[Archived] Alexandria City Council Acts To Preserve Affordable Housing At Quaker Hill

City Press Release


	For Immediate Release	For More Information, Contact
	December 19, 2006 PIO# 268-06/bh	Brian Hannigan, Director of Communications, or Raynard Owens, Communications Officer, at 703.838.4300 Raynard Owens, Communications Officer, at 703.838.4300

ALEXANDRIA CITY COUNCIL ACTS
TO PRESERVE AFFORDABLE HOUSING AT QUAKER HILL
$3.5 Million in New City Assistance to Alexandria Redevelopment and Housing Authority
Will Finance Purchase and Rehabilitation of 60 Existing Affordable Units

The Alexandria City Council unanimously approved at its Saturday, December 16 meeting a series of measures designed to enable the Alexandria Redevelopment and Housing Authority (ARHA) to retain 60 units of affordable housing in the Quaker Hill community, located near the intersection of Duke Street and Quaker Lane.

“The plan approved by City Council is a responsible solution to the challenge facing the City of Alexandria and ARHA to preserve the 60 needed affordable housing units at Quaker Hill,” said Mayor William D. Euille. Without City involvement, these units would likely revert to market-rate rents and become unaffordable to the current residents. The Council cannot allow that to happen.”

Under the terms of the agreement approved by Council, the City will continue a current $1.2 million City loan to ARHA for Quaker Hill and approve a new loan of up to $3.5 million to allow ARHA to acquire and rehabilitate the 60 Quaker Hill units it has managed as affordable housing since they opened beginning in 1990 to replace the old Cameron Valley public housing development. The agreement also includes measures to exempt ARHA’s Quaker Hill’s affordable units from City of Alexandria real estate taxes and to provide security guarantees for the City’s loans to ARHA. As much as $1 million of the City’s new loan would be repaid within 18 to 24 months under terms approved by Council. Additional provisions assure the City of Alexandria an increased role in oversight of ARHA’s finances.

The refinancing request resulted from ARHA’s having held the right of first refusal to purchase the 60 affordable housing units it manages in Quaker Hill, which was originally financed in large part by federal Low Income Housing Tax Credits (LIHTC). Those credits have now reached the end of their compliance period, and the private owners want to sell the property, which is routine in such situations.

In order to exercise its right of first refusal to purchase the units, ARHA proposes to make use of federal tax credits as a key financing source. While ARHA has until 2008 to exercise its purchase option, the Commonwealth of Virginia has just begun accepting applications for its new Northern Virginia affordable housing preservation tax credits program, and ARHA must resolve its Quaker Hill financing structure to make application for those credits. The property is currently occupied by residents who have federal tenant-based Housing Choice Vouchers (also known as “Section 8.”) It does not receive an operating subsidy under the HUD-financed public housing program and the sole source of its revenue is rental income, which includes tenant payments and voucher subsidies. In addition to the normal operating expenses for a rental property, ARHA pays condominium homeowner association fees for its units, which are part of the larger market-rate Quaker Hill development.

Prior to ARHA’s issuance of Housing Choice Vouchers to Quaker Hill residents in 1999, the property’s rental income came solely from low-income resident rents equal to 30 percent of their adjusted income. This revenue was not sufficient to cover ARHA’s expenses, and over time, ARHA made operating deficit loans from its other housing programs totaling $6.9 million to cover Quaker Hill operating costs. This loan must be addressed when the sale concludes.

The existing $1.2 million City of Alexandria loan to ARHA was originally due in August 2006 but was extended by the City for one year to give ARHA time to work out the details of the Quaker Hill buyout. Under the current ARHA proposal, the City would loan ARHA $4.7 million and ARHA would repay the $1.2 million outstanding loan, thereby creating a net new City loan of up to $3.5 million, part of which would be a short-term loan.

“As the federal government continues to slash housing funding, we must do all we can to hold onto the existing affordable housing units we have,” said Mayor Euille. “This plan will provide the City with adequate guarantees to ensure its funds are being used appropriately to help address the ongoing crisis in affordable housing.”

Among other actions taken at Saturday’s meeting, the City Council:

� Gave final approval to an ordinance to grant a citywide wireless internet franchise to EarthLink, Inc.;

� Approved a special use permit for a residential building with underground parking for 310 Hooffs Run Drive in Carlyle Center of the Eisenhower East Small Area Plan;

� Approved a development special use permit for Mount Vernon Commons, a new residential development that will transform the so-called Triangle Property at Commonwealth and Mount Vernon Avenues in Del Ray; and

� Postponed consideration of a special use permit request to operate a child care center for up to 85 children at the Third Baptist Church on Princess St.

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