DVCRFCLI at aol.com
02-28-1995, 09:27 PM
[from DVCRF's "Reinvestment News"]
THE STUFF THAT DREAMS ARE MADE OF: ST. BARNABAS CIRCLE
The lion's share -- more than 60% -- of DVCRF's lending supports affordable
housing. Every project began as a glimmer in the eye of a dedicated person,
who shared and sold the vision until new homeowners unpacked their belongings
and made their houses into homes.
Some dreams take longer to fulfill than others. On Memorial Day week-end,
five families moved into new colonial homes on St. Barnabas Circle, a
remarkable glimmer in the eye of Rev. Al Krass of United Christian Church in
Levittown since 1987.
Is the dream that inspired Levittown -- the first affordable suburban tract
housing in the nation -- alive or dead? This question plagued Interfaith
Housing Development Corporation (IHDC) as it struggled to develop the
Barnabas project. Reflecting on the issues that made the Barnabas developers
look like clones of Job points to the challenges of suburban affordable
housing development in the 1990s. DVCRF and its technical assistance arm,
CDI, labored alongside IHDC.
NIMBY diverts Energies
A founding premise of IHDC, a coalition of more than 22 church organizations
in Bucks County, was that all member churches would seek donations of land
for new housing development. The first church to participate was the United
Church of Christ in Levittown, which donated three acres in 1987.
St. Barnabas Circle takes its name from St. Barnabas, a leader in the early
church. When he decided to follow Jesus, Barnabas donated land he was not
using so that the proceeds could be used by the apostles to meet the needs of
God's people. The name Barnabas means "The One Who Encourages Others".
Discouraging, however, was the NIMBY -- Not in My Backyard -- syndrome that
threatened Barnabas from the outset. At one township hearing more than 300
angry neighbors protested the plans to build new ranch homes for moderate
income families. Fearful neighbors, worried about property values, spread
anxiety about "career welfare recipients," despite IHDC's assurances about
the planned homes.
What happened? "Design a community outreach and public relations strategy at
the same time you create the building designs and the budget would be my
advice now," says CDI's Joe Killackey, who provided technical assistance to
IHDC from the beginning. "I think people pictured high rise, run-down
apartments and assumed that IHDC would bring a so-called bad element into the
neighborhood."
Even though zoning approval was not needed for the site, angry neighbors
organized to prevent IHDC from receiving the necessary permits to build.
Bristol Township Planning Commission rejected its plans as did Township
Council. IHDC made the difficult decision to take the issue to court.
Families needed housing and the dream which built Levittown was worth a
fight. In 1991, Bucks County Court ruled that IHDC could continue. IHDC
altered plans to meet the neighbors' concerns and to secure the necessary
permits. Winning county support early helped save St. Barnabas Circle, and
should be a priority for developers of new projects. In New Jersey, the
"Mount Laurel decision" (NJ Supreme Court) mandates that every town must
provide affordable housing. A similar Pennsylvania mandate would have saved
countless hours for IHDC.
Breaking Ground
Ready to build, and with a growing list of eager homebuyers, IHDC cast aside
legal documents and returned to blueprints and budget pro formas in 1992. CDI
stepped up its involvement, focusing on providing project finance coaching
and construction management to IHDC. "We reduced the number of units from
eight to five to comply with the permits, which completely changed the
budget," says Killackey. In the end, the five homes cost a total of
$580,000 to build, including sidewalks, curbs, sewers and streetwork.
Building only five houses meant that IHDC couldn't afford to hire a general
contractor. Therefore, IHDC brought in a construction manager who hired
various local sub-contractors. Since IHDC cut its teeth on rehabilitating
dilapidated homes, largely with volunteer labor supplied by its member
churches, it didn't have relationships with the tradespeople it now needed.
CDI's construction management services were an instrumental factor in helping
IHDC branch out into the construction of new houses. "It's new terrain to
navigate, and CDI helped us considerably," said IHDC's executive director,
Catherine Washington.
