Habitat gets nod towards $860k funding

Habitat gets nod towards $860k funding

BY PRU SOWERS

KONK LIFE STAFF WRITER

Barely one month into the new fiscal year, Key West City Commissioners have made recommendations that would eat up almost half of the $2 million the city receives annually from the local bed tax designated for affordable housing.

Monroe County collects a 12.5 percent “bed tax” added to local hotel and short-term vacation rental bills. In the 2015-2016 fiscal year, the city collected approximately $20 million. About $2 million is allocated back to city for the development of affordable housing and is distributed by the Monroe County Land Authority, according to city Finance Director Mark Finigan.

Commissioners voted 6-1 on Nov. 15 to recommend to the Land Authority that it approve $860,000 for three projects proposed by Habitat for Humanity of Key West and the Lower Florida Keys, Inc., “for the purpose of protecting and building workforce and affordable housing units.” The three projects include $400,000 to build three workforce units at 1116 Truman Ave., $60,000 to reconstruct a private home at 209 Oliva St., and $400,000 to pay off the mortgage on an existing 12-unit workforce housing complex located at 716 Eisenhower Drive.

That last project was the source of some concern from commissioners, including Margaret Romero, who said the city would receive no benefit from paying off the bank loan on an existing housing complex since the facility would not be adding any new affordable units.

“I don’t see us deriving any income from it, whether it be small or not,” she said. “And it really concerns me we are simply paying off a mortgage.”

Mayor Craig Cates agreed.

“I’d rather see the next project that you’re bringing forward, the city being involved in and put the money directly towards that. Why don’t we just invest in the next project,” Cates asked.

But Habitat Executive Director Mark Moss said that paying off the mortgage would allow the non-profit organization to qualify for fresh loan funding to put towards a new affordable project. Previous repairs to the Eisenhower project also came in significantly over estimates, putting Habitat in the hole after an anticipated $230,000 repair bill jumped to $450,000.

“I would not be asking you to pay that debt off but I have no way of recouping that cash that we put out of our own resources to restore that building. Otherwise, we have to raise rents. We don’t want to do that,” Moss said, adding, “All of the units are affordable to low-income folks. The funds we are requesting are leveraging other funds. The units are community needs. I would argue don’t let the perfect be the enemy of the possible.”

There was also concern over putting $60,000 of taxpayers’ money towards repairing a privately-owned home on Oliva Street. Although the residents currently qualify under the low- to very-low income category, it is still a private residence and not deed restricted, meaning it could potentially be sold at market value, said Romero.

“What happens in later years if that family decides to sell that residence,” she asked Moss. “Who are we to say that that is the most deserving family for which we’re going to help repairs be made?”

Moss responded that the family would agree to a 15-year deed restriction on the house in return for the $60,000.

“The family has no intention of selling,” Moss responded. “But if they decide to sell within 15 years, it [$60,000] would be paid back.”

Commissioners voted 6-1, with Romero dissenting, to make the recommendation for the full $860,000 funding to the county Land Authority, which has the final say which projects receive bed tax monies. Commissioner Sam Kaufman, who has pushed for more commission action to benefit low- and very-low income residents, said the funding requests weren’t perfect but moving in the right direction.

“This is the first item coming before this commission that I’m aware of in the last 13 months that’s supporting low- and very-low affordable housing. I’m happy to see it,” he said.

“I don’t have any problem using property that is in Key West, leveraging it to get more money to build other affordable housing everywhere,” said Commissioner Richard Payne.

“We need to work with Habitat however we can, not only now but in the future,” said Commissioner Jimmy Weekley. “Habitat does a wonderful job in providing that [low income] opportunity for those residents.

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