Alameda tenants fight liberal owner - September 9, 1987

Alameda tenants fight liberal owner

By Carolyn Newbergh (Oakland Tribune)
September 9, 1987

ALAMEDA – The owner of a large, low-income apartment complex threatened with 75 percent rent hikes is a major supporter of such liberal Democrats as former U.S. Sen. Gary Hart and until recently, Lt. Gov. Leo McCarthy.

Albert Gersten, who Beverly Hills real estate firm owns the 615-unit Buena Vista Park apartments, has just become chairman of the Los Angeles television Bill Press’ exploratory campaign for the U.S. Senate in 1988, jumping the McCarthy ship after contributing about $10,000 to it.

It is Gersten’s liberal ties that tenants of the largest low-income, private apartment complex in the Eastbay are banking on in an unusual housing fight to hold down rents.

Tenant leader Clayton Guyton said residents will try to appeal to the Beverly Hills businessman personally to come up with a “progressive” solution – that might include rent control – in what is expected to become a growing nationwide low-income housing crisis.

“He is a person working with the Democratic Party,” Guyton said yesterday. “He understands, I believe, the needs of the people.”

“…We’re asking for (him to be) an example for the whole nation right now. The nation is experiencing this problem.”
Neither Gersten nor any of his representatives were available for comment yesterday.

The Gersten Co. is one of the first operators of low-income apartments in the country to take advantage of a provision in their 40-year, low-interest government mortgages allowing for an early payoff after 20 years and freedom from federal regulation of rents.

Government and housing officials around the country have estimated as many as 500,000 low-income apartment units could be eligible for conversion to market rents in the near future.

After a meeting with Alameda Mayor Chuck Corica and Guyton yesterday, Gersten Co. President Marty Collier said his firm has paid off its mortgate and plans to increase rents 75 percent on Nov. 1.

The increase would mean, for example, that the rent on a two-bedroom apartment at the Buena Vista would go from $271 a month to $474.

Guyton said such a drastic hike would throw many tenants into the street.

However, Collier and Corica plan a trip to Washington on Sept. 21 aimed at getting federal rent subsidies for the complex to assist the most needy among the tenants.
“We’re trying to be a compassionate as we can,” Collier said.

But Guyton said he would propose a more unusual approach to Gersten.

Guyton will ask Gersten Co. for phased in rent control and a commitment to allow tenant organizing and an “upward mobility program” in which residents would get schooling and learn trades at the complex so they can get better jobs and ultimately, be able to afford to move out.

Guyton said he learned yesterday that Gersten had been a big supporter of McCarthy’s U.S. Senate bid before defecting to Press, who is seen by some as more liberal than McCarthy.

A Monday column in the Los Angeles Hearld-Examiner said Gersten had previously contributed $10,000 to McCarthy before joining the campaign of Press, a commentator with KABC-TV in Los Angeles.

Political insiders verified yesterday that Gersten is recognized as a wealthy Democratic supporter and fund-raiser.

“The perception among Democratic candidates in the country is that the streets of West L.A. are paved with gold bricks,” McCarty senate campaign Darry Sragow said. “It is folks like Al Gersten who are looked at for national support.”

State Democratic Party Chairman described Gersten as a “very successful fundraiser” for such politicians as state Controller Gray Davis, Board of Equalization member Conway Collis and presidential contender Hart.

Another party worker in Los Angeles said, “Gersten was very visible in the Hart campaign.”

Source: Newbergh, Carolyn, "Alameda tenants fight liberal owner." Oakland Tribune. 9 September 1987:A1.

Low-income tenants plead for help from Alameda council - September 5, 1987

Low-income tenants plead for help from Alameda council

By Carolyn Newbergh (Oakland Tribune)
September 5, 1987

ALAMEDA – Low-income residents of one of the largest apartment complexes in the Eastbay begged the City Council last night to commit itself to keeping rents from being doubled.

“Women will have to put their children in foster homes, and they will have to live in cheap hotels,” Clayton Guyton, leader off the tenants at the 615-unit Buena Vista Park apartments, told an often explosive special meeting of the council.

“You go to the polls and ask for our help,” said Jean Jacobs, a single parent. “We’re asking for yours.”

The Buena Vista is the largest for-profit private apartment complex for low-income people in the Eastbay according to U.S. Department of Housing and Urban Development spokesman Dirk Murphy.

