Minutes 06-20-2017 - Laserfiche WebLink

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30 Robert Dowling said CHT is asking the Orange County tax collector for tax exemption, and CHT is eligible by the State statute for property tax exemption, which the current owner is not. He said the property is losing money, and the difference between losing money and breaking even is the property taxes. Commissioner Jacobs asked if the amount of the property taxes is known. Robert Dowling said they were around $43,000 in 2016, which declined to $27,000 in 2017, due to revaluation. Commissioner Jacobs asked if Robert Dowling is confident that $27,000 is sufficient to maintain 58 units. Robert Dowling said no. He said the property lost $50,000 last year, with the taxes at $43,000. He said there is also an arrearage of an Orange Water and Sewer Authority (OWASA) bill, which requires a $2,000/month surcharge. He said the Carrboro Board of Alderman agreed to pay this off when CHT takes possession, and between these two changes the property should move from the red barely into the black. He said CHT will make a 20 year pro forma, and put the freed up cash flow into the reserves to maintain the property. Commissioner Jacobs said Robert Dowling has intimated a return to the Board in the future to ask for financial assistance, and asked if CHT is starting this project in a position that almost guarantees a return to the Board. Robert Dowling said CHT will be entering into negotiations with the current owner, and he would prefer not to say any more. Commissioner McKee said he liked the model CHT is proposing, but he agreed with Commissioner Jacobs that this project does not address workforce housing. He said he likes the idea, but not the project. He said he owns rental property, and one can either make money or get badly bit, and he fears the latter will occur with this project. He said the maintenance issue must be addressed, and he would like to know more about the project and the financials before buying into this project. He said he anticipates this project having a large financial appetite. Robert Dowling said the County already has money in the deal, and it will either go below the waves or be kept propped up. Commissioner McKee said he is concerned about how much farther in the County will be. Chair Dorosin said 40% of median area income for a family of 4 is $29,325; 50% is $36,656, which is about the starting salary of a teacher; and 60% is $43,988. He said these numbers are all in the range for working class people, and thus this project seems meant for working class people. He said the BOCC has made a priority of affordable rentals at lower median incomes, which requires a greater subsidy. He said these units could be made available to section 8 voucher holders. Robert Dowling said 39 of the 58 units currently house section 8 voucher holders. Chair Dorosin said there have been social justice issues with the current management and the residents of this property. He said he appreciates the questions and concerns, but these are 58 units that could fail and possibly be lost, if not for some form of intervention. Commissioner Burroughs said when the BOCC was awarding the $2.5 million in affordable housing projects; she was struck by how few projects there were. She said the County needs to focus on preserving the existing affordable housing stock, which this project would do. She said she also deals with rental housing, and it is challenging, but it cannot be more expensive to preserve 58 existing units than it is to create 23 from scratch, and as such she supports this project. Commissioner Price agreed with Commissioner Burroughs, and feels strongly about neighborhood preservation. She said it may not make a lot of money, but it provides homes to families.