E.L. project wins housing loan

[jaredw]

E.L. project wins housing loan

By KEN OSBORNE

The State News

East Lansing was awarded a $1.5 million Community Development Block Grant, or CDBG, loan guarantee on Wednesday to redevelop the 600 block of Virginia Avenue.

The loan guarantee means that the U.S. Department of Urban and Housing Development, or HUD, will act like a co-signer on a loan from a private investor to East Lansing, said Brian Sullivan, a spokesman for HUD.

This allows a city to get a better interest rate for projects that are often high risk because the city guarantees its future community development funding to repay the loan, Sullivan said.

"It makes it a risk-free proposition for the lender," Sullivan said.

The Virginia redevelopment idea has been in the works for some time, but the city was waiting on approval of the loan to move forward with the plan that would replace the current property on Virginia Avenue with new townhouses, condominiums and single family homes, said East Lansing City Manager Ted Staton.

The Virginia area is attractive to new homes and homeowners because of its close proximity to local schools, Staton said.

He said some of the new developments would be geared specifically toward moderate income families.

Since the guarantee has been established, East Lansing Mayor Sam Singh said the redevelopment process could move forward pretty quickly.

"Now that the loan is there the work becomes much more real," Singh said.

The city has to buy the property from its current owners before it can begin to hear proposals from developers, Staton said.

He said the city will not use eminent domain in order to secure any of the property.

"It's our hope that we can acquire all of the properties," Staton said. "If we can't we will redevelop what we can."

Federal regulations make the process of finalizing the loan and purchasing the properties very complex, Staton said.

He said the city is hoping to have the property acquired by the end of this year or early next, so the city can begin to focus on redevelopment plans.

The city has already been guaranteed about $600,000 this year to use for community development, Staton said.

While Staton said this money is put to good use, it is not enough to do a big project, like the Virginia redevelopment.

Instead, the city can use the loan guarantee process to secure larger amounts of money which the city can repay later using its future block grant funding.

In this case, the city will repay the money over the course of 20 years

[hood]

It seems like I've been hearing of this project forever now. The way the city is going about accomplishing this seeming insignificant project is a little shady, using eminent domain and such, it just seems like it wouldn't be worth it for something so low-profile. I don't know, but I do hope that they get this thing done quickly now that it seems the funding is largely in place.

[jaredw]

Update today on the Virginia Ave development.

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Published June 4, 2006

[ From the Towne Courier ]

Twenty-three houses set to be demolished

EAST LANSING

[hood]

It ought to be real interesting to see how this turns out. Does anyone know how common it is for a city to do something this? To me it seems like a waste of effort, but I guess we will see.

[jaredw]

Here is a followup article in the State News today with a reaction to the Virginia Ave project. Click on the link to see pictures.

http://www.statenews.com/article.phtml?pk=36472

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Locals question backyard buyout

Residence of Virginia Avenue's 600 block prepare to give up their property as E.L. project rogresses

By KRIS TURNER

The State News

JEANA-DEE ALLEN

[jaredw]

I got an email back from a person at Mayberry Homes about the Virginia Ave project. Here is the bulk of it below.

"At this point it is still in the development stages and particular details have not been discussed. So I haven't heard anything about it yet including timeline, plans, designs, etc. My suggestion would be, if you haven't already, is to visit our Hawk Nest Community and Okemos Preserve Community. We have models in Okemos Preserve called Lane homes, or alley loads, where the garages are in the rear. This might be a similar concept to something we might be doing on Virginia, but like I said before, it really hasn't been talked about yet. But by visiting our communities, you can get a feel for what kinds of plans we are building and the concept of our homes."

[jaredw]

This is from the East Lansing newsletter Dialog, which is published by the City. The picture below is the one that I had mentioned earlier.:

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Virginia Avenue Project Receives Federal Financing

The City received confirmation of federal funding commitments in March and April which will make the redevelopment of the 600 block of Virginia Avenue possible.

A congressional earmark was obtained through Congressman Mike Rogers in the amount of $346,500.

A commitment to provide a $1.5 million Section 108 Loan Guarantee was received from the U.S. Department of Housing and Urban Development.

These federal funds, made available through the Community Development Block Grant program, provide the resources needed to begin to acquire properties through voluntary means.

The redevelopment will take place between Snyder and Burcham roads.

The vision for the project is a community of 21 new single-family houses and 18 units-in a mix of townhomes and condominium flats-for a grand total of 39 new homeowner units.

About 15 of the homes will be reserved for households earning no more than 80 percent of the area median income ($50,900 for a family of four.)

All of the units will be constructed with the same high-quality materials and design regardless of the homebuyer