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Nonprofit housers shed crocodile tears over demise of redevelopment agencies
by Lynda Carson (tenantsrule [at]
Friday Dec 30th, 2011 6:32 PM
The wealthy so-called nonprofit housing industry is shedding crocodile tears over the demise of California's Redevelopment Agencies and the loss of funding for their so-called affordable housing projects. The wealthy developers already are trying to lobby the state into allowing Redevelopment Agencies to exist again in an effort to further exploit the poor!
Nonprofit housers shed crocodile tears over demise of redevelopment agencies

By Lynda Carson -- December 30, 2011

Oakland -- In a significant win for students and schools throughout California, a court ruling on Thursday gives support to the state's ability to grab funds from local redevelopment agencies to fund the current state budget, with a billion dollars of that funding going towards schools and public safety, according to Governor Jerry Brown.

The unanimous December 29, 2011, California Supreme Court ruling in support of a state law passed last summer to abolish redevelopment agencies throughout California has so-called nonprofit housing developers shedding crocodile tears, as more than 400 redevelopment agencies will close their doors after February 1, 2012, as a result of the court ruling.

So-called nonprofit affordable housing developers promote their projects as being beneficial to the poor while seeking subsidies from redevelopment agencies for their projects, when in reality their projects discriminate against the poor with minimum income requirements.

This means that future neighborhood gentrification projects involving nonprofit housing developers in Oakland that would have displaced the poor, may now be placed on hold as a result. Additionally, Oakland's Victory Court plan for an Oakland A's Stadium is no longer a viable option since it also depended on the Oakland Redevelopment Agency for funding, and the threat of displacing many low-income people and small businesses, has been diminished.

As public housing projects for the poor continue to be underfunded resulting in blighted conditions and over 120,000 demolished public housing units in recent years, the so-called affordable housing industry thrives and has developed hundreds of so-called affordable housing projects throughout California that discriminate against the poor with their minimum income requirements, and are funded by local redevelopment agencies (RDAs).

In yesterdays latest headline release to be found on the Affordable Housing Finance website, the affordable housing industry is astounded and shocked that the state Supreme Court ruled that the state can abolish more than 400 RDAs, in a move that could thwart affordable housing development across California. Shamus Roller, executive director of Housing California said, "Today was a huge blow for anyone in California that struggles to pay rent or lives in unsafe conditions."

Shamus Roller failed to mention that many so-called affordable housing projects have been displacing the poor from their housing in California, or that so-called affordable housing developments discriminate against the poor with their minimum income requirements.

For instance, in Oakland several 501c3 charity nonprofit housing developers including Bridge Housing and the East Bay Asian Local Development Corporation (EBALDC) have already been involved in gentrification projects in Oakland that have displaced hundreds of poor low-income families from their longtime public housing. Future so-called affordable housing gentrification projects that may displace the poor from their public housing, may not be as easy to finance without the assistance of redevelopment agency funding in Oakland, and elsewhere.

Currently in Berkeley, families in 75 public housing town-homes face displacement from their housing in a so-called affordable housing scheme involving some out of state billionaires, that want to buy and privatize Berkeley's public housing.

As another example, in recent years over $60 million in affordable housing funds originally meant to assist the poor, was instead diverted to fund Oakland's Uptown Project as a subsidy to build thousands of expensive condominiums for Forest City Enterprises, and it's billionaire owners.

Forest City Enterprises stands to make a fortune selling the luxury condo's to the wealthy people that are interested in moving to downtown Oakland, as part of Jerry Brown's (old) 10 K Plan that was designed to displace the poor from downtown Oakland, in an effort to replace them with wealthy shoppers living in luxury condominiums.

The Oakland city deal to subsidize the luxury condo's for Forest City Enterprises with the $60 million in affordable housing funds had the full blessing of the local nonprofit housing developers that belonged to the East Bay Housing Organizations (EBHO). Many poor people and local businesses in the area were displaced by the Uptown Project, as a direct result of the nonprofit housing developers that supported the Uptown Project.

Affordable Housing Projects Discriminate Against The Poor

So-called affordable housing projects being run and operated by 501c3 charity nonprofit housing developers have minimum income requirements that discriminate against the poor, unless the poor have a Section 8 voucher or the equivalent kind of subsidy from some other housing program.

When comparing so-called affordable housing with public housing, people with no income at all are allowed to reside in public housing including the elderly and disabled, and most public housing projects do not have minimum income requirements for the poor to reside there.

As the local public housing projects are facing more budget cuts from the federal government and are shutting down, or are being sold off to billionaires and wealthy 501c3 charity nonprofit housing developers, the public housing projects are rapidly being converted into privatized so-called affordable housing projects. Affordable housing projects that discriminate against the poor.

The wealthy 501c3 charity nonprofit housing developers are trying to promote their so-called affordable housing projects as something that is good, and have done a good job at hoodwinking society into believing that affordable housing is good for the poor.

