Monday, December 18, 2006

Update on illegal Habitat houses

"Habitat is not a nonprofit organization that the city can give, or sell, or donate land to. So as a result of this, the Piedmont Housing Alliance has agreed to receive the land and convey it later to Habitat" -- Mr. [Ronald L.] Higgins, city planning manager, Feb. 22, 2005




1232 and 1230 Holmes Avenue (Photo Dec. 18, 2006)

Charlottesville, Va.—The City Council first entertained the idea of giving surplus land to Habitat for Humanity on February 22, 2005.

But city attorney Craig Brown said the transfer would violate state law prohibiting transfer of public assets to religious organizations. He expected Habitat to be added July 1, ‘05 to the list of religious groups exempted from this law.

Urban planner Ronald L. Higgins, since retired, proposed to make the transfer to Piedmont Housing Alliance, which is legal, who would then transfer the land to Habitat.

I reported on this story in Charlottesville Independent Media and Richmond Indy Media. The local press covered the story but never mentioned this aspect.

If the owners decide to sell, not only will they have to give back to Habitat a percentage of the equity, they’ll also have to explain why the property flipped twice in one day.

Why did the city give the land to PHA who gave the land to Habitat on the same day, September 16, ’05? Why didn’t the city give the land directly to Habitat?

Because that would have been a crime. The deed now records the technicality that facilitated the crime.

Nobody can claim they didn’t know because Higgins proclaimed the donation to be unlawful as he proposed the work-around.

The property is now jinxed. An injustice has occurred albeit in plain view. So far everyone involved has gotten away with it. The property may already have been jinxed by a previous injustice we don’t know about yet.

The decision to use a technicality to break the law will follow these officials and volunteers for the rest of their lives and will follow the property forever.

Thanks, Habitat.



1232 and 1230 Homes Avenue combined into one deed according to online records. The owner is listed as Greater C'ville Habitat For Humanity, Art Peters, 501 Grove Avenue, Charlottesville, VA 22902

Purchased by city for $3,800 on 7/5/1967 Deed Book 289 Page 378.
Purchased by Piedmont Housing Alliance on 9/16/05 for $0 Deed Book 1047 Page 488.
Purchased by Greater C’ville Habitat for Humanity on 9/16/05 for $0 Deed Book 1047 Page 494.

1232 Holmes 0.172 acre assessed at $236,100. LOT 22 BK A SEC 3 WOODHAYVEN
1230 Holmes 0.172 acre assessed at $230,600. Non-tax/Tax-exempt. LOT 21 BK A SEC 3 WOODHAYVEN

Habitat for Humanity of Greater Charlottesville

Piedmont Housing Alliance

Search Charlottesville’s online assessment records


Council Beat: Habitat for Humanity land grab, 64 signatures in opposition

"Habitat is not a nonprofit organization that the city can give, or sell, or donate land to. So as a result of this, the Piedmont Housing Alliance has agreed to receive the land and convey it later to Habitat" -- Mr. [Ronald L.] Higgins, city planning manager


To become Habitat houses, 1232 & 1230 Holmes Avenue (Phot Feb 2005)

Blair Hawkins, Charlottesville Independent Media, Feb. 23, 2005

Tuesday February 22, 2005, City Hall Council Chambers

MATTERS BY THE PUBLIC

[…]

ORDINANCE TO CONVEY SURPLUS CITY LOTS ON HOLMES AVENUE

Mr. Higgins said, "This is a project we've been working on since last spring. We were asked to look at a number of the city surplus lots. We've acquired lots over the years for utility easements, service lines and what have you, and looked at a number of them to see if they could be used for single family housing. We were asked to do this by Habitat. They had approached us about a half a dozen lots to see if any of them could be built on. We discovered 3 lots, 2 on Holmes Avenue...and one on Bering Street which is actually at 5th Street Extended, were suitable for single family development."

There was a meeting with the Ridge Street neighbors, who said they could support the Habitat development. The Holmes Avenue neighbors had concerns whether the subsidized houses would be compatible in appearance and assessment value. "We believe they would be." 70% of existing homes on Holmes are larger than the would-be Habitat houses. "We feel the best use of the property would be to convey it," continued Higgins.

"Habitat is not a nonprofit organization that the city can give, or sell or donate land to. So as a result of this, the Piedmont Housing Alliance has agreed to receive the land and convey it later to Habitat for the purpose of Habitat developing and their program to single family houses." Higgins further said there were other options such as doing nothing, leaving the land vacant and publicly owned, or selling the land on the open market at market rate. An auction is possible.