It is also the second complex in HUD’s Northern California region to take advantage of the opportunity to pay off a low-interest, 40-year federal mortgage after 20 years and remove itself from the HUD program regulating rental rates.

Mayor Chuck Corica has set up a meeting Tuesday with the Beverly Hills owner of the Buena Vista, the Gersten Co. He said he would ask that it hold off on converting the market rents until some means for assisting the tenants, such as federal rent subsidies, can be worked out.

Although Corica and other council members often shouted angrily at each other, pointing fingers at who was most responsible for letting the Buena Vista problem get so far, they agreed they want to help.

“I give a darn for you and I’m not going to let somebody roll over you,” said Council member Joe Camicia.

The Gersten Co. owns both Buena Vista and the Vallejo Palisades apartments in Vallejo, which was the first privately owned, low-income rental complex to convert early, according to HUD spokesman Dirk Murphy.

Gersten spokeswoman Linda Sheppard said in a telephone interview yesterday the company hopes to work out with Corica a shceudle of increasing rents over time to market rates. The company is also seeking rental subsidies, she said.

“Our intent is not to evict or run anybody out,” Shepard said. “Our intent is to convert the apartments to market rate. Some tenants will be more hard hit than others. We understand we have a moral obligation to those people.”

The Buena Vista tenants and others nationwide in the same boat face an affordable housing crisis made worse by the almost complete elimination of federal housing construction programs for low-income people under the Reagan administration.

Source: Newbergh, Carolyn, “Low-income tenants plead for help from Alameda council.” Oakland Tribune, 05 September, 1987: A11.

Buena Vista complex rents to double - September 4, 1987

Buena Vista complex rents to double

By Rachel Gordon (Alameda Times Star)
September 4, 1987

ALAMEDA – The owner of the Buena Vista Park Apartments – the largest subsidized housing project in the city – said Thursday it plans to double rents at the complex but vowed to keep as many of the low-income residents at the complex as possible.

“We intend to do whatever is most humane,” said Linda Shepard, Bay Area representative of the Beverly Hills-based Gersten Management Co., which owns the 615-unit West End development. “The object is not to run people out of Alameda.”

The owner is trying to secure the federal rent subsidy Section 8 and voucher programs for the project’s low-income tenants, according to Shepard. Both programs are currently full in Alameda and city housing officials said the wait to get into those programs is approximately two years. Forty-two percent, or 250 households at Buena Vista would be eligible for the federal subsidy programs, according to Housing Authority documents.

Shepard said the owner has been working with federal housing officials in Washington, D.C., to get additional Section 8 certificates and rent vouchers for Alameda, but has not had a firm commitment from them. She added, however, that Gersten was successful in obtaining those subsidies for 66 low-income tenants in its 174-unit projet in Vallejo, which is undergoing a conversion that mirrors the one planned for Alameda.
Clayton Guyton, who chairs the Buena Vista tenants group, said the owner has made no attempt to contact the residents about its intentions. When told of the owner’s plan,

Guyton said it provided some hope that the low-income tenants would be allowed to stay at the complex. However, he said, he wants more assurances.

Shepard’s statements were the first comments from the owner since the Times-Star reported Wednesday that the owner had notified the federal government that it was going to pay off its federally subsidized mortgage on the property and free itself from regulated rents.

When the development was built between 1964 and 1966, construction was financed with a 40-year direct federal loan. In return, the owner was obligated to rent only to qualified low- and moderate-income residents for the first 20 years, or until the nearly $9 million mortgage was paid off. Mortgages are coming due or being paid off nearly all over the country, pulling thousands of apartments for low-income tenants off the market.

Residents of the Buena Vista complex have been prodding the city to come to their aid. The City Council will hold a special meeting at 7:30 tonight in the City Hall council chamber, Oak Street and Santa Clara Avenue, to hear concerns about the rent hike. Mayor Chuck Corica also has scheduled a private meeting for Tuesday with the owner of the complex.

City officials said Wednesday at a community meeting held at the complex that they would consider a number of options, including imposing rent control on the project, instituting a sliding rent scale, and buying the project with tax-exempt bonds to put it under the control of the Alameda Housing Authority.

But residents said the city has not been responsive to their needs up to this point. They accused some city officials of withholding information regarding the conversion of the complex.

