The Mobile Housing Board has approved the creation of another separate entity in order to help the authority manage tax credits from the Alabama Housing Finance Authority for the pending Rental Assistance Demonstration conversion.

Renaissance Redevelopment LLC becomes the second nonprofit the board has created and while the other entity, Mobile Development Enterprises, could have been used to acquire the credits, Executive Director Dwayne Vaughn said the board “decided against it.”

MHB will need tax tax credits from the Alabama Housing Finance Authority in order to embark on its transformation plan, which includes new, mixed-use, mixed-income developments to replace Thomas James Place, Boykin Tower and R.V. Taylor Plaza on the south side of town, as well as Roger Williams Homes on the north side.

Like MDE, the new entity will have its own board members, who will be appointed by MHB commissioners. Vaughn said MHB will vote on the number of members as part of bylaws it will create. The new board will consist of an odd number of individuals, Vaughn said, and Lori Shackelford, vice president and chief financial officer, told the board it can consist of current MHB members.

“It will not be a mirror image, but it can have some of the same members,” she said.

Having the new entity handle the tax credit portion of the redevelopments would make the projects exempt from state bid laws, Shackelford said.

In presenting the item to MHB commissioners, Shackleford said Renaissance Redevelopment LLC was “needed” because “[the U.S. Department of Housing and Urban Development] and AHFA prefer a separate entity.”

When asked, spokespersons for AHFA and HUD each wrote in separate emails that neither organization has a preference.

“Under the RAD program, a project can be owned by the housing authority, a nonprofit subsidiary of the housing authority or any other nonprofit public body,” HUD spokeswoman Gloria Shanahan wrote.  “In the case of tax credits, the properties can be owned by a for-profit, as long as the housing authority maintains its interest in the project. Since each community has different needs, HUD encourages housing authorities to evaluate all options available and choose the one they find to be the most effective for their specific circumstances, based on their plans and local situation.”

Kristi Gates, communications manager with AHFA, wrote “the way an agency chooses to structure itself is at the advice of its legal counsel.”

MDE’s board consists of Vaughn, current MHB commissioner Donald Langham and former MHB chairman Clarence Ball. Mayor Sandy Stimpson recently replaced Ball on the housing board with Kimberly Pettway. State Rep. Adline Clarke (D-Mobile) serves as MDE’s president.

MDE currently has 23 employees working for the authority, Vaughn said. MDE administers the WEALTH program, which provides a variety of classes for residents. The program links residents to jobs, classes at Bishop State or the University of South Alabama, and provides tips for job-ready training. The program also focuses on health through free eye exams and annual checkups, as well as classes on life skills.

MDE is also involved in the authority’s day care program, community relations, grant writing and asset management, Vaughn said. At one time MDE also had a property maintenance crew through a vacancy reduction program in 2011, but those employees have since been laid off.

Renaissance Redevelopment won’t have any employees, he said, and would be solely responsible for handling the tax credits.

In other business, the Housing Board approved amendments to master developer agreements between MHB and the entities tasked with completing the transformation projects, with a 2-0 vote. Vice Chairman Melvin Clark and Joyce Freeman voted for the agreements, while Norman Hill abstained. Chairman Langham and Pettway were absent.

Hill abstained from the agreement on the north side with Hunt Companies and on the south side with Pennrose, Bloc Global and Hollyhand because he said he didn’t feel comfortable voting on something he didn’t completely understand. He asked to have a work session to discuss them further and have the developers present a plan to the board.

“I’m not sophisticated enough to get all this,” Hill said. “I want to have a full presentation from the developers. If other board members fully understand it then I’m OK.”

Clark said he didn’t want to delay the agreements even though he admitted he didn’t fully understand what he was voting for either.

“I don’t fully understand it, but I do have a trust,” Clark told Hill.
Clark also told Hill he “can get with the developer yourself.”

Vaughn told the board the developments were not in a place yet where a site plan could be presented. He said the master developer agreements were a “framework document.”

The board’s vote allows for Vaughn and program director James Brooks to continue to negotiate the contract and only bring “substantive” changes back for board approval.

Hill took exception to a $500,000 fee MHB would be forced to pay developers to re-acquire ownership of complexes developers build on the south side after a 15-year “tax-compliant” term, even though MHB owns the land underneath it. The fee is not present in the agreement with Hunt.

Hill said he had hoped the fee could be negotiated down, but Brooks said that wasn’t possible.

“Nobody seems to be concerned but me,” Hill said. “It’s in there [and] we’re going to vote. That’s something I didn’t agree with then and I don’t agree with now.”

At the meeting, MDE Vice President Antonio Williams announced he will leave at the end of the month to become executive director of the Texarkana, Texas, housing authority.