Fayetteville Housing Authority followed federal rules in land transaction, HUD says

Posted: August 9, 2017 at 1:08 a.m.

NWA Democrat-Gazette/ANDY SHUPE Morgan Manor, operated by the Fayetteville Housing Authority, is seen June 22 on 12th Street in Fayetteville.

FAYETTEVILLE -- A proposed expansion at Morgan Manor doesn't violate a city ordinance or state or federal statute, according to a U.S. Department of Housing and Urban Development response to an inquiry from the city attorney.

The development plan meets the city's minimum standards as outlined in the unified development code, including not creating or compounding a dangerous traffic situation. The state Supreme Court says denying a plan meeting minimum standards is arbitrary, according to City Attorney Kit Williams.

Meeting

What: Fayetteville Planning Commission

When: 5:30 p.m. Monday

Where: Room 219, City Hall, 113 W. Mountain St.

"Because of HUD's response, my previous concern that there might be a law violation tied to this proposal for large-scale development -- I have to withdraw that now," he said. "Apparently they have complied with everything that HUD has requested."

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The plan in front of the Planning Commission for two months would add 58 units on unused acreage at Morgan Manor, 324 E. 12th Place. The Housing Authority operates the 52-unit complex under a form of Section 8 called the Rental Assistance Demonstration program. The program combines public and private equity to provide rental assistance to low-income residents.

Residents living in public housing at the 40 units of Willow Heights, 10 S. Willow Ave., could move to Morgan Manor. The Housing Authority has applied for a tax credit to help pay for the project, along with selling the Willow Heights property.

Local electrician Vlad Tatter and his business partners have agreed to buy the property for $1.25 million and build homes. HUD has to approve the sale. Housing Authority officials have said Willow Heights needs extensive repairs and renovation, sitting on an unstable foundation with waning federal money to address the issues.

The item has remained on the table while Williams awaited the response from the federal agency. The Planning Commission on Monday will remove the proposal from the table and discuss it. Williams advised commissioners in a memo they cannot legally consider the wisdom of the proposal.

"The Planning Commission has no power or authority to question the property owner's rationale or reasons supporting its development decisions," Williams wrote.

The move has become a source of controversy for several south Fayetteville residents. Outspoken critics have questioned the need for the proposal, isolating low-income residents at one site, the connectivity of the Morgan Manor property and other aspects.

Jessie Cassella, staff attorney with the National Housing Law Project, said the process to move residents from one property to another and sell the old land, known as the transfer of assistance, raises concerns. HUD has certain requirements, but what residents want sometimes gets lost in the shuffle, she said. The project is a nonprofit center that advocates for fair housing.

For example, a fair housing review says the new property shouldn't lie "significantly far" from the original site, Cassella said. Also, only three meetings with affected residents are required between the time a housing authority is thinking about applying to the Rental Assistance Demonstration program and the official conversion, she said.

"For these types of situations, especially where fair housing is at risk particularly for folks who are members of protected classes based on their race or ethnicity or age or things like that, certainly HUD should be doing more to make sure there are enough protections for those tenants," Cassella said.

Deniece Smiley, Fayetteville Housing Authority director, said the Morgan Manor project has followed federal requirements, including paying for tenants' moves and getting a fair housing review.

"I was confident that we had followed all the rules and we were in compliance," Smiley said. "So, I was pleased with the response."

NW News on 08/09/2017