City Council members appear ready to give the Caldwell administration the OK to find a new buyer for the city’s housing projects, but want to limit the number of units that can be converted to accommodate low-income and very-low-income occupants in the Downtown-Chinatown district.
The plan to limit the number of lower-income units touched off a spirited discussion Wednesday among city officials and area residents about what the tenant mix should be at three major Downtown-Chinatown towers: 200-unit Chinatown Gateway Plaza, 236-unit Marin Tower and 90-unit Harbor Village.
Introduced by Councilwoman Carol Fukunaga, who represents the Downtown-Chinatown district, Resolution 14-121 states mixed-income housing areas should be "retained to preserve the economic stability of the surrounding neighborhood."
Fukunaga told Budget Committee members Wednesday that she introduced the resolution at the behest of residents of three Downtown-Chinatown towers who want to ensure the current mixed-income nature of their buildings is kept and they are not displaced.
"There is a lot of fear," she said. "There is tremendous amount of uncertainty. Many of the businesses in the surrounding neighborhoods are really, totally up in arms (at the) increased numbers of homelessness."
But several Chinatown residents and housing advocates voiced concerns regarding the resolution.
Anthony Marlin, a Chinatown Manor resident, said people who make less than 60 percent of the area median income are being mischaracterized as "bad people."
Describing himself as being in that category, Marlin said, "Let’s stop associating people that are 60 percent and below with the people on the street that are homeless, that are vagrants, that are muggers. They’re not."
The committee Wednesday moved out Bill 6, which allows the city to seek a new buyer through the request for proposals process. A final vote of the full Council takes place Wednesday.
The original Honolulu Affordable Housing Preservation Initiative plan collapsed in January when the group chosen for a long-term lease on 12 city-owned properties in exchange for $142 million announced it was terminating the deal because it would not be able to come up with $35 million by the city’s March 31 deadline.
The new request for proposals, handing over long-term leases for nine buildings, calls for a minimum bid of $135 million.
The committee also advanced Fukunaga’s resolution, which calls for limiting the number of units that can be designated for those making 60 percent of median income or lower from the stock of units that now can be rented by those making more than 60 percent. Specifically, the resolution states that conversions can’t take place in one of the buildings "if a majority of the units to be converted to serve the low-income community are within a one-mile radius of each other."
Three of the four HAHPI properties that are mixed income are within the Downtown-Chinatown area: Chinatown Gateway, Marin Tower and Harbor Village. To convert moderate-income units in all three buildings to those aimed at families making 60 percent "just seems a little onerous and burdensome both for the businesses in the area as well as existing residents," Fukunaga said.
Vacated units in all three buildings in the past several years have been rented out only to those making 60 percent of area income and below, Fukunaga said.
But Managing Director Ember Shinn said that’s based on a policy adopted by the Council in 2008 to rent city units to those in the 60 percent-and-below category when financially feasible.
The Caldwell administration supports mixed-income properties, and "we are not interested in creating low-income housing in Chinatown or in any other properties that are not already at that level," Shinn said.
Shinn said the administration is unclear exactly what the resolution would allow the buyer to do or not do. City officials pointed out that only 110 out of 526 of the units in the three buildings are currently rented by tenants making more than 80 percent of median.
Fukunaga’s resolution was supported by the Chinatown Gateway Plaza Tenant Association.
Drew Alstofi, statewide director of the nonprofit Faith Action for Community Equity, said that while people making between 60 and 80 percent of median are struggling, tax credits are typically available for units geared to those making less than 60 percent.
"The tax credits are the only significant source of subsidy that’s available to do this stuff," he said. "Your dilemma is if you’re going to keep this stuff affordable to the current income mix, you’re going to get less money for it."
The original deal’s collapse left the city with a $20 million shortfall in the 2014 operating budget. It also meant the city would continue to lose an estimated $7 million to $8 million annually because rent collected is not enough to pay for upkeep and debt incurred by the properties’ purchases over the years.
Three of the 12 buildings covered under the original package are to be covered under a separate request for proposals.
