UPDATE #2, 8.24/2014: We have added a new comment from Mr. Seldin as well as Mr. Maynard's reply to the bottom of this post.
UPDATE, 8/20/2014: We have updated these excerpts with Mr. Seldin's response to Mr. Maynard and his reply at the bottom of this post.
Yesterday
RestonNow posted an article on the upcoming hearings for redevelopment of Crescent Apartments and Lake Anne Fellowship House (LAFH). We responded, in part, with our continuing concern over the fate of the residents of more than 100 apartment units who will be evicted to make way for the building of 285 luxury apartments at LAFH. Robert Seldin, the head of NOVUS LLC, the company redeveloping LAFH castigated us for errors and said we should apologize to LAFH's volunteers and residents. We responded in turn. Below are those comments for your information.
Terry Maynard
The two Lake Anne applications are the first re-zoning applications
to implement the re-development of Lake Anne Village Center. The plan
for re-developing the Crescent Apts. has been widely endorsed,
especially for its effort to assure at least the same number of
affordable units as the existing facility. The re-development of Lake
Anne Fellowship House at last count included plans to evict more than
100 poor, largely foreign language speaking residents in favor of
high-end apartments. We need to watch to ensure that the latest
revision to this re-zoning plan includes a reasonable apartment for ALL
the current LAFH residents.
Reply by Rob Seldin to Terry Maynard
Terry Maynard, you are completely misinformed about the Fellowship
proposal and by further spreading disinformation may cause irreparable
harm to the Fellowship Square residents. Please allow me the
opportunity to state the facts. At present only 114 out if the total
240 potential residents at LAFH receive direct Federal housing subsidy.
This subsidy is set to expire for most residents (86 of the 114) in 24
months leaving them with no means of housing support. Further this
subsidy is tied directly to the Fellowship Square building so those
residents who need subsidy are forced to stay at the property. The
proposed redevelopment will instead provide "Permanent, Portable Direct
Housing Subsidies To All 240 Residents For The Rest of Their Lives"
provided they earn less than 80% of AMI. This is a degree of housing
security that none of the residents currently enjoys and I dare say very
few people anywhere receive. The subsidy will pay the difference
between 30% of a residents income and their actual housing cost, meaning
that if a resident has no income, their housing is free. By being
portable all residents will now have the freedom to choose housing that
best suits their needs rather than being tied to a decaying structure.
In addition to this permanent security for all, the proposed
redevelopment will also add 140 new permanent affordable units to
replace the 26 temporary affordable units that will be on site in 2016.
All residents will be given access to a housing relocation counselors
and will receive up to $3,500 apiece to cover moving expenses either
into the new building or into other housing of their choosing.
I think that in light of the facts, you owe all of the fine Fellowship volunteers and their residents a sincere apology.
Terry Maynard reply to Rob Seldin
Thank you for your feedback, Mr. Seldin. For those of RestonNow’s
readers who don’t know who Mr. Seldin is, he is the head of NOVUS
Residences LLC, the residential division of Cafritz Interests. They
have proposed the redevelopment of Lake Anne Fellowship House (LAFH)
into more than 285 luxury apartments and only 140 affordable units,
leaving the residents of 114 units without a home next year.
Now to your comment: It corroborates explicitly the point I made. It
is NOVUS’ intention to force (i.e.—evict) residents of more than 100
low-income units in LAFH to find housing elsewhere. It is well within
NOVUS’ ability to provide that housing at the current LAFH area location
in the new over-sized luxury apartment complex NOVUS plans to build,
but you have chosen to build a very limited number of low-income housing
units in your redevelopment of LAFH. At the same time, NOVUS is buying residents off with a miniscule rent
subsidy because, under Section 8 Housing Choice Voucher Program, IT IS
REQUIRED BY LAW. This is not because of NOVUS’ overwhelming corporate
generosity as Mr. Seldin infers. Here is a simple statement covering
this situation from a Nevada publication on affordable housing support:
“In the new Section 8 Housing Choice Voucher project-based rental
assistance program, a tenant in good standing moving out of a
project-based unit (such as LAFH) must be offered a tenant-based
subsidy, provided the tenant has lived in the project-based unit for at
least a year.” Do you see that word “must”? So thank you for obeying
federal law. And if you need more documentation, I can provide it.