Minimum Income Requirements For The Poor

At Los Medanos Village in Pittsburg, Resources for Community Development (RCD), a local Berkeley 501c3 charity nonprofit housing developer discriminates against the poor at this affordable housing project and others it has developed, but advertises that there are no "minimum income requirements" for the poor people that have Section 8 vouchers.

As another example on how the poor are discriminated against in so-called affordable housing projects, local Oakland 501c3 charity nonprofit housing developer EBALDC demands that poor people on a fixed income such as social security or a pension, must earn at least 1.6 times the amount of monthly rent being charged in their so-called affordable housing projects. Those with other income must earn 2 times the monthly rent, and there is no minimum income requirement for those with Section 8 vouchers or similiar subsidies.

Another 501c3 charity nonprofit housing developer called "EAH" in Marin County, demands that a single person that wants to move into it's so-called affordable housing development called Farley Place, must earn a minimum of $31,000, but advertises that there is no minimum income requirement for poor people with Section 8 vouchers.

Bridge Housing Corporation, is one of California's largest so-called nonprofit housing developers. During 2010, at their housing development project called Ironhorse Central Station, Bridge Housing demanded that a single tenant must have a minimum income stretching between $15,326 - $18,750 annually, and in another instance in Tier 5 of the same project, Bridge Housing was demanding that an individual must have a minimum income of $26,091 - $31,250.

During 2008, the John Stewart Company was involved in a major lawsuit filed by the residents of the California Hotel in Oakland, after the John Stewart Company and Oakland Community Housing, Inc. (OCHI), threatened to unlawfully cut off their water and utilities in an attempt to unlawfully evict the poor from the historic hotel, and force them from their housing.

A judge had to grant a restraining order to stop these two so-called 501c3 charity nonprofit housing organizations from unlawfully dumping the poor onto the cold streets of Oakland. At the time, OCHI wanted to dump the poor from their housing in the California Hotel, so that OCHI could replace them with higher income tenants that would be subsidized by the City of Oakland, and some homeless programs.

As the wealthy so-called 501c3 charity nonprofit housing developers are shedding crocodile tears at the loss of local redevelopment funding to finance their so-called affordable housing schemes, the executives in the nonprofit housing industry continue to grab excessive salaries and wage compensation for themselves. They are living in luxury, despite all the major budget cuts occurring in the federal housing programs during recent years, including the latest loss of funding for their projects from local redevelopment agencies.

The Poverty Industry In The East Bay...

A few 501c3 Charity, Nonprofit Developer's Salaries & Compensation

Note: As the federal and state budget cuts devastate programs that are meant to assist the poor, it should be noted that as the income for the poor, elderly, and disabled drastically decreases due to budget cuts, at the same time the salaries and wage compensation for the executives in the so-called 501c3 Charity nonprofit housing sector, have skyrocketed to obscene levels.

The more that the housing programs being operated by the nonprofit housing sector are being shredded by federal and state budget cuts, the more in salaries and wage compensation that the executives have been grabbing for themselves, and the higher the rents are becoming for the low-income renters!

It is an obscene situation, and the executives in the so-called 501c3 charity nonprofit housing industry should all roll back their salaries and wage compensation to levels below $80,000 a year, as a way to compensate for all the budget cuts taking place in the housing programs, in an effort to lower the rents being charged to the poor.

Salaries & Wage Compensation

In Oakland, 990 tax filings reveal that the salaries and compensation have been steadily rising at a rapid pace for the non profit affordable housing sector, including key staff employees working for the Oakland based non profit housing organization, East Bay Asian Local Development Corporation (EBALDC).

EBALDC claims that it's mission is to develop affordable housing and community facilities, including integrated services focused on tenants and neighborhood residents, with an emphasis on Asian and Pacific Islander communities and the diverse low income populations of the East Bay.

Records show that in 2009, Executive Director of EBALDC, Lynette Jung Lee, earned as much $140,536 that year, including an additional $5,942 in other compensation from EBALDC.

In contrast, records also reveal that during FY 2007 - 2008, EBALDC only paid Lynette Jung Lee $87,265 plus other compensation of $3,055, meaning that in 2009 Lynette Jung Lee's compensation from EBALDC skyrocketed by more than $50,000 in a single year. Since then, Lynette Jung Lee has retired and been replaced by Jeremy Liu, as the Executive Director of EBALDC.

To have increased the salary of Lynette Jung Lee by $50,000 or more in a single year during FY 2009, that means that at least 1,000 poor low-income households in the EBALDC Empire may have had to contribute a minimum of $50 out of their rent payments, just to cover the cost of a $50,000 salary increase.

During 2009, La Netha Oliver, Director of Human Resources for EBALDC earned $80,221, plus an additional $8,184 in other compensation, but in FY 2007 - 2008 she only earned $68,547 plus $1,227 in other compensation, meaning that her compensation increased by around $18,000 in a year.

