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Albany officials: Bethel housing project worth the investment

Albany officials have agreed to use $500,000 in HUD funding to help with the planned renovations of Bethel Housing Complex. (April 20, 2013)

Albany officials have agreed to use $500,000 in HUD funding to help with the planned renovations of Bethel Housing Complex. (April 20, 2013)

ALBANY, Ga. -- With memories of other failed certified Community Housing Development Organization (CHDO) projects burned in their memory -- most recently the $374,000 Cutliff Grove community development attempt that is expected to eventually impact local taxpayers -- many citizens in Albany and Dougherty County decried the Albany City Commission's recent decision to approve some $500,000 in Housing and Urban Development Home Investment Partnership (HOME) funds for use by the Bethel Housing Community Development CHDO.

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This apartment at 507 Swift St. is part of Bethel Housing Complex, which is undergoing a $10.6 million renovation.

Bethel Housing, the development arm of Bethel AME Church, wants to use the HOME funding as part of a $10.6 million upgrade of a 98-unit low- and moderate-income apartment complex at 507 Swift St. in Albany. The complex, according to tax records, was built in 1973, went through a $1.4 million renovation in 1989 and has a current fair market value of slightly more than $2.5 million.

City officials, wary of such local projects' past failures, say Bethel's long-term management of the Swift Street complex, its own investment in the proposed project and its mission of providing affordable and safe housing for citizens who would otherwise not have a decent place to live lessen the possibility of forfeiture on the project. Such a scenario would leave the city liable for the half-million dollars in HOME funding.

"We're talking about a group that has maintained and managed that property successfully for more than 30 years," Assistant City Manager Lonnie Ballard said. "They have a good track record, and if you look at their mission you see an organization dedicated to providing safe, affordable, decent housing to low- and moderate-income families.

"Imagine what the cost to the city would be if this apartment complex came offline and we had to try and find 98 additional units for the displaced families. This money -- $500,000 -- is significant, but you've got an organization with skin in the game. Bethel Housing has put their resources where their mission is."

Interim Department of Community and Economic Development Director Shelena Hawkins said the $500,000 in HOME funds, which had accumulated since 2007 as 15 percent of the city's total HUD allocations -- an amount required by the federal agency to be set aside and awarded to a certified CHDO -- would be returned to HUD if not utilized. She said careful consideration was given three applicants before Bethel's project was selected.

"This is not a fly-by-night decision," Hawkins said. "A review panel made up of representatives of our department, Planning, Engineering and a local banker with underwriting experience looked over proposals from Bethel, The Oaks at North Intown Homeownership and Mt. Olive Community Outreach Center before determining (the Bethel project) to be the best qualified for use of the funds."

Laura McCool, a DCED housing program manager, said the process of selecting a CHDO to receive the HOME funding was carried out in a manner that eliminated the possibility of favoritism.

"Our review panel awarded points for certain criteria and came up with a tally to determine the best qualified project for use of the funds," she said. "And even with that scrutiny, the process is not complete. No local funding will be issued until (Bethel Housing) has secured all its funding for the project."

Hawkins said the recommendation to approve Bethel's request for the HOME funding was based on its staff's knowledge of the HOME program regulations, its experience in developing and managing HOME rental units and its evidence of leveraged funding for the project.

The Swift Street apartment complex includes 14 one-bedroom, 42 two-bedroom, 21 three-bedroom and 21 four-bedroom units among its 14 housing units. Bethel Housing has partnered with IDP Housing of Valdosta and Massachusetts-based Stratford Capital Group to put together the funding proposal for the project.

A detailed project budget shows costs ranging from $299,800 for predevelopment (including architectural and engineering), $2,457,729 for acquisition (in which the Bethel Housing CHDO will assume the HUD-insured mortgage currently held by Bethel Housing Partnership), $4,781,616 for construction and $3,101,966 in so-called "soft and carrying costs" (including $244,500 for relocation of residents during construction).

IDP Housing's chief financial officer, Steve Brooks, tried to address concerns over the $10.6 million price tag during a brief presentation before the City Commission voted on the HOME allocation at its March business meeting, but he said this week he may not have gotten his points across.

"That amount is not a figure we wanted; it's what it takes to complete this project to the standards required," Brooks said. "One thing I don't think people (who are complaining about the allocation) are looking at is that almost all of that $500,000 amount is going to come back to Dougherty County in sales taxes for construction supply purchases locally.

"Plus property taxes have been paid on that complex every year since 1974."

