Senior project inches forward

A proposal for senior citizen housing on the site of a former Houma school, while moving ahead, is still not a done deal.

Developers and parish officials who favor the project say they are hopeful a complex series of financing hoops can be jumped, now that the Terrebonne Council on Aging has tentatively agreed to kick $5.5 million toward the deal from their tax-funded coffers.

But TCOA’s cooperation – so far in the form of a promised letter of intent – is still dependent on a favorable opinion from the Louisiana Attorney General, who has been asked whether the action is in accordance with law. And despite a majority vote by the all-volunteer citizen panel that manages the Council to move this far, concerns linger as to whether it is in keeping with the agency’s mission statement. There are also questions about how the project will affect TCOA’s pre-existing plans, which include a senior housing campus in northern Terrebonne as well as a day-care center for seniors being tended to by their working children.

Interviews and examination of records related to the project reveal bitter behind-the-scenes dialogues both in and out of the TCOA, and an unusually candid peek at a most basic government process, the distribution of finite resources to competing interests hungry for increasingly scant social services.

Parish President Michel Claudet, whose Feb. 19 pitch to the TOCA board was criticized as overly aggressive, stands by his zeal.

“These individuals have a proven track record,” Claudet said of the Renaissance Neighborhood Development Corporation, the New Orleans non-profit that will renovate the old Houma Elementary School and a related structure at Point and Grinage streets, as well as add a third. “It will be a beautiful $20 million development which includes historic tax credits from the renovation that will enhance our downtown and uplift the area as well as provide very needed elderly housing.”

Pressed by a hard deadline for the state tax credits the developers need to make the plan workable, Claudet approached TCOA, seeking money derived largely from a recently-renewed 7.5 mil tax, with no solid promise to the agency of financial return or pay-back.

Thomas Guidroz, a retired Air Force fighter pilot, is among board members with continued reservations about the project.

“It’s a good program for the parish but not with Council On Aging money,” Guidroz said, noting a small percentage of extremely low-income seniors will be approved for the 103-apartment project. “I hope there is some way to get out of this because some of the board is now better educated and don’t want to do this. We got bamboozled.”

The Council on Aging, Guidroz said, can house more of the neediest seniors in the parish with its own planned housing development in Schriever. The developers and a core group of supportive board members, however, say closer examination of relative income studies on seniors should allay those concerns.

DOLLARS AND CENTS

If Claudet’s pitch appeared last-minute and highly pressurized, it is because the project initially was not intended as senior housing, so the Council on Aging was not party to it when Terrebonne Parish first sought proposals from developers in October.

It was only when the developers were unable to secure state grant money derived from a federal program that a $5 million-plus gap in the funding scheme became visible. That’s when a buy-in from the TCOA was sought, with the provison that the project, initially billed as “work-force housing,” would instead be dedicated to seniors.

That’s because senior housing allows more of the tax credits that would make the project palatable for financiers, coupled with other tax-credit incentives already in place.

“In the tax credit application at the state level there are extra points if you are doing elderly housing,” said the parish’s housing and human services director, Darrell Waire. “It gives you a better shot if what you are designing is for the elderly, so Michel (Claudet) had asked RNDC to be sure and look at that. They did a market study to see it if would be feasible. We knew TCOA had some funds that maybe could be used.”

The proposed deal is for RNDC, which is already building lower-income housing on a Bayou Cane site, to obtain $11.5 million from investors, whose reward will be the tax credits.

RNDC is affiliated with the Volunteers of America organization, which has been involved with affordable housing programs nationwide for years.

The New Orleans developer for RNDC, Victor Smeltz, has noted cobbling together complex deals for affordable housing in an atmosphere of shrinking government grants is an area in which his organization and its parent possess great expertise.

According to the proposal advanced by Smeltz, conventional financing from local banks will account for about $2.5 million. The remaining $5.5 million gap would have been plugged up with $5.5 million in federal Community Development Block Grant money issued through the state, possibly left over from other projects.

But RNDC’s Smeltz said money could not be marshaled.

That’s where the request of the TCOA comes in.

The total $19.5 million budget would buy apartments with a mixed-income rent schedule. Five of the apartments would be dedicated to the poorest of the poor and rent for $155-159 per month. Another 57 apartments would be reserved for people whose incomes are 60 percent of the parish’s median income or lower, renting for $565 to $600 per month. A total of 41 apartments would have no income restrictions and would rent for $800 per month.

SHAPE-CHANGING PROPOSAL

The project had its roots in a turnover of the old Houma Elementary School site at Point and Grinage streets to the parish from the Terrebonne Parish School District. The historic main school building and an adjoining structure was, by virtue of an old agreement, to become parish property if the district no longer needed or wanted it.

A Request For Proposals, known in government vernacular as an RFP, was issued Oct. 31, 2014, and newspaper ads were run daily for a week after that, according to records.

“The Terrebonne Parish Consolidated Government (TPCG) is offering the historic Houma School building and grounds … for redevelopment into multi-family rental housing targeted to the local workforce,” the RFP states. “TPCG’s objective is to provide attractive, quality housing affordable to households earning less than 80 percent of Area Median Income. The project selected should reflect current sustainability and universal design standards and designed to be comparable and competitive with recently developed market rate apartments. TPCG seeks to maximize the number of units on the site while remaining sensitive to the historic character of the area.”

Despite the required publicizing, only RNDC came forward with a bid.

