TARPON SPRINGS — The Housing Authority is planning a $3.3 million project to transform a three-building eyesore on Mango Street into affordable apartments.
The Housing Authority would borrow the money, a portion of which would be from federal stimulus money and local housing funds, to buy and finish construction on a partially completed apartment complex. Once complete, the complex would have 36 one-, two- and three-bedroom apartments.
Bruce Bussey, Urban Development Manager for Pinellas County Community Development, said a final decision on the Housing Authority's request will be made later this month. If approved, it would be a 30-year loan at 3 percent interest.
"The project is just sitting there," Bussey said. "It's a targeted neighborhood that the county looks to improve by assisting the project, bringing high-quality, new housing to that community. Based on the proposal, all the units will be affordable."
The original developer took out building permits in 2006 for 24 four-bedroom apartments. The three two-story frames were completed but nothing else was done. A chain-link fence had to be put around the property to keep out vagrants.
In June, the Tarpon Springs Housing Authority formed an entity called Sunrise Place LLC to purchase, develop, and manage the property. Pat Weber, the Housing Authority's executive director, said the LLC was created to keep all the funding for the project under one umbrella.
Tarpon's commission voted unanimously to support the project, rejecting a recommendation from the city's Planning and Zoning Board against approval.
The board was concerned about the separate company that was created. They were also concerned about the property being taken off the tax rolls and the housing authority's use of public money to compete with private developers.
"Why is the Housing Authority creating all these limited liability companies," asked John Tarapani, chairman of the Planning and Zoning Board. "It used to be when the Housing Authority did a project, the development was held under the name of the Housing Authority of Tarpon Springs."
Tarapani went on to say: "You are putting not-for-profit in competition with for-profit builders and putting private guys at a disadvantage."
Tampa investor Russell Versaggi purchased the foreclosed property that sits adjacent to the Mango Circle public housing community in February with intentions of completing the 24 units.
But then, Versaggi said, he started getting offers to take the complex at 802 Mango Street off his hands. One of those, he said, was the Tarpon Springs Housing Authority.
"I didn't say they had the best offer but we liked what they were trying to do, and we were tying to make a win, win, win for everyone involved," Versaggi said. "I was born and raised here. I like this area and want to see the entire area prosper. ... I thought these guys had a good plan to bring to that area and they had the means to do it."
The plan is to increase the number of apartments to 36 units. Instead of four bedroom apartments, there will be a mix of one-, two- and three-bedroom apartments. There is no need for four-bedroom apartments in the marketplace, Weber said.
Rent on 10 units will be subsidized. Eight of the units will be set aside for those who make 30 percent below median income, which is $16,050 for a family of three. Two apartments will be for those who make 50 percent below median income. For a family of three, that's $26,750.
The remainder of the apartments will be rented at market rate. A one-bedroom apartment will cost $605, a two-bedroom will run $675 a month and a three-bedroom $705 a month.
All the money from rent will go back into the development for the complex's staff and upkeep and to repay the loan, Weber said. The housing authority will manage the property.
If the county approves the loan, construction could begin by the end of the year.
Times researchers Shirl Kennedy and Carolyn Edds contributed to this story.