NORTH ADAMS — After three years of effort, the board of nonprofit Housing Opportunities, Inc., voted Monday to dissolve and have its assets absorbed into the city's community development office.
The move, approved by a 3-to-1 vote, will be finalized pending approval from Attorney General's Office.
Established in the 1980s under the auspices of the North Adams Housing Authority to administer Community Development Block Grants for first-time home buyers, HOI has not acquired new property in more than a decade.
The homes HOI refurbished would be sold to first-time home buyers at 3 percent interest for a 25-year mortgage.
Under the dissolution plan, HOI's remaining assets would be managed by the city's office of community development.
The board had appeared unified in seeking dissolution for several years, but Chairman Christopher Tremblay reversed his position in recent weeks and ultimately voted no on the proposal.
"I have a lot of concerns," said Tremblay, who attended the meeting by phone. "I think this program could be administered and could be brought back to what its original intent and original function was."
Tremblay has raised questions about what the money obtained from HOI's assets would be used for, accused the administration of Mayor Richard Alcombright of overstepping its bounds, and accused the board's own attorney of having a conflict of interest.
"Obviously in the past we have provided housing opportunities, and we sit on some very desirable parcels of land, I would say. We have funds, we have the ability to seek other funding, we have the ability to hire an administrator," Tremblay said. "It's clear that we have a need in our community for low-income and affordable housing."
From 1996 to 2005, HOI spent more than $900,000 in Community Development Block Grant funding purchasing and rehabilitating nine homes. But of the nine homes HOI invested in, three have been foreclosed on, three mortgages are currently in default, and another has been sold. Only one home remains in good standing with its original owner.
"There was no educational component to first-time home-buyership," said North Adams Housing Authority Executive Director Jennifer Hohn. "We put a bunch of people in houses who weren't ready to be homeowners. They didn't pay their mortgages. Bottom line, this is a failed program."
Repeating reasons for dissolution that have been discussed for years, Hohn said the board doesn't have the resources to hire an administrator to make the program functional and noted that many of the assets are unusable for first-time home buyers.
Hohn also noted that HOI's properties can only be used for Community Development Block Grant purposes, but it is sitting on 10 pieces of property that can never be used for a first-time home buyer program. The nonprofit's array of nearly 10 lots includes the former Sun Cleaners building on River Street.
The HOI properties can be sold by the city and used for any Block Grant-approved purpose. If HOI were to sell them, the North Adams Housing Authority could not utilize the funds, per department of Housing and Urban Development regulations.
Hohn has maintained that the North Adams Housing Authority cannot legally continue to administer HOI's programs.
"Using our [North Adams Housing Authority] staff's time that's funded by HUD is something that we can't do to run a nonprofit anymore," Hohn said. "It may have been OK in the past, when it was originated, but it's not OK anymore."
Tremblay also accused Alcombright administration of meddling in the HOI board's business and dissuading it from selling land.
Board member Matthew Neville denied that any mayor, current or former, has told him how to vote as a member of HOI.
"The reason why I would vote yes on dissolving on HOI is because [the Department of Housing and Urban Development] says it is not to be run out of the North Adams Housing Authority office," Neville said.
Hohn also said HOI does not have the financial ability, with $200,000 currently in the bank, to afford hiring separate staffing for HOI.
Tremblay also raised concerns over a potential conflict of interest in the board's own attorney, Stephen Narey, of law firm Donovan and O'Connor. Narey's law firm merged with DeRosa and Dohoney, which includes City Solicitor John DeRosa, earlier this year.
"I think you have taken directive from the mayor as opposed to directive from the board," Tremblay told Narey.
Narey said that, should it be determined that there is a conflict of interest once the transfer of assets begins, either he or DeRosa will find a replacement.
Tremblay also lamented a "lack of information" given to the board, including the circumstances of three HOI homes that are currently in default. He sought to discuss the nature of those mortgage troubles at Monday's public meeting.
"I'm not going to speak about people personally or name names of people who are defaulting on their mortgages," Hohn said.
Tremblay questioned the length of time it has taken the board to foreclose on the properties.
But Hohn said beginning the foreclosure process now would delay the dissolution of HOI. Instead, she said the office of Community Development will work with the homeowners to restructure or rectify the defaulted mortgages.
"The circumstances related to each of the debtors is personal information that is being shared with [Community Development Director' Mike [Nuvallie] and is not really something for public discussion at this point," said Narey, noting that the board could open itself to claims by debtors that it's discussing private information in a public meeting.
However, if the negotiations with the mortgage holders fizzle out, the board could choose to publicly foreclose on the properties.