The city of Fort Worth and an affordable housing nonprofit, run as recently as last year by City Council member Kelly Allen Gray, have agreed to settle a 4-year-old, $220,000 dispute, with the nonprofit surrendering its remaining real estate, cash, and mineral rights.
The city would
cover the $10,000 in estimated closing costs of transferring eight vacant lots
– seven to the city, and one to a neighborhood using it for a community garden.
The nonprofit, United Riverside Rebuilding Corp., would be allowed to remain
open.
The organization,
based in Riverside,
had sought to stay in business, keep mineral rights, and have the city cover
costs.
“It’s probably
best for everybody,” Phyllis Allen, a United Riverside director and Gray’s
sister, said, speaking for the nonprofit board.
The City Council
was scheduled to vote on the agreement Tuesday, but the staff pulled it back
because the documents didn’t have all of the signatures. The council is
scheduled to vote June 4, said Jay Chapa, Fort
Worth’s acting Financial Management Services director.
United Riverside has no
remaining assets, no executive director, and no immediate plan, Allen said.
But “it does
other things in the community other than build houses,” Allen said. “We just want to be alive. We
just don’t want to fold up our tent and slink away into the darkness, as if we
had done some horrible thing. Because we hadn’t.”
Gray, who
stepped down as executive director last Spring to run a successful bid for City
Council, declined comment Tuesday.
Under the
settlement, the city will receive five lots in the 2600 and 2700 blocks of La Salle Street in
the Riverside area, one lot at 1209 E. Robert St.,
and a seventh at 2805 Ennis St.
It will pay $1,091.52 – its remaining cash - to the city and convey an eighth
lot it owns on Chenault Street
to a neighborhood association.
The Tarrant
Appraisal District values the seven lots being transferred to the city at a
total $54,700 at market, and the Chenault lot at $3,850.
The nonprofit
got its start with a grant in 2000. It built 25 houses and remodeled two
others, investing $1.2 million and selling at below-market value to allow
buyers to move in with equity, Gray, executive director from inception until
she stepped down, has said.
The dispute
hinged on two homes United Riverside built and sold. In May 2006, United
Riverside, with Gray as director, accepted $287,000 in federal Housing and
Urban Development money administered by the city's housing department.
Under the
grant, the money was to be used as seed to construct six infill homes. United Riverside would build two,
sell them and use the proceeds to repeat the process.
United Riverside built two homes
and sold them. But the city said it found the buyer of one turned it into a
rental, violating federal affordable housing rules, and the second buyer's
income was too high. In 2008, after United Riverside sold the homes, the city,
as is routine under the HUD process, sought documentation that the home buyers
met requirements.
United Riverside maintained that
it sent the documentation early on but that the originals were later destroyed
by a flood in its offices. The city has said it never received the documents.
The city repaid
$220,719.29 to the government. Of that, the city and HUD determined that
$190,843 went to building the two homes, $12,544 was for a lot not built upon
within the allowed time, and the remainder was for expenses the city said
United Riverside couldn't document.
Allen and Gray have said the dispute unfairly
blemished United Riverside’s record.
“Every single
dime that was entrusted to the United Riverside Rebuilding Corp. was spent the
way it was said it was going to be spent," she said in a February
interview as negotiations between the city and United Riverside proceeded.
"We built
homes, we remodeled houses, we provided social services, we brought families
back into the community," she said then. “We built the best houses [under
the affordable housing program] in the city. The houses are there."
- Scott Nishimura, Star-Telegram Fort Worth City Hall reporter
Twitter: @JScottNishimura