Councilwoman Beth Mason complained last week about private meetings that a developer’s attorney wants to hold to discuss five affordable “workforce housing” condominiums that were approved by the council in 2005 for use by city workers.
MetroStop, a 10-story condominium complex at the Ninth Street Light Rail station, was controversial when it first came up for a council vote in 2005. At the time, developer Dean Geibel requested from the City Council that the floor-to-area ratio be increased to create larger condo sizes. In turn, he said he would set aside five units for affordable housing.
The project drew criticism from open-space advocates who wanted to see the city buy that land for a park. For some, it was the affordable housing units that made the difference.
At a meeting in 2005, Michael Russo, 3rd Ward councilman, noted that it was rare to see non-rental affordable housing in Hoboken. Chris Campos, the then-4th Ward councilman, requested that the units be dedicated as “workforce housing” to city employees like teachers, police, and firefighters who were being priced out of town.
An existing city ordinance mandates that City Hall employees live in town. However, it does not apply to teachers.
In 2005, the council agreed with Campos’ suggestion, and the units were designated for workforce housing in the developer’s agreement.
While regular affordable housing is federally subsidized and must follow state regulations, this “workforce housing” is offered at a reduced rate from the developer and can be regulated how the city sees fit, according to Fred Bado, director of Community Development.
According to the state’s Council on Affordable Housing (COAH), Gov. Corzine passed “a comprehensive affordable housing reform bill” in July that in part offers funds for “workforce housing,” which COAH says is given to those with a household income of not more than 120 percent of the regional median income.
Since these units are not subsidized, it is up to the city to control the distribution of the units. The developer’s duty was simply to designate them for workforce housing and offer them at reduced rates.
According to a summary of the developer’s agreement given to council people who met with the developer’s attorney and city officials last week, the city plans to use a lottery system to create a waiting list of qualified owners. The five units are three-bedroom condos. Thus, the city is giving preference to four-person families.
The condos will sell for $250,000. There is an income limit for four-person families in the three-bedroom units: $61,000 to $92,000.
The eligible income is determined as “no less than 80 percent of the area median income but not more than 120 percent,” according to the guidelines distributed.
Giebel said Friday that he is disappointed that the process is moving so slowly.
“The people could be moving in right now,” he said.
Two weeks ago, the developer’s attorney, James Burke, sent e-mails to all nine council people asking to meet with them a few at a time to discuss how the units will be awarded. He wrote in the e-mails that meeting with small groups would not violate the Open Public Meetings Act.
Geibel said last week that this was to avoid blind-siding the council with this information at a meeting without explanation.
Mason sent a letter to Council President Nino Giacchi accusing Burke of both unfairly favoring municipal employees and of trying to circumvent the state’s Open Public Meetings Act (OPMA).
“Everything in this [letter] is purely conjecture on her part.”
– Fred Bado
The city claims the meeting was purely informational. They also said that the final actions to be taken concerning the five units will be done at a council meeting according to OPMA standards.
Mason maintains that the meetings, whether informational or not, should be held in public.
When told last week that the employee housing was approved at a public meeting in 2005, Mason was not aware of that. But she said she stood by her feeling that discussions about the units should be done in the public.
Two council members attended meetings with the city and the developer’s attorney last week – Peter Cunningham and Ruben Ramos Jr. They were given information from the city about how the units would be handed out.
Mason said she is seeking a determination from the state’s Council on Affordable Housing as to whether restricting the sale of these units to city employees is permissible.
Bado dismissed Mason’s letter to Giacchi as baseless. “Everything in this is purely conjecture on her part,” he said.
According to Bado, even if a family qualifies, they still have to be able to put down the usual 10 percent down-payment and obtain a mortgage.
According to the packets given to council members, the property must be a primary residence and cannot be “flipped” to another owner. There is a time limit during which they cannot re-sell their condo.
Also, the city collects any equity on the property above 3.3 percent.
But the guidelines still have to be ratified by the council, which will most likely occur in October, Bado said.
Bado claimed that Mason may have violated a confidentiality agreement by distributing an e-mail sent to her from the attorney for the developer.
Priced out of town
Russo said that among the affordable housing units in the city, there is a lack of “moderate-income” housing.
He noted that low-income housing can be found in the Hoboken Housing Authority.
There is also moderate and low-income housing in non-government-run buildings such as Clock Towers, Church Towers, and Applied Housing (see sidebar).
Russo pointed to the city ordinance requiring employees to live in Hoboken. He said the law is useless unless the city has housing available at their income level.
“In this city, there’s an attack on the middle class,” Russo said, acknowledging that the same problem exists across the nation.
Peter Cammarano, councilman at-large, said last week that city employees can be “victims of their success” by pricing themselves out of standard affordable housing, and that he is in favor of the “workforce housing.”
He also said that yearly income review should be held for all affordable housing in town to ensure that the units are being made available to people who qualify.
Turnover in some of the town’s affordable housing buildings is low, because laws do not force tenants to move out once their income rises above the original amount. Russo said that he does not believe that workers should be forced out of affordable housing once their income exceeds the original limit for applying. He said that the issue is not that city employees stay in the housing for so long, but that there aren’t enough affordable units in town in general.
For questions or comments on this story, e-mail email@example.com.
Many of the city’s existing “affordable housing” buildings go back to the 1960s and 1970s, when the federal government offered low-interest loans to developers who would help “renew” blighted cities. When the developers built in Hoboken, they got a low-interest government loan, and in exchange, they had to offer their units at a lower rent to the public.
Although some erroneously refer to these units as “subsidized,” buildings like Clock Towers, Church Towers and Marine View Plaza are not subsidized by federal or state money. However, they were not forced at the time to pay regular fluctuating property taxes; rather, they were given a separate tax deal with the city.
Clock Towers, a former factory that was converted in the mid-1970s, has 173 units. Church Towers on Willow Avenue has 402 units, and Marine View Plaza 1 and 2 have 432 units.
While the units served their purpose at the time, many residents today don’t understand while city officials, including the previous mayor, were allowed to remain in the buildings while earning six-figure salaries and buying other property out of town.
There is no law forcing them to give up their housing when they earn a larger income. For instance, when the city’s former mayor, Anthony Russo, first moved into Church Towers in the 1970s, he was earning less than $10,000 per year as a local teacher.
Some believe that officials earning a certain amount should voluntarily leave the buildings. To force them to do so would require a change in the law.
The waitlists for these buildings are long. In 1996, it was reported that the Church Towers list had more than 600 people on it, and had been closed since 1983.
Once the residents of these buildings earn over a certain income, their rent increases.
These buildings are different from the Hoboken Housing Authority projects and Section 8 properties in town, which receive a federal subsidy for low-income tenants.
But who oversees the application process today? A 1996 investigative story by the Reporter noted that earlier that year, a politician’s parents were able to move into Church Towers after selling their $319,000 building on Bloomfield Street. According to the federal department of Housing and Urban Development, this was possible depending on how much they owed on the house and what other income they had.
To read more about this housing, e-mail firstname.lastname@example.org for the 1996 article.