The records also reveal that in 2009, Carlos Castellanos, Director of Real Estate Development for EBALDC, had earned $91,280, plus $11,228 in other compensation, but in FY 2007-2008 Castellanos only earned $71,865 plus $2,415 in other compensation, meaning that his wages jumped by around $28,000 in around a year.

Additionally, in 2009, Don Piyathaisere, EBALDC's Chief Financial Officer earned $98,265, plus an additional $8,472 in other compensation. However, records show that in FY 2007 -2008, Piyathaisere earned $91,138 annually plus an additional $2,236 in other compensation, meaning that in one year his compensation leaped more than $12,000. Since then, Piyathaisere has been replaced by Peter Sopka as the Chief Financial Officer for EBALDC.

Records also reveal that Mary Hennessy, Chief Operations Officer for EBALDC is raking in $129,220 annually, plus $8,134 in other compensation, and that the wages of Charise Fong, Director of Economic Development for EBALDC, have risen in 2009 to $81,828, plus $308 in other compensation, from $69,751 annually plus $2,099 in other compensation, during FY 2007 - 2008, meaning her compensation jumped to around an extra $10,000 in a year.

In total contrast to the huge leaps in salaries and compensation for the top staff at EBALDC, records reveal that during FY 2006 - 2007, Lynette Jung Lee was the top wage earner at EBALDC, pulling in a mere $87,156 annually, with no extra compensation.

The Poverty Industry & Some More Local & So-Called East Bay Affordable Housing Developers

Eden Housing, Inc.

Salaries & Compensation

From 7/1/2008 through 6/30/2009, Linda Mandolini, Executive Director, was payed $162,393 plus $14,368 in other compensation and works only around 28 hours per week. Jan E. Peters, Chief Operating Officer, was payed $136,500 plus $13,177 in other compensation. Terese Mcnamee, CFO, was payed $133,743 plus $6,167 in other compensation. Andrea Papanastassiou, Director of Development, was payed $131,455 plus $6,618 in other compensation.

Satellite Housing

From 10/1/2008 through 9/30/2009, Ryan Chao, Executive Director, was payed $163,893 plus $6,377 in other compensation. During 10/1/2007 through 9/30/2008, Arion Chao, Executive Director, was payed $167,000, and Joyce Boyd, Director of Finance, was payed $81,760, and Miriam Benavides, was payed $85,000, and Analisa Anthony, Director of Property Management, was payed $87,550, and Dori Kojima, Director of Housing Development, was payed $92,000, and Patricia Osage, Dir. Res. SVCS, was payed $80,000.

Resources for Community Development (RCD)

From 7/1/2008 through 6/30/2009, Dan Sawsilak - Executive Director, was payed $112,900 plus $9,814 in other compensation, and Peter Poon, Finance Director, was payed $69,505 plus $1,362 in other compensation. From 7/1/2007 through 6/30/2008, Deni Adaniya, Senior Project Manager was payed $90,000, and Eric Knect, Asset Manager was payed $73,438, and Kate Mckean, Controller, was payed $70,825, and Elizabeth Eckstein, Director of Fund Development was payed $68,542, and Peter Poon, Finance Director, was payed $65,840.

Affordable Housing Associates (AHA)

From 7/1/2009 - 6/30/2010, Susan Friedland, Executive Director of AHA, was payed $133,731, and a year earlier was payed $130,393. From 7/1/2007 through 6/30/2008, Susan Friedland was payed $116,660, and Leland Chin, Finance Manager was payed $76,514, and Teresa Clarke, Construction Manager was payed $84,413, and Kevin Zwick, Director of Development was payed $84,460, and Eve Stewart, Project Manager was payed $67,000, and Angela Cavanaugh, Director of Property Management was payed $68,000.

EAH Inc. (EAH Housing) (Marin County)

From 7/1/09 through 6/30/2010, Stephen Lucas, was payed $182,197 plus $6,951 in other compensation, and Peggy Franklin was payed $331,371 plus $12,460 in other compensation, and Matt Steinle was payed $162,410 plus $9,453, and Mary Murtagh was payed $254,030 plus $10,733 in other compensation, and Laura Hall was payed $186,136 plus $6,951 in other compensation, and Kevin Carney was payed $135,667 plus $6,951 in other compensation, and Cathy Macy was payed $132,931 plus $6,951 in other compensation, and Alvin Bonnet was payed $122,471 plus $8,669 in other compensation.

