Housing Corp Emergency Request for $1 Million Dominates City Council Meeting
By GEORGE BROMLEY
Falls Church Times Staff
July 27, 2010
An item not on the published agenda became the highlight of last night’s meeting of the Falls Church City Council – the Falls Church Housing Corporation’s request for immediate access to $1 million to save the “McKeever” office building and parking garage, which in turn is necessary for “The Wilden” affordable housing project.
According to those in attendance at last night’s meeting, financing is still lacking for the McKeever project four days before a crucial July 31 deadline.
The McKeever and Wilden projects were approved in March by the previous City Council as a joint package. Because of their close ties, if one project fails, the other likely also will fail. The Falls Church Housing Corporation (FCHC) has told the City Council that unless financing for both projects is secured by the end of this month, the housing organization will miss out on essential federal and state affordable housing monies intended for the Wilden.
Originally, the Wilden was to be built by the FCHC and its partner The Community Builders, and the McKeever was to be built by “Flower Building” owner Bob Young. According to discussions last night, however, Young’s project appears to lack necessary funding, putting both projects at risk. To avoid missing its July 31 deadline, FCHC has proposed that it buy the property upon which Young’s building would stand, relieving Young of that obligation and allowing the McKeever project – and hence the Wilden project – to go forward. To allow it to buy the property underlying the McKeever project, FCHC is asking the City Council to let it use $1 million of a $2 million loan intended for the Wilden, and to provide the $1 million immediately.
The FCHC currently owns the site of the Wilden project at 350 S. Washington Street. The McKeever project is planned for the adjacent property at 360 S. Washington, currently owned by the estate of local businessman Thomas Sawner, who died last week. Young signed documents earlier this year indicating his intent to purchase the Sawner property, but the sale has not been finalized.
Last night Mayor Nader Baroukh began the discussion of the FCHC’s request for early payment of $1 million with a number of questions to City staff. Included among Baroukh’s questions was why there now is a shortage of $1 million, where funds to cover the gap would come from, why the FCHC was facing a July 31 deadline, and what would be the potential financial impact on the City if it approves the FCHC’s request but the McKeever project is not built concurrently with The Wilden. He also inquired regarding the status of $2 million in Capital Improvements Program funds set aside for affordable housing and asked for a report on the potential risk to the City, given revised financing arrangements.
Answers to the mayor’s questions weren’t immediately available, but other Council members were not hesitant to express their opinions on the topic.
Former mayor Robin Gardner, who advised that she had learned of FCHC’s concerns only last Wednesday night, viewed the proposed change in the loan agreement as essentially an amendment to the previously approved resolution; i.e., that instead of funding the $2 million at a later point the City would fund half of the money sooner.
New members Ira Kaylin and Johannah Barry saw things differently. Mr. Kaylin called the change “a new proposal, in terms of its financial complexity.” Ms. Barry concurred, stating “This lack of financial planning is not our crisis. Though it looks as if we’re shifting distribution dates, in fact this puts the City at a much higher financial risk, instead of the third or fourth contributor to this process we’ve become capital investors, the first in line.”
Vice Mayor Dave Snyder referenced a statement from The Community Builders, the FCHC’s partner in the project, which claimed that the risk to the City had not increased. He observed that although there are risks to the City in proceeding, there are also risks in not doing so. Councilman Ron Peppe agreed with Mr. Snyder and pointed out that the Council had previously endorsed the project by a 6-1 vote.
Mayor Baroukh, who cast the lone negative vote in the Council’s March 6-1 approval of the Wilden, stated that he did not know why the matter was being raised “at the 11th hour” and said the change was not what he would call a minor amendment. “This has some significant implications on some text that took hours upon hours to work through, but now we’re only going to have a few days to fully assess this.”
One key question will be how the diversion of $1 million from the Wilden to the McKeever project would affect construction of the Wilden, and whether FCHC has identified a source for replacement of the $1 million.
At press time only the agenda for Thursday’s meeting had been posted on the City’s website. The primary documents regarding the FCHC’s request were not available. A link will be added to this story when the documents are posted.
Late Monday night Councilmen Lawrence Webb and Ron Peppe each told the Falls Church Times by email that they were awaiting more information before forming a position on FCHC’s request. Councilwoman Gardner said she did know her position, but due to the lateness of the hour, would provide that information along with a comment on the matter on Tuesday.
Inquiries to FCHC and Young regarding the matter were sent late Monday night after the City Council meeting concluded. Information received will be made available when received.
At the request of Gardner and Pepper, the Council has schedule a special meeting Thursday night for consideration of the FCHC request. The Council is expected to vote at that time on whether to grant the FCHC’s request for early receipt of $1 million.
On a separate matter, the GEORGE bus service, which was the primary item on last night’s Council agenda, did not receive a lengthy discussion. Two residents spoke in support of the system and one in favor of its termination. Mayor Baroukh asked the public to offer their views via email before the Council’s work session next Monday.
Five options for GEORGE have been under consideration. Mr. Snyder suggested adding an option of reducing service hours on 26E, while still retaining some rush hour trips on 26W. The vice mayor also encouraged Gary LaPorta of the Chamber of Commerce, who spoke in favor of the service, to offer recommendations as to how the bus could be used as an economic development tool.
The Council unanimously approved second reading of a change in the City code to allow the use of photo monitoring systems to enforce traffic light signals. Police Chief Harry Reitze stated that the department was still pushing for installation of two enforcement systems by early fall but could not offer a specific date.
Ms. Gardner reported that she and City Manager Wyatt Shields had attended Monday’s memorial service for local developer Thomas Sawner. She expressed regret that Falls Church had only known him for a short time and praised “the amount of giving he gave to his community.”
In his report to the Council Mr. Shields stated that 130 people dropped off hazardous materials during last Saturday’s collection event.
By George Bromley
July 27, 2010