Right
now In Fairfax County, the 2014 maximum allowable rent in affordable
dwelling units (excluding utilities) ranges from $780 to $1,115 per
month, depending on the number of bedrooms (0-3). It is unclear to me
how many, if any, LAFH residents could afford those rents, even with
your small subsidy.
But there are NO available rental units in
Fairfax County under its Housing Choice Voucher program. In fact, even
THE WAITING LIST IS CLOSED according to the County website. (See
http://www.fairfaxcounty.gov/r...
So your plan will not only throw them out of LAFH and Reston, YOUR
PLAN WILL THROW THEM OUT OF FAIRFAX COUNTY. Great work there, Mr.
Seldin! That so defies Reston’s Vision calling for diversity—including income diversity--as
stated both in Bob Simon’s original vision and the recently approved
Reston Master Plan that it is sickening. It is also morally
reprehensible. We clearly understand where NOVUS’ priority lies:
Maximizing profits at the expense of tenants.
As for the
volunteers at LAFH, I have nothing but immense gratitude for their
tremendous efforts in assisting the hundreds of LAFH residents in
difficult circumstances, and nothing I said in my comment suggested
otherwise. In fact, your statement was gratuitous.
Moreover, I
hope that—and I will work for—an accommodation that allows ALL the
existing LAFH residents can remain at Lake Anne in the new NOVUS
development—even if it cuts into NOVUS’ bottom line. And we at Reston
2020 will work with other community advocates to press the County to
help assure that happens. Throwing more than 100 poor people out of
LAFH and Reston would violate all that Reston stands for.
In the meantime, I believe the only person who owes LAFH residents an apology is you for what you are about to do to them.
UPDATE:
Thank you Terry. We appreciate your desire to see the best outcome
for the Lake Anne residents. This is a desire that we likewise share and
that has been the animating principle behind our efforts on behalf of
Fellowship Square for the better part of the past 2 years. If
recognition of your desire to help arrive at the best possible outcome,
we are happy to meet with you and any members of your orgainization to
discuss the challenges and opportunities available for the property and
the solutions that we have been able to thus far arrange. If you are
aware of any potential methodologies by which we can arrive at a better
outcome for the residents we are certainly glad to incorporate them into
the plan if we can. If you would like to discuss this further, please
feel free to reach me in the office at 202-446-0670. In the interim,
please allow me the courtesy of rectifying certain aspects of our
proposal that may still be misunderstood.
At present only 114 "units"
of the 240 total units at Lake Anne Fellowship House carry "temporary"
project based subsidy. This subsidy enables the residents in these
units to afford to live.
Residents in the other 126 units do not
receive any housing support despite financial circumstances that see
many of the "unsubsidized" residents paying upwards of 65% of their
limited income on housing.
The temporary project based subsidy is set to expire for 86 of the 114 units in September, 2016.
The temporoary project based subsidy for the remaining 28 units expires in 2023.
Once the subsidy expires, it cannot be reinstated since the existing subsidy programs are no longer in existence.
Once
the subsides expire, the newly unsubsidized residents will lose their
ability to pay rent and therefore have an increasingly uncertain future.
The
existing Lake Anne Fellowship Houses 1 and 2 are both in need of
signficant repairs. The property's meager income stream (the product of
the property's extremely low rents) is insufficient to enable even
routine maintenance. This creates an ongoing cycle of decline that
hastens the property's functional and physical obsolescence. This cycle
of decline is not in anyone's best interests to continue.
Fellowship
Square has been investigating potential solutions to these challenges
for the past 4 years in hopes of arriving at a solution that would
provide lasting financial benefits to all residents (not just those in
jepoardy of losing current subsidy) while generating a new 40 year life
in permanently affordable senior housing.
The existing buildings are
completely unregulated in terms of rent and age by the County and
therefore once the mortgages expire (2016 and 2023 respectfully) they
could be leased at 100% market rates and to residents of all ages.
While this would create the best financial outcome for the Foundation,
as stated previously the primary motivating factor beind this exercise
is to provide maximum benefit to the existing residents while enabling
the maximum amount of long lasting senior affordable housing.
We have
been working with the Foundation for over 2 years and have been funding
100% of the cost of their exploration into potential solutions during
this period. At no point during this process has our involvement been
predicated upon requiring a solution that would enable us to develop new
apartments but rather has been done, in large part, as a component of
our owner's ongoing history of charitable works thoughout the DC region.
