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GOOD INTENTIONS, BAD RESULTS // Single-home housing: A plan that failed

@@2 (ran LA edition of LT)

In this city, the phrase "scattered-site housing" is really a euphemism for ill-conceived and expensive failure.

Any hope that low-income families might one day get a chance to enter mainstream America has dried up. Instead, dozens of city neighborhoods have been left damaged.

Nearly $3-million in tax dollars has been squandered in the process. In effect, money was spent turning perfectly good single-family homes into boarded-up eyesores.

But don't blame any residents. Families never even saw these homes, much less took a step inside.

The sad truth is that five years after the housing authority bought 50 houses for the project, just five families have moved in. Officials sold off some of the homes, vowing to refurbish the rest.

But now they're throwing in the towel.

Come Oct. 4, the last vestiges of the St. Petersburg Housing Authority's scattered-site housing program _ 18 decaying houses _ will be sold at fire-sale prices. At least, housing authority officials hope they can sell them.

"We're going to write it off as a loss," Paul Turner said last week. "A number of fairly poor business decisions were made along the way."

Turner knows only too well. He oversees Florida's public housing programs for the federal Department of Housing and Urban Development. It was his agency, in fact, that provided the original $3.7-million grant to launch scattered-site housing in St. Petersburg. Now only $900,000 remains, one official estimates.

The idea was to get low-income families out of the big housing projects that so often seemed to have fostered crime, drug abuse and neglect.

Instead of concentrating families in housing complexes, the reasoning went, better to scatter them throughout the larger community. As members of residential neighborhoods, they could lead fuller, more productive lives instead of becoming crime statistics.

Almost from the start, though, the St. Petersburg program seemed tracked to fail.

Fifty houses were purchased in 1990. But then HUD officials learned that the housing authority had used a dummy corporation to make the buys. When sellers complained about the way the transactions were handled, HUD made the authority spend $61,000 more to compensate them.

Housing authority Executive Director Edward White Jr. backed the scattered-site concept, but he wasn't around to see the project through.

In January 1992, the local housing authority board suspended White; eventually the board fired him after HUD auditors concluded that White had diverted more than $1-million earmarked for specific housing programs into unauthorized uses.

The scattered-site initiative languished. The old houses needed ongoing maintenance and repairs, but they weren't forthcoming.

Many of the houses tested positive for lead-based paint, but no money was available to fix the potential health problem.

Maintenance became an even bigger nightmare as housing officials discovered that the houses were so far-flung around that city that work crews couldn't reach them to make timely repairs or even keep an eye on them. Break-ins, fires and pest infestations occurred.

Ray Price inherited the stalled program when he was hired as interim housing chief in April 1993. A year later, officials decided to cut their losses and sell the houses.

By then, though, the buildings were in such sad shape that nobody wanted them for their appraised value.

Although the authority had spent about $2-million to buy and maintain the houses, they were forced to reappraise them at "liquidation" value, meaning fire-sale prices. Most of them were sold last November.

But the authority held back 18 of the houses, those generally deemed in the best shape.

The plan was to take the last of the grant money and convert the little two-bedroom bungalows into three- and four-bedroom houses to meet the needs of larger families.

It didn't happen.

"We learned that the minute we began such an extensive remodeling and addition on them, we would have to make entire structure comply with current building codes," Mike Colletta, director of the authority's facilities services, said recently.

"That meant new wiring, new plumbing, new insulation. It just got too damned expensive."

In some cases, he said, the bungalow lots are so small that there's no way to add to the existing buildings and still meet current setback requirements from property boundary lines.

And even if the work had been completed, another problem would have been created, Colletta said: "You take a $50,000 house and do a $30,000 or $40,000 addition to it, so now you've got an $80,000 or $90,000 house. But how are you ever going to get $90,000 for a home in a $50,000 neighborhood?"

After the reality of the situation sank in, authority officials finally realized that the remaining 18 would have to go. They're accepting bids on the buildings until Oct. 4.

Karen Mullins, president of the Council of Neighborhood Associations, said that while she supports the concept, she's dismayed with the way the housing authority handled it in St. Petersburg.

"Everything looked good on paper, but nobody did the research that should have been done before this whole thing got off the ground. It's projects like this that when the CONA board meets, we review them and then we just shake our heads."

In one last gesture on behalf of the scattered-site concept, bids are being accepted only from non-profit groups that promise to remodel them, then make them available for sale to low-income residents. Residents of public housing will get the right of first refusal.

Mullins noted the irony of the situation: Although the housing authority is requiring buyers to provide clean, safe housing to residents, the houses while in authority ownership routinely showed up in the city's code enforcement files with chronic problems.

"Some of those houses have thousands of dollars worth of code enforcement liens on them," Mullins said. "I think it's an embarrassment to the city for the housing authority to be coming up on these code violation lists all the time."

Mullins said she has supported scattered-site housing. "The idea is wonderful. I can remember back when the housing authority was looking around for suitable houses, and some of my neighbors said, "Oh, no, we've got some homes here that have been vacant for awhile.'

"We had some homes where elderly residents had lived and now their estates owned them and they had been vacant for some time. I said then that having people living in houses is always better than allowing them to stand vacant."

Neither she nor anyone else could have known in 1990 that it would be the authority's own houses that would remain vacant and unused for so long.

Colletta estimated that $900,000 of the original $3.7-million from the HUD grant remains. That money may yet be used for scattered-site housing, he said, in the form of down payments that working families might be able to use to purchase their own homes. The proceeds from the sale of the 18 remaining houses might also be put to such use, he said.

"To be able to have a house away from a housing project is the dream of a lot of people," Mayor David Fischer said last week. "The other dream is own your own home. I think the days of the big projects are over.

"But housing agencies have got to remember that the whole neighborhood is held back from redevelopment and rehabilitation when you let houses stand vacant. They're killers."

For sale

Here are the locations and the asking prices of the houses that housing authority officials hope they can sell to non-profit groups for rehabilitation:

Asking Price paid

Address price in 1990

1.) 2065 63rd ave. s $27,000 $49,000

2.) 2151 64th Ave. S 29,000 41,900

3.) 2101 64th Ave. S 27,000 39,800

4.) 219 38th St. N 28,000 31,500

5.) 4111 2nd Ave. S 25,000 43,000

6.) 5107 3rd Ave. S 22,000 37,100

7.) 5138 Burlington Ave. N 24,000 46,700

8.) 5336 4th Ave. N 28,000 43,245

9.) 6359 5th Ave. S 43,500 30,000

10.) 1201 54th Ave. N 24,000 39,900

11.) 727 51st Ave. N 31,000 42,000

12.) 3855 Iris St. N 25,000 45,000

13.) 1701 31st Ave. N 24,000 40,800

14.) 1524 29th Ave. N 24,000 40,500

15.) 1521 21st Ave. N 25,000 40,900

16.) 466 12th Ave. N 27,000 34,500

17.) 2636 15th Ave. N 22,000 47,000

18.) 4234 6th Ave. N 25,000 39,500