Bridge Housing (San Francisco)

From 1/1/2008 through 12/31/2009, Carol Galante was payed $203,860, and Lydia Tan was payed $316,611, and Susan Johnson was payed $255,001, and D. Valentine was payed $231,615, and Ann Silverberg was payed $173,319, and Rebecca Hiebasko was payed $271,683, and Brad Wiblin was payed $212,823, and Tom Earley was payed $224,432, and Corinne Morrison was payed $178,312, and Thomas Casey was payed $163,939, and James Valva was payed $165,097 (Husband of Officer, Susan Johnson), and Kim Nash-Patchen was payed $157,054, and Elizabeth Nahas-Wilson (The daughter of Director Ron Nahas) was payed $127,979 plus $29,075 in other compensation.

Lynda Carson may be reached at tenantsrule [at]

Comments  (Hide Comments)

by Lynda Carson
Saturday Dec 31st, 2011 3:38 PM
Clarification on Uptown Project

On Thursday May 17, 2001, it was reported by Laura Counts in the Oakland Tribune that the original Uptown Project proposal with Forest City Enterprises and the City of Oakland included 2,000 housing units. This included 900 condominiums, and about 1,100 luxury apartments for the planned $500 million project that ended up being subsidized by Oakland with over $60 million in affordable housing funds. The project is still not completed from what I understand, due to economic problems.

For more on the project see link below to more recent article...

Uptown condos will put new residents downtown
Their spending could spark new prosperity

San Francisco Business Times by Steve Ginsberg

Date: Sunday, May 14, 2006, 9:00pm PDT - Last Modified: Thursday, May 11, 2006, 12:08pm PDT

Related: Commercial Real Estate, Residential Real Estate

Click below for full story...

With ground broken on Forest City Residential West's Uptown project, the transformation of Oakland's most undervalued downtown site will unfold over the next five years. By 2008 hundreds of new residents will be living downtown.

By building 665 condo units in Uptown's first phase, Susan Smartt, a senior vice president at Forest City, is confident the new residents will be an economic catalyst for an area of blighted buildings and vacant parking lots.

Click below...

Oakland Redevelopment Agency Financial Report ending FY June 2008.

Click below for full report...

• The Agency's total assets exceeded its total liabilities by $200.4 million compared to
$152.3 million for the previous fiscal year. Net assets grew by $48.1 million or 31.6%.
The net growth was driven primarily by improved property tax receipts of $122.0 versus
$109.6 million for the previous fiscal year, a $1.2 million net increase in property held for
resale, a $6.9 million increase in fixed assets, and an $18.8 million increase in notes and
loans receivables. These increases were further enhanced by a decrease of $21.2 million
in long-term liabilities as a result of debt retirements, offset by an increase of $5.9 million
in other liabilities.

• For the year ended June 30, 2008, the Agency’s governmental fund balances were $599.2
million compared to $601.8 million in the previous fiscal year, a decrease of .4% or $2.6
million. The change in fund balance is primarily attributable to $12.4 million increase in
tax increment. These increases were offset by increased project expenditures of $12.2
million and finally a decrease of $3.9 million in OBRA rents and other reimbursements.
The fund balance of $599.2 million is distributed by redevelopment project area as
follows: 26.7% or $160.2 million for the Central District; 20.0% or $119.8 million for the
Coliseum; 16.9% or $101.2 million for Central East; 16.4% or $98.3 million for Low and
Moderate Housing; 11.8% or $71.0 million for the Oakland Army Base; and 8.2% or
$48.6 million for Non-major Governmental Funds.

• The overall net change in fund balances in the governmental funds resulted in a decrease
of .4% or $2.6 million compared to the prior fiscal year. The change in fund balance is
primarily attributable to $12.4 million increase in tax increment. These increases were
offset by increased project expenditures of $12.2 million and finally a decrease of $3.9
million OBRA rents and other reimbursements.

Publicly Assisted Privately Owned Housing Sites In Oakland as of 5/18/2011...
(Does not include public housing owned by Oakland Housing Authority.)

Searchable City-owned property database

City Property Liens

City of Oakland Real Estate

Affordable housing minimum income listings, that discriminate against the poor

Click below for listings of minimum income requirements for so-called affordable housing & low-income housing sites, in San Francisco and the Bay Area...

Minimum income requirements discriminate against the poor...

Click below...

See a few examples below:

(Note: No minimum income requirement)
SF Housing Authority
1815 Egbert Avenue
San Francisco, CA 94124

No Minimum Income Requirement

San Pablo Hotel
1955 San Pablo Ave
Oakland, CA 94612
PH: 510-238-1500
East Bay Asian Local Development Corp

Minimum Income must be twice the rent ($850-$900)

Greenridge Apts.
1565 El Camino Real
South SF, CA
Property Company:
Mid-Peninsula Housing Coalition
PH: 650-356-2900

Minimum Income must be $1300/month or more

Willow Gardens
344 Susie Way
South SF, CA
Property Company:
Mid-Peninsula Housing Coalition
PH: 650-356-2900

Minimum Income must be $1300/month or more

Cypress Glen
25100 Cypress Ave
Hayward, CA 94544
Call for an application
Housing hotline
(510) 247-8141 OR
Eden Housing

Minimum Monthly Income
1 BR $2225/mo
2 BR $2698/mo
3 BR $3063/mo

Santana Apartments
2220 Tenth Ave.
Oakland, CA. 94606
Mercy Housing
Property Manager:
Sherrita Cole

Minimum Income must be twice the rent

Hugh Taylor House
1935 Seminary Avenue
Oakland, CA 94621
(510) 562-2464

Minimum Income must be twice the rent (1.6 x for fixed incomes)

Madrone Hotel
477 8th St
Oakland, CA 94607
(510) 287-5346

Minimum Income must be twice the rent (1.6 x for fixed incomes)

Effie’s House
829 E. 19th St
Oakland, CA 94606
(510) 208-5056
Contact: Danny

Minimum Income must be twice the rent (1.6 x for fixed incomes)

Oakland Point L.P.
1448 10th St
Oakland, CA 94607
(510) 891-0310

Minimum Income must be twice the rent (1.6 x for fixed incomes)

Hismen Hun-Nu Terrace
2555 International Blvd
Oakland, CA 94601
(510) 261-3626

Minimum Income must be twice the rent

Chesley Ave Mutual Housing
802 Chesley Ave
Richmond, CA 94801
PH: 510-232-2040
Eden Housing

Minimum income must be twice the rent

Ambassador Hotel
55 Mason St
SF, CA 94102
# 749-6992
Manager: Mary Gilespi
Property Management Company: TNDC

Minimum Income Requirement to live there: $945.45/mo or $11,345.40/yr

Dalt Hotel
34 Turk St
SF, CA. 94102
# 474-7712

Minimum Income for SRO:
$12, 600/year (w/out a bathroom)

Minimum Income for SRO:
$14,304/year (w/Bathroom)

Civic Center Residence
44 McAllister St.
San Francisco, CA 94103
(415) 431-2870

Min. income $1,000/mo.(may increase depending on unit amenities)

Tenderloin Family Apts.
201 Turk Street
San Francisco, CA 94102
(415) 921-8695

Income and occupancy restrictions apply
50% AMI
Min: $29,820 (1, 2, 3 persons)

Crescent Cove
420 Berry St
SF, CA. 94158

50% AMI
Min: $ 26,670; Max: $35,500

60% AMI:
Min: $ 38,430; Max: $51,240

Reardon Heights
8 Reardon Road
San Francisco, CA 94124
(415) 648-1910

Maximum Income 1 person $50,040 2 person $57,240

111 Jones St. Apts.
111 Jones St
SF, CA 94102
(415) 474-2680
Mercy Housing
Property Mngr:
Jimmy Newell

Minimum Income: $28,347/year or $2,362/month

205 Jones St Apts
205 Jones St
SF, CA. 94102
(415) 474-2680
Mercy Housing
Property Mngr:
Jimmy Newell

Minimum Income: $21,147

Carter Terrace
530 Carter St.
SF, CA 94134
(415) 584-4800
Mercy Housing
Property Manager:
Vernon Long

Minimum $27,253

Martinelli House
1327 Lincoln Avenue
San Rafael, CA 94901
PH: 415-457-9273
Mercy Housing

Minimum Income:
$1300 (Studio)


by VonManstein
Monday Jan 2nd, 2012 11:07 PM
No one who isnt poor seeks assistance from these agencies so who are they discriminating in favor of?

And there's a reason people want to live in affordable housing vs public housing: affordable housing tenants generally have honest reliable jobs. I live by section 8 housing and the residents there treat the facilities like shit, are rude to other tenants and are generally bad neighbors. AHA and 501c3s have provided a lot of housing for people who otherwise would have been hard pressed, so making them out to be villains rings pretty hollow with anyone having a three digit IQ.
by BT
Tuesday Jan 3rd, 2012 11:01 AM
This article is completely misleading. Non-profit and affordable housing developers provide poor people with decent, well-built and modern places to live verses decrepit public housing facilities designed to house people like animals in kennels. Before you bash an industry, you may want to consider the alternatives and their role in the housing industry. Would you prefer people to live in "projects" that virtually enslave residents in high-crime areas with a deplorable quality of life? There are thousands of people in the Bay Area who live in affordable housing developments who otherwise would not have a housing option because in case you haven't noticed, we live in one of the most expensive areas of the country. And by the way, income requirements are not discriminatory. They ensure that people living in subsidized housing actually need it and there are projects that cater to the lowest income brackets. It's highly unfair to paint the work affordable housing developers do without considering that market rate developers don't provide options and that most of the "public housing" you defend in this article is a reprehensible. I'd like to know where the author of this article lives. I'm sure it's not the California Hotel.
Critics are misleading public: Reality of nonprofit landlords vs for profit landlords

I am not surprised that the poverty pimps from the so-called 501c3 charity nonprofit affordable housing industry are defending their turf while attacking my article, especially when considering how much money they have been grabbing by exploiting programs that are meant to assist the poor.

