There is concern among some residents at Cross Street Village Apartments in Ypsilanti that the rent will be unaffordable in the not too distant future. Rent increases are a common concern in Washtenaw County and throughout the region. Cross Street Village has offered affordable housing to seniors 55 years of age and up for 15 years.
On Friday, May 26, Purple Walrus Press was contacted by an anonymous source who told PWP that there was a meeting earlier in the day at Cross Street Village regarding rent increases. According to the source the meeting was attended by representatives from ownership, MSHDA, Ronnie Peterson's office, Housing Bureau for Seniors, Legal Services of Southeastern Michigan and Ypsilanti Meals On Wheels. According to the source the meeting addressed, "How rents will be increasing there now and through the next three years, and how after three years the apartments may no longer just be for seniors." According to the source, "Many seniors are concerned about where they might have to go once rents really start coming up."
Purple Walrus Press contacted Cross Street Village tenant Jayna Eckler Friday evening, May 26, 2017. Eckler attended Friday's meeting. Eckler told Purple Walrus Press that the point of the meeting was to discuss if there is a solution for the 104 seniors currently living at Cross Street Village. Eckler stated that many seniors have lived there since 2000 and must live on a limited income such as social security. According to Eckler, the rent increase is roughly between $40 and $120. Eckler's statement in reference to a $40 to $120 rent increase has not been confirmed by Purple Walrus Press. According to Eckler, there is also concern that Cross Street Village will open up to residents of any age range, and will not be renting only to residents 55 and up.
On Monday morning, May 30, 2017 Purple Walrus Press was contacted by Executive Vice President of Independent Management Services James Harrigan. IMS is the management company for Cross Street Village. Harrigan stated that he did attend the Friday meeting at Cross Street Village. When PWP asked Harrigan about recent rent increases Harrigan stated, and this is paraphrased, that there have been rent increases, but that this is not unusual and is line with normal business practice, and that the increase is needed for general maintenance of the building and grounds. Harrigan emphasized that the rent increases are do to capitol needs and pointed out that the Cross Street Village building is old. Harrigan stated that prior rent increase notice was given to residents. Harrigan added that, moving forward, residents will be given up to 60 days notice in regard to leases. Harrigan would not comment on the exact figures as far as rent increases for residents.
Purple Walrus Press has learned from Harrigan that Cross Street Village is for sale. This allows the owners of Cross Street Village the opportunity to exercise an option that could result in the property no longer being designated affordable housing in the future. This would allow Cross Street Village to, if they choose, rent at market rate. Here is an explanation of what the option is and how it works. There is something called the Low Income Housing Tax credit Program (LIHTC). According to Housing Justice National Housing Law Project, "When the LIHTC program was initially created, it only required a a 15 year compliance period. Therefore, properties developed between 1986 and 1989 only have 15 year compliance periods. Post-1989 developments have at least 30 year restrictions as required by the Revenue Reconciliation Act. However, the statute allows for owners to opt out by requesting that the state HFA find a "qualified contract" purchaser to buy the property during the fourteenth year of the initial 15 year compliance period. If no purchaser is found, the owner may exit the LIHTC program. If a purchaser is found, or if the owner will not sell the property, the use restrictions extend to the full 30 years."
Residents of Cross Street Village, unless the building sells, could in theory find the rent unaffordable in 3 years. Existing residents, as of September 1, 2017, would not be charged market rate for three years. If the property doesn't sell by September, 2017, the property could be changed to market property and currant tenants would have 3 years before they would have to start paying market rate.
According to MSHDA, "The fifteen year compliance period has since passed and Cross Street Village is currently seeking to sell the property under the current IRS rules. If the property is sold to a new owner at an agreed upon price set by the IRS, the property will remain affordable for the remainder of the extended use period, which would be Sept 1, 2020, whichever comes first. This means that regardless of whether or not the property is sold, your current rent controls will remain in place for at least three more years." Granted, this information is complicated. Harrigan stated that management wants to keep Cross Street Village affordable.
In a separate conversation with Purple Walrus Press on Thursday, June 1, 2017, James Harrigan emphasized that there are no plans to make apartments at Cross Street Village available to people outside the 55 and up age bracket. According to Harrigan, "Yes, they could go outside the 55 and up age bracket, but are choosing not to." Harrigan stated that ownership has agreed to keep the status age 55 and up. Harrigan feels frustrated that some feel that there is ill-intent on the part of management. According to Harrigan, "We are not kicking anybody out."
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Purple Walrus Press.
|Cross Street Village Apartments Ypsilanti, MI. Purple Walrus Press photo.|