Dougherty County Tax Director Denver Hooten said that Bethel had paid its property taxes through 2012 (that year's total was $40,660.32). Tax records show that Bethel applied for tax-exempt status on the property in 2007 and was denied by the county's Board of Assessment. That ruling is currently under appeal in Superior Court.

"If the court rules (in Bethel's favor), they would be eligible to have the taxes they've paid (since filing the tax-exempt application in 2007) returned," Hooten said. "But they've kept up payment on the taxes in the meantime."

Brooks said construction on the apartment complex must be completed to strict HUD and Georgia Department of Community Affairs standards.

"Energy efficiency is a very big thing now," Brooks said. "For instance, we're required to use 40-year shingles, and we'll take off all vinyl siding and use a much more durable hardyboard. There are also a lot of other little requirements: for windows, carpeting, air conditioning.

"We do this right, because we're putting ourselves and our funding stake at risk as well. If, for instance, Bethel allowed an unqualified resident to stay in one of the units, the property could be foreclosed on and both IDP and Stratford would lose its investment in the project."

Community and Economic Development Program Compliance and Accounting Manager Phyllis Brown said rent at the complex is based on the area's median income.

"The median income in our area is $49,150, and renters in the complex must earn at a level of 60 percent or below that income to qualify," Brown said. "The income rate is adjusted to specified criteria, and no tenant may pay more than 30 percent of their income on housing.."

Asked by City Commissioner Bob Langstaff how his group could justify a $10.6 million price tag on the project when "you could build every family there a new $100,000 home and come out cheaper," Brooks said a number of factors make such a swap-off unreasonable.

"You have to look at land availability," he told Langstaff. "Where could you build 98 new homes in the city?"

Brooks also said razing the apartments and starting from scratch would not be economically feasible.

"Trust me, we look at such proposals carefully," he said. "One thing you have to consider is that code and zoning ordinances have no doubt changed since these apartments were built in 1973. Current zoning might not allow us to build these apartments back. You'd no doubt have parking and setback issues."

Brooks said relocation costs also figure into the project.

"There are 14 buildings, and we'll work on three or four of them at a time," he said. "We will not work on any building with a resident still in it. Part of our cost includes relocating residents while work is ongoing. We have a person on our staff who manages this, and she talks one-on-one with each resident to help them find suitable temporary housing.

"We hire the mover, and we replace any item that might be damaged in the move. But one thing I should note is that, no matter where the residents stay during the construction period, they still continue to pay the rent they are currently paying. If, for example, someone were paying $300 in monthly rent and they found a temporary location that costs $500 a month, we would be responsible for the other $200."

The city's allocation of $500,000 in HOME funding, which is still subject to HUD approval, is a small part of the overall cost of the Bethel Housing renovation project. Stratford Capital is investing $3.765 million in exchange for tax credit benefits earned through the Community Reinvestment Act; $5,218,540 will come from transfer of the HUD-insured mortgage and from a HUD flex subsidy loan; $500,000 will come from Federal Home Loan Bank of Atlanta's Affordable Housing Program; $500,000 will come from Bethel cash reserves, and $157,571 will come from rental operations.

Triumph Housing Management Group of Atlanta will be involved in the project to assure Bethel Housing maintains compliance with federal, state and local standards and guidelines.

"We'll manage the daily operations of the (apartment complex)," Yoshonda Williams, Triumph's director of compliance, said of her company's involvement in the project. "We work hand-in-hand with the development team to assure compliance, and we'll remain under contract to manage the development once the renovation is completed.

"We will be working, I think it's important to point out, with the Bethel Housing Community Development CHDO, not with the church itself. The church will not be the owner of this property."

Brooks said Triumph's CEO, Paul J. Ponte, had contacted IDP Housing to gauge the company's interest in the Bethel project.

"We're a faith-based company," Brooks said. "Improving people's lives through helping provide quality housing is part of our mission, a mission we share with Bethel and with Triumph. This is just part of what we do.

"We met with the ownership of this complex, and after talking with them felt their mission was similar to ours. They have a history of concern for how the residents in that community are treated."

Ballard, acknowledging issues the city has had with certain other CHDOs in the past, points to the accomplishments that are part of the city's allocation of HOME funds, including: 68 rental units rehabilitated, 94 homebuyers assisted, 60 homeowners assisted and 222 low- or moderate-income families assisted.

"Albany has been designated an entitlement community; there are real needs for these types of programs here," he said. "We're fortunate to have a mechanism in place that allows us to help provide decent housing without utilizing General Fund dollars. By working jointly, we're able to maximize the impact we can have on the community."

