Democracy In Albany

You can buy fully renovated "historic" mansions on the park for less than $700,000.  These numbers do not reflect the economic reality of renovating 3 floor rowhouses.  Especially when you gut them (which from the ones I looked in, they did).  Once gutted, they are just putting in modern materials.

These houses will likely go the way of the ones on Grand Street that were renovated.  Been to grand street recently?  

You can't fix neighborhoods by renovating buildings and making them into apartments.  If you aren't getting a decent percentage of owner occupants, they will revert to the mean.  

http://albany.bizjournals.com/albany/stories/2007/10/29/story5.html?b=1193630400^1540293&page=1

After reading this article I posted a diary which broke down the cost per unit/building:

http://www.democracyinalbany.com/story/2007/10/29/163554/10

What really disturbs me is what's reported in the article which was excerpted by DIA in his posting:

"The $12.5 million project was paid for with funds from the city's Community Development Agency, low-income tax credits from the Division of Housing and Community Renewal, and tax credits from the state Office of Parks, Recreation and Historic Preservation."

So let's see what DHCR has to say about Low Income Tax Credits:

"The Low-Income Housing Credit Program (LIHC) (LIHC) was established under the Tax Reform Act of 1986 to promote private sector involvement in the retention and production of rental housing that is reserved for low-income households.

The LIHC program provides a dollar-for-dollar reduction in federal income tax liability for project owners who develop rental housing that serves low-income households with incomes up to 60% of area median income. The amount of LIHC available to project owners is directly related to the number of low-income housing units that they provide."

"The LIHC is available to the project owners only for units that are occupied by low-income households. A low-income household is defined as one having an income of 60 percent or less of the area median adjusted for household size.

From the Oct.'07 Business Review article:

"For instance, a family of four must earn less than $39,720 to live there. Rents for the one-, two- and three-bedroom units will range from $500 to $800."

From the Thursday TU article:

"The developer owns the buildings and will manage the apartments, which will be for moderate-income tenants earning 60 percent of the city's median income. A family of four would have to have an income of about $39,000, said Kristina Rogers, the senior project manager for WinnDevelopment."

Let's see, according to one source, the median household income in Albany is estimated to be approximately $33,000, which sounds about right considering it was $30,000 in 1999.

"The income per capita is $20,464, which includes all adults and children. The median household income is $33,594."

http://www.bestplaces.net/city/Albany-New_York.aspx

So, what's 60% of $33,594? It's $20,156, Right?

As I see it, the developer of this project, Winn, will be receiving oodles in low income tax credits for providing housing to an ineligible population target, moderate incomed families, while pricing out low incomed families and individuals, the population the tax credit program was designed to assist.

As I said before, Park South is a rehab ripoff.

"Why Are We Wasting Money on Slum Housing?"

How on earth could anyone consider this "slum housing" ? Please explain for us why you have.

"We shouldn't be encouraging poverty in Albany ..."

How does a project like this, one that allows families to move from squalid code deficient hovels into newly renovated apartments, (if it was serving a low income population), encourage poverty?

Seeing that all who move here will be middle and upper income individuals and families, maybe you'll share with us your abstract reasoning for the statements above and below?

"There is no reason why at least part of the housing stock in Park South could not be turned into middle class or upper class housing."

Park South is entirely devoted to middle and upper income families. Have you read anything at all about this project? (perhaps you've misread my postings, DIA's, the TU and BR articles. Yeah, you must not have, or you would never have made that last statement.)

And it seems you have completely missed the point I was making. Winn will be receiving tax credits designed to encourage developers to provide housing to those of low income, yet no low income family will be able to afford to live there.

The tax credits are meant to offset any loss to the developer that they would suffer by offering appropriately affordable, up-to-code housing to those of low income at below-market rates.

Without those tax credits, there is little incentive for developers to build low income housing.

Most new low income housing incorporates utilizing the Section 8 rent subsidy for their tenants. Tenants participating in this program pay 1/3 of their adjusted income for their shelter costs and the government then pays the landlord the difference between that figure and the actual fair market rent would that the unit would command on the open market. Section 8 also pays for the tenants utilities.

So actually the landlord does receive fair market rent for the unit.

Perhaps you should read up on the purpose of the Low Incom Tax Credits: