Housing board may face suit over tax credit application

June 07, 2002|By AARON CLAVERIE

Staff Writer

CALEXICO — If the Calexico Housing Authority's board of commissioners doesn't come up with every last penny of the $1.2 million the previous board and previous executive director pledged to give the California Tax Credit Allocation Committee, the authority's partner in a 2000 tax credit application, Beyond Shelter Housing Corp. of Los Angeles will sue the authority board and likely the City Council as well to get the money.

Authority administrators have said the authority only has around $800,000 to give.

The council could be named in the potential lawsuit because it rescinded its promise of a $400,000 loan to the authority in October 2000. The council had the legal right to rescind the loan, according to City Attorney Michael Rood.

Associates of Beyond Shelter Housing Corp. disagree.

In closed session Thursday, the council, sitting as the authority commissioners, discussed its options regarding potential litigation.

After about a half hour, the commissioners emerged to take no action.


For Beyond Shelter Housing Corp., the timing of the council's pending action or inaction is keenly relevant.

The for-profit housing corporation hopes to complete the paperwork on that 2000 tax credit application soon so it can secure around $8.3 million in tax credits. The authority and the corporation were told by the committee that the credits were reserved in November 2000.

Construction of the apartments at the intersection of Rancho Frontera Avenue and Highway 98 was financed with loans taken out on the promise of those credits.

To complete the paperwork and get the tax credits, the authority and the housing corporation have to turn in all financial documents detailing how the apartments were financed and the $1.2 million the authority had pledged to submit on that application.

If the authority doesn't come up with the $1.2 million, the tax credit committee could decide to withhold the credits — an unlikely scenario — or penalize the authority.

If the committee withheld the credits, Beyond Shelter Housing Corp. and its partners would have to charge market-rate rents at the apartments to cover the costs of the loans.

If the committee hands out the credits but penalizes the authority, the apartments could be rented to low-rent paying senior citizens, as was the original intent in 2000. However, any penalty, no matter how severe, would make it harder for the authority to secure tax credits in the future.

After Thursday's meeting, Rood said the matter again will be brought before the commissioners. No associates of Beyond Shelter Housing Corp. addressed the commission.

During the public comments portion of the meeting, Ema Silva and Maria Teresa Gasca, representatives for a coalition of housing residents, said they were disappointed the commissioners did not attend Friday's graduation ceremony for new members of the authority's tenant patrol squad.

Silva said it showed a lack of respect for the housing residents who look to them for help.

Mayor John Renison, commission chairman, said he had called beforehand to say he wasn't able to attend.

Councilman Victor Carrillo said he wasn't invited. Silva and Gasca admitted Carrillo's name was not on the guest list and both said they didn't blame Carrillo for not attending.

Councilman David Ouzan said there was no date on the invitation he was given.

Mayor Pro Tem Frank Montoya said there are times when a city councilman has a previous commitment that is unbreakable.

Councilman Alex Perrone said the commissioners respect the residents.

"I can assure you that I will attend the next time," he said.

Silva and Gasca then took the administration to task, as they have in the past, for not keeping the residents informed of the administration's activities.

Carrillo told Peter Castro, interim executive director, "Pay close attention to this. As the City Council and now as the commission we are an inclusive body. The residents must be given the opportunity to be heard and respected."

He directed Castro to take care of the problems that Silva and Gasca had mentioned.

Renison said the new complaints echoed charges that had been leveled at previous administrators.

He found it hard to believe the communication problems could not be easily solved.

Castro said he has been in contact with the resident representatives and they could reach him with concerns at any time.

Renison told Castro to contact the resident representatives this morning.

>> Staff Writer Aaron Claverie can be reached at 337-3419 or

Imperial Valley Press Online Articles