After
hearing the Foundations list of desires, we set about working with the
relevant Federal and State agencies who play ongoing roles in this
property to see how to craft the best potential solution. After one
year of ongoing discussions and explorations, the best direction was as
follows:
1) HUD would provide PERMANENT, GUARANTEED, and PORTABLE
section 8 housing vouchers to all 240 residents living in either Lake
Anne 1 and Lake Anne 2 regardless of whether they were in a currently
subsidized unit. Rather than being forced to live in properties that
carried current subsidy that could expire, all residents could now
choose properties and bring the subsidy with them and that subsidy could
not expire.
2) These vouchers WOULD NOT come from the County's
existing allocation but would instead be accretive to the County total.
Therefore no Fellowship Square residents would need to wait in any
lines and no Fellowship Square residents would see any gaps in their
coverage. As you are correct that the County's existing wait list for
normal vouchers is currently 3 years long, it was important to get this
assurance as the primary animating principal behind this initiative was
to provide benefit to the existing residents.
3) The vouchers would
provide PERMANENT HOUSING SECURITY FOR ALL RESIDENTS FOR THE REMAINDER
OF THEIR LIVES. This is a condition that not one resident currently
enjoys and that frankly most people in the US don't ever achieve.
4)
To secure these Vouchers, Novus would fund and construct for Fellowship
Square a new 140 unit permanently affordable senior building on the
east (vacant) portion of the existing FSF site. It was expected that
this building would be complete with construction by year end, 2017.
5)
The 140 new units were required by HUD as 140 is the number of units
currently covered by the existing mortgage on Lake Anne 1. Even though
the existing Lake Anne 1 only has 28 subsidized units and is ultimately
unregulated by the County once the existing mortgage expires, the new
property would carry permanent affordability and be permanently for
seniors.
6) From the time that we are able to finalize a deal with
HUD (which ultimately requires having an approved site plan from Fairfax
County) all Fellowship Square residents would be granted vouchers and
given access to a housing counselor who would help each resident
identify the potential housing that best suited their individual needs.
As the new Fellowship building would not be complete until the end of
2017, this would give all residents upwards of 3 years to identify the
best option for them.
7) Once the new Fellowship Square was complete
and all of the residents had been successfully accommodated in the new
housing of their choosing, Novus would remove the existing buildings and
commence construction on the new market rate housing.
8) Through
the "creation" of 240 "Permanent, New, Transportable Vouchers" for all
existing residents plus the construction of 140 new permanent affordable
senior units, the proposed redevelopment would create the opportunity
for up to 380 deserving seniors to have dramatically improved housing
prospects as compared to 114 existing residents who are currently facing
subsidy expirations and the prospect of life in a decaying structure
that does not best meet their needs. By most objective standards this
appeared to be a worthwhile set of achievements.
A few other points that may also be worth understanding include:
1)
Current HUD Fair Market Rent for a 1 Bedroom unit in the DC MSA is
$1,239 per month, as compared with the $780 per month that you may have
been lead to believe.
2) The Section 8 voucher pays the difference
between the Fair Market Rent and whatever amount is 30% of a resident's
income. If the resident earns $0 the voucher pays the full $1,239 per
month (or up to $14,868 per resident per year).
3) Over a 30 year
period, assuming a resident has no income, this would equate to a
benefit of nearly $450,000 per resident in todays dollars; an amount I
would respectfully suggest is somewhat more than "miniscule".
4)
Absent this proposal, none of these benefits can accrue to any of the
existing residents. The residents who lose their subsidies will lose
their subsidies. The residents with no money to afford better
accommodations will be forced to remain in the existing cycle of
decline.
While there are countless other legal nuances that
underscore the set of facts outlined above, they are indeed the facts as
we best understand them. As stated in many prior instances, we are
certainly sensitive to people's concerns about the property, the
proposed redevelopment, and the issues facing the existing residents.
As it remains primarily the resident's interests that we are working to
advance we are grateful for the community's interest and their
willingness to help advance solutions that guarantee the best possible
outcomes. While there are plenty of items worth discussing, we believe
that a solution that guarantees housing security for life for all
existing residents remains a priority and worthwhile goal.
We likewise
believe that any solution that adds 140 new permanent affordable senior
housing units to a site that has no permanent affordability today
advances those goal even further. And lastly we believe that any
solution that requires that all existing residents must be provided for,
and all affordable units be constructed before any new market rate
apartments can even commence furthers that goal yet again. We proudly
stand by the work that we and the Foundation have done and continue to
do on behalf of the residents and we invite you to share in the success
that we hope to bring them. Thank you again for your time and thought.
