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Council OKs $1.475 million in CDBG funds to buy and rehab 12 former public-housing units
Summary
Council approved allocating $575,000 to acquire 12 former public housing units already approved for sale by HUD and an additional $900,000 for rehabilitation, with a goal of rehabbing for low-income homebuyers or rental affordability; motion passed unanimously.
The Wichita City Council on Wednesday approved a two-part Community Development Block Grant (CDBG) allocation to buy and rehabilitate 12 former public-housing houses that the Wichita Housing Authority has listed for disposition under HUD programs.
Background: The Housing Authority converted a portion of its public-housing portfolio under HUD’s Rental Assistance Demonstration program and later filed multiple Section 18 disposition applications to sell the remaining scattered single-family homes. Housing staff told the council that 34 of the single-family properties have sold and many more are under contract; the 12 units in this action are HUD-approved for release and have requests pending for declaration-of-trust releases.
Funding and purpose: The council approved $575,000 in CDBG funds to acquire the 12 units before a federal expenditure-timeliness review (HUD requires certain timeliness for CDBG spending) and an additional $900,000 in CDBG funds to complete rehabilitation work. Housing staff said the 12 homes fall within a pilot investment area where the city and nonprofit partners have invested previously; Habitat for Humanity provided an informal post-renovation value range between about $122,000 and $189,000 per house depending on square footage and lot size.
Intended outcome: The city’s plan is to rehabilitate the homes for low-income first-time homebuyers as a priority; if the city cannot identify buyers who meet program rules, the units could be preserved as affordable rentals with recorded affordability restrictions. Staff said rehabilitation contracts would be brought to the Board of Bids and Contracts for approval and that proceeds from eventual resale would return to the CDBG program as program income for future investments.
Council discussion and vote: Council discussed the home-repair program’s underwriting and insurance requirements and the broader timeline pressure from HUD’s expenditure rules. Council approved the real-estate contract and the two CDBG allocations unanimously (7–0).
Risk and next steps: Staff emphasized the risk of federal recapture if HUD’s timeliness thresholds are not met and said spending the acquisition funds before HUD’s May 2 review would protect the funding. Staff will manage rehabs, secure any additional financing and return contracts for construction to the usual procurement board.
Speakers quoted: Sally Stang, Housing and Community Services, presented the proposal and answered council questions about RAD/Section 18 history and pilot-area synergy.
