Monday, July 22, 2024

The U.S. Department of Housing and Urban Development is closing a loophole the Cambridge Housing Authority is relying on to maintain five of its largest public housing developments. (Photo: Teofilo)

Rushing to act before federal housing officials completely close a financing loophole, the Cambridge Housing Authority has applied to federal housing officials to move 1,066 apartments out of the public housing system to subsidize major repairs.

The CHA board voted March 14 to submit an application to the U.S. Department of Housing and Urban Development to transfer five of its largest developments to private nonprofit corporations the authority controls. If the federal agency approves, the housing units would become eligible for federal rent subsidies that would keep them affordable to poor tenants and bring in almost twice the federal aid Cambridge gets under the public housing program.

With the increased income, CHA says it could attract private investment that would pay for $182.9 million in needed repairs.  Otherwise, residents face “deteriorating conditions” and some housing might become unlivable, the authority said in its application.

CHA is going ahead with its plan despite a move by the government last month to eliminate the strategy. With housing authorities across the country adopting similar plans, threatening to raise federal obligations sharply, the federal agency said that because of insufficient funding it “generally” wouldn’t continue to approve applications to dispose of public housing if they were made. There are alternatives to the process of “disposing” of public housing and converting units to rent subsidies, its representatives said.

CHA officials say they are optimistic because they can show that the alternatives won’t work here. The application included financial analyses intended to demonstrate that.

It also included striking details of leaky walls, crumbling concrete and bricks, poor ventilation, wasteful heating equipment, flooded basements and other deficiencies at the five developments: Millers River and Manning Apartments for elderly and disabled tenants; and Washington Elms, Newtowne Court and Roosevelt Towers for families.

After 14 public meetings with public housing residents, some of them frightened and angry about the proposed changes, the authority’s board session seemed like an anti-climax. It took less than five minutes for commissioners to approve the inch-thick application.

If the government approves and also provides the necessary number of rent subsidies, the CHA will carry out the plan, officials have said. If there are not enough rental vouchers, the authority has pledged to ask to withdraw its application to transfer the housing to private corporations.

The funding plan estimates that the authority will raise about $37 million more than it needs to finance repairs at the family developments. That surplus will fund work at the elderly buildings, where private investment won’t bring in enough money.

The application also indicated that the authority will rely heavily on private loans such as mortgages. Authority officials have said they will guard against foreclosure by keeping sizable reserves and not overborrowing.

CHA chose its largest developments, including two with the greatest need for repair — Manning and Millers River — for the first phase of its application to the government. The authority plans to submit an application for the remaining 1,042 apartments, some of them single units or three-unit buildings, April 26.