Additionally, I am not surprised that the poverty pimps are attacking public housing, as a way to defend their so-called affordable housing projects that discriminate against the poor with their minimum income requirements. They have been doing this for years...

The so-called 501c3 charity affordable housing industry profits from the demise of public housing and the industry has become filthy rich as a result. The poverty pimps have been attacking the nation's public housing programs and the poor for years as their whipping boy, as can be seen in the comment section of this article.

Then the so-called affordable industry has the nerve to claim it actually wants to serve the poor, and begs for money from redevelopment agencies and the federal Section 8 program for their projects that end up discriminating against the poor.

For the record, it should be noted that by the time the so-called 501c3 charity nonprofit housing developers get done exploiting the poor in Section 8 Project-Based Projects, and projects subsidized by the federal government for the aged and disabled, for the most part, the 501c3 charity housing developers are receiving more for their rental units than most for profit landlords get in rent payments, for comparable rental units.

And that's a fact!

Additionally, those are not really crocodile tears being shed by the 501c3 charity nonprofit developers over the demise of California's redevelopment agencies.

Those are real tears being shed by real poverty pimps in the so-called affordable housing industry that want to continue to exploit the poor, from the funding they get for their projects through the redevelopment agencies, and federal government.

What a world...

See the article below to compare "nonprofit landlords vs for profit landlords."

Lynda Carson
tenantsrule [at]

Published on Indy Bay News Wire...

New Story-- Affordable Housing, or Not
by Lynda Carson ( tenantsrule [at] )
Tuesday Aug 24th, 2004 4:03 AM

Landlords Are Gouging The Section 8 Program, And Non-Profits Are Charging More Than The For-Profit Landlords!

Affordable Housing, or Not

Affordable Housing Out Of Reach For Many

By Lynda Carson August 24, 2004

Thats Darlene Maney standing next to the mural at the Hugh Taylor House as she stands with her sign that say's, Save Affordable Housing. Maney used to work for the East Bay Asian Local Development Corporation (EBALDC), and says, "My Message to the non-profits are that they have a commitment to the applicants to get them into their housing in a timely manner. It should'nt take 6 months to a year to get into low-income housing, especially if the units are prepared and sitting there vacant."

Section 8 vouchers and Section 8 project-based vouchers have been under attack by the Bush Administration, as can be seen recently in Alameda and in Marin County. When HUD recently terminated the project-based vouchers at 30 different affordable housing developments of Marin County, those projects no longer seemed so affordable to those that would some day try to find housing there in the near future.

Theres no doubt that affordable housing sounds great and that the term non-profit takes the edge off of raw capitalism. But what do those terms really mean?

In this day and age, the need for low-income and affordable housing seems imperative, and may explain why non-profit housing organizations are big business now adays.

To the multitude of poor and homeless people that never seem able to meet the criteria that would ever allow them to move into low-income or so-called affordable housing, the terms known as low-income housing or affordable housing seem to be quite meaningless or hollow, and if anything they seem to be a bitter reminder of what has been placed beyond their reach.

With the recent Section 8 funding shortfalls taking place across the nation, as HUD Secretary Alphonso Jackson relentlessly tries to convince the world that less is better when it comes to the needs of housing the poor, it has forced people across the nation to take a closer look at whats happening in the world of affordable housing and the Section 8 programs.

Some recently leaked documents from an Oakland non-profit housing organization known as the East Bay Asian Local Development Corporation (EBALDC), reveal that rents being charged in identical units at some of their properties are higher by as much as $300.00 a month and more if the tenant moves into a Section 8 project-based unit or has a Section 8 voucher. This was during the month of June 2004.

A Break Down Of The Hugh Taylor House During June Of 2004.

The Hugh Taylor House located on Seminary Avenue in East Oakland is owned and operated by EBALDC and has 43 rental units, with 25 of them set aside for section 8 project-based tenants, and the rest goes to regular renters that can qualify to move in.

Theres five Section 8 renters in one bedroom units with each being charged $928.00 a month, and theres seven non-section 8 renters in one bedroom units being charged $392.00 per month. The Section 8 tenants are being charged $536.00 more a month than the regular tenants are in identical units.

It's common for non-profit developers to charge more to Section 8 renters which then allows them to charge less to their regular customers while being able to pay the bills, and both Section 8 tenants and non-Section 8 tenants end up paying around 30% of their income if it all goes well.

Of course, if the vacancy rates are high in the building and vacant for long periods of time, it forces the rents up on every one, no matter what kind of financing that may have taken place to fund that kind of development in the first place. There were five vacancies during the month of June at the Hugh Taylor House and on average the rental units remain vacant there for at least 6 months or more before the vacancy is filled

Even though I assumed that EBALDC was charging the average minimum rents, $928.00 a month in that area of town on Seminary Ave, it still seemed a bit high, and I checked the average rent statistics for that area. The locals call it Cemetary Avenue because of so many shootings in that area of town, and it is a low-income area.

