Durham grants $1.5M loan to housing authority in ‘crisis.’ How it will be used

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The Durham City Council has agreed to give the local housing authority an emergency $1.5 million loan after the mayor called the situation a crisis.

The council unanimously approved the loan for the Durham Housing Authority on Monday night after the agency reported a nearly $3 million budget deficit. The loan will help DHA stabilize its operations, increase occupancy and improve the condition of its units.

Rent makes up a third of the housing authority’s revenue. However, Chief Operating Officer Ashanti Brown told city officials at a June 5 meeting that roughly 1,200 households are behind on rent, with more than 100 facing eviction.

Some renters have not paid their rent for five years.

Mayor Leonardo Williams said DHA, the largest provider of affordable housing in the city, is in a “crisis.”

“We have this agreement here where we are stepping up,” Williams said.. “The federal government may own the agency, but these are Durham residents. … DHA has to do everything they possibly can to make sure they stay functioning.”

DHA’s needs

Currently, DHA’s rent collection is at 65%, with a goal of getting it to 85% this year. Its 4,000 households pay an average of $249 a month.

Many of the overdue rent payments date back to the beginning of the COVID-19 pandemic when DHA got approval from the federal Department of Housing and Urban Development to pause evictions, Brown said.

Meanwhile, DHS spent about $10 million to address a crisis in the McDougald Terrace community after many units experienced carbon monoxide leaks in 2020.

In city documents, DHA said the pandemic has had “lingering” impacts and “continues to stress the fiscal integrity” of the agency.

“The unmitigated regional and national housing crisis, coupled with unprecedented uncertainty at the federal level imposes significant challenges for DHA,” the document read. “DHA is undertaking the necessary rent collection actions. … The short-term assistance from the City will aid in the current fiscal efforts to correct the existing cash imbalance.”

Mayor wants to see DHA rent paid

Earlier this month, Williams said DHA needs to start demanding overdue rent.

By law, renters must pay rent, and DHA cannot legally waive the payments..

“There’s no way in the world somebody’s going years without paying their rent — and they’re not even paying barely over $250 a month,” Williams said.

“I’m not being a cheerleader for eviction, but I am saying there needs to be a much more functioning system, a functioning organization,” he continued..

Brown told city officials the loan is just one part of how DHA plans to address the situation and that the agency will keep the council updated.

Council supports loan, with conditions

On June 5, Councilwoman Chelsea Cook said the city is bailing out DHA and that her vote for the assistance was hard for her.

“We’re seeing people just staying in public housing for generations,” she said. “We’re not doing our job of getting people out of there, and we’re not doing our job of keeping people in houses and in places that are [decent].”

“This contract doesn’t have anything in it that’s going to implicate the housing authority or force them to be more collaborative in the future,” she said.

Cook added that if DHA comes to the city to ask for financial help in the future, “we’re going to say yes again because this is all we have, and this is all of our affordable housing.”

Councilman Mark-Anthony Middleton said he used to live in public housing and that DHA residents “are also taxpayers.”

“I’ve been on this council long enough to see a lot of money spent on wonderful festivals downtown and all kinds of cool things,” he said. “So when these taxpayers need something, I am just as excited to spend taxpayer money for taxpayers that live in McDougald Terrace or Cornwallis.”

But Middleton agreed with Cook that there should be “guardrails” for DHA in order for the group and residents to succeed.