We look forward to speaking with you soon.
With Best Regards,
Robert M. Seldin
CEO
Novus Residences
Mr. Seldin: Thank you for your more considerate and illuminating
response. Still, it appears that they reinforce the two key points I
made earlier and leads to a shared conclusion: ·
--NOVUS is planning to evict poor, largely non-English speaking residents of 100 LAFH apartments.
--NOVUS is doing little to nothing more than is required by federal, state, Virginia, and County law, including building 140
affordable dwelling units, to meet the housing needs our Reston’s less fortunate.
--Although
we have not mentioned it before, I agree with you that LAFH has become a
barely livable place in recent years and needs to be replaced.
In replacing LAFH, you are pursuing a course that sees the construction
of 140 permanent affordable dwelling units (because you must) and 285
“market rate” apartments under the “full consolidation” option of the
new Lake Anne Comprehensive Plan allowing 425 units. First, it is not
clear to me how your proposed plan meets the requirements of the “full
consolidation” option, i.e.—that your effort is combined with the
efforts of others Lake Anne redevelopment efforts. A paragraph in the
same section of that Plan also states: “Any redevelopment of this
(LAFH) property should replace the loss of any of the existing
affordable rental units among all the Land Units (at Lake Anne).” It
would seem logical, then, that guarantees of the concurrent availability
of the other 100 needed affordable residences in the Lake Anne area
should be included. Is Republic onboard with the notion to build affordable units at Crescent Apartments to make up for at least some of your shortfall at LAFH? I am not aware that this is the case. What arrangements do you have in place (or expect to have in place before you seek County approval)
to
assure that all LAFH residents can be re-situated in their current
neighborhood when they are forced to leave LAFH with their vouchers in
hand?
Another approach you might consider is pursuing “bonus” density
for providing 100 “extra” affordable units at LAFH for all those people
you now plan to displace. As you are aware, the County is woefully
short of affordable housing and, to the extent legally permissible,
would probably look favorably on such an offer. Heaven knows, the
county has been “flexible” elsewhere in Reston for much less
humanitarian reasons.
And you have a basis for doing so: “Housing
will be provided for all ages and incomes” is one of Reston’s core
Planning Principles under the new Reston Master Plan. Twenty percent
might be an appropriate bonus number of units, so you might be able to
add as many as 85 units to your 425 currently allowable total units if
you added 100 affordable units, thus creating 240 affordable units and
270 “market rate” units. My guess is that the added rents from the 85
extra units (even if there are 15 fewer “market rate” units) would
substantially exceed the revenues under the current proposal. (100 ADUs
at $1,289/month is $128,900. Would you expect to receive $8,600/month
in rent from each of the 15 “market rate” units you’d lose to make up
the difference?) Admittedly there would be added costs, but the
affordable units would also offer NOVUS tax incentives. You’d have to
do the math to see if it’s workable.
Finally, I will take a
critical shot at your remarks. You make it sound as if NOVUS is making a
sacrifice or doing something extraordinary for LAFH’s residents when
you are not, in fact. You are doing what is legally necessary to create
the opportunity for a vastly more profitable market-oriented apartment
complex. You even made it sound as if the housing subsidy LAFH
evictees would receive would come from NOVUS, and apparently that’s not
true.
You also note that the new “permanent, guaranteed, and portable”
Section 8 vouchers are accretive and would not mean that displaced LAFH
residents would not have to go to the back of line that is closed to
wait for affordable housing. That is a good thing, but it still doesn’t
address the issue of affordable housing availability in Lake Anne as
called for by the Comprehensive Plan, or more broadly available in
Reston or Fairfax County. You can’t live in a voucher. Are you aware
of any such current housing opportunities or opportunities by the time
you evict LAFH’s residents? I’m not. You see because most developers
like NOVUS don’t want to build more affordable housing than the law
requires, rarely is any new housing available.
Most importantly,
the idea of large scale eviction and gentrification of Reston’s
low-income housing is anathema to Reston’s vision. As a new developer
in Reston, you will do much better if you try to become part of our
community and not fight it on one of its most important foundations. I
think you will find Restonians and others interested in housing
affordability much more receptive to your plan if NOVUS shows its
commitment to that core value by accommodating all of LAFH’s current
residents in its new development. You simply have to find a way to keep
all LAFH's residents in the Lake Anne area, and preferably in the new
LAFH.
