Housing project is dealt setback

An application for $17-million to $25-million in tax credits to raze and rebuild Ponce De Leon Courts and College Hill Homes is rejected.

By WAYNE WASHINGTON

© St. Petersburg Times, published May 5, 2000

TAMPA -- The financing for a massive public housing project in east Tampa was dealt a setback Thursday when a bid for up to $25-million in tax credits was rejected.

The project's developer, Marlton, N.J.-based Michaels Development, and the Tampa Housing Authority submitted a joint application in March to a state housing agency for tax credits with a value of $17-million to $25-million.

Sold to investors, money generated by the credits was to be added to the $32.5-million federal grant being used to raze and rebuild Ponce De Leon Courts and College Hill Homes, two of Tampa's most dilapidated public housing projects.

Work has already begun on the project, and large portions of Ponce De Leon have been torn down in anticipation of the rebuilding.

Despite the tax credit rejection, Housing Authority Executive Director Jerome Ryans said Thursday that work on the project will continue. The application, he said, was rejected because of a technicality over title insurance that can be corrected. "It's not a done deal at all," he said.

Ryans said the authority will appeal the decision.

There are more public housing projects in the state vying for tax credits than there is money to go around. And the Florida Housing Finance Corp. reviewed applications for the credits and ranked the projects.

Projects in Dade, Palm Beach and Polk counties are listed on the finance agency's Web site as ranking higher than those in Tampa and St. Petersburg.

The appeals process promises to be a political dogfight, as housing authorities and developers can not only point out overlooked aspects of their applications, but also can tell the finance agency about problems in competing applications.

The initial rejection of the application in Tampa sets the stage for a possible dispute between the housing authority and the developer.

The housing authority selected Michaels Development despite concerns by some housing authority board members that the decision was being rushed. Housing authority officials insisted it was critical to push ahead so the authority and the developer could submit a joint tax credit application.

To cement its selection over rival development teams, Michaels verbally promised to make other financial arrangements on its own if the tax credit application was rejected.

That may be an expensive promise. No one from Michaels could be reached late Thursday.

At the time, Michaels president Robert Greer was optimistic the application would be approved.

"Florida may be a tough state with tax credits, but the requirements are the same across the country," Greer told housing authority board members as they debated which development team to select. "We know what we're doing. We've done it over and over."

Housing authorities are new players in the battle over tax credits, which typically have been awarded to private developers rather than public housing agencies.

St. Petersburg and Tampa housing officials fought to convince the state finance agency that housing authorities and their massive projects should get serious consideration.

Tampa is rebuilding Ponce De Leon and College Hill Homes with a $32.5-million grant from the Department of Housing and Urban Development. St. Petersburg got a $27-million grant to do the same at Jordan Park.

St. Petersburg officials said Thursday their project won't be stopped because of the initial rejection of their tax credit applications.

A final decision by the state finance agency on which projects get the tax credits won't be made until September.

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