Such positives, DCED officials say, outweigh risks when city-backed funding is allocated.

"Bethel Housing has a stake in this game," Brown said. "They've been managing that project for more than 30 years; they're not going to be here and gone. You can count on them to be here."

And the rewards, Hawkins notes, are significant.

"For these residents, there's a renewed sense of pride when they see the work that will go into this renovation project," the Community and Economic Development director said. "It has an overwhelmingly positive impact on your place in the community when you feel someone cares."

Comments

BettyBowTie 12 months ago

"Albany has been designated an entitlement community; there are real needs for these types of programs here," he said. "We're fortunate to have a mechanism in place that allows us to help provide decent housing without utilizing General Fund dollars. By working jointly, we're able to maximize the impact we can have on the community."

We ARE an entitlement community and we will remain one BECAUSE we build more and more housing with federal funds which forces us to take in the poor from all over the country. Welcome to "Po'Ville."

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Sister_Ruby 12 months ago

The economic reality of this world is "Whatever you subsidize, you get more of it". Want more jobs and job growth? Subsidize small business. That's Something for Something. Want more people living in poverty? Subsidize housing, give away food, phones, etc. That's Something for Nothing.

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Ihope4albany 11 months, 4 weeks ago

Remember how Po'Ville came to be. Wealthy white folks abused enslaved Africans and their descendants by stealing their wages for hundreds of years. It's no wonder that Albany is poor today; it had one of the highest ratio of slaves.

Unless efforts are made to undue all that economic damage, Albany will remain Po'Ville!

I hope that enlightened people of today will roll up their sleeves and have a Walk-A-Thon for job creation, which can be cured.

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FryarTuk 11 months, 4 weeks ago

No one living was a slave. No one living is entitled to any compensation for slavery. Free education which is the greatest tool for development has been available for a very long time. There is no excuse for an element of the culture to stay chronically disadvantaged unless they choose to be.

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Sister_Ruby 11 months, 4 weeks ago

OMG what a load of complete O'Bama Black Liberation Theology.

Too bad Africans were ever relocated to the land of the free and the home of the brave and the land of opportunity. If Africans had never left Africa, they would be in great shape today right? NOT! IT'S TIME TO PUT ALL THAT B.S. ASIDE AND BECOME RESPONSIBLE FOR YOUR FUTURE. PERIOD END OF STORY. ihope, you're "philosopy" stinks and gets you and yours NOWHERE but a butt load of excuses.

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Bulldawg 11 months, 4 weeks ago

That is the biggest bunch a %^*() that I have ever heard. You cannont blame slavery in Albany as the cause of its current condition today. If you logic were true, than Atlanta would be poorer than Albany because Atlanta had more slaves. You need to check your facts.

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Abytaxpayer 12 months ago

"This is not a fly-by-night decision" Nope in The Thug Life City it makes sence to spend $10.6 million to upgrade a $2.5 million complex. More than $100,000.oo per unit, the givemedats are living better than the taxpayers.

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Ihope4albany 11 months, 4 weeks ago

Remember, it is HUD, the government, with these policies. Go talk to them about why they have continued to make blacks a permanent underclass so that there would be government jobs!

If government breeds givemedats so that they NEVER live better than others because that is what happens. If you think by any stretch of the imagination that being in bondage to government is living better, I hope that I always stay away from receiving government chains through penny handouts that destroy one's sense of self efficacy.

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FryarTuk 11 months, 4 weeks ago

Free education, food stamps, free medical services, government sponsored child care, plus, plus, plus. There are no excuses for not making something of themselves. Get off ya' buts.

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Bulldawg 11 months, 4 weeks ago

Like Fryar said, free everything is real "bondage." Ihope4albany, what color is the sun in your world?

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Sister_Ruby 11 months, 4 weeks ago

I expect it's purple and gold. Right? And he/she must teach Liberation Theology at a nearby University.

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Wryone 12 months ago

This is lunacy, there is no connection to reality anymore. Albany must be proud!

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Sister_Ruby 12 months ago

This is the same logic used by the renouned Super Genius Nancy Pelosi when she argues that giving out extended "Unemployment Benefits" actually makes money for the government.

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WeAreThey 12 months ago

Low-income housing projects are big For-Profit businesses. This complex is no longer owned by the church but by a separate LLC. Over 30% of the costs of this project are 'soft' costs? What- like consulting fees and salaries? A $4.5 million renovation project is now over $10 million? Yeah, this outfit should continue paying property taxes.