UPDATE #2:
Terry: Thank you again for your additional thoughts. We are grateful for your concern regarding the resident’s well-being as that concern has likewise been the primary animating objective of the Foundation’s efforts to date. Despite your undoubtedly good intentions, there are a variety of items about which you still may not be fully informed, and that may prove more helpful to discuss in person. Please let us know if this is something you wish to do and we are happy to arrange our schedules to accommodate your timing convenience. In the interim, please allow me to more clearly enumerate some facts about which there still appears to be some confusion.
The Foundation is not going to evict anyone. Not only would this be prohibited by law, it would violate the very essence of their organization’s purpose which is to insure the best housing options for seniors of limited means in the DC area. In support of the Foundation’s mission, the primary objective of the redevelopment effort is to enable the existing residents to gain access to a far wider and better pool of potential housing options than their limited means currently affords. As lack of money is the main reason that the residents do not have more housing choices today, enabling the residents to gain access to life changing financial resources and the personal and direct counseling services associated with those resources is paramount. By procuring Section 8 vouchers for all residents, each resident would suddenly have access of up to an additional $1,240 per month in federal housing support payments. While an additional $1,240 per month may not seem like much to a typical Reston resident, to the typical Fellowship Square resident it is life changing.
It may likewise be helpful to understand who lives at Lake Anne Fellowship House. A typical resident is between 70 and 90 years of age and has a gross income of between $700 and $1,000 per month. For these residents, particularly those in non-subsidized units, paying rent of even $500 per month presents a serious challenge. The existing buildings are both approximately 40 years old, were built rather inexpensively, and were neither designed nor constructed to accommodate an aged population.
The property meets neither ADA nor Fair Housing design standards, the elevators are not sufficiently sized to house an ambulance stretcher and interior doors and unit hallways are not wide enough to accommodate a wheel chair. The unsuitability of the structures for their current use deters most residents with greater access to capital. When combined with the Foundation’s mission to serve seniors of limited means, the results are a property with extremely low rents and revenues that are insufficient to cover
daily property expenses. With revenues insufficient to fund even routine maintenance, let alone important upgrades, the property has entered a self-reinforcing cycle of decline. This serves no one’s interests.
With this Catch-22,not even Joseph Heller is amused.
Another area of potential confusion may be the definition of “affordable housing” in Fairfax County. Within the County’s comprehensive plan, affordable housing is defined as housing available at less than 120% of area median income as a result of some government mandate or other external force. Therefore affordable housing is not housing that simply “seems inexpensive” relative to other options nor is it housing that is deliberately offered at low rates by the owner. Within the context of Lake Anne Fellowship
House, the property today is regarded as “unregulated housing” by Fairfax County, meaning that the property owner could charge whatever rent they desired and that the market would bear.
Although unregulated by County mandate, the existing buildings must conform to certain income restrictions on specific units, required by the current mortgages, for so long as those mortgages are in place. Lake Anne 2 has a VHDA mortgage that expires in 2016. Lake Anne 1 has a HUD mortgage that expires in 2023.
In conjunction with the existing financing, the Lake Anne 2 mortgage provides 86 units with federal subsidy that expires in 2016 while the Lake Anne 1 mortgage provides an additional 28 units with federal subsidy that expires in 2023.
Once the subsidies expire they cannot be reinstated as the programs are no longer in effect. When the subsidies expire, the residents who have lost subsidy have also likely lost their ability to pay rent.
a practical sense, 114 out of a potential 240 total residents receive subsidy at Fellowship Square today. The 114 subsidized residents will be reduced to 28 subsidized residents in 2016 and then again to 0 subsidized residents in 2023. From a regulatory standpoint, this means that while there are 114 “affordable units” on site today, that number will fall to 28 “affordable units” on site in 2016 and then to 0 “affordable units” in 2023. Since the proposed development will complete the deliver 140 new permanently affordable housing units in 2017, the newly constructed affordable units will in fact be increasing the number of “affordable units on site” by a factor of 5 times.
Due to the impending expirations, time is of the essence.
Understanding the urgency in achieving a positive solution we began engaging all relevant governmental agencies with influence over the property inearly 2013. Through multiple discussionswith relevant county, state and federal agencies we began to flesh out a seriesof goals and objectives that we hoped would enable a productive solution. While each agency is staffed with well-meaning professionals who all recognize that status quo ante at the propertyis unacceptable, as is sometimes the case with multiple jurisdictions,competing regulatory regimes, legal requirements and internal policies proved complicated to align. With a goal of insuring improved financial and housing prospects for all residents and the re-creationof the maximum amount of new affordable housing, the following solution was reached:
1) HUD would provide guaranteed, permanent, portable section 8 vouchers to all residents of Lake Anne 1 and 2 whether they were currently in a subsidized or not.