Councilmember Joe Camicia met with Shepard, an old political associate, three weeks ago and was told then that Gersten was considering the conversion. Camicia said Sherpard had told him that Gersten was willing to pay $500 to tenants who feel they must move because of the new rents and that rents would be boosted to near market rate.

Camicia gave the information to Assistant City Manager Rob Wonder, who then relayed it to Tom Matthews, executive director of the Housing Authority, the agency which oversees subsidized housing in the city. Other council members and the tenants were apprised of the situation.

“They’ve put the residents at a real unfair disadvantage,” said Guyton, of the tenants’ group. “We’re lost a lot of time where we could have been negotiating with the owner and considering our legal options before the fact.”

Councilmember Barbara Thomas said she, too, is incensed that the information – outlined in an inter-office memo between Wonder and Matthews and given to Camicia – was not widely distributed.

Wonder said Thursday that it was a mistake not to give the information to all the council members and that he will not let it happen again. He said the inter-office documents were placed inadvertently in an inactive file after Camicia requested the information and then forgotten.

“That cost the tenants some options,” said Thomas. “That time could have been very valuable to them.”

Camicia said distributing the information immediately would have been premature.

“I had a 15-minute meeting (with Shepard) and wasn’t given any concrete information. She only told me that they (the owner) were exploring their options,” said Camicia. “I simply went to Rob (Wonder) and asked him what the city could do.

“It’s not a question of hiding information,” he said, “it’s a question of doing things in a business-like manner. I thought it would be good to get some information before the issue became politicized and the owners would be scared to the point where they’d starting playing hardball.”

Shepard said it will not be determined when the rent hike will be implemented until agreements with the federal department of Housing and Urban Development are formalized.

Source: Gordon, Rachel, “Buena Vista complex rents to double.” Alameda Times Star. 4 September, 1987:1.

Buena Vista tenants mobilize to keep rent low - September 4, 1987

Buena Vista tenants mobilize to keep rent low

By Rachel Gordon
Staff Writer

ALAMEDA – More than 300 worried tenants, facing a possible rent hike at the city’s largest subsidized housing project, came looking for answers Tuesday night at a packed community meeting.

What they found was a bevy of options – transferring ownership of the project to the city or the tenants, imposing rent control, instituting a sliding rent scale or negotiating with the owner to keep rents down – that left the residents optimistic but ready for a fight.

The owner, Los Angeles based Gersten Management Co., has made no public statement on its intentions.

“We're gathering our forces together,” said Clayton Guyton, chairperson of the Buena Vista Community Association, the tenants’ organization for the 615-unit Buena Vista Park Apartments complex. “The residents and the city have got to come up with some creative solutions to stave off a rent increase.”

The residents are relying on city officials and volunteer attorneys to find ways to keep the West End project for low- and moderate-income residents. Tenants are now paying rents that are as low as 50 percent less than the cost of renting a comparable apartment in Alameda at market rate.

Gersten Management gave notice to the federal government earlier this week that it was going to pay off its federally subsidized mortgage on the property – a move that frees the owner from a cap on rents.

When the development was built between 1964 and 1966, construction was financed with a 40-year direct federal loan. In return, the owner was obligated to rent only to qualified low- and moderate-income residents for the first 30 years, or until the nearly $9 million mortgage was paid off. Mortgages are coming due or being paid off nearly all over the country, pulling thousands of apartments for low-income tenants off the market.

“If they have the guts, the city can do a number of things to keep the low-income housing project in Alameda,” Polly Marhall, a public-interest housing attorney, said in an interview Tuesday afternoon.

Marshall, whose San Francisco law firm, Goldgarb and Lipman, is working on legislation to save low-income housing, said the city of Alameda could try the innovative approach of imposing rent control on conversions of subsidized housing. In the past, however, the city has maintained a strong stance against rent control.

“We’re looking into all the options, and we’ll certainly consider the idea of a special rent control,” said Assistant City Manager Rob Wonder, who attended the hastily called outdoor meeting with Councilmembers Barbara Thomas, Rita Haugner, Joe Camicia and Mayor Chuck Corica.

Marshall said the city and tenants could also follow the lead of other communities to try to buy the property from the owner and designate it as a project for low-income tenants.

“This is a real opportunity for the city to show whether it really cares about its low-income residents,” Marshall said.

The city’s Housing Authority estimates that 40 percent of the residents at the apartments are considered low-income.

The council members did not commit to any one plan but said they will study all the alternatives.