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dingleberry 11 months, 4 weeks ago

In 2011, only $36,000 came from rent of 98 units, an average of $367 per unit per year. About $741,000 came from government subsidies, $7,561 per unit per year. Shows who really pays for the units. doesn't it?

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Sister_Ruby 11 months, 4 weeks ago

Yes, dingle. Thanks for shining a little light into bung hole of ingnorance.

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rightasrain 12 months ago

Mr. Ballard, why would it become the city's responsibility to "find" housing for these residents? Also, once this group is approved as a non-profit entity and gets their coveted "tax exempt" status, not only will they (as you say) receive a refund on taxes paid, but will no longer be on the tax digest and this will come back to screw the taxpayer. Spin it any way you want, it's the taxpayer that will once again be hit for the loss of "investment money" and tax dollars. Albany is a haven for sluggards, thugs, and pansy politicians.

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whattheheck 11 months, 4 weeks ago

It's our responsibility because the city wants it to be. There is a conflict of interest within the city as it relates to the DCED. DCED salaries are paid with administrative fees taken off the top of all the federal CDBG and Home funds. DCED has to pimp projects to stay in business.

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Ihope4albany 11 months, 4 weeks ago

For those who don't know, most progressive cities pay for their departments of community and economic development. Here in Albany, the DCED is not funded by the General Fund!!!

Also, check out the 2025 Comprehensive Plan for Albany-Dougherty or any comprehensive plan. You will see that quality and affordable housing is one of those areas that government supplies to have a viable city.

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FryarTuk 11 months, 4 weeks ago

Ihop said: " check out the 2025 Comprehensive Plan for Albany-Dougherty or any comprehensive plan."

If you think you can depend on the government for personal financial security, I suggest you review at least 2 things:

1 - The Native American Indians' plight since signing treaties with USA;

2 - Obi Wan's throwing Senior Citizens under the bus to help pay for the profligacy of a welfare cult and politicians.

Keep in mind that both victim sets here are paid up owners.

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Ihope4albany 11 months, 4 weeks ago

Sherwood, the multimillion dollar, mega church does not pay taxes on all of its church and subsidiary affiliate property! Fair is fair.

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FryarTuk 11 months, 4 weeks ago

And they should! All churches and charitable organizations should pay taxes just as other private businesses and citizens. They consume public services and they should pay. As Jefferson said when vetoing the AR widows pension bill "Equal rights for all, special privileges for none"

Maybe someone else said it differently when asked about paying taxes: "Render unto Caesar the things which are Caesar's, and unto God the things that are God's"

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agirl_25 11 months, 4 weeks ago

rightasrain..how many of those sluggards, thugs, and pansy politicians of whom you speak do you think benefit from the....ermm..."affordable housing" being given such a generous free ride?

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Sister_Ruby 12 months ago

"We're talking about a group that has maintained and managed that property successfully for more than 30 years," Assistant City Manager Lonnie Ballard said.

I could do pretty good, too if I get millions of dollars of cash influx every few years from federal, state, and local sources. I could do real good. I might even be able to afford to drive a high end BMW or Mercedez-Benz. I wouldn't touch a Jaguar, though. It depreciates much too fast. Of course, who cares since I'll be getting a few more million in a couple more years.

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agirl_25 12 months ago

A few weeks ago I was driving thru a south Georgia county and saw a road sign that read "Pizzpoor Road". I bet if you wanted to you could use it somewhere in Albany since it sounds like that is what the place is becoming with all this "housing" that the taxpayer is providing.

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erock 12 months ago

Pay attention to whos scratching each others back, ask direct questions, not during city meetings but when you see them on the street. Take pictures, watch them, nothing makes them squirm like a strange set of eyes on them. Start investigating some of these fly by night churches that pop up like mushrooms after a rain." God bless you all but most of all send your money."

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Sister_Ruby 12 months ago

Take pictures of the automobiles these so-called "consultants" ride up in and post them for us, will ya?

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SMHgain 12 months ago

Any institution that is "tax exempt" should also be exempt from receiving taxpayer dollars for any type of funding.

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bigbob 12 months ago

This is the smartest comment i've seen in a long time. Thank You, SMH

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Wryone 12 months ago

For the past 20 years or so, Albany has strived to become "Lil 'Lanta"...sure looks like it succeeded.