The dearth of new affordable housing in the suburbs also meant that most
architects active in Bucks County had little relevant experience. The
initial blueprints were aesthetically wonderful, but they weren't feasible
for the income of the families IHDC wanted to house. Numerous and expensive
windows, decorative trim and an impractical kitchen design had to be altered.
DVCRF Provides a Flexible Solution
While CDI's Lee Casper concentrated on the construction management, Joe
Killackey helped IHDC make the numbers work. "We wanted to reach families
who earned 80% of median income, yet rental housing in Bucks County is so
expensive we knew that down payments would be a real problem," recalls
Killackey. The Pennsylvania Housing Finance Agency (PHFA) had just crafted a
lease-purchase program, dedicating $15 million so Pennsylvania residents who
lack money for down payments and closing costs can purchase homes with as
little as $1,000 up front. Interfaith became one of the first two organizatio
ns to participate in this pilot project. PHFA agreed to provide all the debt
financing required, and with excellent terms.
Yet some of PHFA's requirements, developed with large rental projects in
mind, appeared to be project-stoppers due to their underwriting requirements.
Killackey's job was to shave the square edges of IHDC's project to fit into
the round hole of PHFA financing.
DVCRF offered the solution: a letter of credit for $129,020 to PHFA.
DVCRF's first commitment of this type of financing, the letter of credit
replaced the performance bond usually required by PHFA. PHFA needed a
guarantee that construction would be completed within budget. Accepting a
letter of credit from a non-profit community development financial
institution was a first for PHFA, which was accustomed to working with banks
only.
DVCRF created a new loan product to make St. Barnabas work. Don Hinkle,
DVCRF's loan officer for St. Barnabas, remembers underwriting the unusual
structure: "We always say we believe in being flexible and meeting our
borrowers' needs. St. Barnabas required that we examine our rhetoric."
St. Barnabas Neighbors
IHDC demonstrated it could build lovely homes that quieted its critics. But
building homes is not the same thing as building community. A sense of
community comes from one's neighbors. During construction, several of the
families kept a constant vigil, stopping by on week-ends to track the progress
. In May, the children of the five new families planted flowers. Their
parents commissioned a cake decorated with the model of their two story homes
for the moving-in ceremonies. Donna Hollis, one new resident, started a
neighborhood newsletter. One of the children attends the nursery school next
door at United Christian Church. The families coordinated their Christmas
decorations. Their community spirit and warmth towards IHDC's staff and
board spills out at every public meeting, testament that the legacy of the
original Barnabas is being fulfilled.
Future Suburban Housing
IHDC, strengthened by the Barnabas experience, will now carry out new
homeownership projects. IHDC also hopes to collaborate with private
builders. Having worked successfully with the Pennsylvania Housing Finance
Agency prepares IHDC to obtain financing for future projects. St. Barnabas
Circle is clearly a showcase project.
Even so, new construction projects are difficult. A communication strategy
targeted at neighbors and local officials; favorable zoning and land use
rules; architects, builders and sub-contractors who know both the new
construction market and understand the cost issues with affordable housing;
appropriate construction financing provided by skilled personnel; and plans
which integrate families of various incomes are all fundamental ingredients
for success. DVCRF and CDI will keep working with our community-based
partners to smooth the road for affordable housing in all communities and for
families of all incomes.
********
About St. Barnabas homes.....
* 3 bedrooms with 1 1/2 baths; 2 stories; full appliances; one-car garage
* $78,600 purchase price; appraisal value is $130,000. The median new home
price in Bucks County is $159,900.
