Pasco: Proposed sale angers Pasco officials

Proposed sale angers Pasco officials

Two Panhandle towns want to sell two west Pasco apartment complexes to a nonprofit Texas company, eliminating about $59,000 in county tax revenue.

By BRIDGET HALL GRUMET and SAUNDRA AMRHEIN

PORT RICHEY -- Once again, two Panhandle towns have put together a multimillion-dollar deal that irks local officials.

Except this time it's not a proposal to buy the state's largest private water utility. It's a plan to sell two west Pasco County apartment complexes to a nonprofit company in Texas, taking nearly $7-million worth of property off the county's tax rolls.

The deal would also make money for the pint-sized Panhandle towns of Gulf Breeze and Century, which would get a tidy fee for issuing the government bonds for the sale.

The pending sale raised red flags Tuesday with Pasco County commissioners, who voted unanimously to send a letter to Gov. Jeb Bush and the Pasco legislative delegation in hopes of blocking the deal.

Commissioner Pat Mulieri said the sale would take away local control of affordable housing and remove the complexes -- the Rivermill Apartments in Hudson and the Village Square Apartments in Port Richey -- from the tax rolls.

The complexes paid a combined $59,259 in county taxes last year, according to property appraiser's records.

"It's something we have to get on top of," Mulieri said at the meeting at the West Pasco County Government Center.

The $30-million deal includes the two Pasco complexes, plus an apartment building in Jacksonville and another complex in Gulf Breeze.

The buyer would be American Opportunity for Housing, a San Antonio-based nonprofit that owns about 40 affordable housing complexes in the southeastern United States.

The money would come from government bonds issued by the Capital Trust Agency, a partnership between the towns of Gulf Breeze and Century.

The towns might be small -- the 2000 Census placed their combined population at 7,379 -- but they have created a profitable cottage industry out of their government bonds. They have issued hundreds of millions of dollars in bonds since 1999, each time collecting a fee for the transaction.

Ed Gray, executive director of the Capital Trust Agency, said he did not know what the group's fee would be for the apartment sale. "To be honest with you, I haven't even calculated it," he said from his Gulf Breeze office.

Unlike the proposed Florida Water Services sale that generated so much controversy in recent months for Gulf Breeze and the neighboring town of Milton, the towns would not own or operate the apartment complexes.

The ownership would rest with the Texas nonprofit, which is dedicated to keeping rental prices affordable for low- to moderate-income people, not providing a return to any shareholders, president David Starr said.

"Any profit has to go back into affordable housing," Starr said, adding that neither he nor his board of directors receive a salary.

But the nonprofit setup still raised concerns Tuesday with Commissioner Steve Simon. He fears a nonprofit could make money off the deal by putting revenue into high salaries for other workers while reporting no profit.

"There are so many ways of hiding dollars, it's criminal," he said.

By seeking financing through the Capital Trust Agency instead of the county's Housing Finance Authority, the Texas company also avoids local oversight, said George Romagnoli, the county's community development manager, after the meeting.

"If a nonprofit came to us, we would thoroughly check them out, what they've done in the past," he said. "We would make sure there would be set asides for low income (residents). We are not doing that in this situation. We don't know who these guys are."

And -- as with the proposed Florida Water sale that fell apart earlier this year -- officials were concerned about remote owners having control of local facilities.

"First water, now housing. What's next?" Romagnoli asked.

The Florida Association of Local Housing Finance Authorities has raised similar concerns about the Capital Trust Agency. Last year it sent a five-page letter to the governor, objecting to the agency's plans to finance a similar purchase of two apartment complexes in Hillsborough County. "It is simply bad policy to give two small cities located in (the Panhandle) the decision-making power related to taking properties off the tax rolls in every other city and county in Florida," the letter read.