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HomeMy WebLinkAbout1996-05-13 Reading Housing Authority Minutes - Executive SessionREADING HOUSING AUTHORITY Minutes of the Executive Session Meeting of May 13, 1996 An Executive Session of the Reading Housing Authority was held on Monday, May 13, 1996, the office of the Authority, 22 Frank D. Tanner Drive in the Town of Reading, Massachusetts. The Chairman, Reverend Robert K. Sweet, Jr., called the meeting to order at 10:15 P.M. on the following vote: Upon a motion duly made by Mr. Allen and seconded by Ms. Connors, it was unanimously VOTED: To adjourn to Executive Session at 8:45 P.M. to discuss real estate matters and possible litigation and to return to regular session upon completion, upon the following roll vote: Mr. Allen - aye Ms. Galvin - aye Ms. Connors - aye Mr. Kelley - aye Mr. Sweet - aye The Chairman then declared said motion carried and said vote in effect. Ms. Plansky, the Executive Director, was also in attendance along with the Authority's attorn Mr. Greco. Mr. Dolben, Mr. Ley and Mr. Latham representing the Dolben Company and Mr. Paul Kelley and Mr. Coote of the Reading Housing Partnership, also joined the Board in the Executive Session meeting. The Chairman reviewed the serious concerns of the Board regarding the pricing of the "like k and quality" affordable units. In providing the prices to the Board, Mr. Dolben did not excluc the cost of a garage, which was included in the market rate units. The Chairman stated that tr basic understanding of the Board was that the "like kind and quality" of market/affordable un was the basis of all discussions. The Board did not want to be responsible for putting the affordable purchaser at a financial disadvantage, especially in view of the presentations made this Board and based upon Mr. Dolben's promises, to the Partnership, the public and the establishment of the discount rate contained in the Deed Rider. The Chairman noted the concerns with the Hereford pricing along with the actual violations o the agreement: substitution of Unit #404 for #1014 without prior notification; and the RHA u was suppose to be in the first building delivered with an affordable unit. . The RHA will not receive their unit until the second delivery of buildings, - namely, on or about 8/15/96 instead 7/15/96. Both of these are clear violations of the Land Use Agreement between the parties. Mr. Dolben's attorney, Mr. Ley, stated that the 20% was not a figure that Mr. Dolben prc but was one established by the Authority, presented to EOCD and to the CPDC, and was at 5113196 Page 2 Executive Session - Minutes approved and distributed to the prospective affordable purchasers. Mr. Ley stated that the price of the Arlington units were fixed and were based upon what a person at 100% of median could afford to pay for their fixed housing costs. Mr. Ley stated that it did not matter whether the market rate units went up or down in value as the affordable units were not tied to that. Mr. Dolben stated that the garages for the affordable units were negotiated out of the discussion early on in the negotiating sessions. The prices quoted to the Board always contained the price of a garage and he was sure that the Board understood that. The Authority stated the sentiment was clear from all of the Board members that the presentations made to them on record, the support that was given to the project at the CPDC hearings, and the presentations made to the Partnership and the public were all given based on the validity of the figures presented to the Board throughout their discussions for "like kind and quality" units. There was some evident frustration from the Authority due to the fact that the figures for the affordable units remained fixed while the design, size of units and the size of the project, along with the amenities of the development changed, and yet the developer failed to either inform or renegotiate the price for the affordable units. The discussion then focused on the adverse financial impact to the first time buyer. The presentation was based upon the analysis made by Mr. Allen. Mr. Latham stated that the prices were fixed based on a development of 160 units. When CPDC changed the size of the development to 132 units, then the project was in jeopardy and had to be reworked. Mr. Dolben stated that there were not enough garages for all units constructed. No market rate Hereford style unit has a garage. There are only five extra garages available for sale. This did not include the 4 garages with the "affordable" units. Mr. Coote, member of the Reading Housing Partnership,. stated that Mr. Dolben was present at the public informational meeting and was aware that the prices quoted to the prospective purchasers were for "like kind and quality" units. Mr. Coote was upset that Mr. Dolben knew that there was a difference and did not either clear it up or make a proper presentation. Mr. Kelley, Chairman of the Partnership, said that the discussions with the Authority were difficult and somewhat confusing, but what his issue was is simple. The figures that Mr. Dolben faxed to Mr. Kelley were for the market rate prices of the Arlington and Hereford units. The fact that he did not disclose that these units contained a garage, valued at $8,000- 10,000, exposes him, the Partnership, the Town and the Authority to a 93A claim by the purchasers. The Partnership felt that this was a serious legal issue and had to be addressed. Mr. Ley asked the Chairman of the Authority what the issue was: legal or integrity. Mr. Sweet said that both of the issues were critical and must be resolved. Mr. Dolben agreed to look at S/1 Executive what he could do to ameliorate the problem and promised to get back to the Board no later th May 31, 1996. He stated that he had a new set of underwriters and had to discuss the issue w �-t h all parties concerned. The Board thanked Mr. Dolben and his associates for attending the meeting and expected to hav, a proposal from them by Friday, May 31, 1996. The Board then discussed the issues: there is confusion in the representations made by Mr. Dolben to the Partnership; there is confusion in the representations made by Mr. Dolben tot ie Authority; there is confusion in the representations made by Mr. Dolben to the public in the informational meetings for the lottery participants. Is this just confusion or something else? Upon a motion duly made by Mr. Allen and seconded by Ms. Connors, it was unanimously VOTED: To approve the distribution of a letter to all lottery participants revealing the fact that the price at which a lottery purchaser bought a unit may not be 20% less than what an affordable purchaser would have paid at the same time. The Chairman then declared said motion carried and said vote in effect. Mr. Sweet asked that Mr. Greco review the letter before distribution and the proposal when t is received. There being no further business before the Board, it was unanimously voted to adjourn and reconvene in regular session at 10:15 P.M. Respectfully submitted, Margaret , . Plansky, Secretary and Executive Director