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Sister_Ruby 12 months ago

I think of it more as "Lil College Park"

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RedEric 12 months ago

Yeah! 10.5 million for a 2.5 million dollar property that wouldn't cash flow as is. They asked for a forgiveness of part of the debt. Rent won't go up as it is price controlled. So, how can this even be considered a wise investment? It isn't. It will go to the taxpayers to cover this boondoggle.

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Oldguy 12 months ago

That amounts to almost $11,000.00 per unit !!! What the heck are they planning on doing? If every unit rented for $500.00 per month that makes it almost 2 years to break even on this investment. I do not know what they rent for so I am just guessing on that. Are all units occupied full time? Seems to me there are a lot of questions going unanswered. Typical Albany, let's just spend a bunch of money uselessly, the taxpayers can handle it !

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Sister_Ruby 12 months ago

Oldguy, re-do your math son. That's almost $110,000 per UNIT!! How old are these units? How many years did it take to destroy them to the point that they needed refurbishment (if in fact the do NEED it versus just looking for a new influx of government money.....)?

New luxury imports for the team! YAAAYYYY!!

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Oldguy 11 months, 4 weeks ago

You are correct $110,000.00 per unit, those pesky decimal points mess me up. That makes it even more unbelievable. I could tear down my house and build a new one for that amount. As Charley Brown would say GOOD GRIEF.

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Sister_Ruby 12 months ago

Is anybody else but me concerned about the word "OWNER" in the picture of the sign that says "Bethel Housing Complex.........Bethel AME Church Owner" ???

Say WHAAAAATTTTTTT?????????

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dingleberry 11 months, 4 weeks ago

It's the same situation as with Cutliff's non-profit housing arm and Cutliff Church. Quite common these days as one of the government's "faith based initiatives", another name for the same old scam.

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dingleberry 11 months, 4 weeks ago

In 2011, only $36,000 came from rent of 98 units, an average of $367 per unit per year. About $741,000 came from government subsidies, $7,561 per unit per year. Shows who really pays for the units. doesn't it?

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Sister_Ruby 11 months, 4 weeks ago

Yes. Shine that light down the bung hole of Ignorance!

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whattheheck 11 months, 4 weeks ago

"For these residents, there's a renewed sense of pride when they see the work that will go into this renovation project," the Community and Economic Development director said.

Never have so many had such great opportunities to renew their pride. I hope they are proud, there is no pride among the taxpayers as the lifeblood of the city is being sucked out housing project by housing project. If you ever wondered why poverty in Albany is on a historic rise, look no further than this incubator.

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Cartman 11 months, 4 weeks ago

Unbelieveable. How stupid do you have to be to serve as a "city official" that would approve this? Is there no accountability at all?

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whattheheck 11 months, 4 weeks ago

"Recipient communities may undertake a wide range of community-based activities directed toward neighborhood revitalization, economic development, and community services, facilities, and improvements. Entitlement communities develop their programs and set their funding priorities in conformance with the statutory standards, program regulations, and other federal requirements."

The entitlement designation means that we can request and use HUD funds with more ease--there is no magic to the designation other than we do what we want with less involvement with others like with those that get the funds through the state.

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FryarTuk 11 months, 4 weeks ago

So with the renovation expense of $100 K per unit the tax evaluation should rise dramatically with improvements. On 100 units @ $100,000 should be about $10 million at tax formula should be about $90K to $95K per year. Go Denver! Re-evaluate those things. Get the cabbage in the coffers, ole Postell and the Piker can spend it.

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Thurman 11 months, 4 weeks ago

What entity states that we "must" provide anyone, for any reason, low cost housing? What would happen if the City of Albany just started saying "NO"-we will not fund anymore housing projects--PERIOD? It's probably not legal, but should be, to tie occupancy of low income, local government owned/operated housing to having a job and passing a random drug test.

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Oldguy 11 months, 4 weeks ago

They seem unconcerned since a bunch of the money is coming from state and federal funds. Where did those funds come from, TAXPAYERS !!!!!

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bigbob 11 months, 4 weeks ago

This is a great example of whats wrong with Albany. The great leaders (lol) want to give money to low income housing while closing schools because there is no money to keep them open. As long as the leaders are more worried about the intitlement group than the school kids agony is what you get.Just think YOU elected these fools.

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oldster 11 months, 4 weeks ago

The dust has not yet settled from the loss of taxpayers money in the Cutliff Grove mistake. Now here we are considering giving money for another housing project?

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Bulldawg 11 months, 4 weeks ago

I wonder if Christopher Pike ever paid his debit to the Hilton Garden Inn? That would be interesting to know.

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