2) These vouchers would not come from the existing County allocation and would grant all residents access to any apartment community in Reston, Fairfax County, Northern Virginia, or anywhere else in the
US that was registered to accept vouchers.
3) With the vouchers, the residents would never have to pay more than 30% of their income on housing ever again, even if their income was $0.
4) In exchange, Novus and FSF would construct 140 new permanently affordable senior units to replace the 140 units of Lake Anne 1 under the current HUD mortgage.
5) In conformance with HUD policy, the new 140 units had to be constructed on the same site as the existing Lake Anne 1.
6) Once the new FSF building was complete and all existing residents had successfully identified and relocated to more suitable accommodations, Novus could purchase the existing LAFH buildings to construct the new market rate apartments.
Sounds reasonably simple right?
Standing in the way of the plan’s successful implementation was a variety of obstacles.
The existing Lake Anne 1 and 2 buildings are physically connected but technically built on separate land parcels. The only open area upon which you could physically build 140 new apartments is on the non HUD controlled portion of land. Additionally, since FSF was up against a deadline of September 2106 to prevent the expiration of the existing subsidy, the plan had to proceed quickly through the site plan review and permitting process in order to meet the required construction delivery schedule. Lastly, due to the mounting time pressures, we required a guaranteed source of funding for both debt and equity. If any of these items could not be achieved, the residents could not get vouchers, and the new affordable units could not be constructed.
For debt, the clear solution was to utilize the Foundation’s 501c3 status to obtain new construction 501c3 tax exempt housing bonds from VHDA. The good news was that 501c3’s have unlimited tax exempt bond volume capacity under federal law which removes the risk of other competing projects “using up” the
limited supply of bond capacity for non 501c3 entities. The bad news was that 501c3 bonds do not provide tax credits that affordable housing projects normally rely upon for project equity. An additional and somewhat unforeseen complication was HUD’s reluctance to subordinate their Section 202 position to a first trust lender and VHDA’s requirement that their bonds be in a first trust position as the lender.
After working through the debt complications, the next issue was providing equity for the remainder
of the new FSF project which requires monetizing the land on which the existing FSF buildings sit.
As an organization with very limited financial resources, the only asset that FSF has to generate the
necessary capital to cover the gap between the debt proceeds and the total cost of the new affordable housing building is the land under the existing LAFH buildings which can be sold for construction of the new market rate apartments. Therefore, in simple terms, it is actually the ability to build the market rate apartments that pays for the construction of any new affordable housing and enables the receipt by the residents of the life improving vouchers that they need.
Unfortunately, as neither the County nor the Reston design review processes are known for their speed or lack of complexity, construction costs associated with the required design of both the affordable building and the market rate housing escalated quickly as we navigated those processes. While still not complete, the current design requirements have yielded a project where the equity required to construct the new 140 affordable units is equal to the total value of the land that we have agreed to purchase for the 285 market rate units.
Adding further complication is the timing of and security of the required equity. Since Novus cannot purchase the land until after the new FSF building is complete and stabilized and all existing residents safely in new and better housing, in order to provide vouchers to the existing residents, and to provide the new 140 units of permanent affordable housing, it is Novus who must fund the entirety of the equity (between $10 Million and $20 Million) required to build the new FSF building without any insurance that we can ever construct our project. Further, even if we had such assurances, we will still be elongating the time during which we receive no equity return by multiple years; a duration that dramatically reduces the viability of the market rate apartments which are the financial engine driving all of the proposed benefits.
As any prudent investor might ask, “What happens if interest rates spike and we are unable to get a construction loan for the market rate building?” “What happens if costs increase during the extended period and the market rate project ceases to be financially viable?” The answer is Novus will have lost in excess of ten million dollars but the existing residents will all have life-improving guaranteed housing funds, a world of better housing choices, and Lake Anne will have 140 new permanently affordable
senior housing units.
While I appreciate your skepticism of developers and your lack of appreciation for the perceived sacrifices and risks that we are making on behalf of the residents, I can assure you that the facts described above are far from traditional “development risks” and our willingness to expend such extraordinary means is only possible through the unique charitable underpinnings of our unique owner and his family. We are of course willing to share this risk if you would care to make a donation.
