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Funding for senior project a concern
Windermere residents worry about regulations
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Forsyth County News

 

Residents of a large Forsyth County community are questioning the possible use of a government program to help fund the development of an upscale senior living rental community.

At a public meeting Thursday night, about 70 people gathered to hear what Kennesaw-based developer Almquist Hansen is proposing for Towne Club at Windermere.

A 2008 zoning decision cleared the way for a senior housing community on the 18-acre site at Windermere Parkway and Trammel Road.

The developers returned to the Windermere neighborhood this time to discuss plans for funding the project, which could come in part through federal loan guarantee assistance under the U.S. Department of Housing and Urban Development Section 108.

Developer Greg Almquist said the project would not create low-income housing, as is often associated with HUD, but rather jobs for low-income workers.

About 150 permanent jobs are expected with the development, which would house 145 units and resort-style living for seniors age 55 and older.

Most units would be for independent-living, while a few would provide additional assistance. The average rent would likely be about $3,850 per month.

The pay scale for the proposed jobs ranges from about $40,000 to $57,000, which would qualify the development for HUD funding. A majority of jobs would have to go to workers in this range.

Of the $30.6 million project, the developers are seeking a $5 million government-backed loan through the HUD program.

“This money doesn’t come from taxpayer dollars, it doesn’t come from budget dollars, it comes from private issues,” said Almquist, comparing the process to a home Federal Housing Administration loan.

The developers are seeking the loan, Almquist said, because “the financing markets have simply changed.”

Obtaining a private bank loan isn’t as simple as it once was, he said, and this program matches what the group intended to provide in terms of jobs.

It’s the government involvement that most concerned those at Thursday's meeting.

They wonder what regulations would be imposed and how the government-backed loan could impact a potential foreclosure.

Curtis Mimna, a financial consultant for the developers, tried to answer the questions.

While Section 8, which provides for low-income housing, is the most commonly discussed use of HUD, Section 108 has been providing loans under this program for more than 40 years, Mimna, president of CJM Financial.

“It’s not free money,” Mimna said. “It’s a loan.”

The Georgia Department of Community Affairs receives a certain amount of money each year for the Community Development Block Grant program in non-entitlement communities, such as Forsyth County.

The department will review this project and decide if it wants to pledge a portion of those funds “as a primary source for repayment of the loan,” Mimna said.

That is to say, if the developers defaulted on the loan, the state would be on the line to repay it by losing a portion of these allotted funds.

“Georgia is pledging its monies,” he said. “There’s no financial obligation to Forsyth County. It’s not a lien on the tax revenue.”

According to the HUD department: “Section 108 loans are not risk-free, however local governments borrowing funds guaranteed by Section 108 must pledge their current and future CDBG allocations to cover the loan amount as security for the loan.”

The county’s involvement, Mimna said, is to first authorize the transmission to the state and act as a conduit in the process.

Several public hearings will be required on the matter, including the first before the county commission on Thursday.

Almquist encouraged attendees to check out Towne Club at Peachtree City, a completed, award-winning designed senior living community nearly identical to what is planned for Windermere.

The Peachtree City site, however, did not use a HUD loan.

While the loan has several residents concerned about its possible impact on the development, a few seemed to welcome the possibility of a senior community.

“Are you taking reservations?” asked Olga Logan, who hopes someday her mother might be able to move in.

Pending approval at the county, state and federal levels, Almquist said the development could open in fall 2013.