said.

"This will allow [the local housing authorities] to pull the money to the present day, use it now and ... have big impact," he said.

The idea emerged from a change in federal regulations in 1998 that allowed housing authorities to use portions of the capital funds they receive from HUD annually to pay off debt service on a bond issue, said Roy Westlund, deputy director of the state Community Development Administration.

Since that change, a few large housing authorities have issued bonds, but the Maryland plan would be the first where several authorities combine resources and split the costs associated with the sale.

Westlund said the plan is expected to generate the following amounts for local housing authorities: about $45 million for Baltimore City, $6.3 million for Annapolis, $5.7 million for Anne Arundel County and $405,000 for Howard County.

The Baltimore City agency expects to return to the bond market two more times, to raise about $120 million, said Lyle Schumann, deputy executive director. The city authority has a $600 million backlog of projects.

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