The Prince George's County Council agreed to adopt a new policy yesterday that would block government-backed bond financing for developers who fail to meet the conditions of their agreements with the county.
The council's decision, reached after a lengthy briefing by bond lawyers, housing officials and developers, was prompted by the council's unhappiness over large rent increases imposed by Monocle Management Co. at two apartment projects. The projects' owner was granted $24 million in low-interest government financing for renovations last year.
Monocle, a Bethesda firm that operates the Regent Street Station apartments in Suitland, the Sussex Street Station apartments in Landover and 13 other properties in Prince George's, increased rents by 30 to 60 percent at the Regent and Sussex complexes after the county-financed renovations were completed.
Loren M. Simkowitz, who runs Monocle Management, told the council that he was forced to implement larger rent increases than he had planned because he has continued to pay utility costs that were supposed to be assumed by tenants.
As a result of the Simkowitz dispute, the council delayed financing for four similar projects until it could more fully establish what actions can be taken when developers don't keep their promises. Financing for the four projects was approved after yesterday's discussion.
"The vast majority of projects like this go through without a hitch: we just stumbled on this one," said council member Jo Ann T. Bell, who has been the most vocal critic of loopholes that allow developers to change their plans without consulting the council.
The new policy will be included in legislation to be drafted by the county's housing authority. Housing Authority director Major Riddick said that the county has approved nearly $100 million in financing for such rehabilitation projects. The improvements will help maintain the stock of low- to moderate-income rental housing in the county, he said.