According to available stats from Home Finders for that area located below Mac Arthur Blvd, the average minimal rents being charged for one bedroom units are only $650.00 a month.

EBALDC a non-profit, is charging an astounding $278.00 more a month at the Hugh Taylor House for one bedroom units than the regular for profit landlords are charging in that same area for the average minimum rents being charged for one bedroom units.

The Hugh Taylor House also has thirty SRO's (single room occupancy), that are without a kitchen and the shower is located down the hall. On average, Section 8 renters in the SRO's are being charged $687.00 a month, and regular non-Section 8 renters in identical rooms on average are being charged $365.00 a month. Section 8 renters are charged $322.00 more a month than regular non-Section 8 tenants in the identical SRO's.

Checking the going rate for SRO's located in the local for-profit Hotels, I found the following.
The Sutter Hotel charges $560.00 a month for an SRO, the Ridge Hotel charges $475.00 a month for an SRO, and the Old Oakland Hotel charges $480.00 to $520.00 a month for an SRO and the prices vary according to the size of the room that may be available at any given moment.

The Lake Hurst Hotel offers SRO's for as much as $675.00 per month, but along with the room they offer 2 free meals a day to their renters for five days a week inside their dinning room.

As it turned out, at $687.00 a month being charged to Section 8 tenants at the Hugh Taylor House for an SRO, EBALDC charges more for their SRO's than all of the above mentioned for-profit Hotels do, including the Lake Hurst Hotel which offered free meals with their rooms.

Taking a look at the rents being charged at one of EBALDC's other buildings called Effies House during the month of June, the records show that Section 8 renters are being charged hundreds of dollars more a month than many of the other regular tenants that reside there.

As an example, during the month of June, one tenant in a one bedroom unit is being charged $550.00 per month, while a Section 8 tenant in an identical unit is being charged $806.00 a month. The Section 8 tenant is being charged $256.00 more a month than the regular non-Section 8 tenant pays.

On August 18, I contacted Lynette Lee, EBALDC's Executive Director, and asked for an interview. Ms. Lee agreed to the interview, and wanted to schedule a time for it to take place until she realized that the story was about EBALDC and the affordable housing crisis and the Section 8 crisis that was going on. Ms. Lee suddenly claimed that it was a conflict of interest for me to cover the story because I am one of the renters in her empire of more than 600 rental units which she controls.

Comparing Non-Profit Housing Organizations

After doing some research to compare EBALDC with other local non-profit housing organizations to see what they may have in common, I discovered a local one called Resources for Community Development (RCD).

Founded in 1984, in 2002, RCD currently had a portfolio of 970 affordable housing units and emergency shelter beds located throughout Alameda, Contra Costa, and Solano Counties. RCD had another 12 projects, totaling 613 units, in predevelopment and/or construction.

Founded in 1975, EBALDC developed over six hundred rental units of affordable housing as well as 190,000 square feet of retail and office space in Oakland and Emeryville.

In fiscal year 2002, RCD, a non-profit housing developer in Berkeley, turned out to have assets of $21,412,751, while during the same fiscal year of 2002, EBALDC which is also a non-profit housing developer, had assets of $23,876,277.

After subtracting the liabilities from their assets, RCD had a fund balance of $2,965,312.
In that same fiscal year, EBALDC had a fund balance of $17,749,264 that accrued after subtracting their liabilities from their assets.

The financials appear to reveal that through the years, RCD continued to use their funds to develop more housing units and emergency shelter beds, while EBALDC used their funds to pay off their properties and shifted into developing retail and office space rather than focusing on affordable housing projects.

Affordable Housing, or Not.

Fair Market Rents (FMR) are a cap thats been placed on the Section 8 programs and the landlords can ask for as much as they want so long as it does not go beyond the established Fair Market Rents established in any given area.

In Oakland, theres many areas of low-income housing that exist in which the FMR is actually set higher than what the for-profit landlords are charging in many areas. The result is that the Section 8 programs are being gouged because Section 8 renters are often being charged way more than their counterpart non-Section 8 neighbors are, and it's all perfectly legal.

According to Vivian Hain, "I think its a train robbery going on, and I think it's immoral for the non-profits to set up so-called affordable housing in low-income areas to fleece the government. My family tried to rent housing from the John Stewart Company and Affordable Housing Associates, and because we were on the Cal-Works program that only offered us a subsidy of $679.00 per month, we could never keep up with what the non-profits could get from the Section 8 program, and we remained homeless."

