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$2.5 million loan to affordable housing developer places low-income renters into debt

East Bay Asian Local Development Corporation (EBALDC), one of Oakland's largest non profit housing developers, places low-income renters at risk of high rents or displacement by borrowing $2.5 million to renovate the 21 unit building they reside in!
$2.5 million loan to affordable housing developer places low-income renters into debt

EBALDC serves low-income tenants bogus renovation notices on 2 occaisions

By Lynda Carson -- March 17, 2011

Oakland -- During the past 14 months, low-income residents at an East Oakland residential building were served 2 different notices listing a number of major renovations that were scheduled to be done in their building, that never materialized.

Since the 2 notices of renovations were served to the residents in the last 14 months, the low-income renters have not received a followup notice from the East Bay Asian Local Development Corporation (EBALDC), indicating why the renovations have not taken place as scheduled.

In another development regarding the situation, according to the City of Oakland, to date the necessary required permits have not been obtained by the non profit developer for any of the work that was scheduled to be done in the 21 unit building at 829 E. 19th St.

Bogus Renovation Notices Served To The Low-Income Residents

In Brief: After the low-income renters were served bogus notices twice during the past 14 months stating that renovations were to occur at their 21 unit building and in their apartments, it turned out that none of the renovations ever took place, and in the latest development the lack of permits cause concern and confusion for the residents in the building.

Melissa Jenkins of EBALDC has her name prominently featured on a recent Feb. 3, 2011 notice to the residents, called Notice of Planned Repairs and Improvements, and was not available for comment.

In the Feb. 3 notice, Jenkins claimed that the renovations were scheduled to begin during the week of Feb. 28, 2011, but as it turned out the renovations did not begin. Jenkins, EBALDC and any contractors that may be involved, failed to obtain the necessary permits before scheduling the work to be done in the building with the residents at 829 E. 19th St. Jenkins is the Compliance and Administrative Manager for EBALDC.

An earlier bogus notice dated Nov. 23, 2009, called Notice of Planned Repairs and Improvements, was also served to the residents of 829 E. 19th St., stating that renovations were to begin during Jan. 2010.

None of renovations were done at the building, and no permits were obtained by EBALDC or any contractors, to do any of the work that was listed in the Nov. 23, 2009 bogus notice. Additionally, the tenants did not receive any followup notices stating why the renovations did not take place, or why no permits were obtained.

According to the City of Oakland, the last time someone applied for a permit for 829 E. 19th St., was during 2010 when a tenant sought a permit to work out of their apartment. In 2008 a permit was applied for, for work to be done on some exterior stairs, and in 2006 someone applied for a permit to have some electrical work done at the building.

Opposition To Loans For Renovations In Oakland's Low-Income Housing Projects

Low-income renters have appeared at numerous meetings in Oakland during the past few years, to speak out in opposition to around $10 million in loans being offered to non profit housing organizations for their renovation projects, that may be displacing people from their housing.

These renovation projects include the Drachma House, Effie's House, Eldridge Gonaway Commons, Marin Way Court, Oaks Hotel Project, Hugh Taylor House, Slim Jenkins Court, and Posada De Colores Apartments.

A petition with over 500 signatures was turned over to Oakland's City Council on Mar. 31, 2009, demanding that non profit developers could only use the loans for their renovation projects, and that none of the money could be used for their employees. The City Council rejected the tenant's demands.

At the same Oakland City Council meeting, attorney John Murcko stated, "The only way we can properly maintain and save low-income housing projects in Oakland, is for the City of Oakland to take over management of all the low-income housing projects."

Murcko was the attorney defending the tenants at the California Hotel facing illegal evictions from their housing after Oakland Community Housing Inc (OCHI), went broke and illegally tried to evict 100s of tenants from their various properties including the California Hotel, while OCHI threatened to cut off the power and water at the historic hotel during 2008.

Presently, EBALDC has set it sights on taking over ownership of the California Hotel, even though it was in a partnership with OCHI and the City of Oakland in 2008, in the scheme to displace the residents of the California Hotel. EBALDC had an agreement with OCHI and the City of Oakland to take over management of the historic hotel, once OCHI had managed to force the low-income renters out of their housing.

During March of 2009, during two Oakland City Council meetings a number of low-income tenants and housing activists spoke out against giving any large loans to non profit housing developers for their renovation projects, fearing that the projects would result in displacement and higher rents for the low-income renters.

At that point, EBALDC sought a loan of around $1.25 million from the City of Oakland for the proposed renovation project at 829 E. 19th St.

Since then, a year later, on March 16, 2010, Oakland's City Council voted to award the East Bay Asian Local Development Corporation (EBALDC) an additional loan totaling $2,517,000 to renovate the same 21 unit residential building at 829 E. 19th St.

The over $2.5 million loan to EBALDC to renovate a building mostly filled with low-income renters, places the tenants at risk of higher rents or displacement in the future, because of the extra burden of paying off the high mortgage payments for such a huge loan.

Out of the $2.5 million loan to renovate the 21 unit building at 829 E. 19th St., EBALDC will be skimming as much as $105,000 from the loan in what they are calling developers fees. The loan agreement allows EBALDC to grab as much as $5,000 per unit in developers fees from the loan, totaling $105,000 that EBALDC is allowed to take from this project.

In 1997, EBALDC payed around $461,000 for the 21 unit building at 829 E. 19th. St., and according to the Alameda County Tax Assessor's Office the total taxable value for the property is currently around $581,908.

Lynda Carson may be reached at  tenantsrule@yahoo.com

Note: Lynda Carson is a resident of 829 E. 19th St.

try the hud website 17.Apr.2011 01:37

pearlemoon

try the hud inspector general's web page, you can report all this to them. if they do their job, they will investigate and might possibly make this company play straight. they do have rules for all owners of subsidized/ HUD supervised projects.

 http://www.hudoig.gov/