The Alexandria Landlord-Tenant Board approved a list of recommendations this week which, if adopted by the City Council, would add extensive restrictions to housing projects financed with tax-exempt bonds issued by the Alexandria Housing and Redevelopment Authority.
Under federal restrictions on tax-exempt funding, developers of housing projects are already required to set aside 20 percent of the rental units for low- and moderate-income people.
The guidelines recommended by the Alexandria board would lower the amount of rent developers could charge for the set-aside units, would require that developers accept families with children and would require extensive financial disclosure and additional public hearings for such proposed projects.
Alexandria City Manager Douglas Harmon has suggested the council forward the recommendations to the Alexandria housing authority's board of directors for comment next week. The city council would then vote on the recommendations sometime in March.
Angus T. Olson, executive director of the Alexandria housing authority, would not comment on the proposed new guidelines, saying only that the authority would issue its own analysis of its bond policy next week. Olson did say, however, that the authority functions as an independent local agency whose policies are set by its board of directors.
Members of the landlord-tenant board and some city council members became concerned last month over the use of tax-exempt financing for a renovation project that would displace several hundred low- and moderate-income tenants.
The National Corp. for Housing Partnerships, which was chartered by Congress in 1968 to encourage private investment in low- and moderate-income housing, won approval from the City Council to purchase and rehabilitate the Abingdon Apartments. The Abingdon, on the north side of the city near the George Washington Parkway, is one of the city's last affordable apartment complexes.
Under NHP's plan, rents in the complex will rise from a range of $375 to $400 before the renovation, to $625 to $725 after it is completed. The tenants, many of them low-income families with young children, protested the use of tax-exempt funds for a project that they said would forcing most of them to move elsewhere.
"We feel that the current housing authority guidelines allow rents that are too high for most of the tenants in Alexandria," said Mark Looney, coordinator of the city's landlord-tenant office. "These recommendations, if passed, would give the city council more background information about such a project so that they could know what kinds of profits the developers were making and could better negotiate rents that would be more affordable."
In projects that involve rehabilitating older apartments, the landlord-tenant board recommended that the rents on the units set aside for low- and moderate-income tenants be covered by mandatory caps before the City Council approve tax-exempt financing.
The board suggested that the council set the caps at $383 for an efficiency, $455 for a one-bedroom apartment, $528 for a two-bedroom and $646 for a three-bedroom. Those rents would also have to include utilties.
Under the federal guidelines -- which the housing authority has used in the past -- rents for the low- and moderate-income units are set at 80 percent of the metropolitan area's median income for a family of four. That means a developer could set rents for the low-income units as high as $732 a month, excluding utilities.
The landlord-tenant board also recommended the city set annual income limits for tenants of the low-income units. The limits would be $18,900 for one person, $21,600 for two people, $24,300 for three people and $27,000 for four.
The board also recommended that the housing authority try to place people who have Section 8 housing assistance from the federal Department of Housing and Urban Development in the set-aside units. Eligible tenants would be selected, with the elderly and handicapped first, then families with children, on the basis of the length of tenancy in the project, and then other households on the length of tenancy.
The board decided that on new construction housing projects financed with tax-exempt bonds, the set-aside units should not be under the mandatory caps, but that developers be encouraged to keep rents as low as possible. The board recommended that the city require the low-income units have the same amenities used in the market-rate units.
For the market-rate units in a project funded with tax-exempt financing, the board has recommended that developers be encouraged to keep the rents within the limits of the city's voluntary rent guidelines. Every six months the city sets recommended rates of rental increases. At this time the guidelines recommend rent increase of 5 to 8 percent, depending on whether the rent covers the cost of utilities.
The board also recommended that the council require disclosure of extensive financial statements, including anticipated operation expenses, rehabilitation and maintenance costs and profits, for the first five years of the project. In the past, developers have provided this information to the housing authority, but the landlord-tenant board said it thought the council should also understand the financial parameters of any project seeking such a subsidy.
The board also recommended the council require that children be accepted in any project with tax-exempt financing, whether the family is in one of the low-income units or not, and that developers submit cost analyses of providing day care and recreation space.
The board's final recommendation is that the city council always hold a public hearing before approving a tax-exempt bond issue for a housing project, and it recommended expanding the list of people to be notified about such a hearing to include tenants and neighborhood groups around a proposed project.