In closing, we recognize that these are challenging issues that rightly raise people’s interest and passion. Our goal was to work diligently to understand the existing facts and provide a solution that enabled the best solution possible. What I think we have accomplished is something that far exceeds any normal level of expectation and is something that we and the Foundation are proud to stand behind.
Does this mean that everyone must agree with our decisions? No. But in keeping with Reston’s vision, I leave you with these questions:
"How is a solutionthat provides permanent access to life enhancing housing support payments andaccess to far better housing options for all residents not in keeping with the vision of Reston?”
“How is a solution that increases by a magnitude of 5 to 1 the number of permanent affordable housing units in Lake Anne not in keeping with the vision of Reston?”
And perhaps most importantly, “What kind of communityhas Reston become where neighbors prevent the poorest among them from receivinglife improving financial support and dramatically improved housing prospects simplybecause some of the beneficiaries may find better housing options somewhere besides Reston?”
Thank you again for your time and consideration and we welcome the opportunity to speak with you and any concerned citizens in person to explore these issues in more detail if desired. This will respectfully be my final post on this site regarding this issue and as a gentleman I offer you the last word.
With Kindest Regards,
Robert M. Seldin
Mr. Seldin: Thank you for the additional information you have
provided. Your comments have moved from the shrill to the substantive
in the course of this exchange, and I appreciate that. Still, your
lengthy response does nothing to change the essential fact of the situation:
It
is NOVUS’ plan to throw the very low (& less) income (i.e.—50% or
less of the area median income—AMI, which is about $53,000) senior
residents of 100 LAFH apartments out on the street. Rather than
providing these people housing—preferably at or near their current
location—you are letting HUD provide them with a Section 8 rental
“voucher” that subsidizes their rent. That “voucher” is virtually
useless in a county and a metropolitan area that has a shortfall
numbering in the tens of thousands of available low-income (or less)
rental units. In essence, you are throwing these impoverished seniors
out on the street. (I won’t say “evict,” because that’s a specific
legal term, but the result is exactly the same: No place to live. Just
tear down their homes) So far as I can tell from your comments, NOVUS
is doing nothing more than the absolute minimum required to accommodate
the low-income seniors living at LAFH—and it is not enough.
If you
think I am kidding about the subsidized housing market in the area,
please read the Urban Institute’s recent analysis of housing security in
the Washington region, including the “FC” (Fairfax County, Fairfax
City, & Falls Church) appendix. You can find it through this link:
http://www.urban.org/publicati... .
According
to the FC appendix to that report, there are currently about 20,000
affordable rental units in FC, less than half that required to meet the
need of very low (maximum $37-53K income range depending on number of
household members, 1-4) and extremely low (maximum $22-32K income range)
FC households. The Urban Institute FC analysis says there is a specific shortfall of 16,000 rental units
for
these renters. And, if your gross income figures are right for LAFH’s
residents, the people at LAFH fall well below the ceilings for extremely
low income renters with annual incomes ranging from $8-12K—and that is
where 15,000 of the 16,000 rental unit shortfall exists. So, to remain
in the county (much less in Reston) these people will go to the back of
a 16,000 person queue, a queue that is so long it is closed in Fairfax
County.
The result of your plan is that residents, most of whom
you say are 70-90 years old, of more than 100 apartments at LAFH will be
thrown out on the street with little likelihood that they will find
HUD-subsidized housing in the county or even the Washing metropolitan
region. This is the most critical fact that you keep ignoring in your
comments. (Side note: You also keep pointing out how much money the
dispossessed’s subsidy is worth over 30 years. Just exactly how many
70-90 year-old people do you expect to live another 30 years to gather
that hundreds of thousands of dollars in subsidies—notwithstanding the
longevity of Bob Simon, our founder?)
Let me make this plain:
No
one can live in a voucher no matter how beneficial the voucher may be.
And there is no suitable housing available for all these residents in
the Metro area, much less Reston.
I appreciate the conundrum the
expiring HUD subsidies present NOVUS and Fellowship Square face, but
don’t take out Fellowship Square’s inadequate management of the
situation on the residents of LAFH. I presume it is not news to them
that these rental subsidies were coming to the end with the payment of
their HUD mortgage. I would note that the end of the mortgage also will
mean a reduction in LAFH operating costs, which could easily be applied
against the rents of those who will soon lose their rent subsidies.
