Monday, July 22, 2024

City OKs $1.65M to housing authority, less than originally expected

County to vote on same request later this month

Wilmington Housing Authority director Tyrone Garrett addresses city council Tuesday night.

WILMINGTON — Wilmington Housing Authority’s new executive director Tyrone Garrett met city council for the first time at the end of a four-hour council meeting Tuesday. Only three weeks on the job, Garrett laid out his strategic plan to get 105 apartments back in livable conditions by the end of the year, but he needs financial assistance to make it happen.

The mold-ridden WHA units have caused hundreds of families to be displaced and covering costs of their temporary housing has essentially dried out WHA’s bank account. Garrett initially requested $6.3 million to be split between the city and county to cover capital expenditures; however, less than 24 hours later, the amount considered from local governments decreased. 

READ MORE: City, county to temporarily bail out housing authority

City staff realized WHA applied for a $3-million grant with the state through its Emergency Rental Assistance Program (ERAP), established during the pandemic. If approved, the money would be awarded in September.

“If the city and county allocate sufficient money for capital expenditures to be made, the state would pass over their application, saying they were no longer in need,” City Manager Tony Caudle said.

Garrett told council he has applied for emergency funding from the U.S. Department of Urban Housing and Development for the third time.

“I don’t know why it wasn’t approved the first two times,” he said. “But, hopefully, third time’s a charm.”

He also plans to apply for a $2-million grant open to housing authorities across the country. There is $26-million available in total for pandemic-related assistance.

“Across the board, we’re going to try to source out as many options for grant funding we possibly can,” Garrett said.

Caudle announced a “walk-on” resolution and ordinance to Tuesday’s agenda at 10:30 p.m. to assist WHA. (It’s a special request to add an item to the agenda at the last minute.)

In talks with the county, Caudle decided to only seek approval from city council for $1.65 million. The county and city agreed to split half of the original request and see what happens with the $3-million ERAP grant before assisting further.

While the need is dire, the city attorney is still working through the proper procedure of how to get WHA the money. Caudle asked council for the freedom to fashion an agreement as he and attorney John Joye saw fit.

Caudle suggested a few options: to disperse the money as needed, or in three waves at half-a-million each, offering part of it as a grant, or designing a loan agreement.

“We will determine the best disbursement schedule — we anticipate in tranches,” Caudle said. “We do this with several folks, give them an initial allocation and have them report back in 90 days with how it was used and then we’ll give you the next amount.”

The city attorney’s office said the loan process would take longer to assemble and would require approval from city council and WHA’s board. Caudle requested more time for them to research this option, as it’s not something the city typically does.

He added the city does, however, have the legal right to appropriate funds to any public purpose, making it the more accessible option at this time. Caudle explained if council agreed to a one-time grant, it would be the smallest amount possible, around $100,000, to get money in WHA’s hands right away for work to start.

The funds would be used toward remediation of the units, HVAC improvements and mold testing.

Council member Kevin Spears was uneasy about the idea of loaning money without a formal agreement in place.

“It’s like letting a friend borrow money,” he said. “You want your money back … there’s really no other way to look at it. It may be a longer process, but I wouldn’t sign on for a loan and then say let’s work out the details later.”

Caudle told council though, initially, he wanted to stay out of the financial situation , his perspective has now changed. He’s still opposed to helping with operating expenses but said it’s within the city’s purview to assist with construction.

Garrett then addressed council members to remind them he knew about the issues facing WHA before he came — and came anyway.

He said with a fresh set of eyes, he was able to scale back the scope of work WHA originally attempted to tackle. Garrett said his focus is on remediating the environmental safety issues, receiving a “clean bill of health” and moving residents back into their homes. He plans to do that with less than $25,000 per unit — a huge drop from an estimate of up to $80,000 per unit presented to council months ago.

His strategy is to fix up 20 units per month, with 105 back online by the end of the year. This week he sent out a request for contractor work, with a capped dollar amount to bid on. 

“Doesn’t mean we only have to use one contractor either,” Garrett said. “We can use multiple.”

Council unanimously agreed to allow Caudle to give the money to WHA in an agreement he deemed appropriate.

New Hanover County staff also has agreed to assist where needed. It has provided continued assistance by offering licensed therapists and case workers to help families access needed resources, organizing furniture donations for families whose belongings were destroyed due to mold, providing supplies for relocation and storage, securing funding to help families with expenses, and offering WHA expertise and guidance on grants and financial operations.

“While the WHA is a HUD agency and not a service of New Hanover County Government, the county is committed to serving all residents and ensuring that real, sustained aid is provided to families,” spokesperson Alex Riley wrote to media in an email Wednesday.

County staff plans to bring its $1.65-million request before the board of commissioners at the June 20 meeting. Riley explained the money would come out of the county’s general fund and paid in installments as needed.

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