* $900 monthly payment, with escrow for down payment at end of lease period
* four person families earn between $28,000 and $37,000 (80% of median Bucks
County income)
************************************************
DVCRF, CLI and CDI can be contacted at:
924 Cherry Street
Philadelphia, PA 19107
(215) 925-1130 voice
DVCRFCLI@aol.com
************************************************
This post transferred from the cdb-l mailing list
THE STUFF THAT DREAMS ARE MADE OF: ST. BARNABAS CIRCLE
The lion's share -- more than 60% -- of DVCRF's lending supports affordable
housing. Every project began as a glimmer in the eye of a dedicated person,
who shared and sold the vision until new homeowners unpacked their belongings
and made their houses into homes.
Some dreams take longer to fulfill than others. On Memorial Day week-end,
five families moved into new colonial homes on St. Barnabas Circle, a
remarkable glimmer in the eye of Rev. Al Krass of United Christian Church in
Levittown since 1987.
Is the dream that inspired Levittown -- the first affordable suburban tract
housing in the nation -- alive or dead? This question plagued Interfaith
Housing Development Corporation (IHDC) as it struggled to develop the
Barnabas project. Reflecting on the issues that made the Barnabas developers
look like clones of Job points to the challenges of suburban affordable
housing development in the 1990s. DVCRF and its technical assistance arm,
CDI, labored alongside IHDC.
NIMBY diverts Energies
A founding premise of IHDC, a coalition of more than 22 church organizations
in Bucks County, was that all member churches would seek donations of land
for new housing development. The first church to participate was the United
Church of Christ in Levittown, which donated three acres in 1987.
St. Barnabas Circle takes its name from St. Barnabas, a leader in the early
church. When he decided to follow Jesus, Barnabas donated land he was not
using so that the proceeds could be used by the apostles to meet the needs of
God's people. The name Barnabas means "The One Who Encourages Others".
Discouraging, however, was the NIMBY -- Not in My Backyard -- syndrome that
threatened Barnabas from the outset. At one township hearing more than 300
angry neighbors protested the plans to build new ranch homes for moderate
income families. Fearful neighbors, worried about property values, spread
anxiety about "career welfare recipients," despite IHDC's assurances about
the planned homes.
What happened? "Design a community outreach and public relations strategy at
the same time you create the building designs and the budget would be my
advice now," says CDI's Joe Killackey, who provided technical assistance to
IHDC from the beginning. "I think people pictured high rise, run-down
apartments and assumed that IHDC would bring a so-called bad element into the
neighborhood."
Even though zoning approval was not needed for the site, angry neighbors
organized to prevent IHDC from receiving the necessary permits to build.
Bristol Township Planning Commission rejected its plans as did Township
Council. IHDC made the difficult decision to take the issue to court.
Families needed housing and the dream which built Levittown was worth a
fight. In 1991, Bucks County Court ruled that IHDC could continue. IHDC
altered plans to meet the neighbors' concerns and to secure the necessary
permits. Winning county support early helped save St. Barnabas Circle, and
should be a priority for developers of new projects. In New Jersey, the
"Mount Laurel decision" (NJ Supreme Court) mandates that every town must
provide affordable housing. A similar Pennsylvania mandate would have saved
countless hours for IHDC.
Breaking Ground
Ready to build, and with a growing list of eager homebuyers, IHDC cast aside
legal documents and returned to blueprints and budget pro formas in 1992. CDI
stepped up its involvement, focusing on providing project finance coaching
and construction management to IHDC. "We reduced the number of units from
eight to five to comply with the permits, which completely changed the
budget," says Killackey. In the end, the five homes cost a total of
$580,000 to build, including sidewalks, curbs, sewers and streetwork.
Building only five houses meant that IHDC couldn't afford to hire a general
contractor. Therefore, IHDC brought in a construction manager who hired
various local sub-contractors. Since IHDC cut its teeth on rehabilitating
dilapidated homes, largely with volunteer labor supplied by its member
churches, it didn't have relationships with the tradespeople it now needed.
CDI's construction management services were an instrumental factor in helping
IHDC branch out into the construction of new houses. "It's new terrain to
navigate, and CDI helped us considerably," said IHDC's executive director,
Catherine Washington.
