Cecil County Asked to be Co-owner of Private Housing Project, North East Boys and Girls Club Center
The developer of the Elkton Senior Housing project asked the Cecil County Commissioners on Tuesday to become a co-owner of a proposed profit-making apartment project in North East in order to get state subsidies for low-income housing and a new home for the Boys and Girls Club of North East.
The project, called “New East Crossing,” is proposed by the Ingerman Group, of Cherry Hill, N.J., which also developed the Elkton apartments for the elderly that opened recently.
David Holden, the developer’s representative, told the County Commissioners that the project needed the county as a co-owner in order to get state Rental Housing Partnership money. He said the county’s only financial contribution would be to waive permit fees and that any future liability would be covered by insurance. He said there was the possibility that the county might get a share of profits from the project in the future. The county would be given a 20 percent share in the ownership group.
The project would be located on Razor Strap road, off Route 40 in North East. A site plan sketch submitted to the commissioners did not identify the parcels included in the more than 9 acre project. Holden said “there is no address” when asked by Cecil Times for the street address of the property.
By having the county government listed as an owner, the developer would get what amounts to free money from the state, since a Rental Housing Partnership program loan does not have to be repaid if a local government is an owner, according to state housing agency documents on its website.
The ‘partnership’ funds would not be the only subsidy funds for the project. Holden told Cecil Times the developers would also seek state Rental Housing Funds and federal Low Income Housing Tax Credits that are allocated by the state housing agency. Overall, the project would cost about $11 million, the commissioners were told.
Documents submitted to the Commissioners show that Cecil Bank would be involved in financing, just as the bank was in Ingerman’s Elkton Senior Housing Project on High street. In that project, Ingerman made a last-minute purchase of a derelict building on Collins avenue that was owned by the bank. The building was demolished and the land is now vacant, with no current plans for its use by the senior apartment project, Holden said.
[See previous Cecil Times article on the Elkton project here: http://ceciltimes.com/2010/07/elkton-senior-housing-anatomy-of-a-deal/ ]
Tuesday’s meeting with the commissioners was scheduled after Holden sent an email noting that “Mary Halsey from Cecil Bank suggested I contact you after she had a conversation with Commissioner Mullen[sic].” Halsey is the president and CEO of Cecil Bank and Commissioner James Mullin (R-1) is president of the county Board of Commissioners.
Halsey also serves on the board of directors for the Boys and Girls Clubs of Cecil County, according to the group’s newsletter.
The current North East Boys and Girls Club is located on East Cecil Ave in North East. Holden said the developers had an agreement with the Club to lease space for $1 a year but would pay its own utilities.
The proposed project would have 72 apartments (1, 2 and 3-bedroom units) and a 4,500 square foot community building, which would house the Boys and Girls Club as well as activity areas for residents of the project.
An unusual aspect of the Partnership program is a state mandate that residents must contribute volunteer services to the project, such as maintenance or grounds upkeep, according to state documents.
This spring, state housing Secretary Raymond A. Skinner said in a ‘message’ commenting on this year’s legislative session that the Partnership Rental Housing program was allocated $6 million in the Fiscal 2012 budget. The program, he said, “provides loans or grants to local governments or housing authorities to construct or rehabilitate rental housing for low income families.”
The program usually requires the local government to provide the land for a construction project and county attorney Norman Wilson questioned whether the county would be expected to provide land or other services. Holden said the developer would acquire the necessary parcels of land on its own.
County Commissioner Robert Hodge (R-5) said that the county is already planning road improvements on Razor Strap road and that might be considered an in-kind contribution.
The commissioners made no decisions on the request Tuesday but the developer is anxious to proceed. The state has a mid-September deadline to apply for its next round of rental housing and tax credits aid.
The county should run, not walk, away from this project. We do not need more low-income housing. A 20% ownership would mean 20% responsibility for all problems. The Boys and Girls Club should not re-locate to a high crime area.