Housing Hopes Come Up Short

By Miranda S. Spivack
Washington Post Staff Writer
Thursday, February 7, 2008

As expensive high-rises and elegant townhouses began sprouting in downtown Bethesda in the 1990s, Montgomery County officials saw new opportunities to plant moderately priced homes amid the prosperity.

On a single block near the Bethesda Metro station, county officials approved developer Lenny Greenberg's proposal for a project with 29 townhouses, 54 high-rise apartments -- and 12 moderately priced units around the corner on Hampden Lane.

More than seven years later, the posh units have long been occupied, but the less expensive units have not been built. Instead, a boarded-up building sits on the Hampden Lane site.

The case of the missing units on Hampden Lane is hardly unique, according to civic activists and politicians. For years, they say, developers and builders were allowed by the county's housing agency to circumvent county rules aimed at expanding affordable housing.

Montgomery County officials have said for years that creation of affordable housing is one of their highest priorities and that the county's rare public-private venture with developers has done much to ensure that the rich and the not-so-rich can live side by side and enjoy the same schools, shopping and entertainment.

But there are many signs that Montgomery's program has not lived up to its promise.

"It is a badly focused program that doesn't focus on maximum retention of units," said County Council member Marc Elrich (D-At Large), who is examining the county's overall strategy to create and keep affordable housing.

County law requires that the affordable units be built around the same time as more expensive units to promote economic integration. But the county program often has allowed developers to buy their way out of building the units with contributions to a housing fund. It rarely fines developers who don't obey the rules.

In the case of Hampden Lane, construction on the last high-rise units began in 2002. Greenberg signed an agreement in January 2004 to donate the nearby affordable-housing parcel to the county, which said it would take over responsibility for building units that would now be used for formerly homeless residents.

The donation came almost three years after Greenberg was required under county law to signal his interest in making a donation. Neither Greenberg nor P.N. Hoffman, the company that eventually took over the project, told county officials that a donation was planned, according to county records. The records do not explain the delay.

Although it is unclear when or whether the 12 affordable units on Hampden Lane will be built, officials in Montgomery's housing program say they got a good deal.

"As far as we are concerned, it was a perfectly fine transaction," said Joseph T. Giloley, who oversees housing programs at the county Department of Housing and Community Affairs.

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