City attorney Craig Brown said the land could not be donated to Habitat because the nonprofit is a "self-described ecumenical Christian organization." State code seeks to preserve a separation of church and state, except the YMCA, YWCA and Salvation Army are specifically exempted from the law. There was a bill moving through the General Assembly to add Habitat to the list of those operating outside the law, and will likely become state code on July 1.

Overton McGehee, executive director of Greater Charlottesville Habitat for Humanity, spoke as Princess Long, one of the organization's "approved partners," stood next to him. "Thank you for considering giving us these 3 lots. This obviously will help us build more houses this year, because we won't have to spend as much on land this year. I hope you'll view it as an investment in affordable housing." When the homes are finished, they will be appraised, and the value will go into a 3rd mortgage. "If the house is sold, that money will come back to the city, the city affordable housing trust fund, or Piedmont Housing Alliance, or whomever the city designates for that money."

He said Habitat selects families that earn between 25 and 50% of area median income. The families help build one another's homes and their own homes. "The families purchase the homes with an interest free loan" made possible primarily by individual contributions. Two families have selected these lots on Holmes Avenue. Miss Long and Mr. and Mrs. Scott have worked hard on other families' homes and completed the 18-month Homebuyers Club which includes budget counseling. They have the down payment and are ready to become responsible homeowners and good neighbors.

Some neighbors are concerned that the new houses will adversely affect property values. Habitat offers 11 models to choose from so the house should fit in. A front porch would require a variance because of the cliff at rear of property. A back deck near the cliff is easier to handle. The two-story Habitat houses would have 1,200 finished square feet and 600 unfinished. The average home on Holmes is 1,400 and 400 respectively, said McGehee. If the homeowners do not maintain the exterior of the house and the property, Habitat has a covenant in the deed where Habitat will clean or fix the house and bill the family. If they don't pay, Habitat has the right to foreclose.

In response to the concern that the families won't be able to afford rising costs, McGehee said the mortgage is to be paid over a longer term than typical. Habitat believes their families should not pay more than 25% of their income for mortgage, taxes, and insurance. Some neighbors have said they want the land sold on the "open market" but Habitat prefers the transfer be thought of as "an investment in affordable housing."

PUBLIC HEARING

Adam Peters moved into the Holmes neighborhood 2 years ago with his wife and 2 small children. He has been in and out of some of the houses on Holmes. He's also a longtime volunteer with the Charlottesville Habitat for Humanity since 1996. He's proud of Habitat and the community it fosters, the positive effect it has on people's lives and neighborhoods as a whole. In support of the proposed land transfer, he said the size and design of the houses would fit right in. He's proud of the quality of Habitat houses, more solid because volunteers use "twice as many nails" than a regular construction company would. Many of the houses he has volunteered on have amenities his own home does not, such as central air conditioning, central heat, modern windows that filter out UV rays. He observed that Habitat houses are better maintained than their neighbors' houses. Habitat selects only families of exceptional quality.

Thomas Norford lives directly across the street from the 2 vacant lots. He and his wife have lived at this address for 26 years. Both of them have worked 2 jobs at times to be able to afford this house. Over the years, he has inquired about the lots and was first told that the lots were un-buildable, not suitable for housing. More recently the city said the lots would remain open as access to open space behind the lots to be developed in the county. "Then we suddenly find out the city is considering donating these to Habitat for Humanity for affordable housing."

Has the City Council determined that, in the Woodhayven neighborhood, only lower income people can have ownership of these lots and other community members are not given a chance to own them? "We have invested in preserving our neighborhood as a planned development community. Toward that interest, we have gathered 64 signatures on a petition showing our disapproval to City Council." The group does not believe transfer to Habitat through PHA would be the best use of the land. The land is currently appraised at $64,000. These funds could be used to renovate homes that would be affordable to the working poor. Property values are from $200,000 to $250,000 and assessments rose by 11-14% this past year alone. The average working wage is up 6%. So you're looking at 5% in the hole every year.

According to an AP story, owners of northern Virginia Habitat homes are unable to pay the taxes. The working family would never be able to afford the homes on Holmes Avenue to be valued at $170,000. In northern Virginia the localities have had to use tax abatements and utility abatements so the families could afford to remain in the Habitat home.

Sharon Bishop owns the house adjacent to the property in question. She moved into the Woodhayven neighborhood in 1996. The typical Woodhayven house is a 2,000 square feet brick rancher. The average annual tax is at least $1,500. The Habitat houses would be at least $1,200 a year. Are these potential homeowners set up to fail if they are unable to afford all the expenses? The lots are only 40 feet wide, bordered by a 60 foot cliff. The new houses would not meet the 30-foot setback required by zoning. There could be no back yard, so kids would have to play in the front yard, which is not consistent with the neighborhood. Digging the foundation could jeopardize nearby houses. In closing, she asked that the parcels be put on the open market.

