The Island Affordable Housing Fund (IAHF), unable to raise the $1.3 million in private donations needed to develop the Bradley Square affordable housing project, decided last week to scrap the development and sell the property.
The fund has already invested $1.2 million in Bradley Square, and hopes to recover some of those costs from the sale of the property, which went on the market last week for $975,000.
Most of the cost to the nonprofit came from buying the land. IAHF paid $905,000, for the half-acre property in 2007, and currently carries a mortgage of approximately $750,000. The rest of the total $1.2 million investment went into engineering, architectural, and other development costs, during the long and controversial permitting process.
“I’m the eternal optimist, so I’m always hoping there will be something around the corner, but we’ve gone around a lot of corners and still have not found any answers for Bradley Square,” Mr. Hopkins said. “The cost of ownership is just not acceptable when you don’t have a plan to go forward. If we knew we could break ground in three months, we’d find a way to keep servicing that debt.”
Mr. Hopkins said IAHF’s last hope for Bradley Square rested with retiring the mortgage. On January 13, The NAACP of Martha’s Vineyard announced a fundraising campaign in partnership with the fund to raise money for that purpose. That campaign, including a benefit reception and concert in August, fell far short of its goals. The NAACP hoped to establish its first permanent home as part of the Bradley Square project.
“The NAACP of Martha’s Vineyard exhausted their wherewithal and had no other suggestions for raising money for Bradley Square,” Mr. Hopkins said. “Based on that, my board voted not to continue spending donor contributions for a project of this scope without any assurance or any idea of how we could take it forward.”
The fund’s directors made the decision at its meeting September 15 to sell the property, and it went on the market the next day.
“I’m extremely disappointed,” board chairman John Early said. “The mood of the donor community is obviously not in the position it has been in previous years. It’s a situation that we can’t prolong any more. We have to take action, and we have to take it quickly. I hope we will be able to recover most of the outlay for the property.”
Affordable proved expensive
The project was slated to restore the home of Oscar E. Denniston, the site of the first African American Church on Martha’s Vineyard. Plans included a new sanctuary, office space, and an affordable housing unit. Two new buildings were intended to house seven additional affordable units. The parcel sits at the corner of Dukes County Avenue and Masonic Avenue.
The fund, under the direction of then executive director Patrick Manning, purchased the property outright, and assumed the role of co-developer during the permitting process. That was a departure from its usual role of fundraising only.
IAHF is offering the possibility of splitting the property, to sell part of it as commercial property and another part as residential property. Originally, the property was two separate parcels, one zoned commercial and the other residential. The fund combined the two parcels in the early stage of development. Mr. Hopkins said there has been interest, including prospective commercial buyers, since the property went on the market a week ago.
“I hope whatever happens there includes an acknowledgement of the historical value of the Denniston building and the need for affordable workplace housing,” Mr. Early said.
For and Against
From the start, the project enjoyed enthusiastic funding support from town meeting voters, but often strident criticism from some residents of the neighborhood.
According to the applicants, the Bradley Square design committee held a series of 10 advertised meetings seeking public opinion on the project between September 2007 and January 2008.
That was followed by six public hearings before the Martha’s Vineyard Commission, over a period of four months.
In September 2008, near the end of the arduous permitting process but frustrated with delays, the fund put the property on the market at $1.5 million.
Then came a series of five public hearings and meetings at the Oak Bluffs zoning board of appeals (ZBA). In the middle of the ZBA review, a committee of concerned citizens was formed. In seven mediated sessions, that committee negotiated with the developers for several modifications in the Bradley Square plan including lowering the height of the buildings, adding on-site parking, and reducing the number of affordable housing units. The modifications survived a funding challenge on the floor of a special town meeting in December 2008, when voters rejected an attempt to revoke $400,000 in Community Preservation Act funds voted by the annual town meeting earlier that year.
Mr. Hopkins emphasizes that the decision to scrap the Bradley Square project is distinct from the financial condition of the fund. Last spring the fund cut two staff members and did not sponsor the mass appeal fundraising events it has staged in past summers.
He is confident the fund will be a viable organization going forward, with one-on-one fundraising from private donors and a new emphasis on securing government grants.
“Absolutely,” Mr. Hopkins said. “We have successfully reduced the operating costs, the fixed cost of the fund. The fund has historical debt that it has to fulfill, which it will over time, and it has a significant need in the community to address. How fast we do both is based on contributions, but the cost of maintaining the fund is not significant at all.”
The Island Housing Trust (IHT), a kind of companion organization to the fund, is less certain about the future. Traditionally, the trust has played the role of developer, managing projects with the help of donations raised by IAHF.
“I don’t know where they are,” said IHT executive director Philippe Jordi. “We need them more than ever right now. The need is greater than ever. It’s just like everything else, we can only work with the resources we have. If they can raise private funds, we can do more work. If they don’t, things will slow down.”
The fund provided $2.65 million in funding for 27 affordable homes developed by the IHT in the past five years, according to Mr. Jordi. The trust’s latest development, six multi-family homes slated for Lake Street in Tisbury, does not yet include any contribution from the IAHF.
“We’re at that stage where we’re trying to determine exactly what needs to be raised,” Mr. Jordi said. “They have never made a pledge for that project. They could be a player, but it really depends on whether they can achieve the success they’ve had in the past.”
Trial by crisis
Mr. Hopkins, formerly a technology firm executive, began his job with IAHF in September of 2008, and almost immediately faced a funding crisis. Two months into the job, he was forced to tell the Dukes County Regional Housing Authority that the fund could not meet its commitment to help fund rental subsidies for the Regional Housing Authority’s rental assistance program. Town governments and private donors stepped in to fund the program for the rest of the fiscal year. During spring town meetings, all six Island towns agreed to pick up the full cost of the rental assistance program for this fiscal year.
Mr. Hopkins said he thinks there is too much focus on the difficulties his organization has faced and not enough on identifying the needs of the community and fashioning a strategy to go forward.
“If the fund is not going to take on trying to stimulate moneys for the need, who is?” Mr. Hopkins said. “And how do we as a community effectively do that? That’s the debate I would like to see. Because if it were for the fund to step aside, or to take on a different role, that’s the kind of feedback and criticism that the fund should be receiving, not financial decisions that were made almost three years ago that are coming to roost now. I’m fixing those problems.
“The problem is I’m not successful in fixing the needs in the community, and we’ve got to get to that point. Yeah, we screwed up. Who on Martha’s Vineyard doesn’t know the Island Affordable Housing Fund screwed up in the past? Is it one person at blame? No. It’s not my predecessor who’s at blame at all. No one had a crystal ball. No one knew that funding was going to dry up, that we were overextended.”