Feb 052016
 

bag of money

by Naja and Arnaud Girard…….

Donald Roberts lives in Peary Court with his mom Ruby.   They rent one of the 48 deed restricted “affordable” units. Their situation is puzzling. With a combined annual income of under $55,850, they qualify for “low-income affordable workforce housing.” Their rent should be $1,571/month, yet they pay around $2,400/month. At that price, their 2-bedroom deed restricted affordable unit at Peary Court is pretty much market rate.

So what happened to the hard fought victory that nearly four years ago “saved” 30% of Peary Court units for affordable workforce housing?

It was May 29, 2012, and the Planning Board had previously recommended the city rezone Peary Court (a former military housing enclave) without requiring the soon to be private owners to provide any affordable housing.

Public outrage descended upon the City Commission. It was almost an historic moment; one of the Commission’s greatest hits. Most remarkable: the passionate pleas of those 7 women who so captivated reporter Mark Howell that he published a piece entitled, “The Seven Women Who Spoke,” in Solaris Hill. Seven Key West mothers coming down to “tell it like it is” to seven City fathers awkwardly sitting on the dais. And the battle was won. In exchange for higher density and some additional building rights, the would-be developers were to abide by the code and provide 48 of the 157 existing units as deed restricted affordable housing, effective immediately upon transfer.

In a November 14, 2012  letter found this week in city files, City Planning Director Don Craig informs developers of the city’s interpretation of how the workforce housing code would apply to the property,

“In conclusion, it is the determination of the City Planner in conjunction with the City Attorney that the proposed development for the Peary Court Housing project must meet the requirements of the Work Force Housing Ordinance inclusive of: 16 low income affordable units and 32 median affordable units. Alternatively, and as encompassed by the Ordinance a mix of low, median, moderate and middle income may be provided up to a mixture of 32 low income units and 16 middle income units…

Please use this letter as City’s determination as to how the Work Force Housing Ordinance is to be interpreted for new multi-family residential development inclusive of the Peary court Housing project. This determination should be used to guide the Development Agreement and Development Plan application for the Peary Court Housing project.”

Today this translates into rents of $1571/month for low-income units and $1965/month for median-income units. Yet, according to several Peary court tenants interviewed this week, the deed-restricted units are being rented for around $2400/month.

Here’s what happened:

After everyone went home, satisfied with having protected the common good, the developers filed their formal deed restriction declaration with the County Clerk, translating those 16 low-income and 32 median-income units into 48 “moderate-income” units renting for roughly $2400/month. The city accepted the deed restrictions without question and two weeks ago the City Commission went along with the deal when they authorized a development agreement for Peary Court that carried over the more lucrative “moderate-income” assignments.

Considering the rental rate difference, the shift to the moderate-income denomination for all 48 units could have produced a windfall of nearly one million dollars for the developers over the past three years.

So here comes the million-dollar question: Did the City violate its own laws and sign an agreement with a developer that is contrary to land development regulations and if so is that agreement legal?

According to Florida Statute 163.3231 “a development agreement and authorized development shall be consistent with the local government’s comprehensive plan and land development regulations.”

In New Jersey, tenants in deed-restricted housing sued their landlords for having overcharged them for rent. The Court found in their favor and ordered the tenants to be reimbursed– not just for the excess rent, but for three times the excess rent. The legal concept is called “treble damages.” It’s similar to Florida Statute 772.11 where the victim of civil theft is awarded three times the value of his actual damages.

Peary Court tenants are not alone. According to the Housing Authority there are 202 privately owned deed restricted units in the City of Key West. Commissioner Sam Kaufman recently pointed out a report that showed that as many as 40% of those privately owned deed restricted units may be in violation, either by renting (or selling) to people whose income is too high (not qualified for the affordable housing) or by charging more than is allowed under the affordable housing guidelines.

City Attorney Shawn Smith is currently working with city staff to audit those privately owned deed-restricted units for compliance.

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 February 5, 2016  Posted by at 1:30 am * Featured Story *, Naja and Arnaud Girard  Add comments

  9 Responses to “Key West: Your Landlord May Owe You For Overcharging For Rent”

  1. They should know by now that their corruption will be brought to light! They should know The Blue Paper will eventually find out. Or perhaps the people running the show are just stupid or intimidated?

  2. Naja for mayor, Arnaud for city attorney, of Key West!

  3. Hmmmm . And just what was the city going to charge if they bought them ? Yep $2400.
    Now where do they sit with a bank ?

    And with a lawsuit likely to follow nobody will be stupid enough to buy them.

    I think the city best try to buy THE BLUE PAPER before they uncover any more corruption.

    Hope the voters are paying attention. Until I found this paper I suspected corruption but nothing like has been uncovered. One huge mess if the feds get called into this.

  4. Naja & Arnaud,

    Brilliant work, extraordinarily written. Short sweet and to the point. A ‘masterpiece’…

    Blessings & Respect

  5. This adds a twist to all of the regulated rents in Key West. Just how many are overcharging and if forced to lower it the likely you will see more homes being sold to the rich and the loss of another workforce home to the rich for a private home.

    All comes down to a profit for the landlord after taxes, insurance , utilities, mortgage . When the bottom line does not show 10% or better then why keep it ?

    With the lower rents a landlord will not be able to keep them.

    You just might have a bigger workforce problem than you know.

    My question is why are so many families that are welfare non working being allowed to live in section 8 ? Would it be legal to only rent them to employed people ?
    Some as we all know never worked in their life and are living in paradise free off of tax payers.

    • Homes that are “deed restricted affordable workforce housing” can not legally be “sold to the rich” while the deed restriction is in place. The purchaser must also qualify at the income level associated with the deed restriction. We now know there is no control of the rentals… question is: Is there a control mechanism at the time of sale?

  6. That could easily be a loophole for a retired person that has money to pay cash but only gets a SS check.

  7. 1 by 1 you will see workforce home go away. They will not get maintained by such low rent to value and many are wooden 100 year old homes that are beyond saving. This is another case of government sticking nose where it does not belong. What if at time of purchase they qualify buy it, move in and then open a store and then no longer qualify ?

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