Although the tenants were pressing for immediate action, Thomas said they may have some time.

“Many of the residents are on record for having complained about habitability issues,” said Thomas, referring to complaints of rodent and roach infestation, broken elevators and unsanitary garbage bins. “If the owner tries to evict them or raises their rent, that could be considered a retaliatory eviction. They have some time before anything can happen to them.”

Many of the tenants, fearing the worse, said Tuesday that a big rent increase would be catastrophic.

“I’d be forced to split up my family. I’d have no other option, “said Patricia Meyers, a disabled mother of three who has lived at the complex for nine years.

Meyers, who supports her family on $623 a month in welfare, now pays a monthly rent of $341 for a three-bedroom apartment. Doubling that amount would leave her in the red.

“I’d have to put my children in foster homes and go find a little sleeping room for myself somewhere,” Meyers said. She said she has no relatives who could help raise her children.

Yvonne Keel, a 14-year resident at the complex, said she is in a similar situation. Retired and living on a $639-a-month pension, Keel said a rent hike would force her out of Alameda.

“I’d be driven out of the city,” she sai. “I’ve got nowhere to go. I’d end up on the streets or in a grave.”

Source: Gordon, Rachel. “Buena Vista tenants mobilize to keep rent low.” Alameda Times Star. 3 September, 1987:1.

Buena Vista rent ceiling may topple - September 2, 1987

Buena Vista rent ceiling may topple
City could lose largest low-income complex

By Rachel Gordon (Alameda Times Star)
September 2, 1987

ALAMEDA – The owner of the Buena Vista Park apartments has filed documents with the federal government indicating its intention to pay off its mortgage early and free itself from a cap on rents at the city’s largest subsidized complex.

“With the paperwork that has been filed, it appears that the mortgage has been paid off (Tuesday), or it will be in the next couple of days,” said Dirk Murphy, a spokesman for the regional Housing and Urban Development office in San Francisco.

As soon as the mortgage is paid off, the owner, Los Angeles-based Gersten Management Company, can raise rents as much as it wants at the 615-unit West End apartment complex. There is no rent control in Alameda.

Representatives from the Gersten Management Company would not comment Tuesday on the reported action.

When the development was built between 1964 and 1966, construction was financed with a 40-year direct federal loan. In return, the owner was obligated to rent only to qualified low- and moderate-income residents for the first 20 years, or until the nearly $9 million mortgage was paid off. Mortgages are coming due or being paid off early all over the country, pulling thousands of apartments for loce income tenants off the market.

“This is bad news,” said Clayton Guyton, a tenant at Buena Vista and chairperson of the Buena Vista Community Association, the tenants’ group. “We’re going to be pushed out of these apartments and out of Alameda. The rents are the lowest in the city and when the rents are increased, we won’t have anywhere else to go. A lot of us are just making it on the rents we’re paying now.”

Tom Matthews, executive director of the Alameda Housing Authority, which oversees subsidized housing programs in the city, agreed with Guyton’s grim prediction.

“Legally, there isn’t anything we can do,” Matthews said. “Whatever can be done is going to be at the option of the owner. It’s frustrating.”

Monthly rent for a two-bedroom apartment at the complex is $270 – about half the cost of a comparable apartment in Alameda renting at market rate.

Matthews estimated that 40 percent of the tenants at Buena Vista Park are low-income residents and would be eligible for other federal housing assistance, such as the Section 8 and voucher programs, if they were available. But, he said, the programs are already full.

“The wait to get into those programs is probably two years long,” he said, “unless they’re evicted and put out on the street, then they’re put at the top of the waiting list,” which is approximately 850 names long.

Even then, however, finding housing in Alameda that qualifies for the federal programs is difficult,” Matthews said.

City officials said Tuesday they will attent to negotiate with the owner on behalf of the tenants.

“We’ll ask them to keep the rents down and to phase the increase in over a long period of time,” said Assistant City Manager Rob Wonder, who feared that an immediate and substantial rent increase would flood the market with people looking for cheap rents in Alameda.

“The city just isn’t prepared to absorb this,” Wonder said.

Mayor Chuck Corica agreed.

“It would really be a heck of a blow to price these people out,” Corica said, “The city has to somehow try and convince (the owner) to go easy on the rent increase.”

Source: Gordon, Rachel, “Buena Vista rent ceiling may topple.” Alameda Times Star. 2 September, 1987:1.