That seems to be another point you’ve overlooked in your comments,
telling half the story. I don’t know whether the reduced costs would
offset the reduced mortgage completely, but I’m confident your analysts
can figure that out.
In the meantime, you and NOVUS have not
offered “the best solution possible.” I offered an alternative for
seeking “bonus” density in my last comment which would allow you to
house all current LAFH residents as well as a large number of market-rate
apartments. I won’t repeat it. No doubt there are other solutions
that would meet the housing needs of LAFH’s residents as well as your
profit motive—and still satisfy the complex requirements of the various
governmental jurisdictions involved in this admittedly complex process.
--
A preference for “consolidated” development of Land Units A (parking
lot), D (Crescent Apts.), and E (LAFH) over individual property
“coordinated” development. The preferred option includes a substantial
increase in the allowable number of dwelling units, including 425 for
LAFH under a “consolidated” approach versus 320 units on a
parcel-focused redevelopment. So far, the developers have not achieved
“consolidated” development with NOVUS Residences working on LAFH (E) and
Lake Anne Development Partners (LADP) handling the parking lot (A) and
Crescent Apartments (D). We can find no indication that NOVUS’ proposal
meets the requirements of “consolidated” development to warrant 425
units versus the base level of 320 units—nor have we heard NOVUS claim
they have.
--Both the new Lake Anne plan’s “Areawide” and “Land
Unit E” sections call for new housing to be provided in the Lake Anne
area for everyone now living in affordable housing, which includes
everyone in LAFH. The language in the Land Unit E section
specifically states: “Any redevelopment of this (LAFH) property should
replace the loss of any of the existing affordable rental units among
all the Land Units (at Lake Anne).” The NOVUS proposal would force LAFH
residents to find low-income senior housing somewhere beyond Lake Anne
and probably Fairfax County because none is available locally according
to County information.
--Planning Principle #7 of the Reston
Master Plan—which itself took more than four years to develop—states,
“Housing will be provided for all ages and income.” This statement
reinforces similar language in Bob Simon’s original planning principles
for Reston a half century ago. NOVUS’ proposal is a forced
gentrification of LAFH that would see more than 100 residents dumped
from their homes to an uncertain future in direct conflict with that
principle.
What is most worrisome to me is that NOVUS may be
intentionally using this non-conforming re-development proposal in
conjunction with an implied—maybe even explicit--threat to walk away
from LAFH altogether. The Foundation is virtually bankrupt and, you
said, federal housing subsidies on 86 of the current apartments are set
to expire in 2016 and another 28 units in 2023, either of which could
force it into bankruptcy. In what may be a “take it or leave it”
offer, NOVUS appears to be trying to use this imminent financial
disaster as leverage to garner County approval for its proposal even if
it does not comply with the County’s Comprehensive Plan. The specific
housing impact of a Fellowship Square Foundation LAFH bankruptcy on the
residents of LAFH is unclear to me.
The coming County decision on
NOVUS’ scheme generally comes down to whether or not it wants to settle
for the option NOVUS presents despite its non-compliance with the
recently amended County Comprehensive Plan, and throw out more than 100
low-income seniors with housing vouchers to find new homes.
So let me end with a few questions for you:
1.
Please explain why you believe your proposal meets the requirements of
the Lake Anne Comprehensive Plan, specifically the requirement
“consolidated” development that would allow NOVUS to build 425 rental
units (vice 320) as you have proposed when the plan states, “Any
redevelopment of this (LAFH) property should replace the loss of any of
the existing affordable rental units among all the Land Units (at Lake Anne).” Where in the Lake Anne area will the residents of the 100 displaced LAFH units be placed—with or without vouchers?
2.
Please explain how your proposal conforms to the broader Reston Master
Plan Planning Principle #7 that “Housing will be provided for all ages
and income.”
3. What kind of developer is NOVUS that it is quite
willing to throw the most vulnerable of Reston’s residents—its
impoverished seniors—out on the streets with a useless housing voucher
that NOVUS isn’t even paying?
4. How do you sleep at night
knowing that, because of your planned actions, more than 100 poor
seniors may be homeless in two years?
As with your comment, this
will be my final post here, but it is quite likely we will meet at the
County Planning Commission and Board of Supervisor hearings if you
continue to pursue this course of action.
Respectfully submitted,
Terry Maynard, Co-Chairman
Reston 2020 Committee
