City tries to help YWCA sell its building
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By KELLEY BOUCHARD, Staff Writer Portland Press Herald Saturday, January 13, 2007
Portland officials are trying to broker an agreement with the state housing authority that would help the debt-ridden YWCA of Greater Portland dispose of its former headquarters on Spring Street.
The YWCA closed its building at 87 Spring St. in October and is trying to sell it to pay debts totaling $2.3 million.
A public auction in December was put on hold so the YWCA could seek an exemption from a city ordinance that requires the replacement of any housing units that are lost in the sale of the headquarters.
The property has been assessed for tax purposes and listed for sale at $4.9 million, but city and state officials have raised questions since then about the building's condition and actual market value.
Built in 1960 and expanded in 1966, the brick structure contains large amounts of hazardous asbestos. The indoor swimming pool has significant structural problems and the 50 or so rooming-house units need major updates, city and state officials said Friday.
"It's a money pit," said Councilor James Cloutier, a real estate lawyer who serves on the council's housing committee.
Among those expected to bid on the property is the Maine State Housing Authority, which holds a deed covenant that requires the building to remain a residence for women in transition and crisis through 2029.
The authority acquired the covenant in 1999 because it gave the YWCA more than $1 million in funding.
YWCA officials have asked the City Council to designate the sale a "project of special merit" so potential buyers won't be restricted by the housing replacement ordinance.
The council's housing committee voted 3-0 this week to recommend against the special designation.
Committee members decided the pending sale and debt resolution plan don't constitute a project, Cloutier said.
The committee also directed city staffers to work with representatives of the YWCA and the Maine State Housing Authority to find a creative solution to the YWCA's problems.
"We all have an interest in preserving housing in the city," Cloutier said. "We hope the city can play a constructive role. We want to make sure everyone is doing the best they can."
YWCA and state housing officials said they welcome the city's assistance and remain committed to providing housing for women in need.
Concerns about the run-down condition of the YWCA headquarters aren't new, said Catharine Hartnett, an executive board member.
Hartnett said the YWCA and the Maine State Housing Authority have been negotiating a potential sale since last summer. Under one scenario, outlined in a YWCA document, the state would have paid $2.8 million for the property. Under another scenario, the state offered $1.6 million, far less than the YWCA's debt obligation.
"They're very familiar with that building," Hartnett said. "It's an albatross. We will continue to look for a creative solution, but we need to do what's financially responsible for the Y."
She said bankruptcy remains an option.
The City Council is scheduled to consider the YWCA's request for an ordinance exemption at 7 p.m. Wednesday at City Hall.
Without the exemption, the buyer would have to maintain the existing housing units, replace them elsewhere in the city or pay $30,000 per unit to the city's housing fund.
The YWCA's debts include $700,000 in loans from Maine Bank and Trust. It also owes $552,000 to the state Department of Health and Human Services, $398,000 to various vendors and $118,000 in severance payments to former YWCA employees, according to a YWCA document.
Staff Writer Kelley Bouchard can be contacted at 791-6328 or at:
kbouchard@pressherald.com
Reader comments
voter of Port., ME
Jan 13, 2007 7:39 AM
Bravo to the city for retaining the requirement to provide housing or $30,000 per unit. It's long past time for developers to pay their dues for the profits they earn off the disadavantaged.