Princess Long, a single mom with 2 sons, would live on one of these lots. She asked that neighbors give her the same opportunity to feel proud of a home she has worked hard for.

Richard Price, by request of the Habitat director, came to speak about the market rate housing project being developed in the Woolen Mills neighborhood to include 2 affordable units. He asked that Council approve the land transfer to Habitat.

Kenneth Jackson said he's "never heard such institutional discrimination in my life." You can serve my burger and wipe my butt but you can't live beside me--to paraphrase Jackson. "Low income people are people too."

The Council then discussed the proposal but postponed a decision until the next meeting on March 7. Councilor Rob Schilling shared that he had already informed Habitat that he opposes the gift transfer, but would support sale at fair market value and otherwise supports the work of Habitat. Mayor David Brown said, "I think unequivocally we should" convey the land to Habitat through PHA for affordable housing.

ANALYSIS:

Institutional discrimination? Who's being discriminated against?

1. The neighbors who sought to purchase the abandoned public lots and then pay taxes on the land. Everyone in the community, except Habitat and the Habitat family, is discriminated against.
2. The Habitat family because they are not allowed to enjoy the financial benefits of their hard work and rising assessments. If they sell, the profit goes back to finance more discrimination.

Who benefits from the discrimination?

1. Habitat gets free land and gets to say they helped a needy family. Why doesn't the city give the land directly to the family so they would have collateral to get a loan to build a house?
2. The city's housing trust fund takes back a lifetime of built-up equity if the Habitat house is ever sold.

What institution is discriminating?

1. The city against working poor trying to rise out of poverty without the "help" that perpetuates a disadvantaged class of citizens.
2. Habitat against Princess Long and the Scotts by writing into the deed that they cannot benefit from their investment the way their neighbors can.

Who are the accomplices?

1. Piedmont Housing Alliance by acting as a middle-man for a transfer otherwise prohibited by state code.

Perhaps the city should wait until July 1 when a new law is expected to add Habitat to a list of entities exempted from the law prohibiting transfer of public assets to religious organizations. How much meaning does a law have if everybody's exempted? What does it mean for the people who are not favored enough to be designated above the law?

Just as you can write into the deed permanent restrictions on the new Habitat owners, it's possible that the city is bound by restrictions it assumed when the land was taken. Almost all public land today was private land at one point. If the land was purchased on the open market, the city would be free to sell or give it away.

But if the land was taken for a specific use, what happens when that use no longer exists? In this case, the city claims the land was acquired for utility easements. If that's the case, the city may not even own the land, but simply be using it for a public purpose. If so, the land should be returned to its rightful owner at no charge who can then sell the parcels in the clear. If the land was taken for a specific purpose and never used for that purpose, it should be returned to its rightful owner along with a penalty for breech of contract.

Ironically, this Council meeting was on the same day the Supreme Court heard a case about land transfers under the guise of eminent domain, better known as urban renewal. At issue is whether government can take property for a public use and then not be bound by that covenant. What the nation needs is for the court to explain the rules of the real estate game clearly and reaffirm that these rules apply equally to everyone.


Charlottesville gives public land to Habitat for Humanity

Blair Hawkins, Charlottesville Independent Media, March 8, 2005

City Council voted 4-1 to donate 3 "surplus city lots" to the Greater Charlottesville Habitat for Humanity for development. Because the transfer is prohibited by state code, Piedmont Housing Alliance will act as middle-man.

Tonight, the City Council voted 4-1 to donate 3 "surplus city lots" to the Greater Charlottesville Habitat for Humanity for development. One lot is on Bering Street in the Tonsler precinct on the less affluent south side of town. The other 2 lots are on Holmes Avenue in the Recreation precinct on the north side of town. A 64-signature petition was presented to Council 2 weeks ago in opposition to the Holmes Avenue transfer.

At the last Council meeting on February 22, city attorney Craig Brown said the transfer was prohibited by state law. He did not indicate tonight that he had been mistaken in his interpretation of the Code of Virginia that prohibits transfer of public assets to religious organizations. He did not cite the specific code. Unlike the YMCA, YWCA, and Salvation Army, Habitat is not yet exempted from this law.

In order to get around this legal hurdle, city planning manager Ron Higgins announced at the last meeting that a private developer has agreed to act as a middle man for the donation. "Habitat is not a nonprofit organization that the city can give, or sell, or donate land to. So as a result of this, the Piedmont Housing Alliance has agreed to receive the land and convey it later to Habitat," stated Higgins.

