Bayou la Batre’s Safe Harbor housing development looks the same on the outside as it did a year ago, or when it originally accepted tenants back in 2009. But Bayou la Batre Housing Authority Director Virginia Shanahan said months of internal changes have stabilized a financial situation that saw the authority rapidly spiraling toward bankruptcy.
“When I came in it was pretty clear that we had to do two basic things,” she said. “First, we had to get rid of people that weren’t paying the rent and second, we had to get our costs under control. With the help of the board we did those things and with other changes and new, reliable tenants coming in, you can begin to imagine that the Authority can sustain itself and properly manage and maintain the units for the city.”
In June, the authority voted to raise rent on the 100 units by 23 percent while also requiring tenants to purchase insurance for incidental damages. Meanwhile, it also gave up an office off-site in favor of a house within the development. This month, Shanahan signed an insurance policy that was 20 percent cheaper than in previous years.
Insurance has historically been the housing authority’s highest expense, costing $137,187 in 2011 and $134,479 in 2012. In the fiscal year beginning this November, the authority will pay just $107,638 to insure its property, a figure Shanahan called a “game changer” for the community.
“This is going to free up a lot of revenue for basic maintenance, some capital improvements and for the first time ever, savings,” she said.
By Gabriel Tynes
The houses were originally intended for victims of Hurricane Katrina but with the loss of federal assistance in 2011, that requirement dropped off. The housing authority is the second agency to take up residence. Earlier this summer, Mobile County EMS signed a temporary lease on a four-bedroom unit to house an around-the-clock ambulance crew.
“It’s a standard lease agreement where we pay full price just like the tenants,” said EMS Director Mark Turner. “Previously, our crews were housed in a old temporary jail in the city’s community center, which was not a good structure for them to be in for 24 hours a day, seven days a week. In Safe Harbor, the crews have been pleased. It’s a nice place and although we’re looking for something else long-term, it has been very accommodating.”
Rates are still below market value, with a two-bedroom, one-bathroom house commanding a $382 monthly rent and a four-bedroom, two-bathroom house costing $665.
“It’s still affordable for low income and middle class families,” Shanahan said. “And with new income requirements were also better able to regulate it.”
In June, the authority also approved a more rigorous application process for new potential tenants, for the first time implementing non-refundable application fees, credit and criminal background checks and an employment verification with salary requirements.
In August, board member Darryl Wilson resigned but a month later, was hired as a part-time employee in a maintenance position. Shanahan said the board got an approval for the hire from board attorney John Lee and a staffer on the Alabama Ethics Commission.
“Darryl cares about this community, he put in a lot of voluntary time as a board member and frankly he is qualified,” she said.
Board president Marcia Stork reiterated Shanahan’s remarks, adding that before Wilson was hired, he volunteered “40-50 hours per week” performing maintenance at the authority.
“He had wanted to resign (from the board) a couple times before, but I talked to him and the fact of the matter is he’s very skilled and it benefitted us because now he’s employed on an ‘as needed’ basis,” she said. “I’m not sure anyone else would have accepted those terms. We checked with the ethics commission to make sure everything checked out.”
In September, after a round of evictions due to delinquencies, Safe Harbor had 11 vacancies. Shanahan said today there is 100 percent occupancy and the authority could expect annual revenues of around $558,000 per year. Budgeted expenses through September were $460,729 for the year, but the revenues were only expected to be $397,298, or about 29 percent less than targeted.
A year before, when the housing authority collected $353,453 in revenues, it spent $456,782. That year, it also spent $128,319 on salaries and $37,745 in legal expenses.
Stork said she was hopeful ongoing litigation between the authority and a group of former tenants would be settled by year’s end, thus lowering the board’s legal bills.
“I hope between the mayor’s newly-appointed attorney and John Lee we’ll be able to
work it out,” she said. “The financial situation has been hurt a lot because of large legal bills from being back and forth in court repeatedly.”
Safe Harbor was built with a $15 million FEMA grant on land that is still owned by the city. The housing authority manages the property independently.
“The bottom line is I think we finally have a good thing going,” Shanahan said. “We’ve got young families, a few single people and elderly residents. People have been eager to move here and tell me they feel safe here. My hope is that in a few years, we can start building more houses.”
“I think Virginia, her assistant Russell and Darryl have brought this housing development a far way since May and it’s an asset now,” Stork said. “People enjoy being there. We want a respectable neighborhood with people that respect the houses as if they were their own and we are finally getting to that point. We struggled for a while.”