Saturday, May 1, 2010

Community housing group runs into Gilbert opposition

by Parker Leavitt - Apr. 27, 2010 12:00 AM
The Arizona Republic

Hairdresser Robin Corey had to wait nearly five decades, but the Chandler woman this month finally became a homeowner.

Corey, 49, is a single mother who has worked as a hairdresser for 31 years. She's been fortunate enough to keep a job and provide for her son, but she never thought she'd make enough money to own a house.

That all changed with the help of Tempe-based Newtown Community Development Corp., a non-profit that provides affordable housing for lower-income families.

Newtown started its community land trust program in 2001 and has helped families purchase 45 homes in Tempe and several in Chandler, executive director Allen Carlson said.

The organization is now working to expand across the Valley and has found funding partners in Glendale and Scottsdale.

Newtown hoped to also expand into Gilbert and at the invitation of town staff applied for a $480,000 federal grant to purchase eight houses in Gilbert, Carlson said.

However, the Gilbert Town Council delivered the group a major setback and denied Newtown's grant request, ignoring a recommendation for approval from the town's Community Services Committee.

Vice Mayor Linda Abbott said she is fundamentally opposed to the idea of using taxpayer money to purchase a home for someone else.

"In terms of the American dream, I think clearly it's important for people to have a roof over their head, but I don't believe as a taxpayer it's my job to ensure that people own a home themselves," Abbott said.

Councilwoman Jenn Daniels agreed, saying that she was also uncomfortable with the organization's ownership model, which is different from other housing groups like Habitat for Humanity.

The organization buys existing homes, remodels them and sells them to qualified applicants at a discount.

In order to keep the home price low, the non-profit group keeps the land and sells only the house and leases the land back to the homeowner for a nominal fee.

For Corey, that reduced a nearly $150,000 home in Chandler to $123,000, a price that falls within her budget.

After Newtown purchased the bank-owned house, it paid for major renovations including tile floors, kitchen cabinets, appliances, a new water heater and air-conditioning unit, new exterior and interior paint and landscaping.

"They do all the work to bring the value back up," Corey said. "So it helps Arizona as a whole, and it helps the community so that if someone else were to sell their house they could sell it at a higher price."

The community land trust program gives priority to families earning less than 65 percent of an area's median income. Much of the funding comes from the U.S. Department of Housing and Urban Development, which receives appropriations for HOME program funds from Congress and distributes that money to about 650 jurisdictions across the country, spokesman Brian Sullivan said.

The federal HOME program has been around since 1992 and distributed $1.8 billion in fiscal year 2010, $4.25 million of which went to Maricopa County communities, Sullivan said.

Glendale is considering awarding funding for Newtown for the second straight year. Last year, the city awarded the non-profit $165,000 to acquire four properties. An advisory committee has recommended $127,000 for this year.

"It's one more tool to encourage affordability for families that work but just can't afford to get into a home," said Erik Strunk, community partnerships director for Glendale.

"It's a permanent supply of good, affordable housing," he said. "You stabilize a neighborhood and give a family a chance to become homeowners."

Despite a warm reception in other communities, the Gilbert Town Council was divided 3-3, and the grant failed to win council approval, sending Carlson away with no funding.

"It's unusual," Carlson said. "We haven't been denied funding like this before."

Community housing group runs into Gilbert opposition

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