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A year ago, low-income residents of the Mount Vernon Plaza apartments at 930 M St. NW were offered a deal. The building’s affordability period mandated by government loans had expired, the property owner, the Williamsburg, Va.-based Bush Companies, informed them. Bush was therefore allowed to raise their rents to market levels, which would mean more than doubling them for some tenants. But the developer told tenants they could get a discount if they agreed promptly, in the form of 12 months of rent at a level halfway between their current rates and the market ones.
That still amounted to increases of around $600 per month or more, for tenants who qualify for affordable apartments because they fall under certain income thresholds. Many residents simply couldn’t afford to pay the increase, discount or not, and feared they’d have to move out. Now, with the 12-month discount period nearly over, the tenants who remained faced the prospect of the full rise to market rents.
On Oct. 21, however, the D.C. Department of Housing and Community Development sent a letter to Bush ordering the company not to raise the rents beyond the levels affordable to the low-income tenants.
“DHCD is hereby demanding that the Property Manager ceases and desist [sic] with issuing these letters [requesting higher rents] and cease and desist with any attempts to raise the rents on the rent restricted units without DHCD consent and in violation of affordability restrictions,” DHCD Loan Risk and Portfolio Specialist Robert A. Hayden III wrote.
The terms of the affordability restrictions are hardly clear, since there were a tangle of loans and leases when Bush and the local and federal governments made their arrangements in the late 1980s. But it’s DHCD’s understanding that 63 units in the building must remain affordable for the duration of the ground lease through which the city rents the land to Bush.
“The Lease term is sixty (60) years from the date that the Federal Housing Administration issues a certificate of project completion,” says DHCD spokesman Marcus Williams in an email, “and based on available information the project lease term will end in 2049.”
In other words, Bush can’t raise the rents on these 63 units to market levels until 2049. A Bush spokeswoman did not return a call for comment.
That could mean a substantial reprieve for tenants who thought they’d have to move out before market rents took over in the new year. But it’s no help to residents who already left, unable to afford the “discount.”
And for residents like Alem Ghebremariam, the effect is unclear. Ghebremariam, who’s lived at Mount Vernon Plaza for 18 years, has been paying $935 a month. But his son recently moved out to go to college, and he wanted to take in a roommate to help cover the rent for his two-bedroom apartment. When he sought the property manager’s permission, he was told that he and the roommate would need to apply as new tenants, and their rent would go up to market rate, or $2,200 a month. Unable to afford that increase, he took a deal from the property manager to get a month’s free rent and move out at the end of October—-by tomorrow.
Now that the rent increase is being challenged, Ghebremariam wants to stay. But he says the property manager won’t let him, and insists he move out after tonight.
“I don’t know what I’m going to do,” he says. “I’m going to tell them again I’m not going to give the key.”
But there’s a bright spot for him: Until the matter with DHCD is settled, he thinks Bush will have trouble forcing him to leave. “I don’t know how they’re going to kick me out,” he says. “They have to go by the court, I guess.”
Photo by Darrow Montgomery