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5H program in Calexico on brink of completing 1st home sale to renter

March 02, 2001|By RICHARD MONTENEGRO, Staff Writer

CALEXICO — The first sale of a Casas del Sol home here to one of its renters could occur by mid-summer after several lingering issues holding up the approval of the Calexico Housing Authority program were addressed recently.

Housing Authority Executive Director Lupita Rios said officials with the U.S. Department of Housing and Urban Development, the federal agency that would authorize such sales of authority homes, were holding up approval of the 5H program until three key issues were resolved and a contract between the Housing Authority and an independent agency implementing the program was received.

Rios said the required information was provided to HUD on Friday and the first sale associated with the 5H program, which has been in the works since the early 1990s, could become reality by mid-summer.

Continued bickering by residents of Casas del Sol and members of the Housing Authority board in recent months has led the Calexico City Council to get involved in the issue.


Last week Calexico Mayor Javier Alatorre, councilman John Renison and City Manager Rich Inman had a conference call with Bob Cook, executive director of HUD's Office of Public Housing Authority.

Alatorre said it was during the call last week that Cook stated the program was in a holding pattern until the Calexico Housing Authority addressed several issues of which Rios spoke.

According to Alatorre, Cook would issue a letter to the city confirming the 5H program would become reality once those issues are answered to HUD's satisfaction.

City officials in turn informed Rios of what was needed.

On Thursday morning, Alatorre said another conference call with Cook took place in which Cook stated the issues were addressed and a letter to the city would be forthcoming confirming the program is a go.

The Calexico City Council has set a special meeting for 6 tonight in City Hall to update the residents of Casas del Sol on the status of the 5H program.

Rios spoke to a reporter Thursday about the 5H program and the issues HUD required be answered.

The first issue related to the contract with the agent hired to assist the authority with the program.

"The project could not be done on a turnkey basis," Rios said, meaning the Housing Authority could not turn over the obligation to sell the homes to an outside agency.

She said that has been an option for other programs similar to the 5H. However, this time around HUD forbade it.

The outside agency contracted by HUD for that purpose initially was Goodwin and Associates of Atlanta.

Rios said Ed Goodwin of Goodwin and Associates will be involved in other capacities such as assisting with the implementation of the program and prequalification for prospective homeowners.

The Housing Authority, however, will have sole responsibility of selling the 50 Casas del Sol single-family homes.

She added a contract between Goodwin and the authority had to be received by HUD by Friday.

The second issue was in reference to the transfer of annual HUD subsidies and contributions by the authority.

Rios said HUD subsidizes rental fees within the authority's service area based on a certain equation — the rent is 30 percent of a family's annual income and the difference between what the family can pay and the operational costs to the authority are picked up by HUD.

Rios said it was the authorities hope some of those funds could be diverted to replace the 50 homes that would be lost to those served by the authority.

She said HUD won't allow for that transfer of funds.

The third issue pertained to the allocation of Section 8 vouchers for those families living in Casas del Sol who for whatever reason will not be purchasing the unit.

Authority officials wanted to provide those families not purchasing a Casas del Sol home in which they live with Section 8 vouchers to find another home, Rios said, adding HUD also denied that.

She was careful to say HUD does not want these Section 8 vouchers given or the transfer of funds as they pertain to the 5H program.

However, she said, "We may pursue them in the future but not at this time."

She said in some ways the program in its current state straps the Housing Authority because it takes away from the number of units serving the low-income residential needs of Calexico.

At the same time, one of the HUD stipulations of the program is that all proceeds of the Casas del Sol sales go to building new affordable units in Calexico — without HUD assistance.

The 5H program, which Rios said she attempted to get approved some eight years ago under different HUD names and regulations, will include credit repair programs for those residents who may have bad credit.

The authority will stage training sessions for tenants, such as homebuyer orientations, home preventative maintenance talks, homeowner financing discussions and programs about the rights and responsibilities of home ownership.

She added the program calls for the creation of a homeowners association, which will be taken up by a management corporation already put in place by the renters of Casas del Sol.

Using figures calculated by the Housing Authority in 1999, Rios said each Casas del Sol home would likely cost less than $60,000 and the authority would earn more than $1.5 million on the sales of all 50 homes.

Based on those 1999 figures, only 20 of the 50 families living in the units would be financially capable of purchasing one of the homes.

She said updated figures weren't available.

Staff Writer Richard Montenegro can be reached at 337-3453.

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