This letter is in reference to the Bailey Hill Reservoir project. The City of Fort Smith is proposing supporting this project in the form of subsidized construction of the infrastructure. These funds are sourced from tax dollars paid, in large part, by the Real Estate holders of the city, both private and commercial.
I represent the River Valley Landlord’s Association, a group of local Landlord’s and related professionals. We have 52 members representing over 3,500 rental units in the River Valley Area. Representatives from the Housing Authority spoke to our Association in December of 2012. Several aspects of that conversation have caused concern amongst our members:
*) Representatives from the Housing Authority claim that The City has a need for additional affordable housing. When asked how this was determined, the representative stated that a survey was conducted by a company hired by the City. When members in attendance (40+ persons) were asked who had been surveyed, ONE person raised their hand. This would seem to indicate that the survey is inaccurate and misrepresents the actual number of Landlords surveyed and, therefore, the real possibility of manipulation of the data. Who conducted this “Survey", where may we review the results, and who is the entity that audited and approved these results?
*)If the Housing Authority would conduct and advertise education seminars for area Landlords, then more Landlords would find a comfort level dealing with the Authority. The education of area Landlords alone would free up scores of units by providing guidance on how to navigate through the paperwork and regulations that many Landlords find intimidating. The Housing Authority cannot expect a web site or conducting a once a quarter meeting, without related training sessions, to attract Landlords with viable properties.
*) The United Development Ordinance (U.D.O.) requires that the Developer develops the infrastructure, not the City.
*) The City donated the land to the Housing Authority for this project. Private Enterprise was not given a chance for this gift.
*) Many of the Vouchers given by the Housing Authority are for specific projects. This automatically excludes independent Landlords. This is not unfair competition; this is a complete lack of competition.
*) Private Enterprise is better suited to this type of development as they are answerable to profit margins and the realities of a Free Market. The Housing Authority is free from such realities. The Authority has very little incentive, if any, to execute this project in the most cost effective, quality manner. The proposed Project has a projected per unit cost of $160,000 a piece when land, infrastructure, etc. is included. A Private builder, it is estimated, can build a 3 bedroom, one bath unit for approximately $70,000. But even excluding this efficiency, how can a Private Builder compete with the proposed units that have garages, two baths, dishwashers and monthly rental rates that are subsidized not only for the basic rent but the utilities as well? Will we Landlords be so extravagantly subsidized by the City? After all, these are our taxes and don't we have a right to the use of a portion of them to offset the unrealistic market prices set by the Housing Authority? The Landlords of this City pay a large percentage of the tax revenue that keeps this city running. We, as commercial landholders, cannot avail ourselves of Homesteading our rental properties, we pay full blow millage in our Real Estate taxes. To use the taxes collected in part from local Landlords to build direct competition to our livelihood is simply unconscionable and immoral.
*) The City of Fort Smith is simply not in the Housing industry. That is why H.U.D. and other Federal Agencies were formed. Funds used for this proposed project could, and should, be used to attract businesses to the area and increase the tax base, one of the main functions of the Fort Smith Board of Directors.
*) The Housing Authority is in the position to take the most eligible tenants. Where are the checks and balances to make sure we Landlords get the same quality tenant?
Our Association is dedicated to providing quality housing at affordable prices in a fair market environment. We look forward to the opportunity for all parties in this situation: the Landlords, the Housing Authority, the City of Fort Smith, the tax payer, and most importantly, the persons in need of affordable housing, the get best possible service and outcome.
River Valley Landlord's Association
River Valley Landlord's Association