Housing Hopes Come Up Short

Although buyouts have become less frequent since 2004, when the County Council changed the law and increased the amount required, they remain legal. The council plans to consider proposals to do away with them.

Meanwhile, the fate of the 12 affordable units in downtown Bethesda remains uncertain.

According to county law, construction should have begun in August 2002, three months after work began on the final high-rise units. But nothing happened.

Some of the delays were caused by government agencies and others by frequent changes Greenberg made to his plans, former county housing chief Elizabeth Davison said in an e-mail.

The county can fine developers up to $500 a day if they do not build the affordable units on time. County officials did not do so in the Hampden Lane case and rarely do so on any project. Davison said she preferred persuasion over fines.

A 2007 study by the Office of Legislative Oversight found that the housing agency lacks the tools to ensure that the market-rate and affordable units are built at the same time. The report recommended linking issuance of building permits for upscale units to on-time construction of the affordable units, a rule that would have prevented the Bethesda delay.

In November 2002, Davison wrote to P.N. Hoffman, which was building the high rise on the Greenberg project, informing the company that the affordable housing was on hold because the county was looking at other uses of the site. Those plans apparently had been under discussion since late 2001, county officials said recently, but housing agency files do not reflect that.

Housing agency officials say their files do not explain why Greenberg was allowed to hold off building the affordable units or include the details of arrangements with P.N. Hoffman.

County Attorney Leon Rodriguez said his office, which he did not head at the time, acknowledged that delays occurred. He said the office "did conclude that the appropriate remedy to that situation was to accept a donation of land."

The value of the donation probably was higher than the potential sum the county would have received from Greenberg with a buyout, about $20,000 per unit, according to what the housing agency was charging in downtown Bethesda at the time.

In January 2004, 14 months after Davison's letter to P.N. Hoffman, documents show that the county formally scrapped the plan to have the developer build the affordable units and instead allowed Greenberg to donate the 5,115-square-foot parcel, which he had bought about 10 years earlier for $280,000.

Davison told the County Council in October 2005 that the housing agency also was working to temporarily provide the 12 units elsewhere in Bethesda until the building was constructed. But that does not appear to have occurred, according to county officials and documents. Davison said the nonprofit Bethesda Cares, which helps the homeless, temporarily occupied the Hampden Lane building, now boarded up.

County officials say the plans grew more complicated after they agreed to swap Greenberg's parcel with another developer, Pollinger Co., to allow that company to assemble contiguous parcels for its own planned upscale development. That, too, is supposed to include some affordable units.

That project also has been delayed. Two lawsuits filed by neighbors living in the townhouses are challenging the Pollinger project and the county's procedures. Those cases will be heard in the spring.