Modesto housing nonprofit considers rent increases

kvaline@modbee.comMay 26, 2014 

A Modesto nonprofit agency that provides housing for the poor, the disabled and those who were once homeless says it will be raising clients’ rents to remain on firm financial footing.

Community Impact Central Valley officials say they provide about 160 units in duplexes, apartment buildings and other types of housing for clients and their family members. About 330 people live in CICV housing. Officials said the rent increases would reimburse CICV for the cost of repairs and maintenance for the properties and for the services CICV case managers are required to provide tenants.

Officials said the typical rent is about $250 per month, and they had been considering increases of $60 to $90 per month. But they said they expect the increases to be less. They have sent letters to tenants regarding the increases and are meeting with them to ensure they can pay the increases. Officials said those who cannot afford the full increase will be charged a lesser amount.

The rent increases could take effect within a few months.

CICV grant administrator Aaron Farnon said the need for the rent increases became apparent as he reviewed CICV’s programs as part of an expected July 1 merger between CICV and Modesto-based Community Housing and Shelter Services. Farnon said CHSS helps about 130 families each month through such services as providing them with vouchers for temporary lodging in motels; money for the first and last months’ rent and security deposit to get into rental housing; and help with past-due utility bills.

Farnon also serves as CHSS’s executive director and has been working part time as CICV’s grant administrator for about a year. He is expected to become executive director of the merged agency and will continue to make about $88,000 annually. He said some of his salary now is paid by CICV.

He said CICV has been using reserves to pay for maintenance and repairs and case management. Those reserves have fallen from about $200,000 in February 2013 to about $71,000 today, said Kathy Lee, CICV’s interim director. CICV said another issue is late reimbursements from the U.S. Department of Housing and Urban Development for case management services. Farnon and Lee said HUD owes CICV about $200,000.

But CICV officials are optimistic HUD soon will begin releasing payments to reimburse CICV. They said HUD approved releasing about $33,000 last week and is expected to approve releasing $9,000 this week.

Gene Gibson, a spokeswoman in HUD’s San Francisco office, said in a May 19 email that CICV has not submitted adequate paperwork to receive reimbursements. CICV officials met with HUD in San Francisco on Thursday in preparation of an early June meeting in Modesto with HUD officials to review the paperwork issues.

“I’m way more optimistic,” Farnon said after last week’s meeting. “The meeting was really productive.”

CICV owns about three-quarters of the roughly 160 housing units. It purchased and renovated the properties through state and federal programs. The rest of the housing is owned by landlords, and the rents are subsidized through a HUD program. CICV is required to provide case management for the tenants in all of the units.

Farnon said that after CICV acquired and renovated its housing units, it planned to secure grants and other funding for the maintenance, repairs and case management. But he said that plan was derailed when CICV was engulfed in scandal.

The agency was known as the Stanislaus Community Assistance Project when The Bee began reporting in 2011 that while SCAP had received millions in taxpayer dollars to help house the poor and disabled, many of those dollars benefited SCAP’s managers and their families. SCAP changed its name, management and much of its staff in 2012 after its questionable spending practices became public.

Modesto officials also are meeting with CICV officials after a tenant complained at two recent council meetings about the proposed rent increases. CICV purchased about 60 of its housing units through federal Neighborhood Stabilization Program money it received from the city. Modesto wants to ensure that CICV remains in compliance with HUD regulations and programs.

CICV and Community Housing and Shelter Services want to merge to become a “stronger, more stable and sustainable” organization, according to a news release issued by the agencies. Farnon said each agency has nine employees. CICV has an annual budget of about $2.9 million, he said, and CHSS’ budget is about $1.9 million. He said the merged agency would use the Community Housing and Shelter Services name.

Bee staff writer Kevin Valine can be reached at kvaline@modbee.com or (209) 578-2316.

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