The dearth of new affordable housing in the suburbs also meant that most
architects active in Bucks County had little relevant experience. The
initial blueprints were aesthetically wonderful, but they weren't feasible
for the income of the families IHDC wanted to house. Numerous and expensive
windows, decorative trim and an impractical kitchen design had to be altered.
DVCRF Provides a Flexible Solution
While CDI's Lee Casper concentrated on the construction management, Joe
Killackey helped IHDC make the numbers work. "We wanted to reach families
who earned 80% of median income, yet rental housing in Bucks County is so
expensive we knew that down payments would be a real problem," recalls
Killackey. The Pennsylvania Housing Finance Agency (PHFA) had just crafted a
lease-purchase program, dedicating $15 million so Pennsylvania residents who
lack money for down payments and closing costs can purchase homes with as
little as $1,000 up front. Interfaith became one of the first two organizatio
ns to participate in this pilot project. PHFA agreed to provide all the debt
financing required, and with excellent terms.
Yet some of PHFA's requirements, developed with large rental projects in
mind, appeared to be project-stoppers due to their underwriting requirements.
Killackey's job was to shave the square edges of IHDC's project to fit into
the round hole of PHFA financing.
DVCRF offered the solution: a letter of credit for $129,020 to PHFA.
DVCRF's first commitment of this type of financing, the letter of credit
replaced the performance bond usually required by PHFA. PHFA needed a
guarantee that construction would be completed within budget. Accepting a
letter of credit from a non-profit community development financial
institution was a first for PHFA, which was accustomed to working with banks
only.
DVCRF created a new loan product to make St. Barnabas work. Don Hinkle,
DVCRF's loan officer for St. Barnabas, remembers underwriting the unusual
structure: "We always say we believe in being flexible and meeting our
borrowers' needs. St. Barnabas required that we examine our rhetoric."
St. Barnabas Neighbors
IHDC demonstrated it could build lovely homes that quieted its critics. But
building homes is not the same thing as building community. A sense of
community comes from one's neighbors. During construction, several of the
families kept a constant vigil, stopping by on week-ends to track the progress
. In May, the children of the five new families planted flowers. Their
parents commissioned a cake decorated with the model of their two story homes
for the moving-in ceremonies. Donna Hollis, one new resident, started a
neighborhood newsletter. One of the children attends the nursery school next
door at United Christian Church. The families coordinated their Christmas
decorations. Their community spirit and warmth towards IHDC's staff and
board spills out at every public meeting, testament that the legacy of the
original Barnabas is being fulfilled.
Future Suburban Housing
IHDC, strengthened by the Barnabas experience, will now carry out new
homeownership projects. IHDC also hopes to collaborate with private
builders. Having worked successfully with the Pennsylvania Housing Finance
Agency prepares IHDC to obtain financing for future projects. St. Barnabas
Circle is clearly a showcase project.
Even so, new construction projects are difficult. A communication strategy
targeted at neighbors and local officials; favorable zoning and land use
rules; architects, builders and sub-contractors who know both the new
construction market and understand the cost issues with affordable housing;
appropriate construction financing provided by skilled personnel; and plans
which integrate families of various incomes are all fundamental ingredients
for success. DVCRF and CDI will keep working with our community-based
partners to smooth the road for affordable housing in all communities and for
families of all incomes.
********
About St. Barnabas homes.....
* 3 bedrooms with 1 1/2 baths; 2 stories; full appliances; one-car garage
* $78,600 purchase price; appraisal value is $130,000. The median new home
price in Bucks County is $159,900.
* $900 monthly payment, with escrow for down payment at end of lease period
* four person families earn between $28,000 and $37,000 (80% of median Bucks
County income)
************************************************
DVCRF, CLI and CDI can be contacted at:
924 Cherry Street
Philadelphia, PA 19107
(215) 925-1130 voice
DVCRFCLI@aol.com
************************************************
This post transferred from the cdb-l mailing list