A Houma developer, Jim Erny, said he would have likely bid on the project had he been aware of it.

The parish made clear in its RFP that no local government money was available for the project, but additional tax credits available through the state for senior housing held a door open for success by the developer.

LAYING ON THE ARM

That the TCOA has what appears to be surplus money is not a secret.

A January audit drew criticism from state officials that the TCOA had too much money without required dedication in its accounts.

The Louisiana Legislative Auditor recommends that governmental entities maintain three to six months of their expenditures in the bank, but the Terrebonne Council on Aging has three times that — $15 million.

“I see them holding more money than I expect to see,” said Joy Irwin, director of local government with the State Legislative Auditor. “I would ask why they’re holding so much money.”

Claudet mentioned the audit in his initial appearance before the board, a topic the body was already sensitive to.

“There are a number of articles that appeared recently that have not been in the best interests of this body,” Claudet said. “The people in the parish have entrusted you with money for elderly affairs. We are fulfilling our mission by utilizing these funds.”

Discussions with board members indicate that they felt like lottery winners put upon by needy relatives once their good fortune was disclosed, and that they saw the pitch as a raid on their accounts.

Executive director Diana Edmonson had maintained that the money was not surplus at all, and that rolling 5-year plans for the agency, which provides meals, transportation, medical assistance and housing to elders accounted for the perceived surplus.

So sensitive was the board to the criticism in January that they recently authored a resolution declaring news coverage of the audit to be unfair.

But Claudet said that coming to the TCOA under such circumstances was logical, and he had difficulty understanding why anyone on the board would oppose contributing money to the proposed project.

RELUCTANT BOARD

Board members said that they were bound to ask about a return because the money they have primarily comes from a 7.5 mil tax recently re-approved by voters. There were also concerns expressed about how the council would be involved in terms of running programs at the apartment site, or indeed if they would have a hand in running the apartment themselves.

“It is good for the community, it is good for the entire parish,” said Claudet in response. “If we did that in parish government, where we had to have a return or some gain, we wouldn’t be doing most of the things that we do,” Claudet pleaded.

The council’s Capital Outlay Committee had already advised a thumbs-down on the project, fueling some of the rancor from board members.

In particular, that committee had advised rejecting the parish proposal and a focus on the potential for elder housing in Schriever. But a cost for the land itself, later board discussions revealed, had not yet been determined.

At a Feb. 23 board meeting Smeltz got a chance to answer questions directly, and he focused on giving detailed information rather than pitching or pleading. He made even more clear a message already delivered by Claudet, that the deadline for needed tax credits upon which financing depended would run out soon.

When the board met again on March 3 a vigorous 90-minute discussion ensued. One of the most vociferous questioners of the proposal, board member H. Rene Rhodes, who seemed a likely opponent when the time came to vote, was among those who ended up supporting a forward move.

A total of seven board members voted favorably on a motion by Natalie Bergeron, who was also a critic of the project, to move forward in favor of TCOA investing in the proposed Houma Elementary School Project, subject to legal and audit review prior to the final intergovernmental agreement with TPCG, TCOA and the Volunteers of America (RNDC).

Two board members voted against, one abstained and one was not present.

ACCUSATIONS

Controversy continued, even after the March 3 vote, outside the TCOA headquarters on Tunnel Blvd.

A Terrebonne Parish ranking sheriff’s deputy and contender for the then-open position of Terrebonne Parish Registrar of Voters, Shane Fletcher, sent a letter to the District Attorney and various media outlets.

He accused Natalie Bergeron, another Registrar contender, of currying favor with Claudet “by changing her vote,” suggesting inappropriate conduct and potential violations of law.

Claudet has since affirmed that he was in no way involved with anything having to do with the Registrar selection. Local law enforcement and prosecutors have since effectively dismissed Fletcher’s allegation. They note that Bergeron did not get the Registrar position, making the allegation particularly difficult to prove.

MOVING TOWARD ACCEPTANCE

The TCOA’s director, Diana Edmonson, appears to be more accepting of the proposal, to which she had first displayed resistance as well. The deal, she noted, is still a work in progress.

“So there’s no money out the door nor will there be any money out the door anytime soon,” Berwick Duval, attorney for the TCOA said of the council’s $5.5 million.

The tax credit filing deadline, meanwhile, has been rescheduled by the state to April 14th.

“We do have a couple of tweaks we’d like to make to it,” Smeltz said last week regarding the deal. “But everything else is on track and we’re ready to go with that. Unfortunately, it does push the schedule back about a month because it will take them a month longer to announce the awards. But it’s all coming together very nicely.”

One of the biggest objections to the proposal had come from questions about whether the concept of the site being exclusively for seniors.

But Claudet, Smeltz and other supporters say that restricting tenancy to seniors is a key component of tax credits now sought for investors.

Still, all involved acknowledge, work remains to be done if the project is to move from concept to reality.

“Our piece is only a small piece of the project and so it’s contingent upon the Renaissance people getting the rest of the money for the project within a certain timeframe,” said Duval, who represents the TCOA. “If they don’t, then our commitment is dead. If they do that, construction begins by a certain timeframe … So, there are certain timelines that if they fail to meet them there’s no commitment. And that, we being the Terrebonne Council on Aging successfully negotiate a cooperative endeavor agreement with the Terrebonne Parish Consolidated Government, that’s a condition before the money goes out the door.”

Houma ElementaryFILE PHOTO