In a call to Oakland Community Housing, Inc. (OCHI), a non-profit housing developer of Oakland, I reached the Executive Director Dwight Dickerson, who was very blunt about his position and he said, "For project-based Section 8 housing, I think that you have to charge market rate rents to be able to pay off the mortgage for any given location."

Jeanne Cooke, pays $925.00 a month for a beautiful one bedroom unit with hard wood floors, which includes a dinning room in downtown Oakland and said, "I could never imagine living on Seminary Avenue, in East Oakland, to be charged more for a one bedroom unit by a non-profit than what I am being charged here."

According to John Stewart of the John Stewart Company which owns or operates more than 22,000 rental units in California, "It's a systemic problem. The cost of building and operating rental housing in California has become so costly, that even the non-profits have not managed to offer housing that is available to the homeless and very low-income families. For many, the cost of housing is beyond their reach no matter what we do."

Lynda Carson May be Reached At; tenantsrule [at] or 510/763-1085

by Anon
Tuesday Jan 10th, 2012 12:25 PM
While I do not doubt the sincerity and good intentions of the author, I do believe that she is misguided and does not understand how affordable housing is financed, and how the tax credit program operates. In the spirit of full disclosure, I am a veteran of the affordable housing industry and am proud of the role my colleagues and I play in providing quality housing for a segment of the population that remains vulnerable to the volatility of the marketplace.

It is true that there are situations where a tax credit financed, affordable housing development displaces households. There is no way around that. However, if that occurs that household is eligible for permanent relocation benefits, so it is not as if they are tossed on the street with nothing for their troubles. Furthermore, I would argue that the onus is on the local jurisdiction, city staff, and the elected officials that approve these projects to communicate what their expectation is with respect to maintaining the housing stock for the most vulnerable segments of our population. The reality is that none of these affordable housing projects would be completed without public funds, and the local jurisdictions are in the so called drivers seat in terms of what they will accept in exchange for these funds. If that expectation is that ZERO existing households are permanently displaced, then the local jurisdiction would need to communicate that and be ready to pay for the capital impact that a lower rent structure will cause. That last statement is key: a lower rent structure means more public funds are needed. So the decision that city staff and local elected officials need to make is whether they want to subsidize less units at lower rent targets or produce more units at incrementally higher rent targets. As a developer, the truth of the matter is that we will ultimately do what our city partner wants! Classic case of he who has the money makes the rules!

You continue to rant on about the possible sale of units by the Berkeley Housing Authority. Again, the same rationale applies. The staff and relevant electeds could push for long term covenants as a condition of the sale. Whether Ross and the Related Companies purchases these units is not the problem. The problem is if the housing authority does not understand the true value of these assets and has no commitment to these residents.

The author may also misunderstand how Section 8 works with respect to the financing of an affordable housing project. Typically, developments with a project based Section 8 contract utilize the additional revenue to leverage an additional tranche of conventional debt. What do all these big words mean? It means that more commercial debt is used to finance the project instead of additional public funds. While it is arguable that the Section 8 revenue are public funds, but if the local jurisdiction does not have the ability to write a check for the full balance necessary for a project, this type of financing structure is one alternative. So, it is not as if the developer is renting only to section 8 households to line their pockets with the difference between the subsidy rent and the underlying restricted rent. The fact is that the additional revenue is being used to leverage additional private capital for the project. Also, the typical cash flow waterfall in an affordable housing deal dictates that the City and other public sources receive a portion of the remaining cash flow after operations and debt service.

As it stands now, there is some truth that the affordable housing industry does not typically serve the same population that resides in public housing. That is not to say that it could not. The economic reality that policy makers and elected officials grapple with is that the state mandates housing production goals via RHNA, and those households that only qualify for public housing are not well served by this process. But whose fault is that? The developers, who continue to work hard and produce affordable housing opportunities for households that may not be at the lowest of economic levels but certainly qualify as having a need and who also have limited housing choices? The nonprofit housers fill a niche that was created by the Federal Tax Reform Act of '86, and has created hundreds of thousands of affordable housing units nationwide. The market rate builders, despite what they would have you believe, would never have done this. Having colleagues on that side of the fence, I know that their attitude is simple: too much brain damage for limited returns. The state tax credit allocation committee has regulations in place capping the amount of developer fee that can be earned on a project. Obviously, there are no such restrictions for a market rate developer. Why would a market rate developer subject themselves to the increased complexity of a tax credit execution if they could earn a better return on their investment elsewhere developing only market rate product?

The real story remains that the loss of redevelopment agencies will severely dampen housing production for a vulernable segment of our community. Is this segment the same as the households that reside in public housing units? The answer is of course, no. But they remain vulnerable and nonprofit affordable housing developers, working with their local partners will continue to provide needed affordable housing. The author misses this fact: the low income housing tax credit has been the most successful vehicle to incentivize private investment in the production of subsidized housing. And these housing units would otherwise likely never have been developed, leaving countless households in deplorable conditions.

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