Boldly, the 4 approving Council members, all Democrats, referred to the transaction as if the property were being given to Habitat directly. Apparently, good intention is the basis of their decision to break this law. The sole Republican Rob Schilling opposed the transfer, not because it is illegal, but because he prefers to sell the land. He said the city cannot afford to give away land.

In an unrelated appropriation, the Council voted again along party lines to give Piedmont Housing Alliance $30,000 to continue its redevelopment in the Page and 10th Street neighborhood. Rob Schilling opposed giving PHA the money because the project lacked details on how it would be spent.

Council Beat: Habitat for Humanity land grab, 64 signatures in opposition (Feb 23 2005)
http://cvilleindymedia.org/newswire.php?story_id=1390 (with 3 photos)

I'm just a humble reporter. I report reality as I observe it. The only way I can hold our officials accountable is through freedom of the press.

2 Comments:

Anonymous J. Smythe said...

I just saw this post of yours. So I'm commenting late, but here goes.

The city originally wanted to "give" the land to Habitat. I don't know if I missed it in your articles. But the technical reason that habitat wouldn't qualify for the land is because their organization is "Faith based." And that is what made that option verboten.

Prior to the city meeting where the 69 residents showed up in opposition - the city had conducted a private and separate meeting with members of the neighborhood to get their reaction to having a habitat house in the neighborhood. And give the residents an opportunity to voice concerns and get questions answered as well as to meet the people who would be getting the houses from Habitat.

In spite of the fact that the potential habitat owners were at that private meeting, the response the city and habitat received from the residents was not much different then the show at the city council with the 69 in opposition.

After the questionable claim "that one of the residents in the neighborhood made inquires years ago wanting to purchase it," The main (unspoken) objections to the habitat homes in the neighborhood were three part.

First for well over 20 years the back of that lot at the tree line (when vacant) was used as the neighborhood dump for yard clippings (grass, leaves, tree limbs, etc..) and some other questionable items. So they were losing a free disposal spot for yard waste.

Second, there are several people in the neighborhood who own more than two vehicles (some up to 3 or 4). Those people were losing the extra street parking, or at least faced more competition for it when those houses were completed.

Third they were worried that their property values would lower with two habitat houses on the block. And they didn't like the idea that someone was getting something for free that they'd had to pay for (which was their perception of the situation but not the fact of it).

You wrote:Why doesn't the city give the land directly to the family so they would have collateral to get a loan to build a house?

Presumably they wouldn't have qualified for a conventional loan (even with land as colateral).

Habitat is functioning in this instance as a mortgage corporation. It's set up so there is a first and second loan on the house. If the owners live there for thirty years the 2nd loan is forgiven, and they get the house free and clear with the exceptions of the covenants on the deed. If they sell before that they are responsible for the full amount of both loans.

The Covenants on the deeds (as I understand it) stipulate that Habitat gets "right of first refusal" on any sale of the house. They get first shot to buy the house back at fair market value. Which they usually do.

It also states that the house can never be a rental property. Meaning if it sold, and habitat did not buy it and someone came along not affiliated with habitat and purchased the house they couldn't use it as a rental. Additionally when that non-habitat person wanted to sell the house- they would have to give Habitat right of first refusal.

And the final covenant as I understand it- is because of a habitat house somewhere else in the city which had problems with the resident/owners not taking care of the front lawn and keeping the property presentable. That's a requirement that is covenanted on these houses as well (a well maintained front lawn).

These houses won't affect my property values. I'm guaranteed never to have renters in those houses, and the new residents are good neighbors. I'm not going to begrudge anyone the helping hand they might need.

As an added note- as long as those lots were vacant there was always the threat that a road would be built from one of the other developing areas along Rio road. I think that was the original reason those lots were not developed. At least that was the rumor that's been around as long as the neighborhood has been in existence.

1/18/2007 7:00 PM  
Anonymous Anonymous said...

im mother of 5 grandmother of 2 my youngest child is 5 we were told that we didnt qualifie for habit humane house to get built on our property in rockbridge county my husband is diable claimed we owed to much out standing bills they mislead people in thinking these house are for the poor people wrong you cant be over 1000 dollars in delp so who does qualifie we have an income of 755 diability and my job i just found making 10 hour we were going to put our land up but we dont qualifie by the way the ones that do have to not only to comuity work but do have to pay ever bit back non profit mithink no ask for donation all the time just to make money not to help someone like us

12/07/2007 10:15 PM  

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