Renters say city plan jeopardizes them

By James Gonser
Advertiser Urban Honolulu Writer

About 75 people crowded into a City Council Budget Committee meeting yesterday worried about how Mayor Jeremy Harris' plan to sell several city-owned apartment buildings would affect them.

"I'm coming up on retirement and don't want to move," said Joe Spatola, a nine-year resident of Marin Tower. "I qualify for the (rent-to-own) program, but there is no guarantee I can qualify for the loan. And if I don't buy, I have to move."

The city-owned Marin Tower, the Chinatown Gateway Plaza and the Harbor Village are part of a plan to sell city-owned buildings to private investors and be converted to condos. Affordable units would be sold to occupants who qualify for federal loans. The city administration also plans to sell 10 other buildings, but they would be sold outright and not be part of a rent-to-own program.

Deputy City Managing Director Malcolm Tom said anyone in the affordable apartments in the three buildings will have the first option to buy their apartments. He added that for those who buy, payments will be set at the same level as their current rent.

Tom said this will provide home ownership opportunities for renters while, in turn, the sale the properties will reduce the city's overall debt by $116.6 million.

But City Councilwoman Ann Kobayashi said many of these apartments were built decades ago by the city to provide affordable homes. She said one of the obligations of government is to help provide for low-income people, and already there is a lack of affordable rentals.

"We are not in favor of selling these buildings," Kobayashi said. "We feel there are not enough rental units now and we would definitely not sell any buildings for low income, Section 8 or the elderly. We don't believe in that."

Committee members also criticized Tom for holding informational meetings last month at the buildings being considered for rent-to-own, saying the gatherings were poorly handled and have frightened the residents.

"None of the council members knew about those meetings," said Kobayashi, the committee chairwoman.

City Council approval is needed to sell the buildings, and Kobayashi said the committee won't agree to sell any buildings without requirements for affordable rental housing in perpetuity.

Tom detailed how the rent-to-own program would work and said it includes interest-free loans and requires no down payment from existing low-income tenants.

The three properties comprise 526 units, according to Tom, and 452 families are expected to qualify for ownership. Those families are low- or moderate-income tenants.

Retired teacher Judy Naniole, who lives in Harbor Tower, said she attended one of the meetings but is still not sure how the program works.

"I heard after one year, if I don't buy, the price of the rent can go up," Naniole said. "I'm on fixed income and not sure if I can afford it."

Tom said renters would have one year from the sale of the building to purchase their unit. If they choose not to buy, they have five years to move. If they buy, then resell their apartment in less then five years, profit from the sale would go to the city. After five years they would be free to sell with no penalty.

City Councilwoman Barbara Marshall said the plan would take 452 units permanently out of affordable housing within five years.

Marshall asked Tom if the city has any plans to replace the affordable units, and he said no.

The remaining nine buildings have nearly 750 apartments, and the city would not require any of them to remain rentals after being sold, Tom said.

The West Loch Elderly building was taken out of the rent-to-own program because many of the residents said they would not be likely to buy their apartments at such advanced ages, Tom said.

The remaining nine buildings that could be sold are the old Bachelor's Quarters in 'Ewa, Chinatown Manor, Kanoa Apartments, Kulana Nani Apartments, Manoa Gardens Elderly, Pauahi Hale, Westlake Apartments, Winston Hale and Foster Gardens Commercial Property, which does not have apartments.

Kobayashi has asked for a list of all city properties and plans to create a volunteer task force to make decisions on whether city property should be sold.

Reach James Gonser at 535-2431 or jgonser@honoluluadvertiser.com.